the idea that's the key to a successful tech business, according
Adams, founder of AV Labs, head of Austin
Ventures' bootcamp for entrepreneurs, and author of the book, "A
Good Hard Kick In The Ass." What is the key? What he
calls execution intelligence, "the ability of a particular
group of people in a particular place and time to make a company
thrive." At this
Netpreneur Coffee & DoughNets event held November 14, 2002, he
discussed the importance of effective execution and shattered many
of the common myths about starting and growing a technology
Copyright 2002 Morino
Institute. All rights reserved. Edited for length and clarity.
Statements made at Netpreneur events and recorded here reflect
solely the views of the speakers and have not been reviewed or
researched for accuracy or truthfulness. These statements in no
way reflect the opinions or beliefs of the Morino Institute,
Netpreneur.org or any of their affiliates, agents, officers, or
directors. The transcript is provided “as is” and your use is
at your own risk.
mary macpherson: welcome
evening and welcome to “Coffee & DoughNets Goes Late
Night.” And, yes, it is the last time Coffee & DoughNets
will be going late night.
I'm Mary MacPherson, and, on behalf of the Netpreneur team,
we're glad that so many of you turned out for the program tonight.
I'm not going to spend a lot of time waxing philosophic. We'll
save that for the last Coffee & DoughNets, which will be
December 11, and we have an interesting program planned for that
last time we were together was October 23, the day after the
announcement that Netpreneur would sunset at the end of the year.
Since that time, we've been truly gratified by the responses that
we've received. Many people have sent their thanks and told us
stories about their Netpreneur experiences. Many of you have
offered products and services from your companies to continue
Netpreneur-like activities. You've volunteered your time to help
us in the transition and to help the program move forward, and
you've also volunteered to get involved with the philanthropic
work that Mario mentioned in his
letter to the community.
I said I wouldn't wax philosophic, but I want to read from
a note we received from an entrepreneur that really touched us
all. Actually, it kind of undid me. This was a note to Mario, and
I'm just going to read parts of it: “I've just read your sunset
memo, but you really brought the sunrise into the Washington area
entrepreneurial community, so I guess you have the right to go
dark. I'm from the old school of believers that all things must
eventually come to an end, even the good, but know you all on the
Netpreneur team that I really appreciate the things I've learned
through your efforts.” He went on to mention some specific
things about the program, then the note picks up: “As I sit here
signing our regular donation to So Others Might Eat and
thinking about our contributions to a number of organizations that
impact needy children, I'm reminded that the philanthropy is a
result of strong entrepreneurial community, but I'm sure I am
preaching to the preacher.”
I speak for Mario and all of the team when I say that that
really sums it up. Entrepreneurs in our vibrant group have a sense
of giving back to the community at large, and that's what
Netpreneur has been about from the start.
In terms of keeping Netpreneur going, we've said many times
that the network will live on after we're gone. In a post-Netpreneur
world, it is likely to be a distributed model, one that is run by
you in the community. That sounds pretty straightforward, but, as
we are exploring opportunities, it actually turns out to be pretty
complex. We think it’s well worth the effort, however. We’ve
received hundreds of messages from people who reached out to us.
We're following up with everyone and, in the next six weeks, plan
to reach some kind of resolution about how this will continue.
We'll have more to report on that in Netpreneur News and at the
Meanwhile, before I introduce our speaker, let me
acknowledge this evening’s volunteers: Dorothy Camer of Car
Free Mobility, Tina Holderness-Dante of Metamorphosis
Consulting, John MacKinnon of Teligent, Sean McColl of PromoCorp,
and Ed Rykowski of Information, Inc. Let me also acknowledge our team: Mitch
Arnowitz, Ben Martin, Neil Oatley, Lynn Plummer, Adele Rudolph,
and Fran Witzel. It is really through their efforts that all of
this is possible. Even though Netpreneur is going to be sunsetting,
these people are not going away. I know you'll still see them, and
please say hello if you have a chance. Mario sends his regards and
regrets that he couldn't be here tonight, but said to assure you
that he will be at the December event.
Now, on to the program.
I first met Rob
Adams about a year and a half ago at an incubator conference.
It was in the middle of the bubble. The world has certainly
changed a lot since then, but the advice Rob dispensed then still
holds today. He delivers it in a way that many of us know would
warm Mario's heart. [Laughing] Mario has delivered a few good,
hard kicks in the ass himself over the years, and many of us in
this room have been the recipients.
Rob is going to take us through a presentation for about 45
minutes, then we'll do Q&A, followed by book signing. Without
further ado, let me introduce Rob Adams.
rob adams: a
good hard kick
I guess that tonight I have good news and I have great
news. The good news is that I'm only going to talk for 45 minutes.
The great news is you get the last 15 minutes for questions.
Having been the victim of many slide presentations as an
investor, I assure you that I understand exactly where I
stand—you folks and my presentation are the only things standing
between me and a beer, so I promise to keep it as entertaining as
I know how.
Let me give you a little bit of my background because it's
relevant to what all of you are going through and what we're going
to be talking about.
I'm an entrepreneur. I actually cut my teeth at Lotus
Development back when Lotus was founded in the early ‘80s. I
went on and raised money for a Boston area startup, relocated to
Austin, Texas, did a startup there that went public, and now find
myself in the venture business. Over the course of my operating
career, I raised a lot of venture capital, both from companies I
was running as well as for friends and business acquaintances, and
now, all of a sudden, I find myself on the other side of the
table. I like to say that now I sign the front of the checks
instead of the back of the checks.
I want to give you a perspective as someone who has been
both an entrepreneur and an investor of what types of things
investors look for. The original premise for the book, A Good
Hard Kick in the Ass, was in the idea that during the bubble
we invested in some companies that did some things very, very
well. Many of those companies, although not all of them, have
continued to do well. We tried to take them apart and figure out
what particular piece each of those companies did that made it
really good at one particular aspect of business. Those things are
what I'm going to talk to you about today.
I understand that all entrepreneurs want a checklist. They
want to know exactly what to do to make things work. “Give me
the 10 magic bullets and I'll go do them, I promise you.”
Unfortunately, it's not that easy. Quite frankly, if it were that
easy, it wouldn't be as rewarding as it is, but I will talk to you
about some of the characteristics we found that set the stage for
strong company traction in the earliest stages.
The book originally came out as something of a guidebook
for people doing startups. If you look at the kind of people I
correspond with now who are reading the book, interestingly, it's
a lot of large companies. That’s because large companies
frequently find themselves up against the wall now. Some of what
we talk about in the book is very fundamental. There's nothing
new, there's nothing you haven't heard before, but we try to put a
different twist on it or take a different approach.
Before I dive in, I just have one more disclaimer. To keep
this relationship very, very objective, I'll let you know that
I'll be glad to read any business plans as long as the company is
based in Austin, Texas, where, by the way, every day is as
beautiful as today. I'd love to talk to you about your companies,
but we focus on the Southwest, so keep that in mind for later.
I'm going to start by taking you through the somewhat
counter-intuitive approach in how we talk to entrepreneurs. I like
to phrase these things as myths:
Good ideas are scarce
I know my customer
I have to ship the killer product
I must raise a lot of capital quickly
Investors fund business plans
Investors want their money back quickly
Advertising is the hallmark of a good marketing plan
I can use partners to sell my product
easy part is to tell somebody what not to do, but I'm going
to spend a lot of time telling you how it should be done or how
successful companies do it, as well. Then I'm going to try to give
you a little bit of the investor’s perspective.