Common sense analysis of this, that and the other

Tough skin 1010 (1996)

leave a comment »

Notes for my 1996 talk at SVASE

Note to those arriving here from Vision Aforethought – this page has not been formatted properly as I quickly imported it from Word. Am a busy guy.
Foundation 101
Vision Aforethought
Startup 101

The way it is going to be

For those of you about to start your own venture in the software business, a few pointers that should help you avoid some dissapointment:
a – CD-ROM is dead.
b – Selling software over the net is dead.
c – Giving software away over the net is alive. Charge for it later.
c – High bandwidth (satellite & cable) based information delivery is the future.
d – Do not invest your time or money in buggy-whip technology.

– The future of software distibution is already happening. And the net is the answer. Not because it is less expensive for the manufacturer (that’s you), but because CONSUMERS will (are!) demanding the convenience that they are used to after downloading their web browser, OS updates etc.
Timing is everything. Innovation is nothing. Wintel success through timing. Microsoft nearly blew it with their Internet strategy, or lack of.
-BAAESE: Microsoft: The answer is simple: Can Microsoft bring intergrated client/server solutions to its applications before Netscape bring applications to its client/server solutions. SUN: They are the new Apple. They have an opportunity to leverage their friendly identity and Java technology to create their own range of consumer appliances.
-BAAESE: Apple have 95% of their intended mkt.
-BAAESE: Create a killer ap for the web. That is, simplify current tasks. Such as Classifieds etc. Also, MARKET RESEARCH: We asked people what they thought of Pagemaker, and got little interest. Yet it was a hit. A game we previewed got great feedback, but we could not locate a publisher.

Tough Skin 1010

hardened advice for the budding 
digital entrepreneur

by alex blok – for SVASE
Q:2000 (Liberator) Thursday June 6, 1996


•    1. baby (gorilla) steps
•    2. diet & lifestyle
•    3. do not trust your grandma
•    4. ideas are your gold
•    5. development & staff
•    6. getting things done
•    7. marketing
•    8. public relations
•    9. money
•    10. resources

Forewarned is forearmed

1.    This short guide is designed to provide the type of information you are unlikely to receive from the majority of standard business books and college courses. For some reason, these all seem to assume you are already successful or wealthy and only provide guidelines on how to maintain that success, or reach the next level though venture capital and an IPO. I do not discount the value of this information, but it is completely worthless if you, the captain of the ship, are not pursuing your vision based on some basic ground rules – the majority of which are normally painfully learned as you go along. 
We only live once, and there is no reason why success cannot be achieved the first time around. Therefore, in a sometimes alternative manner, I have chosen to share the lessons learned from running my own business. I very much hope that my own experiences and suggestions will provide you with some armaments before you go into battle. 
I have divided the document into numbered sections that are mostly listed in the order that you will find them useful. 
a short bio
In 1982 I founded Tecnation in England – subsequently creating the products on channels 12, 13, 15, 18, 19, 20 & 24 of, I left for sunny California in 1991 to pursue a lifelong dream of creating and marketing a range of intelligent and innovative ‘network computing’ (‘NC’) devices and services – with the mission of simplifying, enhancing and empowering the lives of people world-wide. More recently, others have clicked that the NC is a good idea – all of a sudden giving my business plan a certain level of credibility. Thanks Larry! 
I have spent the last six years learning how America works and researching the technologies required to realize this vision. 
I believe our time has come. I hope yours has too.

1. Baby (gorilla) steps

1.    The following is a list that you should consider and act upon before quitting your day job: find a mentor or business partner (a ‘look out’)
This does not refer to the legal ‘partner’, but someone you have known a long time, and trust and respect for their particular skills. Attempting to start a business single handed is sometimes extremely lonely, and like a sailboat in a storm, you always need someone to grab the inhaul when the wind begins to blow. More importantly, your lookout will inevitably spot the rock just below the waves that you missed because your eyes were on the horizon. 
Do not even think of forming a legal partnership. A recipe for disaster. Ask anyone who has tried it. Chances are, the ‘partners’ are unlikely to speak highly of each other five years down the road. I avoided this route, and have sadly witnessed many other good friends end up breaking up. Loss of friendship through a business venture is probably as painful and financially damaging as divorce. 
make sure you have at least enough capital to cover 3 months of overheads…
…beyond the date when you expect to make your first significant profit. This will give you breathing space and reduce the chance of having to borrow money or take more extreme measures. At all costs, you do not want to give up a piece of your company prematurely during a period of major desperation. (I own 98% of Tecnation, and am only now starting to consider investors.) 
ignore and steer clear of jealous critics
One of the most soul destroying aspects of entrepreneurship is meeting a jealous critic. These people hide their personal insecurities behind remarks that although sometimes professionally delivered, are often based upon lack of self respect and the feeling of enhanced ego that negative criticism can instill. These people should be separated from those who sincerely desire to help you and see you succeed through constructive criticism. Constructive criticism means that comments will be followed by suggested alternatives. When Siskel and Ebert review a movie, they often, if not always, follow their remarks with “…I think the director should have been more creative with the camera angle…”, rather than a straight “The direction was appalling.” kind of remark. 
read biographies of successful and unsuccessful entrepreneurs
You will enjoy spotting their mistakes and learning from their smart moves, you will also learn that they ALL went through similar experiences to those you may have already experienced, or will experience down the line. 
You are not alone! 
”Henry Ford, The Wayward Capitalist” – A Biography by Carol Gelderman.
Dial Press. ISBN 0-8037-3436-0 (Not well written, but incredibly revealing.) 
”Odyssey” – By John Sculley
Fontana. ISBN 0-00-637284-8 
”Selling The Dream” – Guy Kawasaki
Harper Collins. ISBN 0-06-016632-0 
”Startup” – Jerry Kaplan – ESSENTIAL reading!
(Sorry, no publisher info at hand.) 
”Built to last”, Successful Habits of Visionary Companies
Harper Business. ISBN 0-88730-671-3 
”Beware the naked man who offers you his shirt” – Harvey Mackay
Morrow. ISBN 0-688-09229-2

2. Diet & lifestyle

1.    live like an animal
2.    If you wish to remain on top form for the maximum period of time possible and be prepared to handle a tough situation or meet an unexpected deadline, you may need to change your lifestyle. This is likely to entail throwing away some habits that you have taken for granted until now. The Live Like An Animal philosophy of life is my own, and not based on any teachings or medical knowledge. It is basic high school common sense, and if it was not for the corrupt nature of the word’s drug companies, the majority of us would be adhering to it anyway. (That’s another discussion!) 
So, open your mind and read on… 
the philosophy
Not very long ago (approximately four times the length of time that we have been using computers), humans ate a diet that consisted mainly of whole unprocessed foods, such as fruit, vegetables and uncooked meat. Although hygiene was not quite at the level it is today, the diet we consumed then was what our bodies have evolved over millions of years to expect. The complex carbohydrates in fruit and vegetables are digested slowly keeping our blood sugar in balance, and providing us just the right level of vitamins, minerals and energy to perform efficiently without the need for stimulants. 
Meat contributed to our essential periodic exercise. After all, it was not possible to jump in the car and hit Safeway for a juicy stake and a crate of beer. We had to chase our food, and that did our bodies good. It kept the cholesterol away, made us strong and resilient – and most importantly for us mechanics of the technology revolution, fed oxygen to the brain! 
So, back in the old days, (ignoring the plague and the lack of all you can eat Internet accounts), we were actually CAPABLE of performing better. Ever wondered why so few genuine literary masterpieces and inventions crop up anymore? Why there are no high-speed magneto levitating trains whisking us about the country? We are surrounded by processed foods that clog up our system – and distracted by the brain numbing alpha wave effects of television. 
so, what to do to be the Tom Cruise of entrepreneurs
(and stay that way for as long as possible)
1.    work days
2.    Start the day with a large breakfast full of carbohydrates and other low fat natural energy sources: Whole-grain cereal or porridge, brown toast, orange juice. ONLY DRINK COFFEE WHEN YOU HAVE A DEADLINE. If you become addicted, not only will you spend a fortune, get headaches and find it less effective when you REALLY need it, but over the long term too much coffee may damage the synapses in your neurons causing fatigue and memory loss. (I call it, ‘Palo Altan Syndrome’.) Drinking too much coffee is equivalent to putting kerosene in your car’s gas tank. It gives you a quick burst of speed, while stripping the guts out of the engine at the same time. 
For lunch, eat an apple. 
Only eat large meals after a major workout or other heart pounding exercise. Your body will be in a better position to absorb all the nutrients and burn off any excess calories. If you eat a lot during a work day, you will get sleepy 30 mins to 1 hour after eating and lose your ability to focus as the blood flows from the brain to the stomach. (Thinks: “Ah hah! That’s why I get sleepy each day at 2pm.”) 
none-work days
Exercise. Pig out. Sleep a lot. (In that order.) 
avoid fat
Other than the more well known side effects, did you know that in a significant test just conducted in Scandinavia, within 30 minutes of feeding a group of people just one portion of McDonald’s hash browns, their blood vessels showed signs of major constriction? The fat content not only puts a strain on the heart, but effects your ability to concentrate as the blood flow is reduced. 
The research actually implied that just ONE fatty meal could kill you – in particular if you already have a week heart. 
get a little sunshine in your life
30 minutes of sunshine each day is very good for you and your state of mind thanks to the various vitamins and chemicals that it generates*. Eat a lot of fruit and vegetables and you are less likely to get skin cancer. (It’s a Western thing.) 
*The world’s highest suicide rate is in Norway. It is often dark in Norway. 
do not work and watch TV at the same time
Not matter how much you believe otherwise (see the little devil on your left shoulder winking?), TV generates alpha waves that stun the brain reducing your concentration when working. TV is an excellent way to relax and be inspired. So, when you do watch it , keep a notepad on the table and make notes when ideas come to mind. Expand on the ideas later when the TV is off. 
the way it is
A lot of the above is not likely to be mainstream knowledge. A large proportion of the US economy relies upon the obvious but ignored fact that for the second half of our lives we spend a fortune on medical expenses trying to fix the damage we do during the first half. 
Service yourself now, else someone else will service you later!

3. Do not trust your grandma

1.    A discussion on confidentiality. Imagine the following quite plausible scenario:
It is the weekend and you are at a family get together. You know, one of those bi-decade events that only occurs when someone is born, gets married or dies… 
Fruit cake in one hand, tea cup in the other, Grandma asks you what you have been doing since graduation. The last time you met her, you were re-designing the tree house following an accident that had something to do with woodworm and a broken arm. 
Semi-sarcastically, whispering into her ear, you explain that your latest venture is secret and a bit complicated, but you are writing up a patent to use fractal mathematics to compress hi-fi quality music so that it can be sent down the Internet via Real-Audio(R)*. Your assumption is that this would be meaningless mumbo jumbo to someone born when owning a valve radio was hip. 
A week later during bridge with Marge and Harry, Marge asks what Grandma’s grandchildren are doing now they have grown up. Grandma being a little tipsy, and very proud that her son is one of the select few people trying to make money on the Internet, explains that elder Grandson is doing “something to do with factual music that will give really good audio – whatever that means”. 
Harry’s son George works at Morgan Stanley as an investment advisor, and knows Johnny Lin who just so happens to be VP of engineering at Network Compression, Inc. (NCi). A very fast moving startup with enough capital in reserve to patent a new idea overnight. And Harry owns 5% of Nci. 
Until 30 seconds ago, NCi had been focused entirely on using Fractals to compress large image files for the high-end graphic design industry. 
Not any more. 
*Real Audio is a genuine real cool technology for sending audio over the Internet. 
Such paranoia
Not at all. The majority of people do not prematurely pass on ideas with the intent of causing harm, or to exploit you. They do it because it is cool to know something that others do not know. And it feels good to pass on that snippet or rumor. There’s also the fact that someone may own stock in one of your competitors. 
So what to do?
Tell absolutely everybody absolutely nothing. 
When at a party or sitting on a bar stool, try not to discuss your profession else you may be tempted to let the cat out of the bag. Focus on politics, yesterday’s game or a hobby. 
What about confidentiality agreements? (NDAs)
These are worth using just so you can keep track of who you have disclosed your business plan to. However, they do not prevent someone discussing your idea, and if they do, how will you know? We only have people sign our NDAs when they have a direct interest in the company and they know that breaking the NDA will put their own position at risk. 
Basically, if there is a leak, it is likely to be your own fault. So, say ” “.

4. Ideas are your gold

1.    …and gold has long term value. Subtitle: Do not undervalue the worth of an idea. 
look around you, what do you see?
A door handle. A pen. The pull down windows on your software application. The light switch on the wall. The cigarette lighter in your car. The adjustable seats in your car. The hinge on your kitchen door. The plastic doohickey in the middle of the LARGE pizza box… 
All boring everyday items that you take for granted now. But at one time, revolutions. And some of these ideas made someone very rich, and at the same time may have created a whole new industry. Many of today’s companies including AT&T;, Microsoft, and Apple did not invent the technology that they now profit from. They got to the patent office first, licensed technology, and aggressively marketed their products – while the genuine inventors of the technology sit sulking somewhere. REMEMBER: A patentee* is not necessarily the inventor! *Is this a real word? 
Other than the obvious such as Xerox and their various laboratory innovations, here are two examples of well known products or trademarks that despite their widespread use, were never exploited by their inventors for financial gain: 
the Compact Cassette
Philips Consumer Electronics (one of the world’s largest consumer electronics companies) invented the Compact Cassette. Yet although they built the cassette mechanisms and insisted everyone put the Compact Cassette logo on compatible products, Philips NEVER asked for royalties on the individual cassettes. (Unlike today’s compact disc, which earn Sony and Philips a royalty.) 
If Philips had shown a little more faith in their idea and got their legal people to arrange a licensing agreement, they would have earned hundreds of millions of dollars from a technology that became a long term global standard. 
the Yellow Pages(tm) – NOT! 
A great name, but not a trademark! The Yellow Pages was conceived by a phone company (who’s name I do not have at hand at the time of writing), yet the name was never registered. So, today, there are many printed and on-line ‘Yellow Pages’ directories. If the originator of the name had registered it, they would have been able to use the name to their advantage in marketing. “The ORIGINAL Yellow Pages(R)”. 
our gold
Tecnation has two patents pending. One is for advanced ‘Dynamic Graphics from Audio’ technology – tradename: Bit Bopper(tm). The other is far too hot to hint at right now, but I may be able to present it to SVASE in advance of public launch. *1 
avoid the symptoms of parallel vision
If you have come up with something unique that you are absolutely convinced has market value, then take the following steps as soon as possible:
2.    Fill a note pad with drawings explaining your idea(s).
3.    Type up a clearly written description of your idea(s) with links to the drawings if need be.
4.    Print out hard copy of the typed information (if you used a computer).
5.    Create a code number for the invention. (Anything you like! Say: 0001)
6.    Make a note of the code number and the invention it refers to, along with a date. Put the note in a VERY safe place that you will not forget. Ideally, a fire safe.
7.    Make copies of the drawings and printouts.
8.    Obtain an envelope large enough to hold your documents. Clearly write the code number in a place on the envelope where it will not be covered up by stamps or post office markings.
9.    Put the copies of the printouts and the drawings into the envelope.
10.    Mail the envelope to your attorney and ask him to file it under your name and the codenumber. For example: Babbage / 0001.
11.    Relax. You just made sure you won’t be accused of plagiarism or copyright infringement*. Nothing of major intellectual property value here, but hey, don’t you feel good? (*Assuming you were first.)
12.    Now, if your invention includes some nice catchy trademarks, contact a trademark attorney or paralegal ( and ask them to do a SEARCH on the trademarks and then register them. If you reside in the San Francisco Bay Area, you can visit Sci3 (see RESOURCES) and conduct trademark and patent SEARCHES for no fee.
13.    Contact a reputable patent attorney and get him to protect your idea. If you are going to spend a lot of money on your business, spend it here – not on a car or cool office. IBM, Sony and Yamaha own lots of patents. IBM, Sony and Yamaha also make a lot of money and dominate their markets. No coincidence. REMEMBER: You do NOT have to build or create a product to patent it. You simply need to describe it in such a way that anyone reading the patent can create the invention themselves – given expertise in the field.
14.    Relax further. And pray that the person the other side of the country who also just invented bullet proof sunglasses didn’t get to the patent office first…

5. Development & staff

1.    It is during this phase of your venture that you are creating the material worth of your business. Without a product, you are at a higher risk of being ripped-off or losing confidence and possibly giving up. Passing your business plan or patent application to an unscrupulous ‘investor’ before you have a product could be damaging. After all, without a barrier to entry, all he or she has to do is to write out a series of checks to some contacts, and realize your baby without you. In addition, some of us are partially driven by ego (admit it!) and having something to justify one’s reason for existence is a major will booster. the importance of completion over focus
Probably the most important advice you will receive throughout your life is to “focus”. This term is in itself very unfocused and deserves further definition: 
People tend to believe that focusing on one particular product is key to that product’s success. This is absolutely untrue.
2.    Provided you are good at dividing up your time, delegating tasks and GETTING THINGS DONE, you can spread your personal time. I am currently working on three projects in parallel, and am ahead of all my deadlines thanks to a single to-do list and a balanced lifestyle. If one project fails (for whatever reason), I still have one or two others to rely upon for income. In addition, I can switch to another task if one day I am bored or unable to work on a particular project.
3.    If you are focused on a project that may in fact be doomed due to a yet unseen competitor or a paradigm shift, you have nowhere to go. Avoid being blinkered by your vision. Like a ship sailing the ocean, you can aim in the general direction of land ho, but keep an eye on the sea to avoid hitting an iceberg.
4.    Where focus IS important is when you delegate tasks. Do not discuss your other ventures with your staff or investors. Be project specific. Ensure your staff focus on your project only. If you think a college student can knock you up some code in their spare time, you are very wrong. There is a significant difference between intellect and time management. With mid-term tests or finals always around the corner, students are not to be relied upon. Wait until they graduate. (They will costs more, but you get what you pay for!)
5.    Another place where focus is important is in the marketing phase. Never launch more than one product at a time. Even if they are unrelated, you will cause confusion. SONY: Walkman / Compact Disc / Video 8 / Minidisc / DVD secure multiple revenue sources
As you will see from the attached graph based on Tecnation’s past, current and future product history, we have always ensured that once a product is in development or on the market – another product is developed and released to provide additional income over and beyond the previous venture. 
attracting the right people
As you know, your most important resource is your engineering team. I would like to share some critical suggestions that are based on my experiences. 
Product development is Tecnation’s most successful and proven asset, and I urge you to follow this strategy:
6.    Do not hire people to work for you part time who have other day jobs. They will lack focus and energy.
7.    Only choose people who share your enthusiasm for the project they are to be working on.
8.    Offer your engineer(s) a share in royalties and/or stock option – whichever is practical. (Unless they are happy with cash compensation.)
9.    Explain your policies at the start. For example, I only pay contractors on completion of specified deadlines. No one is paid up front. If they are late because they choose to take a short vacation during a critical phase, withhold income and make your feelings known. If they do it again, fire them and move on. If you do not show strength of character to your team, you will suffer the consequences. Control your anger. Release it only when the situation is appropriate. Notice how the fictional character John Luke Picard runs his ship. This is leadership at its best. A real-world character to follow is of course David Packard. The real secret here is to ensure your staff respect you, and appreciate that they are an important cog in the machinery of the business. Respect their opinion, and ask for it whenever you need to make a decision… do not label your crew
Everyone has something to contribute to the venture, and their ‘title’ should not be used as a measure of their worth in a particular field. Although it is rare that a marketing type person will be able to debug some C++ code, engineers and other staff often have important and relevant opinion in the direction of a product. After all, chances are they are potential customers – and therefore may perceive the product in a manner you had not even considered. I know many ex-engineers from companies such as Apple, 3DO and General Magic who have contributed much to an internal venture, only to have the project canceled by their employer. I am sure that if engineering had had more influence over marketing, that these projects would have made it to the marketplace. 
Since founding Tecnation, I have allowed my engineers to suggest and implement features into our products that they thought would be ‘cool’, or that they discovered in error – a ‘bug-come-feature’! All extra value for money for the customer!

6. Getting things done

1.    During the heavily funded phase of a business (money already in bank), or during a period when you don’t have the incentive to work hard, you may slacken. This is human nature and occurs because when we are faced with a deadline our adrenaline level rises, and subsequently, we are able to perform better. But without a deadline or other incentive, we can get complacent. The threat of humiliation due to an incomplete presentation to a client, or being beaten by the competition to a public announcement are major factors in an increase in adrenaline levels. 
opportunity knocks – once
If you are a procrastinator, book meetings BEFORE having your stuff ready. 
Be assured, if you respect the person you are to be meeting (and expect them to respect you), you WILL get it done. And remember, if something beyond your control happens and you are unable to complete your presentation in time for the meeting, you can always cancel as a last resort. However, canceling is not a good idea as it may put off the person you plan to meet. After all, they may be looking forward to your presentation as much as you are looking forward to giving it. Or, it may be your last chance. They may be considering your proposal against another, and you cannot afford to miss this once-in-a-lifetime opportunity. 
the importance of a to-do list
One of the reasons for getting stressed up when facing deadlines or (simply in running your business day to day) is because your brain is forced to sub-consciously deal with the various issues and tasks you have yet to achieve. The brain desires completion. 
The solution to this is a SINGLE to-do list. List everything you have to do, whether it be business or personal. Do not bother to sort it in ‘alphabetical’, ‘date’ or ‘project’ order. Each time you refer to the list, read through it and select a task that you feel best suited to completing during your current frame of mind. At 4pm after a day of work, you may not be able to write a detailed software specification, but you may have enough mental energy left to work on something less demanding, such as a block diagram – or why not drive over to a computer store to check out the competition’s products? Easy, but it IS another task done!

7. Marketing

1.    If you have a very good product in development, and something you know is going to be a killer application, then unless you have ambitions to take on Microsoft, take it to a 3rd party publisher. There is nothing a publisher likes better than to be handed a ready-made product. The cost to him of developing something like your brainchild would be considerably more than what they will ever pay you in advance royalties, so they will be keen to take it on if they like it. Later, when the royalties start flowing in, you can begin your strategy to de-throne King William II. reality check
Back in 1984 when my colleague Neil Lee and I produced the prototype of our Pagemaker™desktop publishing application for the British Broadcasting Corporation Computer*, I had already been looking through Beeb computer magazines for a suitable company to market Pagemaker. 
* Otherwise known as the BBC Micro or ‘Beeb’ as it was nicknamed 
I found an advertisement for a mouse for the Beeb from a company called Advanced Memory Systems (AMS). AMS used to sell memory expansion cards, hence their name. The ad was very nicely done and stood out from the rest of the ads in the magazine. I contacted AMS initially with the idea of having them market a graphic design application I had coded (‘Artsystematic™’) that would have been an ideal partner to their mouse. They said “no”, as they already had something . But when we got the prototype of Pagemaker up and running, and presented it to them, they jumped at it! 
Subsequently, AMS did a fantastic job of marketing what became known as AMX Pagemaker and has absolutely nothing to do with the Aldus/Adobe product. 
AMS’s advertising for AMX Pagemaker was excellent, as was their distribution and support that subsequently helped make both AMS and Pagemaker the number one desktop publishing company in England – if not the world – at that time. Later, we ported AMX Pagemaker to three other computers, and it received equally good marketing by AMS. And like the original Beeb Pagemaker, rave reviews from the press and users! 
there’s a positive lesson here
In 1985-1987, many other companies launched desktop publishing applications for the Beeb and other British personal computers. It is quite likely that if we had not approached AMS that although we may have been able to get some publicity and hype, we would have never been able to get to market first, and therefore get a head start on our competitors. We would have probably spent a good year trying to launch the product ourselves and come in a poor second or last – despite inventing the concept and the product. 
AMS had ready cash, and a proven marketing record. And we benefited from this kind of situation with many of our subsequent products. 
Later, AMS were purchased by Logitech – who just so happened to make the mice that AMS had been selling with our software. 
a cool demo is worth a thousand words & a big spreadsheet
Turning your idea(s) into a tactile reality is the most important part of your startup phase. Business plans and market research will occupy vast amounts of your time, yet be of no value without a product. (Some may argue that the reverse is true.) If you intend to market your product yourself or seek major investment, a business plan is of course essential. At the very least, it provides a detailed to-do list for you and your staff, and proves that you know what you are all doing. 
If you wish to license your product to a 3rd party, the business plan can take second place. Why? Because you are going to approach a company with a visionary leader. If he or she is as perceptive and intelligent as you are, they will need no backup material to see the value of your product – other than the cool demo of course! 
Although Tecnation has a business plan for the company as a whole, until our current (and very ambitious) ‘DAX’ project, we have NEVER written a business plan for any particular product. 
Sony did not develop a business plan for Walkman. Akio Morita (former visionary Chairman) KNEW the Walkman was a great idea! He designed it well, made it cool and sold lots of them. Period. 
See for pictures of AMX Pagemaker, and one of AMS’s excellent advertisements.

8. Public Relations

1.    any news is good news
2.    Newspapers, journals, magazines and on-line news services are all desperate for a story. Exploit that fact. But do bare in mind that your press release will be arriving at Very Big Technical Publishers, Inc. along with a few other press releases from people all demanding the limelight. So always PHONE first. When you are developing your product keep it quiet, and as long as you have any intellectual property protected, stick to giving private demonstrations at user groups – such as SVASE. 
Once you have a marketing partner and your product is going to be ready for sale when the world learns of it (like Microsoft – NOT!), your utmost priority is to send out an eye catching press release. Make sure any imagery you include with your press release is compelling, like a nice photo of the screen or product packaging. 
With the advent of the Internet, you can spread the work of your product via the various Internet news services (such as C|NET). Often, the name of the news editor will appear alongside major stories with his or her e-mail address. In addition, you can announce your product in newsgroups, as long as the newsgroups allow such postings. The best way to find out if a newsgroup allows obvious commercial plugs is to look at whatever is already there. If you see a PR posting from a business, and it is followed by a string of ‘flames’ castigating the source, you know to stay away! (Or ask the person who runs the group.) 
READ the news, BE the news
It is of course vital that you keep up to date in trends and technology, in particular in areas related to your business. Do not be shy of reading about the competition or potential competition. It does hurt, but will provide you an excellent opportunity to prepare your product to not just equal what they have, but to be better. Very few products are actually available when you first read about them so you may be able to play catch up – after all, you are a fast moving startup with no red tape and corporate ego o politics to deal with. (Later!) 
Try not to spend too much time reading papers and surfing the web. Set aside an hour EVERY day at approximately 2pm to read the news. By then, most press releases posted on both the East and West coasts will have made the net and the afternoon papers. 
excellent ‘reality check’ news sources
(that is, if it is here, it exists outside silicon valley…)
◦    online
◦ print
Wall Street Journal – MARKETPLACE
New York Times – BUSINESS
BusinessWeek Magazine
The Economist – If it is here, then it has major potential.

9. Money

1.    is useful indeed. Obtain it wisely… OPTION A
for the aspiring and arrogant who wish to drive all the way
If you are hell ambitious and driven, you will never desire venture capital. And no matter how desperate you are, you will never receive it. Breaking up your baby and letting suits take it over will cause you great discomfort, and any investor is going to see right through you – no matter how great your business plan or product. 
My advice here is to seek small scale loans against your assets – such as a car or house. Giving up even small amounts of equity in your company at this stage is crazy and you will regret it later. The exception is if your investor(s) can contribute a significant sum of money combined with some skills useful to your company over the long term.
2.    Create a prototype or working version of your product or service.
3.    Complete a 4 or 5 page business plan executive summary to show your investor how you calculated the amount you require. Get him to sign an NDA first!
4.    Demonstrate your product to small scale angel investor(s).
5.    Borrow money against your assets in the form of a loan.
6.    Form relationships with companies who could use your technology and form Joint Ventures (JVs), but do not allow JV partners to control you. OPTION B
for the humble and flexible who are happy
to make a quick million & then be ejected
7.    Create a prototype or working version of your product or service.
8.    Complete a first rate business plan.
9.    Put a very good team of people together.
10.    Approach first round investors.
11.    Make a noise in the marketplace.
12.    Attract second round investors.
13.    Go public.
14.    Work with investors to make yourself look good to potential predators.
15.    Get bought out.
16.    Be ejected in a management shakeup. Retire young and wealthy. Of course, all this is talk. You will really need to show absolute commitment to get bought out. If you have a good team, then it is more likely to happen. 
I have yet to complete the experience of looking for or obtaining major investment in Tecnation, so alas I cannot provide much advice here. May be in a few years? 
UPDATE: March 8, 1997 – We are now actively engaged in the search for seed funding or venture capital for a significant Internet service that we shall present to SVASE in the not too distant future. Fortunately, if we are unable to secure investment, our recent upturn in business means we shall be able to self-fund the launch of the service. As it stands today, we have been rejected by two investors, one of whom said “come back when you’re established”, which is a positive response, as it meant there was some interest in our business plan. I personally set a limit of approaching 20 investors. If after 20, we still have none, we’ll try our plan B, which is confidential. Two other investors are currently evaluating our business plan. 
Investment resources
There are plenty of books on the subject of raising capital. I would also recommend asking a few people with similar businesses to yours how they got their funding. Three of my friends have raised 3 – 4 million each since 1992. (Books That Work, Minerva Systems, Zip2. – Actually, Zip2 just received another $12million! There is hope!)

10. Resources

•    Here are the details of some business and organizations that offer useful services and products that will be invaluable during the startup phase of your venture: intellectual property
◦    Dan Ledford Paralegal Services
1.    Basic trademark and patent searching and registering. sci3 (patent and trademark searches, seminars etc)
465 South Mathilda Avenue
Suite 300
Sunnyvale, CA 94086
Tel: (408) 730-7289
Fax: (408) 735-8762

1.    pagers
1.    EconoPage – Phone 1 800 760-PAGE Econopage have an excellent business model! Check out their stores. 
They offer a once year package that includes everything (yes, the pager too!) for approx. $150. Get one to go with your cellular. Then you only need call those you wish to spend a dollar a minute talking to. (Investors, wife, investors, wife…)

1.    po box
1.    A PO Box is very useful. A great way to filter our junk mail and maintain a level of secrecy if you are developing something big. We only give out our PO Box address, and it means we avoid solicitors and other cold callers that can waste time if you are just starting up. Another benefit is that you do not need to have mail redirected each time you move.
◦    You can choose a low cost Post Office box, or use Mailboxes Etc, which although a lot more expensive, offer the following advantages over the Post Office:
◦    24 hour access (even holidays – they give you a key for the front door.)
◦    Ability to receive packages of ANY size. (They hold them for you.)
◦    Various services such as UPS (expensive! They add a surcharge!)
◦    24 hour copy machine.
◦    In store shop with packing materials and packing service. Mailboxes Etc.
555 Bryant Street
Palo Alto, CA 94301
Tel: (415) 326-5555
Fax: (415) 326-1475 
Mailboxes Etc. are soon to be starting a ‘SoHo’ (small office, home office) service. Like the AAA does for car owners, this service will provide various services relevant to the small or home business, such as discount telephone rates, insurance, rental cars etc. And even Internet services soon!

1.    office services
1.    Kinko’s – Kinkos saved my life. And they could save yours too. If you do not require or cannot afford a fully equipped office, or only occasionally need access to powerful desktop computers and copy machines, you need to check out a Kinko’s store. There are over 700 of them all over the US (soon beyond), so if you’re stuck in LA and need hard copy of a proposal or presentation, you can simply walk in with your laptop, plug in and print – in color or black and white. And then there’s Kinko’s vast range of copy and binding services too. You can surf the net using modems connected to the computers. America On-line, CompuServe and dialup Netscape access is available at the Palo Alto store, and possibly elsewhere too. 
The nicest touch is the phone that Kinko’s supply that you can use to make FREE local calls! Great for checking your voicemail or changing an appointment while you’re working at the store. 
Kinko’s also offer an interest free charge card that allows you to spread your cashflow.

1.    SCORE (Service Corps of Retired Executives Association)
1.    96 North 3rd Street, Suite 260
2.    San Jose
3.    Tel: (408) 288 8479
◦    As the name suggests, SCORE is a none-profit made up of retired and very experienced executives. They can provide proven business advice and useful contacts.

1.    401(K) Plan
1.    401(K) Ventures – You’ll know you have made it when you need these guys!

1.    tecnation
◦    Industrial design for the digital world. Constructive product and service critique. Software design. Perceptive predictions about the future. Stock advice. (Nice plug Alex. Ed.)


1.    I very much hope the information provided here is of genuine help to you in your venture – and assists in a smooth and successful realization of your aspirations. Remember: Protect & complete your gold. The money will then flow. 
”May the force
2.    be YOU!” 

Alex’s 15 aces for success & no excuses
3.    Define your vision & mission in <= 25 words. Write it down.
4.    Read the biographies of some business leaders & companies.
5.    Find a mentor / partner who can act as devil’s advocate and friend.
6.    Protect your ideas NOW. They are gold. (And your mind will rest.)
7.    Tell everyone nothing. Trust no one. Drunk? Discuss politics or sport.
8.    Calculate your estimated startup costs. Then double them.
9.    Finish what you start, even if you become disillusioned.
10.    Maintain credibility. Never show your Achilles Heal.
11.    Find a 3rd party company you respect and who needs your product.
12.    Pay your staff well. Profit share.
13.    Earn respect. Show respect.
14.    Hire others to do tasks that are not your primary skill or focus.
15.    Maintain a single ‘to do’ list. Keep it with you at all times.
16.    Live like a (wild) animal. And don’t forget to party like one too!
17.    Aim to retire fulfilled and with no anger in your heart. 
Q:2000 (Liberator)



Written by Oflife

May 25, 2009 at 11:53 pm

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: