I recently decided that although investing in start-ups and lecturing on “pitching to investors” is really freaking cool – it’s time to jump back into the game. Being an Angel Investor is kinda like being a lifeguard at the pool, you’re always around the pool, but you never really get to jump in and just have fun swimming.

Me and my co-founder, Rick, just launched MissionKonnect.com. We are re-purposing some really robust automated marketing software for non-profits, charities and mission groups. Our relationship management solutions create lasting, powerful relationships with volunteers and donors. Our software delivers insight into prospect and volunteer engagement, automates marketing campaigns and graphically shows the progress of every individual’s and organization’s relationship within the  nonprofit organization – it’s pretty much a “marketing as a service” company at the moment, but ultimately we’ll build the company around the technology.

The cool thing is that we are only in our “beta phase” and just started testing our assumptions, and we already have additional clients that want to implement our technology and services right away. I’m sure we’ll gain more knowledge as we move through the process with our beta customer, but it’s nice to know that we’re already building a pipeline of potential clients. I guarantee, we will have several paying customers before we even finish testing our beta (I guess, I had better get that checking account set up). I plan to share my experiences and lessons learned right here on my blog.

Lesson #1 Tell others what your doing -use your personal network:

Words are powerful and change your reality.  I’ve known for several months that I wanted to jump back into the start-up scene – I knew the problem that I wanted to solve, the process it would take to get there, but was missing a clear vision for the SOLUTION.  So, I made up a list of things that “I knew for sure” about the problem and space we wanted to go after, and without a clear vision, I just started sharing my story with people, and one conversation led to another and one meeting led to another meeting and finally one introduction led to another introduction.

I was amazed at how many people in my network said, “I’m not sure I can help, but you should talk to this person and just gave me an email introduction”. I started taking lots of meetings and gathering all the information I could. Plus, it gave me a chance to keep dialing in my pitch and talking through different possible solutions.

Lesson #2 Find a co-founder with the same level of passion for solving the problem:

I was fortunate that one of those early conversations led to an email introduction that later led to me finding a co-founder that was just as passionate about the problem as I was. I had completed my list, formulated some new ideas and even completed the first version of  my Business Model Canvas, when I was introduced to Rick. Rick and I hit it off right away and I knew after the first meeting that I had found my co-founder for this new mission. Being an investor, I know how important the “team” is to the overall success of the company, and I know if the team is passionate about the problem – we’ll eventually discover the right solution.

The post Time to Go Swimming appeared first on Venture Capital, Start-ups & Dentistry.

The post Early Stage VC Decision Making appeared first on Venture Capital, Start-ups & Dentistry.

http://techcrunch.com/2013/01/13/participating-in-hackathons-is-the-best-way-to-become-pitch-perfect-for-vcs/

The post Participating Helps appeared first on Venture Capital, Start-ups & Dentistry.

Over the last few months I’ve been involved with several discussions with entrepreneurs about “pricing” their product or service and one of the big takeaways have been not to price your product or service too low.

First, setting a pricing structure isn’t easy and takes multiple obvious things into account, but don’t forget to think about your customer and “how they buy” your product or service when setting your price.

It’s really different if you are selling to the end user or a businesses because the “value” of your product and “available funds” are very different for every buyer. If your customer is a business or team with a larger budget, they’ll easily pay more for something they think will help them. After all, if they are using a company credit card there isn’t much difference between $99 or $299 (to them anyway), but as the seller you just made three times as much on the sale.

Now, if your ideal customers are typically a Mom with 2.4 children, then a $99 price vs. a $299 price is probably a very big deal.

The post Price Matters appeared first on Venture Capital, Start-ups & Dentistry.

Steve Blank said, “No business plan survives first contact with customers.” That’s because your assumptions will never be 100% accurate and you need to get out and talk with your customers – early and often.

What’s the point?

• To uncover how “users” think and behave with your poduct
• To discover patterns in their behavior
• To validate or invalidate your assumptions about how users are using your product
• To provide your team direction and data instead of opinion or speculation

Here’s 5 tips on how to do customer development interviews.

1. One person at a time – Groups can be distracting and people within the group can change and influence others ideas and opinions. Avoid them and speak one-on-one with your customers.

2. Know what you want to learn – Decide on certain aspects of your product that you want to learn about  and stay focused on only those aspects.  You can not learn anything if every conversation takes off on a different tangent with each customer. I recommend trying to only learn about 3 specific areas at one time during your customer interviews.

3. Get excited to hear things you don’t want to hear – You will usually condition yourself to only hear what you want to hear and this is a bad idea. Remember, the goal is to learn some things about your customers and their experiences with your product that you don’t know. Sometimes it is not always positive and that’s OK, because you need to know about it before you can fix it.

4. Ask open ended questions – Customer Interviews aren’t multiple choice surveys. Minimize questions like “do you like this or that.” Instead ask questions like “what do you like about this or that – how does it help you accomplish what you need to get done?”

5. Listen more, talk less – God gave you two ears for a reason – use them. Don’t rush to fill the “space” when there is a pause in the conversation, let your customer do that and hopefully they will provide you with more information. Take notes and details about the conversation as quickly as possible so you don’t miss or forget anything.

Remember, you are learning, not selling. Get out and find out what your customers think!

The post Customer Interviews = Customer Development appeared first on Venture Capital, Start-ups & Dentistry.

Making mistakes is easy –we’ve all done it.  But for young entrepreneurs - the mistakes made early in your start-up will have a drastic effect on the future of your start-up. The choices you make now will determine your future success and the profitability of your company. Avoiding these four simple mistakes will assure you greater success and a chance at profitability.

1. Lack of True Vision

Many people go into business without a vision, but it winds up costing them lots of wasted time and money in the long run. Start your company from day one with a vision. Your vision should be the “ideal end result” –the company of your future. Where do you want your company to be in three to five years?  How many hours are you willing to put in?  What kind of culture do you want to have?  What must you accomplish to get there?  A clear vision of your future gives you greater direction, and with greater direction you’ll reach your destination much faster.

2. Failing to Understand the Business Side of a Start-up

As a young entrepreneur, you must educate yourself and learn to operate your company like a business from day one. Gain an understanding of things like cash flow, overhead, personnel management, ROI,  marketing and customer service. If you really want to be successful, you should dedicate time for working on your company, not just working in your company. Set aside time every week to work on your business, making it a real business.

3. Focusing on the Product, not Relationships

It’s not all about your product, it’s mostly about relationships. Young entrepreneurs are sometimes so focused on building their product that they forget about forming a true, trusting relationship with every employee, customer and investor. Your company will be more successful if you focus on your relationships as much as you focus on the product.

4. Failing to Set Goals and Monitoring the Results

Goals and Milestones represent the incremental steps to the company of your dreams. Goals give you direction and a target to aim for. Setting and achieving both personal and professional goals is one of the best ways to measure the progress of your life and your company. Include your team in your goal setting and share the rewards and wins with them when you reach a milestone. Always monitor your results because numbers don’t lie.

Avoiding these common mistakes and pitfalls will not only make you a better leader, but will also help your start-up become the successful company it can be.

The post 4 Early Mistakes You Must Avoid When Starting a Company appeared first on Venture Capital, Start-ups & Dentistry.

As a venture capitalist and angel investor I see lots of financial models for various startups at different stages in the process. Most entrepreneurs are really excited to share with you their vision of a young company and explain the problems in the World they have set out to solve, but when you start asking about their financial models and projections the whole conversation changes and the energy is sucked right out of the room.

Financial Models Are Mostly Wrong

I’ll be the first to admit, most financial models are useless for a startup and as an investor I know many, if not all, are going to be wrong anyway. Why will they be wrong? Because financial models are really only fancy mathematical equations with various inputs and one or two wrong assumptions on the input side screws up all the numbers on the output side of the equation.

Financial Models Do Serve A Purpose

Then why do we still like to see financial models? Because the real value of doing financial models lies in the PROCESS, not the actual models themselves. As Investors we want to know that entrepreneurs have thought through the process and have a basic understanding of what it’s going to take to build the product, acquire customers, operate the business and at what point the company will breakeven. It doesn’t matter how cool your product is, if you can’t find enough customers and can’t generate revenue you’re probably going to fail. At some point it has to be about the financial models.

Make It Easy On Yourself

Don’t try to overdo your projections, use basic assumptions and build a “minimal viable product” or “minimal viable financial model” that can be easily adapted and changed as your knowledge increases about the inputs and expenses involved with running a company. Do you need five year projections from day one? Heck no, but you do need to have an idea of how much money you have to work with, what it’s going to cost to operate your business on a monthly basis and how many customers you will eventually need to offset those cost to reach breakeven.

The post Financial Models Do Suck, But We All Still Need Them appeared first on Venture Capital, Start-ups & Dentistry.

I once heard this story about a traveler who was moving his family to a different town and passed a farmer coming from the opposite direction he was going.

“What kind of people live in that town?” asked the traveler.

The farmer answered with a question, “What kind of people lived in the town you came from?”

The traveler responded that they were obnoxious, self-centered and selfish and that was the main reason he was leaving.

The farmer said, “The people in this town act the same way.”

A few miles later down the road another traveler bumps into the same farmer, and asked a similar question about the people in the town. The farmer responded the same way by asking about the travelers experience in the previous town.

The traveler said, “Oh, they were very polite, friendly and accommodating.”

The farmer said, “So are the people from this town.”

Like the traveler, it’s our attitude towards life that determines life’s attitude towards us.  A person’s attitudes and expectations tell the world what they want out of life, and people often get what they want or are expecting. Your attitude shapes your beliefs, your beliefs govern your actions, and your actions determine your results. When you offer a sincere smile to a stranger, it’s almost impossible for him or her not to smile back at you. When you’re in the mood to start an argument, it’s relatively easy. Say a few negative things and you’ll probably get a negative response from the other person.

People usually reflect back to themselves their own reality. This is why it’s important as the leader of your company to always maintain a positive attitude. It’s your attitude towards life, your team, and your customers that will determine their attitude towards you. Remember, your attitude is like a reflection – a reflection in the mirror.

The post Attitude = Reflection appeared first on Venture Capital, Start-ups & Dentistry.

The post My Favorite Facebook Quote/Cartoon appeared first on Venture Capital, Start-ups & Dentistry.

Keep it Simple Stupid. I can’t remember how long ago it was that I first heard this acronym, but it’s something I believe should be at the core of any business model or Investor Pitch. In the early years of the web – people tolerated flash intros, lots of different fonts and cheesy cartoons and even dealt with clunky websites and software products that were difficult to navigate, but that has all changed – people want simple, easy-to-use functionality and looks.

A cluttered website like a bunch of text in a pitch deck is distracting and confusing for both users and investors. If your product isn’t the simplest one then someone is going to build something similar, make it easier to use and steal a few (possibly many) of your customers.

Google Search seems to have started the trend and Apple has definitely raised the bar for everyone. It’s time to focus your start-up on simplicity.

So what can you do to make your product or application simplier?

1. Say no to extra features. Everyone wants to add additional things to their product and some customers will even ask for special features. Build special features for certain clients and charge them for it, but don’t include every request in your product.  Kill those features that only 10% of your customers use or at least inform those customers where the new buttons will be located and hide them on a second or third page or on a little button in the comer.

2. Look at it from the customers’ viewpoint. What happens when a customer starts your product or lands on your webpage? What’s preventing them from having the best possible experience with your product? How much of the text is really necessarily needed to get the point across? Help make it easy for you customers. Give them an Easy Button. Reduce Clicks. Eliminate Messages. Avoid Alerts that are not that important.

3. Specialize. Focus on what you do the best and outsource the rest. If you’ve got the back end covered, hire out the front end design. Spend your time on doing what you do and not “playing” in other areas.

4. Post a sign on your desk that says K.I.S.S. Constantly ask yourself how this can be done simpler? Review your technology and your application frequently. Talk to your customers.

Don’t forget simplicity moves fast. Innovation means it won’t be long until someone else comes up with a simpler way. Companies that win in the long term will be the ones that tackle bigger problems with even more simple solutions.

The post K.I.S.S. appeared first on Venture Capital, Start-ups & Dentistry.