Startup Conversations

Venture Capital and Mutation Theory

Many entrepreneurs that I talk to struggle with understanding how and why venture capitalists make the decisions they make, either in not funding their business or funding a different business.  It helps to understand the top-down dynamics that go on in the VC world, as illustrated by the following anecdote.  I heard this second-hand, so if anyone with first-hand knowledge (I know I have some readers from Adams Street) wants to chime in, I'm all ears.

Adams Street Partners is the oldest and arguably the best fund-of-funds in the private equity sector.  They invest in private equity partnerships in total, of which venture capital is a subset, but they are best known as a venture capital fund-of-funds firm.  They invest over $1 billion per year in new private equity partnerships, and have been doing it for over 20 years.  They have generated an annualized 20% return on capital (IRR) back to their investors over that 20-year period.  They invest in a lot of VC firms, who in turn invest in a lot of underlying portfolio companies.  Multiple thousands of underlying portfolio companies.  Over that period of time and that amount of capital, one would think the 20% return was generated by a very diverse mix of successful underlying portfolio company exits.  Not so fast.  The story told by Bon French (CEO of Adams Street) is that a full 5-points of the 20-points of return over that 20-year period is attributable to a single company exit within a single VC firm portfolio (Benchmark Capital's investment in eBay).

Why is this story important for entrepreneurs seeking to raise VC money?  Because VCs know they have to fund the monster hits in order to generate the type of return necessary for the VC asset class to continue to be attractive to the limited partner investors.  They need to find and fund the "mutant" companies: those with the DNA that creates the potential for them to grow beyond any rational expectation.  Hence, venture capitalists have to believe in "mutation theory" as the reason that the asset class is attractive to limited partner investors, like Adams Street.

I have no data to support this claim, so you've been forewarned about its potential accuracy, but my belief is that if one were to remove the top performing 1% of portfolio company exits out of the VC asset class return calculations, VC would under-perform the S&P 500.  It's that top 1% of exits that drive the whole reason for existence of venture capital as an institutional-grade investment asset class.

Entrepreneurs need to understand this so they can understand how and why VC's make the decisions they do.

Liquidation Preference and Participation Commentary

A few months ago, Dick Costolo (a.k.a. Ask The Wizard) wrote a great post on Liquidation Preference and Participation in a venture financing round.

Since Dick and I are "brothers from different mothers" (i.e. both Chicago-based tech entrepreneurs with blogs on startup issues, who post too infrequently but make up for it with posts that are far too long!), we started an email dialog on this topic.  I should re-write / re-organize the content of the email, but since the end of summer is here and I'm too lazy to do it, I'm just going to post it as is.

I have also done an open source spread sheet (see below) to help fellow entrepreneurs model out the effects of different preference and participation terms in a venture financing.  If anyone is going through that phase and don't *really* understand the ultimate effect of those terms, its worth going through. You can change different amounts of dilution, change from a preferred security to a participating preferred security, put in different preference multiples and institute different levels of caps on participating preferred securities, and then change the exit price range.  Changing these variables rolls through the whole model and shows what cash returns go to management and what goes to investors, and compares it to what each would get at those exit levels in a plain vanilla preferred stock financing.  Please feel free to take it and post it elsewhere so more people have access to it.

Download Cap_table_decision_support_tool_v1.0b_(open_source)

(the v1.0b is the corrected version of spreadsheet; do not use v1.0 or v1.0a as they both contain errors!)

You can read Dick's post first, and then read my email reply below to him.

Dick:

Just read your post. Very good info. Some of my thoughts on the topic are below:

1. Preferred stock is debt OR equity
2. Participating preferred stock is debt AND equity. The word "preferred" represents the debt and the word "participating" represents the "AND equity" (simple, everybody gets it when explained that way)
3. A lot of VCs use participating pfd because that is how LPs charge VCs. E.g. in a $100mm fund, LPs in effect loan the VC firm $100mm and the LP gets their $100mm back PLUS they get 80% of the profits...and we all know which way sh*t usually rolls when on a hill. Deal with it. If you're lucky enough or good enough to be on a hill that reverses the laws of physics, more power to you!
4. Caps can create very funky return profiles. They usually create pockets where the investor return flat-lines for a period of time, i.e. the investor is indifferent between exit at X and X+a because the money back to them is the same. Entrepreneur is NOT indifferent between X and X+a so it can create misalignment at a very critical time.
5. Every single one of these terms can be thought of on a risk/return curve. I would even draw a curve to highlight it. 99.9% of VC - Entrepreneur misunderstandings is because VCs are almost myopically focused on the low end of the curve and entrepreneurs are focused on the high end. But they never discuss it in those terms...its like a Mars - Venus thing. If entrepreneurs can put their Venus glasses on and talk to them that way, then you can usually find creative ways to bridge the gap. Give them the protection they want on the downside but tell them you need more upside for it. It doesn't always come in the form of higher valuation, but sometimes in additional options for founders...maybe out of the money options if necessary. Or some other mechanism. You don't want to get too cute, especially on a Series A, but it at least signals to your Venusian that you understand and acknowledge their issues and are trying to be creative about how to solve them. That alone can work wonders in the relationship.
6. Entrepreneurs should always always always (did I say always?) remember how the VC gets paid and understand how the other investments in the fund are doing because that drives 90% of how a VC will think about your company (remind me to tell you a relevant story from the book The Tipping Point...about the Good Samaritan and the power of context). Its like a CEO always has to know how his sales guys are getting paid and where they are in their quota. If the other investments in their fund are middling to poor then they are going to take a more conservative stance and use the return from your company to just get them above water so they can stay in business and raise another fund (or keep their job inside of their firm). If you have a VC who is cranking away on good deals in their fund then they are going to take an aggressive stance and swing for the fence. Different VCs are drawn to different places on the risk - return curve based on the context of your company inside their fund. One place on the curve is not inherently better than another place...you just need to make sure that your eyes are open to that and that hopefully the entrepreneur wants to live on the same place of the curve as their investors. Doesn't always happen, but to make sense of your spouse's (er...your investor's) behavior you always need to keep that in mind.

You Can Adjust The Sails...

While visiting my parents rented beach condo on the shores of Lake Michigan, I saw a great poster art on the wall.  It was a picture of racing sailboats with the caption "Success" and under it "You Can't Change the Wind but You Can Adjust the Sails".

This is a great phrase for how I view startup company opportunities, and I addressed this topic in different ways in two of my previous posts, Venture Business Dogma and Follow Up to Venture Business Dogma.  For a startup company, the demand for the product or service they are offering is like the wind to a sailboat.  Company management skill, sales, marketing, customer service and operations is like adjusting the sails.  Adjusting the sails can propel you to beating the competition, but if the demand for the specific product or service you are offering isn't really strong, it won't be much of a race worth winning.

All VCs and entrepreneurs that are in the "good to great" category can adjust the sails with high skill.  What separates the good from the great is that ability to read the wind better than others, i.e. knowing better than others what type of demand exists (or will exist) for a specific product or service.

Follow Up To Venture Business Dogma Post

As a follow up to my post on what is the most important element when evaluating high growth startups, a study performed by Steve Kaplan, Berk Sensoy and Per Stromberg, researchers at University of Chicago is very apropos.  Steve is also the Academic Dean of the Kauffman Fellows Program and is at the tippy top of the pyramid of academic researchers focused on private equity markets (and is a great guy and a friend).  Kaplan et. al. performed academic research on whether its best for VCs to bet on the Horse (product / market axis in my post) or on the Jockey (the management team).  It was a pretty rigorous piece of academic research and they had access to 50 business plans of companies that went public after having received venture backing.  To mitigate sample selection issues they also then analyzed the evolution of every company that performed an IPO in 2004.  The findings strongly indicated that the Horse is more important than the Jockey.

To organize the data, they took company information at three measurement points:

• BP, or Business Plan, which is the point in time where they received venture financing

• IPO, where they took information out of the IPO prospectus

• AR, or the third Annual Report after the IPO, which would occur between 2 and 3 years after IPO (e.g. for an IPO in July 1999, the AR point was the 2001 annual report)

A few money shots came out of this research, organized into 4 different areas

• Core Business

• Of the 50 venture backed IPOs, only 1 changed its core business.  Or to put it another way only one management team successfully re-tooled the business and still made it to IPO.
• Of the 106 relevant IPOs in 2004 (relevance is defined in the paper, but in general  they eliminated REITs, holding companies, spin-offs, JVs and the like), not one of them changed their core business in the 5 years prior to IPO, and only 8 changed their core business at any point in their corporate life.
• Conclusion: Backing an "A" team with a "B" plan does not lead to IPO exits. You have to start with "A" plan.
  

• Differentiation from competitors (determined by self-reported questionnaires completed by management)
  • Unique product or technology (which would be the Horse)
    • At BP, 100% of companies ranked this as a key differentiator
    • At IPO, it was 98%
    • At AR, it was till 92%
  • Management expertise (which would be the Jockey)
    • At BP, only 45% of companies ranked this as a key differentiator
    • At IPO, it had plummeted to 14%.
    • At AR, it was at 13%
  • Conclusion: At all points in the company lifecycle, the Jockey's themselves believe that the Horse is significantly more important than the Jockey

• Management Stability
  • Starting at BP and running through AR, only 50% of the CEO’s remained the same and only 25% of the top 5 executives remained the same.
  • Conclusion: For companies that make it to IPO and beyond, the team will change, but the business plan will not.  So if you have an "A" plan, you could start with a "B" team because the team will get rebuilt over time anyway.
    

• Ownership
  • In a sample limited only to the VC-backed companies in the study, average CEO ownership immediately prior to the IPO was 10%.  There had been a similar CEO-ownership study conducted on VC-backed companies going public between 1978 and 1987, or roughly 20 years earlier, and the average CEO ownership immediately prior to IPO in that study was found to be 19%.
  • Conclusion: The relative contribution by the Jockey, as reflected in the amount of economic value the Jockey owns, has been nearly cut in half over the last twenty years. I would postulate this phenomenon as being driven by supply and demand; the scarce resource is no longer the Jockeys so Jockeys command less economic value.  That’s not to say that Jockeys per se have decreased in importance, its just that they have increased in supply relative to the supply of Horses so the relative price of Jockeys to Horses goes down. Referencing my previous post, some of the factors driving this are the Flat World phenomenon and the incredible influx of capital into the venture asset class.

Having ruminated on this for a while I have to clarify that I believe this data would only be relevant to companies in the classic venture capital mode, i.e. companies attempting for high organic growth.  In the Private Equity business and/or platform roll-ups the quality of the Jockey is much more important because the Horses have all been vetted over many years of operating results so there is less variance in different investors analyses about what is a good Horse and what isn’t.  So in the PE / LBO business value accrues to those investors who can analyze Jockeys and/or have the best relationships with the best Jockeys.  And 20+ years ago venture capital was probably more similar to that model.  But my anecdotal experiences, and this academic research shows that venture capital no longer operates on that model.

By no means am I disregarding the value of great management teams...especially because I'm now back on the operating side of the business myself! But as an operating executive I'm really trying to objectively analyze what is most important and prioritize allocation of resources most appropriately.

This is a fascinating piece of research for anyone with a stake in high-organic growth companies.  I've made lots of generalizations here in the interest of brevity and clarity of point.  For those interested in learning more, I encourage you to download the research paper and powerpoint presentation that summarizes the paper and read it yourselves and blog it at your sites or come back to comment here if the spirit moves you.

Venture Business Dogma

Venture Business Dogma: People, People, People...er, maybe not.

I know this may be heretical and maybe blackball me in the venture industry…but I gotta be me. And I use the word “heretical” by design because this topic can devolve into a religious argument. Many investors swear by the venture capital maxim that the three most important things in making an investment decision are people, people and people. I’m not sure that’s the case anymore.

My primary thesis is that the scarce resource in the current generation of the company startup ecosystem is finding a product or service that satisfies a significant and growing economic demand materially better than the alternatives (both direct and indirect alternatives), and creates incumbent competitive advantages, i.e. the nature of the product or service is that the strong get stronger, intrinsically.  When that scarce resource is found, all the other resources, including the right people to build the business will flow to it. In other words, optimize the equation around the product-market axis and then solve for the other variables around it over time.

A related maxim that maybe explains it more plainly is that these investors would rather back an “A” management team with a “B” business plan, rather than “B” team with an “A” plan. I think that’s outdated. There are too many entrepreneurs and too many investors around the world all introducing innovations to satisfy various demand pools all the time. Twenty years ago (or maybe even 10 years ago) the “A” team had time to retool their product or service and find the unmet demand and satisfy it. But now everything happens so fast, in part due to the Flat World, in part due to incredible influx of capital into the venture asset class, that the “A” team doesn’t have time to retool, or the more likely outcome is that if they do re-tool then the capital that backed them on their earlier iteration of the product/market plan is rendered worthless in a "re-cap" financing (I'll leave it to Brad Feld at Ask The VC to explain a "re-cap").

I don’t know if this is an apocryphal statement or not, but Don Valentine, legendary VC at legendary firm Sequoia, supposedly once famously said: “I want to invest in companies addressing markets that are so big that even the management team can’t get in its way.” I am an apostle of that church. I describe it as I look for opportunities where there is potential for the demand to just SUCK up the product or service like a wet-vac, mess and all.  When you find that situation, all the other issues become second-order; still important, but second-order.

As an investor, the biggest hit I ever had was one of these. I pursued an investment in a company that was out of favor among the “smart VC set”.  They had met with virtually everyone in the industry and no brand name firm was stepping up to lead it, and the partners at my firm initially were down on it. We killed it once, because of a combination of management team, nascent market, regulatory, deal structure, geography and syndicate issues. I brought it back up a few months later and everyone eventually got comfortable enough with it and supported me to do the investment. It turns out everyone was right. There were a lot of very messy issues, including having 4 different CEO’s in the first 5 years after we invested. But the demand for what they were delivering proved out to be HUGE, and they had the technology and infrastructure to deliver it better than anyone else. It was those two things that I focused on in my due diligence and compelled me to stick with it even though many other elements of the opportunity were sub-par.

When we invested that company had done about $1 million in revenue in the trailing twelve months. Five and half years later it did $200 million in revenue in the trailing twelve months and $70 million in EBIT and had a market cap of $2 billion.

That company was kind of like a sausage factory: it wasn’t pretty to see it being made but what came out the other end was damn good. To me that was a great experience of optimize your equation around the product / market axis and then solve for everything else over time.  It certainly doesn't always work, and I absolutely don't want to minimize the importance of great management teams (especially since I'm currently on the operating side of the business), but that's the way I'm seeing the startup world right now.  It definitely influenced me in my choice to pursue the operating company opportunity I'm doing now -- I think we have one of those opportunities where the demand is ready to suck up our offering like a wet-vac.  I'll be blogging more about that in the near future.

Non-Obvious Changes That Fostered Innovations

My previous post on how the Industrial Revolution ultimately created culturally-groundbreaking innovations in the fine art market got me thinking about other structural changes that spurred non-obvious innovations.  In business school I had a professor who used to be a Corporate Finance MD on Wall Street.  He was in the middle of the junk bond-fueled explosion of LBO's in the 1980's.

He claims, and I believe him, that the thing that sparked that explosion was the creation of the spreadsheets Visicalc and then Lotus 123.  His thesis is that on Wall Street they all previously understood the theoretical and financial underpinnings that drove that market well before it actually happened.  Their problem was that they could not effectively evaluate all the different outcome scenarios of doing those deals until spreadsheets came along.  It then unleashed a torrent of innovative financing structures that reshaped the global business environment.

The essence of high-growth startups and of venture capital investing (at least for me) is to find these structural changes and look for the non-obvious ways in which it will impact different markets (see "The Yin of Startups" on the upper left panel of my blog).  E.g. the people who saw spreadsheets and realized before everybody else the impact it would have on the global financial markets made a fortune by investing in or operating the institutions that capitalized on it.

I'll try to make these non-obvious insights a recurring theme of this blog and I look forward to hearing from others on this topic.

Entrepreneurial Innovation in 19th Century Art Market

My wife gave me a great surprise birthday trip to Paris recently.  It was our first vacation without kids in 3 years.  We hired a guide to take us through the Louvre and other parts of the city.  We have found local guides to be best way to really understand whatever place we are visiting, and this was no exception.  He told us many great stories.  One of them was on what drove the explosion of innovation in the fine art market in the late 19th century.

He described that for all of European history, fine art was created by artists who had "sponsors".  They financially supported the artist and gave them "assignments" to work on.  Because artists were not free to create, the fine art gestalt was more reflective of the sponsors than the artists.  Sponsors did not have the creative instincts of the artists themselves, so European fine art was very refined and technically innovative but it was not culturally groundbreaking.

A seeming non-obvious external factor changed all of that.  It was the industrialization of Europe and the subsequent rise of the merchant class in the late 1800's.  Members of the merchant class had enough money to spend on fine art but not enough money (or did not have the inclination) to be full-time sponsors of artists.  Because there was now a market demand for fine art, artists took on the role of entrepreneurs and began the series of groundbreaking innovations that continue today.  Innovations of that period consisted of Impressionism, Post-impressionism, Cubism and several others.

Art went from looking like this (Virgin Mary painted by Jan Van Eyck)

To looking like this (the famous Guernica by Picasso depicting his rage over the senseless massacre in the city of Guernica -- it was bombed simply as target practice for the Nazi war machine)

Like any great innovation, the "incumbents" initially dismissed Guernica when it was unveiled at the Spanish Pavilion of the 1937 World's Fair.  One critic called it: "a hodgepodge of body parts that any 4 year old could have painted".  Yet with the passage of time it has become the art world's most powerful anti-war statement.

Picasso's own words on his creation of Guernica describe it the best, and illustrate how a work like this could never have been created under the old "sponsored art" system.

"A painting is not thought out and settled in advance," said Picasso. "While it is being done, it changes as one's thoughts change. And when it's finished, it goes on changing, according to the state of mind of whoever is looking at it."

This is all a fascinating illustration in how an entrepreneurial ecosystem can spur creativity, and how often-times non-obvious structural changes can unleash entrepreneurial creative forces.

Could the affect that the rise of the Merchant Class in Western Europe in the late 19th century had on the fine art market be akin to the affect that Google’s release of Adsense had on social media entrepreneurs in the early 21st century? Both created a mechanism for entrepreneurs to get paid for their creativity and subsequently unleashed a torrent of new innovations.  Food for thought...

Anyone wish to share the impact that other non-obvious infrastructure changes had on the creation of entrepreneurial markets?

Bloggers ARE Different...

As a new blogger I'm intrigued by the type of people that write and read blogs.  This post discusses how different bloggers may be from the rest of mainstream society and what it means for advertising services companies that target the blog audience.

Below is a list from the New York Times on the Most Emailed stories and another list on the Most Blogged stories from January 8, 2007.  The differences in the implied interests of those that read and write blogs versus mainstream society are startlingly apparent.

January 8, 2007 NYT Most Emailed List
1. Happiness 101
2. Attack of the Zombie Computers Is Growing Threat
3. Little Asia on the Hill
4. Editorial: The Imperial Presidency 2.0
5. When Buying a Diamond Starts With a Mouse
6. Big Sur Without the Crowds
7. Jazz Is Alive and Well. In the Classroom, Anyway.
8. Questions Couples Should Ask (Or Wish They Had) Before Marrying
9. In Obesity Fight, Many Fear a Note From School
10.   Frank Rich: The Timely Death of Gerald Ford

January 8, 2007 NYT Most Blogged List
1. In Days Before Hanging, a Push for Revenge and a Push Back From the U.S.
2. Plan Sets Series of Goals for Iraq Leaders
3. Bush Plan for Iraq Requests More Troops and More Jobs
4. Mr. Ford Gets the Last Laugh
5. The Imperial Presidency 2.0
6. Images of Hanging Make Hussein a Martyr to Many
7. A New Commander, in Step With the White House on Iraq
8. The Invasion of the Alpha Male Democrat
9. War Could Last Years, Commander Says
10. Attack of the Zombie Computers Is a Growing Threat, Experts Say

The Most Emailed list seems pretty representative of the interests of the general population: emotional happiness, marriage, buying diamond rings, music, childhood obesity and travel.  The Most Blogged list shows the top 9 entries are political, and #10 is about computer / privacy security.  You couldn’t come up with a better snapshot on how the interests of bloggers are different from those of the general population.

It may not always be this different, but I had also grabbed the same list on October 11, 2006.

Most E-Mailed List
1. Essay: Friends for Life: An Emerging Biology of Emotional Healing
2. Seduced by Snacks? No, Not You
3. An Elephant Crackup?
4. Gone for Decades, Jaguars Steal Back to the Southwest
5. Eye-Catching Images of Nature, Made With a Common Machine
6. Across Europe, Worries on Islam Spread to Center
7. Music Review | Barbra Streisand: Music Overpowers Streisand's Many Missteps
8. In God’s Name: Religious Programs Expand, So Do Tax Breaks
9. In God’s Name: Religion-Based Tax Breaks: Housing to Paychecks to Books
10. Cat Lovers Lining Up for No-Sneeze Kitties

Most Blogged List
1. Evangelicals Blame Foley, Not the G.O.P.
2. N. Korea Reports 1st Nuclear Arms Test
3. At Reuters, a New Book and a Lost Job
4. Poll Shows Foley Case Is Alienating Public From Congress
5. Foley Scandal Is Hurting G.O.P.'s Image, Poll Finds
6. N. Korea Reports 1st Nuclear Arms Test
7. Baker, Presidential Confidant, Hints at Need for New War Plan
8. Blast May Be Only a Partial Success, Experts Say
9. Dot-Com Boom Echoed in Deal to Buy YouTube
10. Where Faith Abides, Employees Have Few Rights

Whole lotta social sciences conversations could be had around this topic, but I’ll leave that to others.  Please comment freely here or at your own blogs and/or link back.  My conversation thread is on what it means to online advertising services.  The heaviest blogging activity comes from a very tight psychographic segment.  It’s a valid question to ask whether the READERS of blogs (as opposed to the authors whose activity comprised the above list) are as tightly defined psychographically.  My guess is that the readers are not as tightly defined, but pretty close…because if all you have to read in blogs is political news then it will be political news interested people who read blogs.  Others will just not bother and read the emails about love, marriage, health, travel, etc. that their friends and families send around.  Advertisers wishing to reach this psychographic segment have a gold mine.  Other advertisers might not get the performance from their ads that they hope for.

As a shareholder in Feedburner, creator of the largest RSS-based ad network, this is a topic that I’m keenly interested in as it affects my bank account.  Feedburner does manage feeds from all sorts of media sources, not just bloggers, but the most fertile ground for their ad network is feeds from bloggers. Dick, Brent, Fred, Brad, Matt(s) and others: please chime in here to add your thoughts on this.

I'm also a shareholder in comScore Networks, who has made a great business out of addressing topics such as this.  Gian F., do you have anything you want to add here?

Although I'm not a shareholder in FM, I am also very curious as to John Battelle's thoughts on the topic, as he has been around online media audiences longer than anyone and his current company is based on advertising to the blogger audience.  John, any comments you want to share?

A key question is IF and if so, then WHEN will the blogger audience be more representative of the overall population?  Until it does, advertising on blogs is going to be a goldmine for campaigns that appeal to the existing tightly defined blogger psychographic.  After it becomes mainstream it should become a goldmine for all advertisers.

Matt B: do you have thoughts on this relative to the development of the email marketing market that you’ve seen while running Return Path?  Email had the same problem 5 years ago.  Now it seems as mainstream as broadcast TV.

On a related note, I have a challenge for some MBA student or marketing research PhD student to do a research project on the topic: It would be interesting to use the Most Blogged and Most Emailed lists from the NYT to create an “index” of sorts.  The index would track over time the mainstream-ization of the blogger audience.  Articles would have to be classified by category (which the NYT does) and then aggregated to show trend lines.  I’d have to think about this a bit more, but some statistics-oriented student could design this in their sleep:

- Take the Most Emailed list for some period of time, say one quarter history

- Assign each of the articles to a category.  If the NYT doesn’t cooperate, you could probably build a site crawler that looked for the title of each article on the NYT site and determine what category it was assigned to on the site (e.g. Travel, Health, Sports, etc.).  Or you could crawl all the words in the articles and make a contextual assumption.

- Use the volume of articles assigned to each category (e.g. 10% Health, 20%, Business, 10% Politics, etc.) in the Most Emailed as the baseline index for the online media “conversational” interests of the general population, or at least the population of the NYT audience.  I say “conversational” because emailing an article to someone is akin to talking to them about it.

- Do the same categorization assignment to the Most Blogged articles going forward to get a proxy for the online media conversational interests of the blogger population, and then show the comparison against the baseline and how it is trending over time.

Probably other ways to do this…would love to hear other people’s thoughts, and would especially like to hear of someone taking this on as a project.  You’d have a lot of interested people following the results.

Who Am I and Why I'm Doing This

As my one-line description says, I'm a entrepreneur, venture capitalist, husband and father of 3 (not in that order!).   I've been active in the online media world since it began in 1993/1994, first as an entrepreneur and then as a venture capital investor at Flatiron Partners (where Fred Wilson taught me the venture business), and then as an independent angel investor and advisor with a strong entrepreneurial streak.  My About page has a bit more detail on the companies I've been involved in and some of my track record numbers.  I am also proud to be an alumni of the Kauffman Fellows Program.

Everyone has their own reasons for publishing a blog.  Mine are primarily as a business networking and self-educational tool.  Hence the name "Startup Conversations".  I view this blog as an extension of offline conversations with people, such as a networking lunch or cocktails at an industry conference.  And in those offline conversations some time is always well-spent discussing personal matters such as family, current events, recent movies and the like in order to form a personal connection and enhance the business relationship (and to make life more interesting).  So I'll be mixing personal and business topics in this blog for the same reason.

I have an agreement with my wife that when I talk about family I will keep it safe by only using first letters of our first names, so I'm married to A, and have three kids, T, Q and F.

I'm sure that in many of my posts I will misstate things, make exaggerations to emphasize a point, be way off base on some topics, etc etc.  So let this be my disclaimer...and let the conversations begin!