Experience is a hard teacher because she gives the test first, the lesson afterwards. Vernon Sanders LawWhere there is a lack, there is the talk: Ballmer is talking about Windows' advantages over Linux. I especially liked this one: "Linux itself is a clone of an operating system that is 20- plus years old. That's what it is. That is what you can get today, a clone of a 20-year- old system". Well, that 'clone' ain't releasing security patches every second day for their shipped products...
More funds are funneled to totally new ventures. That's my feeling also. A VC was telling today that they have two new investements on their table about to be signed. Both of them were new seed phase fundings. Gradually we're getting there...
Ventureblog had a nice term called 'Alpha Geek" for people who are the leading indicators for something brand new and valuable. It's always a pleasure to talk to these 'Alpha Geek' persons. They are enthusiastic and always having something new and exciting on their mind. And most of all they are the rolling stones that never stop. I admire people who can reinvent themselves and change constantly. That's exciting. Even when you're just their friends...
And my bike episode has become to a culmination point that was to be expected: I cannot keep my bike in the yard. Without any reasons It just bothers someone in the house. Well, it cannot be the noise since I haven't kept it on. Well, now I have to test my insurance and park it on the nearby streets. That's so groovy!
There's nothing like a long Monday to remind you that you work for money, assuming you do, rather than having your money work for you, which is rare. - G. Armour Van HornI wish it would be a Tuesday... So grey day. Raining all day long and business was somehow sticky. In brief, I did not feel like working today. And bold I was and did nothing!
Well, due to a bit dull economics maybe you're also in a biz where some fundamentals are about to change. If 'Service orientation' does not ring any bells then most likely you should read this.
One more reason to scrap Windows and start to use Linux - Office XP runs on penguin.
A great piece about secondary VC market. Is it buyers' or sellers' heaven?
How to Make Money on the Net? Business2.0 did find out and you bet that eBay, Google and Yahoo are on the list. Nope.
On Friday I had a good discussion with an old friend of mine. He's a sales man in a small IT outsourcing company that has only a few big clients. He told that Jan & Feb of this year have been horrible. Not even a single sales done. And it was not only him who had trouble. Even traditional businesses such has house manufacturers that are in consumer biz had pure nil months. The good news was that March compensated the frustrated times and opened finally the order book. Hopefully for good.
I must admit that I admire his persistence. He told that one should not give up and let the bad times put your down. One must just try a bit harder. And keep the good moods - especially when talking with prospects. A good tip was that talk about sports or any other stuff except your business when doing cold calls. Just briefly mention about the purpose and then change the topic. People turn into a better mood and open up for your case in the next call. Even saying no must be tiresome if one has to do it all the time...
No worries, yesterday I had some jolly good time. A good dinner, Taylor's port, champagne and a few cigars, of course. So, maybe it was just a hangover after all?
If entrepreneurs are having hard time raising money, the situation ain't any sweeter for General Partners (GPs) of VCs. PrivateEquityOnline describes different types of Limited Partners (LP) according to their behaviour. Sounds like ordinary sales for me...
The good times are here again! I got a call today from Tokyo. First I thought it was some new biz and I got a bit excited. Afterall it was just an attempt to sell me some stocks. The harrasment was twofold. First a junior sales rep was warming up and checking my financial feasibility. Mr. X, how are you Mr. X. Are you able to commit a minimum of 5.000US Mr. X. After a while Mr. X started to be fed up and not least for hearing his name every 5 seconds. A few hours later a senior sales rep was calling again. Conforming my feasibility and my email address again. What a waste of money and resources! For a principal I'm not buying anything out of a phone call abroad. What has rotten so badly that they cannot sell domesticly? Who's-the-greatest-fool used to be the name of the game in the last phases of the bubble when investment bankers called randomly people around the world for good investment tips. So, I'm still sticking to my prediction of Q3 this year. Good times here we come!
Ninety percent of everything is crap.
Theodore Sturgeon (1918 - 1985)
AlwaysON Network was interviewing Eric Schimidt of Google, check it out!
If you want to be the first to know whom to call when the recovery starts you should read this prognosis.
Imagine if every Thursday your shoes exploded if you tied them the usual way. This happens to us all the time with computers, and nobody thinks of complaining.
Jeff Raskin, interviewed in Doctor Dobb's Journal
"The computer is a moron." Peter F. DruckerI spent the entire day putting concepts together and thinking about the essence of strategy. It is amazing how little has been said about strategic management in dynamic and complex environments, i.e. almost in any industry nowadays. Most of the talk is about strategic planning and stuff created in the '80s or earlier.
Gary Hamel had a great article in Fortune already some years ago. Most of it is still valid beside some praising of Enron and other fallen stars.
After the dot-com boom it has been a time to build solid businesses again. Customer, not the investor, is the king again and here is a good reminder how to survive in the long term. Especially I liked those seven points at the end.
There is no other guru like Peter F. Drucker. Check his interview at Business 2.0 in 2000. Excellent piece:
Many of the newer Internet companies are struggling to keep their businesses afloat. What are they doing wrong?
Drucker: I don’t think they are doing anything wrong. They’re just not doing anything right.
I heard about Segway a few years ago. Then it was the most posh thing among rich people. Only a few had seen and tested it. They described it as a totally new concept that will change the world. Well, at least Phillip Torrone has been using it for 140 days and 700 miles with success.
Dealing with strategy in a daily basis makes me wonder every time how often the means and objectives are mixed up. Even in the most basic functions and processes. CRM is a good case in point. CRM News reminds us that CRM is not about technology...
Wow, nice weather and the sun shining could not hold me inside. Some 700 kms with bike and still alive! Curvy, paved roads and an experienced friend ahead showing the right lines to get fast in and out of curves. A heaven!
OK, back to boring biz life again (for a few hours that is, the weather is great today, too!). Check the latest BusinessWeek. They have an article about European VCs who are not doing that bad after all. Their US counterparts had a bit tougher ride. Don't get too proud yet. European athmosphere for entrepreneurship ain't as fertile for new startups than the States. Gray panthers are getting the biggest benefits - money comes to money or in this case the financing rounds get to those who have already a few rounds behind from the past.
Where facts are few, experts are many. Donald R. Gannon
The surprising thing about young fools is how many survive to become old fools. Doug LarsonI started my holidays by buing a bike. It took six days from my initial idea that I could actually buy one. Two weeks ago I did not even consider it as an alternative. My last ride was ten years ago and it took just a few blocks to get it all back. Of course, I don't feel comfortable and in-control altogether but braking and driving ain't impossible either. Two bikes tested and I bought the other one. Well, I have been lucky since my friends are experts in this field and have assisted me in every possible way. There was a temptation to buy a bigger one immediately but almost everyone says that it's better to start with 600 ccs first. Accelerating to 60mph in 2-3 sec is fast enough after four wheelers of 6 secs. Should be enough with some 110 bhp. Now I just have to stay alive...
Today I don't bother you guys with any business talk since it's time to relax and have it cool. Happy Eastern!
Experience is the name everyone gives to their mistakes. Oscar Wilde (1854 - 1900), Lady Windermere's Fan, 1892, Act III
According to Windmill Reports survey there were 148 wireless-related companies receiving VC funding in Europe in 2002. The average deal size was €6,6m breaking down to the average seed of €400.000, 1st round of €3,2m and 2nd round of €6,4m.
I was visiting a seminar where a marketing director of an insurance company was presenting their marketing strategy. The lady was in her 40's and was as enthusiasitic about her presentation as I would be while reading the terms and conditions of an insurance. A question was bounced from the audience asking about the differentiating factors of their new positioning and visual appearence since it appeared to be almost identical to one of their competitors. I was expecting to get something like "we're the company who listens to our customers and care, the other is offering their products and putting them in the spotlight". Something one could feel, smell, associate oneself with. Nope, she told that even though both company's have the same main colour as their visual outlook the supporting colors differ. Also some other technical details of their internal policies and guidelines was given... Auts.
Some VCs are having trouble of not getting enough technical details out of entrepreneurs' presentations. My experience is that it's damn difficult to get the VCs to understand even the basics of their (invested) portfolio companies technologies. This sounds very frightening and thus many VCs are also in deep trouble nowadays. The promised smart money has actually proven to been pretty stupid after all. Pure numbers and bankers. Risk management and stress tests with volatilities. No business substance and value building.
A VC was drawing me a nice picture about agent problems and different agendas even in the same board room. Imagine a situation where there are four VCs with approximately same size private placements for a high tech company. The investments have been made in various rounds with different valuations, terms and sequences. This results that each VC has a bit different point of view, risk position and own hidden agenda depending on their own situation. No obvious lead investor can be pointed either. So, who has the most to lose? For those four investors this is just one investment of their overall exposure, i.e. their portfolio. Things turn interesting if the four VCs are sharing the same limited partner. Just one of the many point of view suddenly turns into a major risk exposure of one target company via four different funds...Who should be sitting in the board of the high tech company?
It is the mark of an educated mind to be able to entertain a thought without accepting it. Aristotle (384 BC - 322 BC)"a complete catastrophe" - a new cabined has been formed. More spending and reckless policies. Ain't my cup of tea. Better jump off the ship while it's still possible...
To be an equal opportunity weblog I must give the floor also for the US side: Sex Tips from Donald Rumsfeld
I was checking some bikes today. Must say that there is a severe chance that I might fall into one. Hopefully just not literally.
Palm is about to release some new models. They seem to be boosted with a camera and wireless features.
Watch out touching your screen with bare fingers in the near future. You might be scanned and identified. Well, I would not mind if my laptop would recognize me and speed up the booting...
You remember the movie Charlie's Angels with Cameron Diaz? Nokia was sponsoring the movie and Cameron was using her Nokia 8210 along the storyline. Angels were having tight clothes without any pockets. Still they were able to fetch their phones out of nowhere. Well, there is a sort of similar commercialised product in UK...
"Play for a billion". Pepsi will launch a contest where you earn some big buck (a billion to be exact) or do some monkey business.
Finally someone is trying to penetrate the new issues market. Fingers crossed that they will make it!
Hardware industry has become a mature industry with saturated future prospects. Mobile devices are gradually starting to have the same faith - talk is cheap and plain vanilla. There is a rumour that Jobs is bidding for Vivendi. Hardware is irrelevant and content is king?
Universities are keen on biz plan competitions. I cannot avoid of the immediate association for the hype 90's. Create an excellent story/script and we will finance your movie/venture... Many consultancies were busy writing business plan in a few days. Never mind studying the market or getting to know the real demand. I always felt uncomfortable of creating something hypothetical and offered to do it the hard way (and more costly). Now we are getting back to bases were the real deeds are more important than the fancy outlook.
Never mind the calendar - the spring is here. The best way to confim it is my fever for restless vehicles. A few years ago I had to buy a sports car. The next spring it was a must to tune it since it was not fast enough. The following it was the time to change the whole thing into more powerful one. Now it's bikes. I'm a total rookie. I felt so stupid in a fair the other day with all the available models and brands.
The biggest dilemma is whether I have the guts to do it. I'm a bit afraid for my life. Driving with four wheels with cars accelerating better than 7 sec to 60mph is no equal for bikes with 2-3 secs. I have a history of lifting the back wheel of Audi TT Quattro 225hp in a ramp...
My all time favourite of start-up handbooks is Nesheim's: High tech start up. It's in my 'must-list' for new entrepreneurs founding their new ventures. The book describes in detail the different phases and mindsets the founder is required to go through from an idea till IPO / trade sale. To summarise the book: be paranoid and especially with your investors.
'VCs are not nice people' is a good reminder of the routhless world we're living in. Darwinism is alive and kicking well. Nokia Network's announced layoffs are the biggest in Finland since the early 1990's. 700 R&D engineers have suddenly more time for their families. I wonder whether they can find any applicable jobs since Eriksson is even worse shape.
Iraqi information minister Mohammed Saeed al-Sahaf has made it to the history books. A web-site has been opened for his entertaining comments and ever-positive approach.
I had a chance to evaluate an exceptional company. They started when others were closing down: the end of 2000. Some 30 people and since last summer cash flow positive. High tech field that is still emerging. However, they have been able to get all the possible deals available and secure the leader position globally. Competitors have awaken to the same actions only 6 months ago and are now knocking on the same doors this company secured deals with years ago. Also, still with the orignal business plan holding and even pacing them accordingly. A rare case I regret to admit. If everything goes nicely they could be a fat trade sale candidate in two to three years. The economical situation should be favourable as well as the emerging market by then. A company run by serial entrepreneurs and tech geegs with respectable track records. Amateurs should not bother...
CEO of a listed company was joking today that it's an industry standard to keep all the incurred holiday days in cushion for the day when you're fired. Eventually you're anyhow and it's just a matter of time. And for that moment being it's a nice feeling to have some 2-6 months worth of paid holiday available. In cash that is. And he was not joking...
Alias in real-life. An incident worth reading: how a weblog can save you out of messy relationships.
Cram downs, P-t-P (pay to play / path to profitability) and why to destroy own portfolio companies - excellent article in Forbes about lower valuations and survival struggle I've so much been foaming about.
High-Tonnage Bombs. No - this is not about Iraq. Start-ups that take tonnes of money in and then explode. Nine rounds of financing and hundreds of millions investor money makes a nice wake-up call all around Sand Hill round.
I'm pretty excited about RFID tags' almost endless opportunities. They are coming slowly but within five years they will hit like mobiles. One day they will replace EAN codes that today tag all the products available. New technology is always frighthing, at first.
Benetton seems to be stepping back from its initial proof of concept test. Consumers were afraid of their privacy. For manufacturers the advantages are enourmous even before the product hits the shelves. But how to ensure that the tracking is turned off when the consumer walks off the shop?
Still not convinced about the paradigm shift? Be conviced and read the excellent article series by Bill Reichert, Garage Technology Ventures. They have been through pretty hard times as well. The name 'Garage' should give enough of hints about their past biz logic as an incubator...
High tech biz model works extremely well when the economy is booming, the opposite happens in the downfall times. So, is the recovery coming in a few months since the war is becoming to stablize? Only 90 days for the high tech recovery?
This week I have been having some discussions about the economic situtation. With my humble and limited survey it seems that people are starting to believe that Q3 this year will be the turning point. One does not hear too many more pessimistic predictions. It's more like that the juice has run out of the negative mood. We are getting used to it already.The good times are not coming back. And this is the point where the upswing can arise. First slowly but gradually. More investments, better future prospects, the confidence.
If the VC funded IT companies are in trouble, so are the companies that funded them. A Washington Post article predicts that some 200 out of the 800 US VCs will vanish within the next five years. The other day I heard that only 15 of Sweden's 200 VCs are survivors. Quite a bumpy road...
Some are still getting bigger and stronger. Forbes listed the fastest growing high tech companies.
Wireless data services are too expensive. Also, they are too complicated to set-up. In 1998 I was happily connecting with my Nokia 8110 to the corporate network and roaming across the Europe.
Five years later I have great difficulties with my 6310i. It does not like to communicate with my laptop running under Win2000. Infrared is not working dispate many installation attempts and patches, cable connection works sometimes after swapping com ports with my Palm's hotsynch, fax-feature is an hopeless attempt. So, I just simply talk and try to find a hot spot to get the things done. This seems to be a common problem with Nokia nowadays. They are not a proper software company. I had so much trouble with my Communicator the last summer that I had to switch back to Palm. One simply could not trust the device. Either it will crash down or otherwise mess the data. I had enough of formatting the damn thing every fortnight or so.
3 % of the 6000 IT-companies that got funded in the late 1990's will survive. That's only 200 and even on those ones one has to do manoveurs to turn them into profitable businesses. Sounds like VAR with 95% confidence level reversed...
Job well done Kimi! Looks like that Kimi can add some spice to the F1 this season. Time for Michael to give away for another Finn?
What's the matter nowadays that one cannot find a decent place to enjoy a regular Sunday afternoon? Almost all the hang out places are closed. Most of the restaurants as well. Even the hotel bars are closed. And I'm only asking for a place to have a comfortable chair, some relaxed elegant atmosphere and maybe some smooth jazz to crown the quality time with good conversations. Well, some Graham's with cuban cigars and good friends around was something I was lucky to have today. These days I have missed during my time abroad.
Today I truly realised the potential of digital music. Gradually I start to have all my cds copied to my computer's hard disk. 80g hard disk costs around 100€ which is nothing. It's so convient to play and change music just by a few clicks. Upgrading from MCs to CDs was a big thing in the early 90's. Imagine that one had to stand up and walk to the stereo system and turn the vinyl around every 30 minutes. CD was something luxurius. 60 minutes non stop. Now I don't have to bother standing up at all...
Greg Blonder has some interesting ideas about free music in the future. I must admit that I like his thinking. It does not take many years when all our media content is in digital format. Distribution and dublication costs are practically zero. Streaming will be a natural way of receiving the content like radio is today.
IPOs Hit 28-Year Low In the First Quarter . So much about exits. Trade sales are as feasible with today's market valuations. Sit on your hands and hold tight. I would rather invest on a Swan and sail around the world a few rounds.
Sex and music videos go hand in hand. Well, Robbie Williams have merged these two pretty succesfully, or what do you think?
Lately I have also been involved with some SM activities myself. Today was one of them: Mobile Expo. A trade fair for mobile biz commenced in 2000 when it was a massive success. Each year it has shrinked by half. This must be the final year, I thought already in 2001. Well, 30 exhibitors and only 900 visitors in total for yesterday. Two makes a crowd on those corridors. Almost as pathetic experience was the Biotech fair the other week in the same massive trade center. Two industries that are totally broke and out of fashion. People were not even pretending to have fun, not talking about being excited about their stuff. Splendid!! Next time I rather visit some funerals.
The best part was to hear some stories about old collegues/biz friends. Some real party animals have gotten married, some have moved to Australia, others have returned to their nifty fifty corporate cubicles as if they had never left. Business as usual.
Mobile is dead. Wireless with big mammoths and a closed ecosystem are in! Long live the young and entreprenerial spirit and thanks for the cheap labour and concept testing anyhow. The table is catered and the big boys may start to enjoy the main course...
I used a taxi today and talked with the senior driver about his business. Man, it sounds hard work. Ten hours a day is not sufficient to make a living. For him (he owned the cab) some 170€ a day is enough and an average ride is around 15€. The supply and demand do not meet efficiently since it may take more than 3 hours without any customers. Then suddenly you are making nice money in a few minutes. Summa summarum, some 15 hours should be enough and seven days a week. Cool! In India fellows were writing off their smallest and cheapest car in the market (mini Suzuki) seven years. And the car costed 6000 eur. Petrol was not cheap, only half the European price level. I paid 20eur for a car and driver for an entire day. Half of the fee went down the drain and off the exhaust pipe...
Now I gotta go back to my living room. Three hours at home and night shift begins. With Partagas Churchills again. Man I love Cuba!
Today I was approach from Russia. A possible business lead in Moscow. I must say that a year ago I would not have been excited at all. I had totally negative image of the whole country. Fortunately I was forced to visit Moscow in last April. I may have been lucky since my local business associates showed us around the famous places and obviously knew their way around.
I was thrilled. The atmosphere was amazing. A mixture of Prague, Paris and maybe London. Relaxed, international and full of action. On Sunday there were lots of people having a stroll and shopping in long streets full of Prada, Boss, Armani and like. Some ten years have made wonders for the city. Most of all it smelt like a boom time. Everywhere one could see construction sites for tall buildings if not skyscrapers. As many luxurious cars I haven't seen for quite a long time. And it was not just the rich people. Not many Lada's or Volga's around. Most of the cars are imported from Germany or other nearby countries. Plenty of Vectra's and Golf's in the streets.
Well, altogether I'm still skeptical and not head of heels in love with the east. I dislike the biz conduct and the evident corruption. I hate hassle and Russia is still a big hassle. But I don't regard it as an impossible place to do business if one has a good local business associate who is representing the global new young generation with proper values and hunger for achievement. Legitimate business that is.
Aargh! I crave for action. The flu is persistent and I'm not. Fuzzy feeling and all the filters on. No ideas or great emotions encountered. Just pure frustration.
I had a lunch with a CEO of one of the VCs in the neigbourhood. He was hopeful that the biz environment will get better in Q3 this year. Not the great boom times but a turn to the better anyhow. That was the good news. The bad news is that the paradigm has changed - for good. No more free money or almost any investments for new startups. Basically one has to be estalished in order to fulfil the investment criteria. Proven product, existing customers, market risk reduced or erased, scalable biz model etc. It sounds and de facto is a situation where one has to create the company by oneself without any risk money involved. The "risk" money will come around when you have already a cash positive situation and clients around. So, where is the risk? It is here, in VCs portfolios. They have materialised it or they have to do it soon. Therefore they do not like any more additional risks, i.e. new unproven technologies or companies. Only sure bets, later stage investments. That's the change of the paradigm. The New Normal!
PowerPoint Palace. I think that was the term a MS representative called Nokia's HQs since they are a big client for MS's office products. Today was the time to do some marketing material. Actually it wasn't as dull and boring as it may sound. Athmosphere was stimulating, Swedish theater's cafe with plenty of people coming and going. It took some 3 hours but was pretty rewarding. It was more like creating something new than just warming up some old stuff in a microwave. The beaty but also the challenge is to be precise, still articulate and to the point. Most of the presentations are just some sloppish phareses and terms but together in more or less random order. Actually I hate all ppts altogether. One has to do those in order to learn the marketing rap but should forget them while presenting the case. Good salesmen are talking most of the time and the best are listening most of the time. Custom made speeches and sales pitches for me, please!
I got fed up with my idle computers. What's the use of 1 or 2 gig processors if most of the time they are just used for showing the screen savers. Also a mailer, excel and office are that demanding nowadays. Yeah, right. Well, the point was that I downloaded an app that will use my idle computing time for drug discovery for a major cancer project. Grid computing is the hip term. There is at least another similar project for AIDS.
After reading some stuff about the war I started to wonder the following: What if Hussein did not actually have any big plans or programmes about weapons of mass destruction. He just hided something and played around like he was actually running some development programmes. The allies' evidences shown were not that convincing before the attack. Would it possible that Saddam just needed some excuse to cling in the power? A nation is united when there is a foreign enemy. And in this case he needed a strong enemy that is taking a keen interest to their matters. Otherwise the country would just turn into a void after some twenty years of pure fighting and war. Even Saddam would have hard time keeping in power on those circumstances.