I am experimenting with Liferea (Linux Feed Reader) as my RSS reader. Before, I used Bloglines. The change gave me an excuse to go back to my Bloglines clippings folder and look at some old posts I had saved. It is good to look back sometimes, so here are some of the better posts on business and entrepreneurship that caught my attention.

Entrepreneur advice to graduates (2004-03-01)

Ross Mayfield gives invaluable advice to people who are about to graduate from college and wants to be entrepreneurs, starting with change your major (to focus on critical thinking and communications). Some of his points:

• Start a business - just do it
• Take responsibility beyond your years - or rather: your qualifications
• Go abroad
• Experiment at the margin - absolutely right!
• Pay yourself - easier to forget than you might think...
• Work with good people
• Stick to ethics
• Start a weblog - he would say that on his blog, wouldn't he? But it is true

And a classic Ross Mayfield-ism: When I was a kid I bought a book, "how to make money with your Apple II+," written by some other kid. None of the business ideas made sense to me. Except publishing that book. Read the post and learn.

Types of startups

TJ points to an article over on Dispatches Weblog titled There is More Than One Kind of Startup. Unfortunately, the server sends the wrong character encoding and all the pictures are stretched, making them very hard to read, but stick with it, to read about:

• Marginal businesses
• Revolutionary ventures
• Corporate initiatives
• VC-backed startups
• promising startups

Going international (2004-05-23)

Andrew Anker wonders about the international thing: How quickly should a Silicon Valley start-up move from only focusing on the domestic U.S. market to thinking about a move abroad, and has the assessment of the best time changed recently?

Traditionally, international markets were not important. From all appearances, this is drastically changing. As start-up dollars cease to go into marketing they are increasingly moving to international expansion. [...] [T]he earlier stage web companies I'm speaking with are thinking of a global footprint as a must-have, not a nice-to-have. Or maybe more appropriately, not even thinking of the international thing as anything particularly special. The Internet has so lowered the barriers to info-trade that Europe and Asia are just a few more hops away.

Interview questions (2004-05-27)

Rajesh has 25 questions that are useful to consider for both interviewees and interviewers, and links to an article reprinted from January 1983 titled The 25 most difficult questions you'll be asked on a job interview that considers them in more detail.

Local versus central venture capital (2004-06-10)

The emergence of increasingly sophisticated local sources of "pre-seed," seed stage, and growth capital around the country is both necessary and encouraging. But, it strikes me that regional approaches aren't sufficient. The startup game is truly becoming global, and the paths to the world go through the established venture centers of Silicon Valley and Boston.

The Dispatches Weblog makes a strong argument for the conclusion that centralized venture capital will continue to dominate based on arguments around the cost of building a risk capital infrastructure and the increasing transparency in the industry making such an investment less and less relevant.

Pitch structure and contents (2004-06-23)

After seeing yet another Power Point presentation by a new business to the potential VC investor, Brad Feld decides to share with you the structure you should follow in some detail. Read the article for the detailed points; the top level questions you should answer are:

1. What is your vision?
2. What is your market opportunity and how bis is it?
3. Describe your product/service
4. Who is your customer?
5. What is your value proposition?
6. How are you selling?
7. How do you acquire customers?
8. Who is your management team?
9. What is your revenue model?
10. What stage of development are you at?
11. What are your plans for fund raising?
12. Who is your competition?
13. What partnerships do you have?
14. How do you fit with the prospective investor?
15. Assumptions and risks ["other"]

Measuring the performance of a software company (2004-07-31)

Jeff Nolan has an insigthful post on how to measure the performance of an enterprise software company. Metrics include:

• Customer satisfaction. Without a benchmark, Jeff suggests holding back 25% of the sales commission until the customer goes live. I would suggest that is a good policy even with benchmarks.
• DSO and Days Payable Outstanding (DPO).
• Revenue-per-employee
• Bugs
• Customer acquisition targets

VC and movie business compared (2004-09-22)

Venture capital business is similar to the Hollywood studios, and all the money is in sequels, according to Kevin Laws.

Running an efficient board meeting (2004-09-14)

Ed Sim has a useful post on how to run an efficient board meeting, including an outline of the standard agenda, with links to further discussions. If you are a company chairman, board member, or investor, read this post.

See also Brad Feld's post on ideal board meetings.

Private equity's new challenges (2004-09-18)

Dispatches Weblog has an interesting summary of a McKinsey article on the challenges facing the private equity industry, including:

• There is an excess supply of capital.
• Privileged access is less important.
• Financial-engineering skills are a commodity.
• Tough IPO market.
• Emergence of new types of competitors.

Some discussion about what to do follows, both from the article and from the author's personal perspective. Worth a quick read.

Opportunity creates opportunity (2004-09-28)

Bnoopy reminds us that opportunity breeds more opportunity. You should pursue opportunities when then present themselves (always take a cookie when they are passed): you never know where they may lead. Nothing new, but always a useful reminder.

Venture capital bloggers (2004-09-23)

Ross Mayfield has a now dated but still useful A-list of venture capital bloggers.

When should a start-up hire a Head of Sales? (2004-09-28)

Matt considers the question of when a start-up should hire its first dedicated sales people. The answer is that it depends, but Matt provides a useful structure.

Ten questions to ask a VC (2005-01-23)

Dispatches Weblog has an extremely insightful post on ten questions you should ask of any prospective VC, and why. Go read it if you are even thinking you might ever raise money.

1. How big is your fund?
2. How much is left in the fund after commitments and reserves for follow-ons are accounted for?
3. When do you intend to go out fundraising?
4. When you fundraise and tell the story of your three most successful investments, how will you describe how value was created for LPs?
5. Who is on your firm's investment committee?
6. What was your firm's advertised IRR when you raised your last fund?
7. May I get a copy of the "book" you sent around when you raised this fund?
8. What do you think the exit will be on this investment? Do you think it will be a financial buyer or a strategic buyer?
9. As you think about how to shape the company so that it is optimally positioned for that exit, what three things do you think need to be done in my company?
10. What was your firm's biggest disaster as an investor? How did the investment go sideways?

If you are not sure why these are important questions, go read the post immediately.

Working with partners (2005-04-14)

Ed Sim has an incredible important article for all entrepreneurs. I can remember how many times the CEO of a start-up company has told me excitedly about his partnership with IBM or some such organization. Read this article and its five rules

1. Don't rely on corporate; engage at the field level.
2. Focus, narrowly focus your opportunities.
3. Your partner's sales force needs to get comped.
4. Dedicate the proper amount of resources to make the partnership successful.
5. Don't get sucked into your partner's black hole.