Investment is dead. Social Media thins. Now What?

ADAPT

Now, we are luckier than most start-ups.  Due to the success of Room Full of People, SF Beta, and SNAP Summit we have enough in the bank to get by all right for about 3-6 months, depending on how close we cut our bills.  We’ve cut office space, gym memberships, corporate drinks, our skype account, and are reducing our pay checks and cell phone bills to help it last longer.  (Any other trimming suggestions are appreciated.)  But we will need to get money from somewhere to grow.

But all the investment has dried up; the angels have flown home, and the VCs have the “No” on their Vacancy signs lit.  The only place I should even waste any time looking are a few of the early–stage VCs and angel forums, and only then with incredibly low hopes.

ADAPT

Alright.  So, we need to secure users, traction, and reliable growth right at the start.  We need to see ad revenue, interest in private Troggs for companies, and discussion ownership – IOW, money.  But a lot of bloggers and analysts suggest that the trend of 2009 will be to defriend; to scale back your social network engagement and chose quality over quantity, to really prioritize who you want to get feeds from.  Uh-oh.  Will adding yet another social media site to the mix truly help?

ADAPT

Well first things first; we need to reassess our own views of Trogger.  It may mean drastic changes and redesigns, or it may just mean a tweak in our perceptions; I certainly hope for the latter.  The strongest trait a start-up has over its corporate competition is quick adaptability.  And if you don’t have that, you’re f-d.

I have begun encouraging my business partners to view Trogger not as another wad of gum stuck under the pubescent-teen-that-is-social-media’s desk, but as a pod on the bean sprout of information organization (which could wither and die, be eaten and passed, or fall and grow into another).

My own new perception is:  We have Wikipedia for user-generated “facts”; but where do you go when you want a collection of people’s opinions on a the Israel/Gaza conflict, on the growing trend for corporate iPhone Apps, on the economic situation, or the shut-down of Circuit City?  You go to CNN for one, a few blogs for another, a forum here and a message board there for the third and fourth.  We need a wikipedia for opinions, I say.  And that is what I, personally, want to see this become. (I write this without my biz partners’ agreements, yet, but I’ll be sure to include our summaries of our discussions about this idea here.)

The most important thing I foresee us learning through this process if the overwhelming power of adaptability.  A start-up that has an idea and sticks to it, determined to see it to its first envisioned and planned completion, is doomed.  You alone do not have the idea for the next Google or Microsoft or Facebook.  It comes from iterations, from user testing, from failure.  In my last post I discussed the two opposing traits founders must have (dreamer vs. pracical); here is another, darker trait that is important to keep balanced.  Christian sees and works for success.  I plan for and work against failure. This is our first social med…er…information start-up.  9 out of 10 folks, without even listening to the idea, will bet against our success.

So here we go.  A new year and a new vision for me, a new thought to keep me striving and studying for another day, and loving that a person can’t lay-off themselves.  🙂

Partners and Advisors

So as the three of us are working together, we are also discussing what skills we have and what we need; what players are missing from our table.  Perhaps some of the readers may know better than us, and can lend their two cents in the comments, but here is what we have come to learn so far re: the development of an early-stage team:

DETERMINE YOUR STRENGTHS
Well of course, the first thing is to assess what you are bringing to the table.  Are you an experienced entrepreneur?  A CEO or COO?  A front end designer/developer?  A back end programmer?  Or even just the person with the money? I have found that sone of the most important things to assess are:

• Are you a talker or a listener?
• Are you creative, with big ideas and tons of inspiration, or are you grounded and practical, tweaking what you are given?
• Are you a planner or a doer?
• Are you a developer?  If so, is it front end or back end?  Would you architect a whole site and database, or do small detailed projects?

Once you’ve figure these out, you need to…

FIND A BALANCED PARTNER
While there are start-ups founded by one person, you will almost always see the most successful to have pairs.  And usually the pairs are made up of one outgoing partner, and then a quieter supportive one: Larry Page and Sergey Brin, Steve Jobs and Wozniak, Larry Ellison and Bob Minor…the list goes on.  I, personally, feel that you simply need another person to bounce ideas off of, to help the thing that exists grow.  I think that, regardless of your other skills – whether they be finance, design, programming, business – there are two types of founders out there, and you better be damn sure you have both.

Big Ideas/Creative
On our team, I frequently consider Christian to be this individual.  He brainstorms ideas from nothing, just imagining something he would want and figuring out how best to do it.  He can envision it on a huge scale, how it changes people’s interactions, or redefines an industry, or draws hundreds of millions of users.  He can discover five solutions to problems that haven’t even been encountered yet, and throw out three more if those arn’t liked.  He would like nothing better than to be in a room with a bunch of intelligent and creative thinkers, dreaming up a project and how to build it.  People like this are necessary for a company to grow and prosper.  He keeps us motivated and inspired; he reminds us we are doing this, keeps us thinking and sharing and reaching for our goals.  Thankfully, he can also get into a project and think practically, too, which is important…

Small Ideas/Practical
I consider myself, and am frequently referred to, as the practical one of the group, the grounded partner.  Its hard for me to dream big when I know our user count will just pass 50 on launch.  I enjoy being given a big idea and refine it, recognizing its weaknesses and developing solutions, assessing time lines and priorities and keeping people focused and down to earth.  I’m always watching the numbers: the bank account and the days until its empty, the number of users and their satisfaction.  I’m working on the small projects: how do get more invites sent, better metric technology, more balanced gold economy.  I’ll politely listen to new ideas, find a place for them, and remind people of what our top priorities are now.  These people, ideally, tame the big thinker and help the company make its way toward a world changing endeavor.

DEVELOP THE TEAM
Now, you do need more than just two people, but you should keep a good balance between the two categories above.  Everyone on an early stage start-up should share pieces of both of those categories, I think, but the dynamic of your team should definitely favor the practical: you’ve had the idea, now you need to do it with a minimal amount of changes and bickering.  You will need a CEO, COO, CTO, and CFO type.  Practical skills for early-stage employees to have include knowledge of SEO, metrics, financial forms and strategies, small business development, PR experience and connections, a variety of programming languages specializing in the one you use, and of course social web experience.

FIND ADVISORS
Keep in mind that your advisers are generally not people who have a lot of time to give, so don’t rely on them to build your metrics gathering system or design your logo.  But they should be dedicated to seeing you reach success and happy to look over your products and examples, offer advice, and make introductions for you.  I first suggest you find someone who understands raising money and financing.  Someone who knows VCs and angels, how to approach them, what to have prepared, etc.  The second would be someone highly experienced in your field.  Working on a social network?  Get a high-up from Facebook, Myspace, Bebo, or Hi5.  Making some video sharing thing?  Look to people with YouTube, Rev3, Ustream, or Seesmic experience.  Have a huge tagging aspect?  Try Flickr, Delicious, or WordPress.  These people know the technology and how to access the market.  By this point, ask them who else they think you should have – if they are good advisers, they’ll know.  Usually, someone experienced in Biz Dev and someone well known in the world to evangelize your product are useful.
——————————————

But wait!, you say.  How can I hire and pay all these people without any funding?  When can I raise money? A good question, and one that depends entirely on your situation.

I ONLY HAVE AN IDEA
Tough cookies.  There was a time when you could take just an idea and some drawing to an angel and still get seed-level funding.  With the economy going how it is, those times are pretty far past.  I don’t want to say it is impossible, as I’m sure someone could come forward with an example of it happening recently, but its tough.  Its the real Black Swan.  Most early-stage investors at least want a team of founders, a prototype, and generally even some traction (even if its just showing that a few hundred of your FB friends have been using it in beta testing for a few weeks, and havent left.)   You can certainly try to raise money with just an idea, but it’ll be REALLY tough right now.

I HAVE FOUND PEOPLE WHO WILL WORK FOR FREE (for now)
Well lucky you; don’t go flaunting that fact too heavily, or someone else will try to recruit them.  In fact, make sure these people are incredibly tied to your idea, that they have a lot of faith in you and wouldn’t leave for somewhere else just because that place can pay them.  Think carefully about giving these people a founding status (and ammount of equity) or atleast a founding-employee.  So now, with your idea, a good developer or 2 (dont have more than 3 this early on, I suggest…too many cooks and all.), a person to focus on raising money somehow, and a person to work on user growth – start making a site.  Once you’ve got a prototype ready, ask for lunches with possible investors (see my post on these) and chat with them; peak their interest.  Then make a deck and elevator pitch(<-great advice) and start sending it around.  Definitely have images from your prototype in it.  You should be doing a lot of alpha testing (which I’ll discuss in a later post) while these early meeting are going on, so you have user testimonials and traction to show at the next meeting you hopefully get invited to.  From there on, its a lot of luck and negotiating.  (PS: While not necessary, having a good advisor that can intro you to the people and name drop from you is definitely helpful!)

I HAVE (an) ADVISER(s)
Then why are you asking me?  Go talk to them about funding and hiring.  Ask about how you may be able to attract people using small ammount of equity and promising back-pay.  See if they can help you with decks and elevator pitches and cap tables and the like.  Hopefully, if they are good, they can begin introducing you to VCs, angels, and other possible early-stage employees.

New Tech Presentation Advice

So this is a little different, but I was New Year cleaning out my macbook pro, and found this.  As I worked in the event industry, I saw quite a few presenters, all with varying degrees of skill.  Just knowing an area of interest is not enough.  In fact, I would much rather hear an experienced and skilled public speaker talk about something they know decently then a pro who is terrible in front of people.

But sometimes you are just asked to speak, and you want the press and the opportunity, but dont have much experience.  Well here are a few tips to keep in mind that should help you out, developed from seeing truly the whole range of abilities.

How To Present To A Web 2.0 Crowd:

Speaking in front of any large group of people is challenging.  Now, make your audience 300 – 700 entrepreneurs, founders, venture capitalists, C-level and VP-level execs, and other individuals, many of which think they know more about the topic than you (and, in fact, may); now you’ve got a real challenge.

After having watched dozens of presentations, we at Room Full of People are happy to offer a bit of advice.  You certainly do not need to take it.  The most important thing is that you be confident and comfortable; so do what feels best for you.  These are just to give you some guidance.

•    Know your audience.  Ask us for a breakdown of the current and predicted attendees.  Cater your presentation to them as best you can.

•    Do not read from your presentation slides.  In fact, your slides should have very few words on them; they should be primarily helpful images and key points to guide the talk and discussion.  People paid to hear you; they could read your work online for free.

•    Be concise.  Know what your time limit is, and plan to talk five minutes less than you are scheduled.  Practice so you don’t go on unnecessary tangents.  Don’t stutter or hesitate.

•    Think first.  When you get an audience question, pause a moment, think, then speak.  Do not feel pressured to answer immediately or say more than is necessary. (eg. if it is a “yes” or “no” question, answer “yes” or “no”, and clarify only if appropriate.)

•    Have a nice balance between presenting and taking questions.  Your presentation should include new, opinionated, divisive, and/or debatable points; do not be afraid of conflict, as it leads to great Q&A sessions.
o    If can read and control your audience, take questions throughout the whole presentation.  It keeps the audience engaged.
o    However, if you are more comfortable with a specific Q&A session, than do that, or the audience will take over.  We have found  that a 50/50 or 60/30 break down of the time works well.

•    DO NOT PITCH! You can mention your company and background, to add credibility to yourself, but do not talk about  your company.  Your presentation should be informative and relevant to an issue in the field, not a commercial.  If you are interesting, people will come up to you afterwords and ask about your company.  If you are a pitch, they will ignore you.
*****************************

Keep your eyes on our blog – I plan to write up one of these for small demos, and presentation demos as well.  🙂