Tag: Startup

7 Traits Of Truly Sensational Startup Employees

Ellen

12/9/2014   LinkeIn  by Dharmesh Shah

While you might think a great employee is a great employee no matter where she works, what matters in a small, growth-oriented startup is often very different from what matters in a huge, stability-oriented corporation.

For one thing, the ability to successfully navigate politics-filled waters is usually a lot less important in a startup. Plus, since the organizations tend to be flatter, standing out is often more a matter of what you accomplish than of whom you know.

(But then again I love startups and I love startup cultures… so I’m probably biased.)

I’ve been in an around startups for a long time and known some great startup folks (including many that work at HubSpot). I think I have a sense for what makes for truly sensational people at a startup.

Here’s my (partial) list:

1. They would much rather act than deliberate.

I’ve only written one business plan in my life. It was while I was in business school, and it was required. Generally, I think business plans are pretty useless (but the planning process can be quite useful).

The problem with business plans is that things change so quickly in the startup world. Before the ink is even dry on that 100+ page business plan as it shoots out the printer, things have already changed and “the plan” is already outdated. Stuff happens: Good stuff, bad stuff — and every now and then, amazing stuff.

Very few startups I know – or companies I’ve invested in – resemble their original business plan. (And that’s a good thing, because it means they’re shaping their businesses to meet the needs of their customers.)

Great startup employees are the same way. They think a little and then do a lot. And then they adapt and modify.

The best companies often don’t start with a brilliant idea, they iterate into one.

It’s hard to learn from thinking. It’s much easier to learn from doing.

2. They don’t care about what’s behind the curtain.

In some corporations, offices – and the perceived status that come with them – are everything. A corner office makes you better than someone with a hallway office. A hallway office makes you better than someone in a cubicle.

(At my company I don’t have an office – I’m not sure what that makes me.)

Startups generally avoid politics. Instead of obsessing who has the bigger desk/office, they obsess over the customer.

Sensational start-up employees understand calories are best spent making a real difference for customers. Every business has finite resources. The key is to spend as much of those resources as possible on things that matter to the customers — or, at least genuinely matter to the team. Fretting over trivial things doesn’t help anyone. It’s just a waste of energy.

3. They don’t see money as the solution to every problem.

Sure, capital-intensive ventures that require extensive investment may need significant cash to get going, but most businesses require little funding to get started. (A quick glance at the Inc. 5000 list shows just how many startups were founded with relatively little funding.)

One of the key lessons first-time entrepreneurs need to learn is resourcefulness. How do you take limited resources and turn them into something remarkable?

That’s also true of the best startup employees. They’re remarkably resourceful. They’re not looking to build an army of people to do their bidding They’re not looking to spend thousands on advertising to avoid the hard work of writing a blog. They’re constantly looking for creative ways to make the most of the resources they have.

In short, they throw brains at problems, not money. And the solutions they come up with are almost always better. And, the connections built between people from solving problems creatively are some of the strongest connections that can be built.

4. They see every customer as an individual that deserves respect.

Maybe you have hundreds or thousands of customers. If so, that’s awesome – but that also can mean you face the danger of thinking of your customers as a nameless, faceless group of revenue-producing entities.

But no matter how many customers you have, each is an individual. The day you start thinking of them as this amorphous “collection” and stop thinking of them as people is the day you start going out of business.

Great startup employees never lose sight of the fact that every customer is a person: a person with hopes, dreams, expectations, needs… and a person who ultimately wants to be treated as a person. Yes, they worry about the “market” and work to build a business that can scale as it grows. But, that’s shouldn’t be an excuse for not caring about customers.

Great startup employees solve for the customer – and in so doing, they solve for the business.

5. They love a meritocracy.

Sensational startup employees hate politics. They hate hidden agendas. They hate the “good old boys” network.

They’re willing to succeed on their own merits – because they believe in themselves.

And they believe in others, too.

6. They care much more about their peers than the perks.

Catered meals. Free massages. Lavish parties. These are all perks — and they’re great if you have them. But, the best people care much more about who they work with (their peers) than the perks they get.

This is for a very simple reason: The #1 benefit of working at a startup is that you get to learn. And, how much you learn is largely a function of how much autonomy you have — and who you’re around.

Also, stars know intuitively that life is short. Too short to work with people you don’t enjoy.

7. They instinctively focus on the company’s mission.

Walk through any huge corporation and you’ll find people who have created their own jobs (and not in a good way.)

Some will have developed databases filled with data (but resulting in no usable insight) because they love building databases. Some will have created fancy charts (again resulting in no usable insight) because they love creating fancy charts. Some will schedule meeting after meeting (none of which resulting in meaningful decisions) because they love being in charge… and they love hearing themselves talk.

Great start-up employees focus on the core mission of the company. They build products customers want. They meet customer needs. They help other employees succeed. The best people don’t just bide their time while they’re at work. They squeeze as much value out of that time as they possibly can in furthering the organization’s mission.

They try to make tomorrow better than today for everyone around them – because that’s what they love to do.

By the way…If you found yourself nodding your head a bunch while reading this article, you should check careers at HubSpot. We’re constantly looking for people with these traits. (We’re a public company now, but have the soul of a startup).

 

https://www.linkedin.com/pulse/20141209185905-658789-6-traits-of-sensational-startup-employees

5 Startup Tips No One Bothered To Share With You—Until Now

Ellen

If you could get advice from a time-traveling entrepreneur from the future, this is what he might say.

Fast Company  By Rob Hull

Starting a business is one of the most exciting career choices you can make. There’s nothing quite like watching something you’ve built from the ground-up grow into a successful organization that provides true value to customers.

It’s also one of the most difficult career paths, as there are so many factors that go into getting a business off the ground, from market research to funding to developing a market strategy and building a team.

There are certain pieces of advice every entrepreneur should be equipped with before they embark on their entrepreneurial journey. The following are five things that I certainly wish I knew beforehand.

1. Find A Good Sounding Board Outside The Business

Don’t be above seeking advice. Some of the best entrepreneurs I know are also some of the best listeners. They understand that leading a company doesn’t mean doing everything on their own. And while entrepreneurs are not required to have all the right answers, they are required to find them, which many times come from listening to trusted people outside of the organization.

Yes, great entrepreneurs are great decision-makers, too. They surround themselves with a sounding board of confidantes who offer different perspectives and solutions to business challenges, and they take those perspectives into account when making decisions.

So establish a close circle of confidantes not affiliated with your company and open yourself up to new ideas. It gets lonely at the top, and sometimes you need to talk to someone with a fresh perspective that can see the situation clearly and in a different light.

2. Focus On Your Customer’s Success

Don’t jump the gun and attack the market before fully understanding the field that you’re entering. There are many important questions that you need to answer before you begin selling your product or service.

If you’re selling to businesses, who are you selling to specifically within those businesses? Are you targeting a specific size of company? Are you selling to a specific industry? Should you focus on servicing customers in a certain geographic location?

To build a successful business you first need a very deep understanding of your market and customer and how your product brings them value. Then, equally as important, you need to be able to explain that value so that potential customers clearly understand what you can help them to accomplish.

After you’ve established the right value proposition and started to acquire customers, focus on customer success to keep them and to continue to grow your business. The more your team can help customers succeed with your product, the more closely you can associate your organization with your customers’ successes and gain a reputation as an essential vendor to industry-leading businesses.

Developing a large group of happy and successful customers will create a group of people willing to tell their success stories, act as a reference on your behalf, and refer more business to you.

3. Hire For Company Culture Fit

Keep in mind that, particularly at the beginning stages of the business, you’re going to spend a lot of time working closely with the team you hire. Ideally you want to hire people who are smarter and more talented than you are at what they do so that you have individual experts for specific roles within your organization.

Just remember to take company culture seriously too. Each time you hire someone, consider whether you will enjoy working closely with this person and whether other existing members of your team will as well.

Create opportunities for career growth to keep those employees long-term, and create a culture of open communication to keep everyone engaged and productive.

4. Make Fact-based Decisions

Drive decisions with data, not emotions. This is often one of the most difficult entrepreneurial strategies to perfect. It requires an understanding of the most impactful metrics to your organization, a disciplined focus on performance analytics, and an investment in technology that will help to analyze and measure performance against pre-determined goals.

It’s also one of the most valuable skills once perfected, as performance metrics can help you better understand what’s working and what’s not so that you can take corrective action if necessary.

5. Be prepared To Fail

Embrace failure as a learning event. And whatever you do, don’t dwell on past failures, as doing so will only prevent you from quickly moving forward. Understand what happened, decide what you could do differently next time, and take corrective action.

Have conviction in your instinct. Many people will tell you that you will fail. You have to know when to listen to their input and suggestions for change and when to trust your instinct to move forward with the plan you have in place. Remember that resiliency is one of the strongest characteristics of successful entrepreneurs. If you have the right team, strategy, and value proposition in place, that resiliency will pay off.

—Rob S. Hull is founder and chairman of Adaptive Insights, an intuitive, cloud-based solution for corporate performance management. Prior to founding Adaptive Insights, Hull served as CEO of ChemTracker and as CFO for a number of market-leading software companies, including LoopNet and Risk Management Solutions.

 

http://www.fastcompany.com/3039632/5-startup-tips-no-one-bothered-to-share-with-you-until-now

Entrepreneurs Buzzing Over Medical Marijuana In Florida

Ellen

6/16/2014 | NPR

One of three marijuana plants growing in the backyard of a 65-year-old retiree from Pompano Beach, Fla. He grows and smokes his own “happy grass” to alleviate pain.

Twenty-two states and the District of Columbia now have laws allowing for some form of medical marijuana.

Florida appears poised to join the club. Polls show that voters there are likely to approve a November ballot measure legalizing marijuana for medical use.

If it passes, regulations that would set up a market for medical marijuana in Florida are still at least a year away. But cannabis entrepreneurs from around the country are already setting up shop in the state.

In Miami, Fort Lauderdale, Tampa and Orlando, there’s a business conference every few weeks devoted to a product that’s still illegal.

There are a lot of names for marijuana, but in the industry, they mostly call it cannabis. Tom Quigley runs a group called the . Don’t confuse that with the Florida Medical Cannabis Association or the Medical Marijuana Business Association of Florida, just three of the dozens of groups started in the months since it became clear that the marijuana measure was moving ahead.

While the vote is months away, there are many who see Florida’s impending embrace of medical marijuana as an opportunity that’s too good to miss. Quigley greeted about 150 of them at his conference in Orlando.

“We can’t teach you in one day how to run a cannabis industry business, but what we can do is bring the best information to you,” Quigley says.

There were seminars on cultivating the best strains, converting cannabis into oils and concentrates, and on marketing and legal issues.

Since California became the first state to approve medical marijuana in 1996, 21 other states have followed suit.

If Florida approves it, it will be the first state in the Southeast to do so. And with nearly 20 million residents, it will be the biggest market outside of California.

The National Cannabis Industry Association estimates medical marijuana will be a $785 million industry in Florida — one that Quigley says will have all kinds of economic opportunities.

“If you want to become a bud tender that works inside one of these dispensaries as an occupation, if you want to run your own business, there’s that opportunity as well,” Quigley says.

Right now in Florida, the cannabis industry is mostly talk. But money is lining up as well. Quigley is with ArcView, an investor’s group that funds cannabis industry startups.

Cannabis-RX, a real estate company based in Arizona, is also active here, investing in properties it plans to sell or lease to growers and operators of dispensaries.

“We look at light industrial commercial buildings that are in the right zoned areas of the cities,” says Llorn Kylo, CEO of . “And we usually seek between 10,000 and about 100,000 square feet.”

Along with real estate, Cannabis-RX also offers budding entrepreneurs financing and consulting services to help them get their businesses off the ground.

At the Orlando conference, Meg Sanders of , a grower with three dispensaries in Colorado, flew in from Denver. Sanders says she’s always looking for opportunities to expand — including in Florida.

“For us, we’ve worked very hard to create a fantastic template of what we do. And if there’s opportunity in other states, we’ll definitely be there at the table,” says Sanders.

It’s unclear exactly what opportunities will arise in Florida. If the medical marijuana amendment passes, the state won’t issue regulations for another six months to a year.

Florida’s governor recently signed into law a very limited version of medical marijuana — one that allows production and sale only of a special strain that’s low in THC. As part of that law, just five nurseries will be allowed to grow it. They have to be large operations that have been in business in Florida for at least 30 years.

Chris Rumph, a prospective entrepreneur at the conference, says that regulation has many wondering how welcoming Florida officials will be to the emerging cannabis industry.

“Opening up to nurseries that have been around 30 years, I think that’s kind of silly,” says Rumph. “We live in a state where we’ve got thousands of nurseries with people that are very educated and knowledgeable about plants and how to grow things effectively. So, there’s a little bit of suspicion there for me.”

How the medical marijuana regulations will be written, though, is for the future. For activists and entrepreneurs, the first task is mobilizing Florida voters to actually approve the medical marijuana amendment.

 

http://www.npr.org/blogs/health/2014/06/16/322580314/entrepreneurs-buzzing-over-medical-marijuana-in-florida?sc=17&f=1128&utm_source=iosnewsapp&utm_medium=Email&utm_campaign=app

 

How to Start a Business With a Friend — and Actually Remain Friends

Ellen

6/11/2014 | Marshable

This article is part of DBA, a new series on Mashable that features insights from leaders in entrepreneurship, venture capital and management.

When you launch a company with a friend — if you’re a woman, at least — people tend to think one of two things: That it’s either an endless slumber-party (“That sounds like so much fun!”) or that you are completely insane and are destined to have a falling out that would be worthy of a Bravo reality show.

But four years into starting Of a Kind, a site that sells the pieces and tells the stories of emerging designers, my business partner Claire Mazur and I have had neither experience. In fact, we think that our partnership is one of the strongest, most impressive things about the business we’ve built. Below, eight of the tips and tricks we’ve picked up along the way.

1. Harness your shared history

Having been friends for the better part of a decade before starting a company, Claire and I had experienced a lot together, from the inevitable drama that comes with being a college girl (See: crying into pillows over breakups) to the more grown-up weight of family illness. We know how the other deals with stress and emotion. And while this comes in handy in countless settings, from presentations to hiring sessions, I have to say that I find it most comforting when we’re sitting in what feels like the worst meeting of all time, and I know the person sitting next to me is equally miserable.

2. Define roles

Though we share a couple’s desk and bounce ideas off each other all day, we have clearly outlined our responsibilities so that a) we don’t both write responses to the same emails and b) we don’t step on one another’s toes. Our who-does-what breakdown lives in a spreadsheet that we revisit regularly as our company and our priorities evolve.

3. Accept that people will confuse you

They will! And there’s nothing you can do about it. In fact, we have not one but two portmanteaus of the Brangelina/Kimye ilk: Clairica and Eclaire. But when people ask us if we live together? That’s when we laugh in their faces.

4. Schedule time apart (and don’t feel badly about it)

The amount of hours we clock together is almost obscene — in addition to our time at the office, there are drinks, meetings, dinners, after-work events. Our rule: We don’t see each other on weekends (unless a mutual friend’s wedding or birthday dinner thwarts that).

5. Take time to be just friends

Be gossipy. Talk about Scandal — or the World Cup brackets, if that’s your scene. Do the things you did before you had an inkling that one day you’d have a professional relationship.

6. Let other people in — but also make time for just the two of you

For us, this has been one of the biggest challenges of growing our company: We want each new hire to feel like he or she is part of Team Of a Kind, not some supporting character in the Claire-and-Erica show. But, now that we spend a greater portion of our days managing and delegating than we did back when, we inherently have less one-on-one time to check in on each other, brainstorm, and workshop bigger projects. This year, for the first time, we’ve started scheduling weekly closed-door meetings that pull us out of the office’s open floor plan (and, just as imperatively, out of our inboxes) to think big-picture together and walk through our week’s to-dos.

7. Learn how to fight and what’s worth fighting over

The more confident we’ve become in our business and in the roles we’ve carved out (see #2), the better we both have gotten about letting the little things go. This means we only devote energy and emotion to hashing out things that we deem to actually matter — and, in doing so, we give them the weight they deserve.

8. Own your individual brands of crazy

I am completely brain-dead from, oh, 3 to 5 p.m. every day, I love reading things aloud for no real reason, and I get outraged about really inconsequential stuff, like two-page-long resumes. Claire has to be fed every two hours, is allergic to mornings and sometimes starts conversations 30% in with no context. These are the type of things are not going to change. So they have to be what we can joke about — and cater to. Claire will listen to me read three paragraphs of an article before telling me to shut up, and I don’t schedule anything that requires enthusiasm before 11 a.m. And we wouldn’t have it any other way.

 

http://mashable.com/2014/06/11/starting-a-business-with-friend/?utm_cid=mash-com-fb-main-link

4 Keys to Building a Great Startup Team

Cory
4-steps-good-startup-team-apple-team
On April 24, 1984, Steve Jobs, left, chairman of Apple Computers, John Sculley, center, president and CEO, and Steve Wozniak, co-founder of Apple, unveil the new Apple IIc computer in San Francisco.
IMAGE: SAL VEDER/ASSOCIATED PRESS
In many cases, a startup is only as good as the people behind it. The success of a business can heavily depend on whether the people involved are doing their jobs well.

As the founder of two tech startups, entrepreneur Lynn LeBlanc has learned that a successful business needs a strong, highly skilled team right from the start.

“A good startup team needs to have [experience that] spans most of the core functional areas of a successful company,” said LeBlanc, the CEO of IT management platform HotLink. “This way, you’ll have predictable outcomes from the combination of each member’s knowledge and skills.”

To put together a winning group for your business, LeBlanc advised seeking individuals who fit the following criteria.

  • They have experience in areas that you and the rest of the team don’t. Hiring people with similar backgrounds might seem like a good idea initially, but in order to truly flourish, your company needs dedicated experts in all core areas of business. If you have a strong technical background but no experience with sales and marketing, hire someone who knows that area inside and out, and vice versa.
  • You know them well (or they know each other). Many entrepreneurs learn the hard way that hiring unqualified family members and friends based on a close relationship is a bad idea. However, it is important that the people you do hire for your startup are ones you know well. You should feel confident in their background and expertise, and know that they’ll make a positive contribution to your business. If you don’t personally know a potential hire well, someone else on your team should so he or she can vouch for the candidate.
  • They can afford to work for a limited salary at first. Look for financially stable people with enough savings or another source of income to live on a limited salary for the first year of the business. It may be a tough sell for some, but if you can save money on payroll upfront, you’ll have a lot more flexibility when it comes to yourbusiness finances.
  • They want to use your product. This may seem obvious, but the people you hire to work with your startup can and should serve as early evangelists for your product or service. LeBlanc said that some businesses make the mistake of not having their target-end users participate in the product development process, which can lead to issues you never thought of once actual customers begin using it. Your team shouldn’t just want to help you create a great product; they should want to provide feedback as potential customers before it goes to market.

Lionsgate TV Developing Series About The Creation Of Twitter

Brett

By NELLIE ANDREEVA | Wednesday December 18, 2013

hatching twitter

Lionsgate TV has  put in development a drama series based on Nick Bilton’s bestselling book Hatching Twitter: A True Story Of Money, Power, Friendship, And Betrayal, with former executive and now Lionsgate-based producer Allison Shearmur attached to executive produce. Bilton, a columnist and reporter for the New York Times, will write the script and serve as producer. Hatching Twitter gives behind-the-scenes account of the creation of the service by four friends and its evolution into a social media phenomenon. “Twitter has transformed almost every aspect of our lives from politics to business to friendship, and I can’t think of a more compelling story to adapt for television right now,” said Lionsgate’s Kevin Beggs. “Nick’s book has all the elements of a great drama with its complex characters, high-stakes power struggles and betrayed friendships.”

The project will inevitably draw comparisons to the hit David Fincher-Aaron Sorkin movie The Social Network, which tracked the origins of Facebook. “The Social Network was a perfect film, and this series will be different, providing a longer view of the work life changes, gamesmanship and personal sacrifices made by a group of individuals who are building a company that will change the way that people communicate,” Shearmur said. Bilton is repped by CAA and Katinka Matson.

How ModCloth Went From a College Dorm to $100 Million a Year

Brett

How ModCloth Went From a College Dorm to $100 Million a Year

By Lauren Indvik

Aug 13, 2013

ModCloth founder Susan Gregg Koger has had a long love affair with thrifting and vintage clothing. In 2002, with the help of her then-boyfriend (and now husband) Eric Koger, she launched ModCloth, a simple online shop where she sold the finds she could no longer fit in her closet. She made a sale on her first day.

Today, ModCloth is one of the fastest-growing fashion and home ecommerce ventures to emerge in the past decade. The company did more than $100 million in sales last year, and is growing at a rate of 40% annually, according to a ModCloth spokesperson. (The same spokesperson declined to say whether the company is profitable.)

The business has expanded from the Kogers’ college house basement at Carnegie Mellon, where they employed a student part-time to help with packaging and shipping, to 450 full-time employees across offices in San Francisco, Los Angeles and Pittsburgh.

Growing ModCloth in such a short span has been no easy feat. Earlier this month, we caught up with Eric and Susan to talk about the company’s early days and the challenges of scaling the business — not just in terms of new offices and employee additions, but also scaling ModCloth’s technical infrastructure and improving its supply chain. An edited version of our conversation can be found below.

Q&A With Eric Koger, CEO, ModCloth

Eric Head Shot

Eric Koger, CEO and Co-Founder, ModCloth.

Let’s start from the beginning. How did ModCloth start?

The story of ModCloth begins when I started a web development business in 2000. Susan and I started dating, we went to Carnegie Mellon in Pittsburgh, and Susan stumbled over all these amazing pre-worn items at vintage sales. I had all of the technical skills to help her launch an ecommerce site. We thought, let’s get all of these gems online as a collection and start selling them, and we’ll use that to help pay for books and part of our living expenses in college. We tried experimenting with a few items online on eBay, but realized very quickly that if [an item] wasn’t from a well-known designer, it wouldn’t be discovered. Plus, it was difficult to get across the overall aesthetic that Susan wanted, and we saw an opportunity to build a brand around Susan’s point of view.

With ModCloth, and my job, [we were able to] support ourselves to a large degree throughout college. From 2002 to 2005, [ModCloth] started getting a lot of interest. She got to the point where the site was doing 70,000 unique shoppers a day, and we realized that this was something she could do as her full-time job when she graduated a year later in 2006. It was certainly a a lot more interesting than what we were seeing in the career center. This could work, we thought, we just need a more scalable business model — the problem was that [Susan] was only able to offer things in one size. So we took a week off school, and went to a major fashion trade show, Magic, in Las Vegas, and put together [ModCloth’s] first collection of vintage-inspired pieces from small indie designers. Then we had real inventory, so we could grow and do more significant volume.

ModCloth - Storage of first round of new inventory (versus vintage)

The first round of vintage-inspired merchandise arrives at Susan and Eric’s home.

How were you able to manage your growing inventory and sales at this point? You didn’t raise your first round of funding until mid-2008.

I jumped in [to ModCloth] full-time in 2007. We focused on getting the business to $1 million in sales before we raised our first round of capital. Jeff Fluhr from StubHub and First Round Capital [among others] put $1 million in the business, and it took off. We bought more merchandise and started building out the team. The next round of capital [$2.1 million] came in 2008 from Floodgate. It became clear we needed to expand out to California to get closer to designers in Los Angeles, and [to improve our] technology more seriously. Plus all our investors were in the Bay Area. So we expanded from Pittsburgh to San Francisco, working at First Round Capital on every desk they had until we moved into our own space in May 2010. In June we raised another $20 million [from Accel Partners, Floodgate, First Round Capital, Jeff Fluhr and Harrison Metal Capital]. A couple months later, in September, we get our first real setup in Los Angeles, and we started doing this loop between San Francisco, L.A. and Pittsburgh. That was crazy and fun time for us. We hired a whole new team in Los Angeles, senior people with more experience than we had. And now that we were hiring in three separate places, we stopped [doing our own] interviewing at the lower level.

Tell me about the challenges of scaling from the technical side. What was ModCloth’s first website like? How did it evolve?

Our first website was built in PERL on an open-sourced shopping cart called Interchange. Second was osCommerce built on PHP. I learned enough PERL and PHP to do those. I was always a hacker. We relaunched on Ruby on Rails in 2009. When we landed in San Francisco, we were hiring developers and it was a language that was attracting some of the best.

How have you been able to anticipate growing demand for ModCloth products?

We know our customers exceptionally well. Because we’re digital, we’re able to keep track of things better than any brick-and-mortar retailer is. When Zara or H&M or Urban Outfitters [want to test demand for a product], they do a pilot run in pilot stores. If they sell out of all the smalls immediately, they know it’s popular, but don’t really know how much demand they have for a small. With our Be the Buyer program, we get a more precise read on demand because people are on the wait list for specific sizes. On top of that, we have all this historical sales data on products, and we’re also interacting with customers on Pinterest and Polyvore and other external sites to see what [our customer] is saving and playing with, the styles that are inspiring her. Combined with Be the Buyer and Make the Cut, we’re able to anticipate what she’ll want down the line.

How were you able to scale on the manufacturing side?

Designers tend to do the development of the prototype, then contract with manufacturers to get things produced. As we scale, we pushed the scale problem onto the designer most of the time, telling them we’re going from 30 to 60 units to 300 to 600 units, and if your manufacturer can’t do that, find someone else. We’ve also done some of our own development and sought out manufacturers who can respond quickly. It’s tough; even though we’re significantly larger today, we’re small compared to some of the large brick-and-mortar retailers. Making sure our order gets priority is always a risk — [a manufacturer] might get a big order from Macy’s and our order won’t be significant any more. Building a relationship with the vendor is really important.

There are other elements too. We’re also escaping the number of designers we work with, and offering an increasing number of styles. Underneath that, there’s an increasing number of SKUs, a wider range of sizes — we want to be inclusive. On the back end, we’ve built our own technology that makes our buying more effective than average retail system. Our buyers can interact with our systems on mobile for instance and most other retail buyers can’t.

Beyond scaling on the supply and technical sides, you’ve also had to hire more than 450 employees since founding ModCloth. How do you recruit talent?

We look for people who are really passionate about what we’re doing and believe in the purpose of ModCloth. We also have a strict “no assholes” rule. You spend so much of your life at work — life is too short to work with assholes. So we try to filter out people we think will be condescending or contemptuous or aggressive in the workplace. ModCloth is two-thirds women, a very collaborative environment with a strong marriage of art and science. It’s a lot easier to hire young passionate people early on — you get a more unfiltered read on who they are as individuals, whereas experienced people have a lot of experience interviewing and can very polished, and it’s hard to decipher the truth in the interview process.

Beyond that, we’ve always done a good job of finding ways to simulate a real world working environment in the hiring process. Of course that’s a lot easier in customer care, when you have them respond to a mock angry customer email or call. It’s harder when you are trying a senior executive who needs to have technical confidence and be good at mentoring and developing people. One thing we look for across everyone is clear communication skills. Fuzzy language and writing tends to equal fuzzy thinking.

Susan Head Shot

Susan Koger, ModCloth co-founder and chief creative officer.

You’ve always had a boutique-y, community feel. How have you maintained your connection to your community as you’ve gotten larger?

There are two parts. One, we’re building a community around inclusiveness, heaping customers feel great about themselves. Part of doing that is moderating the community. We’ve needed to scale moderation so that contributions — photos, comments — don’t take a long time to go live, so that the community isn’t stifled. The other part is that ModCloth is known for being quite quirky and, if a million other people are quirky, is it really that quirky? To continue to feel special, you need unique merchandise. We’ve also made a point to never feel corporate. We want the brand to come across as if Susan is still writing copy, not a big organization. We tell the team: You’re building a relationship with all these customers, all these women, interact with them like a real person. The community also interacts with each other, and we let them know we’re listening to them and we view this as a conversation.

Tips on Talking to and Tapping Potential Investors

Brian
SMALL-BUSINESS GUIDE

Peter DaSilva for The New York Times

After presenting to investors with stories and research, Debra Reisenthel, the chief executive of Palo Alto Health Sciences, said she learned that most investors responded better to candor.

By JULIE WEED
Published: October 16, 2013

Debra Reisenthel, chief executive at Palo Alto Health Sciences, has been trying to raise money from investors for the last four months. The goal is to finance the development and production of a biofeedback device that measures carbon dioxide output and trains people to breathe in a way that helps them manage anxiety disorders.

Suggested Resources:

1) Reid Hoffman reviews what worked and what didn’t in a pitch he made to investors in 2004 for LinkedIn.

2) Brian S. Cohen, of New York Angels, has written a book called “What Every Angel Investor Wants You to Know.”

3) David S. Rose, venture capitalist,gives a TED talk on what you should know before pitching venture capitalists.

Related

Along the way, Ms. Reisenthel said, she has learned some important lessons about pitching to investors. “We used to start meetings with a story about our founder, the problem we were addressing, its cost to society and the scientific research that led to our business idea,” she said, “but investors wanted to know right away, ‘What exactly are you selling and who is going to buy it?’ ”

As a result, Ms. Reisenthel learned to get to the point, immediately. Whether they are pitching to venture capitalists, angel investors or friends and family, entrepreneurs who have been through the process stress the importance of making a crisp presentation, sizing up competitors and knowing what kind of information the potential investors require.

KNOW YOUR AUDIENCE Angel investors and venture capitalists come to the process at different times with different needs and goals. “The angel investors we met with during our idea stage were interested in the zeitgeist of the project,” Ms. Reisenthel said. “They were excited to be part of what we were trying to achieve, and they were O.K. with unanswered questions. They didn’t need a detailed five-year plan, and understood their investment would be diluted in value when we took on additional funding.”

She said the venture capitalists, by contrast, are generally willing to invest more money but they want to know when the company expects to be profitable. “V.C.’s are more about the details — market size, business model, cash flow plans, sales break-even point and how the company will find customers,” Ms. Reisenthel said. They were more likely to want to be involved in strategic decisions, expected regular updates and often wanted a seat on the board of directors. “They were also less willing to accept risk than angel investors.”

KEEP IT CONCISE Pete Higgins, a founding partner at the venture capital groupSecond Avenue Partners in Seattle, has heard hundreds of pitches over the last five years and has financed about 7 percent of them. He said a concise presentation was telling because entrepreneurs who can explain a complicated set of technologies or a new product show they are smart, that they have done their research and that they can communicate — all factors critical to a company’s future.

Ms. Reisenthel uses a slide deck of about 10 and no more than 15 slides and prepares additional slides in case deeper questions arise on topics like manufacturing costs or competitive analysis. “You need to know the business, the technology, the science better than anyone in the room,” she said. “Practice in front of smart professional friends in the industry who can critique you before you go in for the real meetings.” Selling the quality of your leadership and your team is as important as the idea, Mr. Higgins said.

Sometimes just a few compelling sentences can get an idea financed. Last year, Mr. Higgins said, “A start-up veteran pitched us, saying, ‘I want to sell $4.99 live concert recordings that are ready to be downloaded to the concertgoers by the time they get to their car in the parking lot. It’s technically straightforward, makes money for the band on tour and is an inexpensive memento for concertgoers, who are often trying to record on their phone anyway.” Mr. Higgins said he knew in five minutes he would invest, and theLively app made its debut this year.

KNOW THE COMPETITION Beyond just listing other companies in the same arena, understanding and describing the competitive landscape can be critical, according to Mr. Higgins. “If other companies have tried something similar and failed, tell us why they failed,” he said. “If the market is crowded with competitors, how will you do it better? Just having a feature they don’t is an incremental benefit and not enough to overcome the inertia that will keep customers from switching to your product.”

Mr. Higgins advises entrepreneurs to ask for financing only when they can demonstrate a transformational new technology, a new distribution method, or a better cost structure that cannot easily be copied. And recognize that there are competitors to every business idea, he said, even if it is the pencil and paper people are currently using to do the task you plan to automate.

EXPECT MISHAPS Julie Gilbert Newrai of Minneapolis raised $1.5 million in her first round of fund-raising in June 2012 and is preparing to begin a second round. Her service,PreciouStatus, relays personalized daily updates from professional care providers to family members of people in eldercare and child care centers.

Celebrity Or Startup, UTA & Kleiner Perkins Adapt Old Models To A New Kind Of Client

Brian

By THE DEADLINE TEAM | Thursday October 17, 2013 @ 7:12pm PDTTags: USC, UTA

David Bloom is a Deadline contributor.

One after another, groups of USC engineering students, ranging from thirtysomething doctoral candidates down to baby-faced undergrads, trooped to the stage today. Each pitched their newly honed and toned startup companies before a roomful of potential investors, supporters, and — in a changeup for both — executives from old-line venture capital firm Kleiner Perkins Caufield & Byers and old-line Hollywood talent agency UTA.

The Viterbi Startup Garage Day featured presentations from nine teams (another group couldn’t make the event), all recently done with an intensive 12-week program to build a working tech product and get it on the market. In some cases, Viterbi’s program was a last stop to fine tune a product built on years of research and work. Other companies had been mere proposals last spring. All the young entrepreneurs are hoping to benefit from a program that’s giving them some unexpected friends in influential places.

“Early-stage entrepreneurs need two things: help with business development and access to capital,” said Ashish Soni, the Viterbi School of Engineering faculty member who runs the first-year program. “Kleiner provides access to capital. A lot of what UTA does is dealmaking. You can replace that celebrity (the agency would typically represent) with a startup.”

Only one of the nine presenting companies had anything like an entertainment angle to it. That company, MediaHound, proposes to help consumers find (legal) access to movies, TV episodes, music, books and games, regardless of the technology platform, distributor or device involved, and make it easy for users to create and share “universal playlists” with friends, and to buy or sample the material, said CEO Addison McCaleb.

The company already has raised more than $500,000, done test runs with several prominent film festivals and signed partner deals with 60 companies, including YouTube, Amazon Instant Video, Sony’s Crackle and Hulu, McCaleb said.

But even working with an entertainment-oriented startup is a relatively new initiative for UTA, never mind working with the other startups creating health-maintenance apps, gym-management tools or 3D scanning and printing hardware, acknowledged Brent Weinstein, the agency’s head of digital media. “This isn’t a traditional business for talent agencies,” he said. “But we believe anybody, in any company, can benefit from sophisticated and passionate representation.”

UTA joined the Startup Garage program as part of a broader effort to help create tech giants that will stay in Los Angeles, a city that produces more engineers than any other in the country, thanks to Viterbi and other strong engineering programs at schools such as Caltech, UCLA and Cal Poly-Pomona, said Weinstein. But because of the general lack of big tech firms beyond what’s left of the aeronautics and defense sector, most of those engineering students tend to end up in the Bay Area, working there for giants such as Google, Facebook and Apple.

“We are big believers in the L.A. early-stage marketplace,” Weinstein said. “This program gave us a chance to dig in and help some early-stage companies thrive.”

UTA has had previous success with startups, helping launch a big shopping site and Awesomeness TV, the online video site that sold this summer to DreamWorks for $33 million up front and an earn-out that could nearly quintuple that price.

Now, both UTA and Kleiner will have an ongoing interest in the 10 firms that came through the first year of the Startup Garage, and an ongoing incentive to help them succeed, Weinstein said, though he declined to discuss terms of the arrangements.

The program also represents a change for Kleiner, the bluest of blue-chip venture-capital firms but one that typically is involved in later rounds of a startup’s development, once it has begun generating significant revenue. That’s changing, however, said Kleiner general partner Mike Abbott, because of the need for VCs to get access to what he called “foundational research” and the companies that are created from that work. Whereas once a lot of that research was being done in the R&D wing of tech companies such as Hewlett-Packard, Xerox and IBM, that’s no longer the case. And while Kleiner partners know the way to the Stanford engineering labs, they needed to extend their reach to other top-level schools to have access to more startup opportunities, Abbott said.

Abbott said USC Viterbi Dean Yannis Yortsos “sees that and understands that he needs a more entrepreneurial approach” to the research work being done in his school. “You can argue that not every team (in the Startup Garage program) is doing a grand challenge,” Abbott said, “but we wouldn’t take a team in the program if it didn’t have an engineer involved.”

The next step will be helping the teams grow into full-fledged businesses during the next six to nine months. All nine presenters were asking for additional seed funding of $250,000 to $1 million, typically to be spent for customer acquisition, marketing or hiring additional engineers or technical capacity to expand into full-scale operations. Still undetermined is timing and partners for a second year of the Startup Garage, though director Soni said he hopes to double the number of nascent companies invited to take part.

Do Startups Take an Emotional Toll?

Brett

While it can be tempting to focus on flashy business successes, there’s another side to entrepreneurship not often discussed: the emotional toll it can take.

Starting a company can be a lot like battling an ocean storm from inside a dingy. One minute you’re experiencing smooth waters (you just signed on a big client), the next you’re in the middle of a typhoon (your funding source went dry and you may be forced to close up shop).

After last week’s death of Internet visionary Aaron Swartz, I touched base with entrepreneurs Jake Nickell of Threadless, Elaine Wherry ofMeebo and Evan Doll of Flipboard to get their views on the pressures of being a young, successful startup owner.

 

http://www.openforum.com/articles/how-to-handle-stress-of-start-ups/