the business of (tech) startups featuring paul singh
TRANSCRIPT
The Business of (Tech) StartupsPaul Singh, Entrepreneur, Investor, & Speaker @paulsingh
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@paulsingh #RJTechTour
THE BUSINESS OF (TECH) STARTUPS
MONEYBALL FOR STARTUPS. AND CITIES.
@paulsingh #RJTechTour
WHY?1. Technology is the fundamental driver of
growth in the industrialized world. And it’s changing the way we work.
2. Private market investing is (one of) the few remaining ways for the average person to create significant wealth.
@paulsingh #RJTechTour
500 STARTUPS
@paulsingh #RJTechTour
@paulsingh #RJTechTour
@paulsingh #RJTechTour
@paulsingh #RJTechTour
I BOUGHT A TRUCK. AND AN AIRSTREAM.
@paulsingh #RJTechTour
2016 TECH TOUR Tallahassee, FL
Vancouver, BC
Kelowna, BC
Shreveport, LA
Pittsburgh, PA
Tulsa, OK
Los Alamos, NM
Las Vegas, NV
Lincoln, NE
Waterloo, ON
Helena, MT
Syracuse, NY
Columbus, OH
And 17 more…
more info: www.resultsjunkies.com/tech-tour
@paulsingh #RJTechTour
more info: www.resultsjunkies.com/tech-tour
@paulsingh #RJTechTour
API TO VENTURE CAPITAL & FUNCTIONAL EXPERTISE
THE BIG OPPORTUNITY IN EARLY STAGE TECH INVESTING:
(FOR FOUNDERS. FOR INVESTORS. FOR GOVERNMENT.)
@paulsingh #RJTechTour
TECHNOLOGY IS THE FUNDAMENTAL DRIVER OF
GROWTH IN THE INDUSTRIALIZED WORLD
@paulsingh #RJTechTour
OPPORTUNITIES HAVE NEVER BEEN GREATER
@paulsingh #RJTechTour
@paulsingh #RJTechTour
MOBILE IS EATING THE WORLD
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INNOVATION WILL COME FROM VENTURE CAPITAL
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MONEYBALL FOR STARTUPS IT’S NOT SPRAY AND PRAY. IT’S A PROCESS.
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EARLY STAGE STARTUPS HAVE CHANGED
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STARTUP COSTS LOWER THAN EVER
BUT SCALING STILL COSTS MONEY
CLOUD, OPEN SOURCE AND ONLINE DISTRIBUTION DRIVING
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Sept
embe
r 12,
201
4
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WEB GETS BIGGER. WORLD GETS SMALLER.
@paulsingh #RJTechTour
@paulsingh #RJTechTour
TRACTION IS THE NEW INTELLECTUAL PROPERTY
PLATFORMS (SEARCH, SOCIAL & MOBILE) PRIMARILY DRIVING THE CHANGE. NO LONGER “GOOD ENOUGH” TO DEPEND ON TECH DIFFERENTIATION.
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@paulsingh #RJTechTour
CAPITAL INCREASINGLY COMMODITIZED
RISE OF THE ANGELS, YO!
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NEW REALITY: MONEY FOLLOWS
FOUNDERSRISE OF THE ENTREPRENEURS, YO!
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SIGNALS ARE EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC
@paulsingh #RJTechTour
SIGNALS ARE EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC
@paulsingh #RJTechTour
TRANSPARENCY IS SIGNALS ARE EVERYWHERE
BIG DATA + OPEN SOURCE ANALYTICS = NEW TECHNIQUES FOR VC
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WALL STREET BEAT US TO IT
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@paulsingh #RJTechTour
UBS PROPRIETARY SATELLITE PARKING LOT FILL RATE ANALYSIS POINTS TO AN INTERESTING CADENCE INTRA-QUARTER AND POTENTIAL UPSIDE TO OUR VIEW.
“
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@paulsingh #RJTechTour
TWICE A WEEK A SMALL HELICOPTER CIRCLES OVER CUSHING’S TANK FARMS ON AN OIL INDUSTRY SPYING MISSION.
“
@paulsingh #RJTechTour
WALL STREET ISN’T ALONE
THESE TECHNIQUES ALREADY USED TO UNDERWRITE IN-VITRO FERTILIZATION LENDING, PAYDAY LOANS, SUBPRIME AUTO LENDING,
HOME/PERSONAL/AUTO INSURANCE AND MORE.
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WE CAN DO IT, TOOSURPRISE!
IT TURNS OUT,
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+ “GUT” + TRUSTED MENTORS + MUCH, MUCH MORE DATA.
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WE CAN DO IT, TOO.
@paulsingh #RJTechTour
WE CAN DO IT, TOO.
@paulsingh #RJTechTour
WE’RE DOING IT, TOO.
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@paulsingh #RJTechTour
VENTURE CAPITAL IS OPEN TO ATTACK BY DISRUPTIVE NEW BUSINESS MODELS AND TECHNOLOGY.
“
-- NAVAL RAVIKANT (@naval)
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MONEYBALL FOR CITIES START MORE COMPANIES. WATCH YOUR FUTURE JOBS APPEAR.
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ECONOMIC DEVELOPMENT HAS CHANGED
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THE AGE OF THE INDUSTRIAL CITY
IS OVER
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NOW POSSIBLE TO BUILD BILLION DOLLAR
COMPANIES IN T-SHIRTS FROM A COUCH
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FROM ANYWHERE*
@paulsingh #RJTechTour
MORE THAN TRADITIONAL INDUSTRIES, THE KNOWLEDGE ECONOMY HAS AN INHERENT TENDENCY TOWARDS GEOGRAPHIC AGGLOMERATION. IN THIS CONTEXT, INITIAL ADVANTAGES MATTER, AND THE FUTURE DEPENDS HEAVILY ON THE PAST.
THE SUCCESS OF A CITY FOSTERS MORE SUCCESS, AS COMMUNITIES THAT CAN ATTRACT SKILLED WORKERS AND GOOD JOBS TEND TO ATTRACT EVEN MORE.
“
-- ENRICO MORETTI
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NEAR PERFECT CORRELATION BETWEEN
URBANIZATION AND PROSPERITY
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NEAR PERFECT CORRELATION BETWEEN PRESENCE OF SMALL
FIRMS AND THE LATER GROWTH OF A REGION*
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PROXIMITY IS VALUABLE
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TECH COMPANIES WILL NEVER CREATE THE MAJORITY OF JOBS
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TECH COMPANIES HAVE A DISPROPORTIONATELY
POSITIVE EFFECT ON THE ECONOMY
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WHAT HAPPENS IN THE TECH SECTOR DETERMINES THE SALARY OF MOST PEOPLE, WHETHER THEY WORK IN
TECH OR NOT
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ALTHOUGH JOBS IN LOCAL SERVICES CONSTITUTE THE VAST MAJORITY OF JOBS, THEY ARE THE EFFECT, NOT THE CAUSE, OF ECONOMIC GROWTH.
“-- ENRICO MORETTI
@paulsingh #RJTechTour
MODERN ECONOMIC DEV
PEOPLE > STRUCTURES
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KEY IDEA
GET MORE PEOPLE TO *START* COMPANIES
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A FEW IDEAS...
@paulsingh #RJTechTour
(500) CHECKLISTProduct solves a problem for a specific target customer
Capital-efficient businesses - operational @ <$1M funding
Primarily internet-based distribution - search, social, mobile, local
Simple revenue models - transactions, subscriptions or affiliate
Functional prototype before investment (or previous success)
Small but measurable usage - some customers, early revenue
Small but cross-functional team - engineer, design/UX, marketing
@paulsingh #RJTechTour
Demo Day Videos ⟹ livestream.com/500startups
Sample Pitch Decks ⟹ slideshare.net/500startups
Venture Capital 101 ⟹ venturehacks.com/archives
Investor Thoughts:
Brad Feld ⟹ feld.com
Fred Wilson ⟹ avc.com
Chris Dixon ⟹ cdixon.org
Mark Suster ⟹ bothsidesofthetable.com
angel.co/valuations and angel.co/salaries
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LOOK AT WHAT OTHER CITIES ARE DOING (AND COPY THE
RELEVANT PARTS)
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INVESTORS: INVEST OUTSIDE YOUR
REGION, BRING THE BEST FOUNDERS TO YOUR CITY
@paulsingh #RJTechTour
HUGE OPPORTUNITY AT THE POST-SEED,
PRE-A LEVEL
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EVEN MORE TAKEAWAYS
Focus on Traction.
Learn to Communicate and Inspire.
@paulsingh #RJTechTour
ALSO... Distribution > Product
Tactics > Strategy
Notability > Credibility
Get on AngelList
Raise 12-18+ months of funding
Learn the basics of VC economics
Don’t confuse due diligence with progress & probability...
Shameless plug: resultsjunkies.com
@paulsingh #RJTechTour
TECHNOLOGY IS THE FUNDAMENTAL DRIVER OF
GROWTH IN THE INDUSTRIALIZED WORLD
The Business of (Tech) StartupsPaul Singh, @paulsingh Kristian Andersen, @kristianindy
#HighAlphaIdeas
HIGH ALPHA SPEAKER SERIES
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