How Web 2.0 is changing the way we work: An interview with MIT's Andrew McAfee - Courtesy of McKinsey Quarterly.
http://www.mckinseyquarterly.com/How_Web_2_0_is_changing_the_way_we_work_An_interview_with_MITs_Andrew_McAfee_2468
Thursday, November 26, 2009
Tuesday, November 24, 2009
Monday, November 16, 2009
Some things to look for when seeking venture capital
Venture capital firms are not just a source of finance for the lucky few who manage to pitch their idea better than the thousands of other innovators competing for scarce resources.
A venture capital firm looks beyond the idea and is often more concerned with the team who will deliver the business growth.
In the same way, when seeking an investment by a venture capital firm, don't just spend your time marching up and down Sand Hill Road, rattling the tin for contributions hoping for the quickest offer of a term sheet. Instead, you need to view the process as a courtship. In the same way that a job interview is really an "inter-view" - an opportunity for a company to size you up, but also an opportunity for you to gain direct insight into the team you may be working with - you need to work out if you can work with this team.
Bear in mind that for the VC money they will have active board involvement to ensure that they maximize the return to their investment and minimize the risk that the entrepreneur is going to make mistakes. And they have most likely seen all those mistakes before.
Remember that this relationship will likely last several years and for the success of the business, it has to last. But there will be an end - because the VC must be focussed on 'the exit'. VCs are always looking at how they will recoup their investment and pay back their Limited Partners with profit
A venture capital firm looks beyond the idea and is often more concerned with the team who will deliver the business growth.
In the same way, when seeking an investment by a venture capital firm, don't just spend your time marching up and down Sand Hill Road, rattling the tin for contributions hoping for the quickest offer of a term sheet. Instead, you need to view the process as a courtship. In the same way that a job interview is really an "inter-view" - an opportunity for a company to size you up, but also an opportunity for you to gain direct insight into the team you may be working with - you need to work out if you can work with this team.
- Will the VC team be able to help marshal all of the non-financial resources you will need to scale up your business?
- Will they be an active or passive board member?
- Can they help you find the right staff and do they have the connections to help you get the product or service to market quickly and efficiently?
- Will they be a useful sounding board and source of ideas for when the going gets really tough?
Bear in mind that for the VC money they will have active board involvement to ensure that they maximize the return to their investment and minimize the risk that the entrepreneur is going to make mistakes. And they have most likely seen all those mistakes before.
Remember that this relationship will likely last several years and for the success of the business, it has to last. But there will be an end - because the VC must be focussed on 'the exit'. VCs are always looking at how they will recoup their investment and pay back their Limited Partners with profit
So when preparing your pitch remember that the VC is not just a source of finance to help an innovator on the path to mega wealth, you have to make the relationship work.
Tuesday, November 10, 2009
Unleashing the Collective Genius of Employees
Unleashing the Collective Genius of Employees is the name of a webcast from Stanford University which I watched recently. It describes an excellent idea for capturing and encouraging innovation in the workplace. If you're interested in watching the whole seminar it takes less than 1 hour and can be found here. http://tinyurl.com/ylnf3fm
In summary, it describes a kind of 'stock market' for ideas in which participants (the employees) are given notional capital to invest in the ideas generated from within the company. The idea is that rather than have good ideas lost in the 'ideas basket' because of a lack of time or resources or because the promotor of the idea can't navigate the politics, there is a mechanism to have ideas investigated and championed (or quashed) based on an internal market mechanism.
In summary, it describes a kind of 'stock market' for ideas in which participants (the employees) are given notional capital to invest in the ideas generated from within the company. The idea is that rather than have good ideas lost in the 'ideas basket' because of a lack of time or resources or because the promotor of the idea can't navigate the politics, there is a mechanism to have ideas investigated and championed (or quashed) based on an internal market mechanism.
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