I attended another fantastic CED Entrepreneurs Only Workshop today. The speaker this time was Michael Doernberg, CEO of eMinor, creator of ReverbNation. He gave an informative and entertaining presentation about what he's learned starting four companies and successfully exiting two of his previous ones. I really enjoyed hearing all his tips and stories.

Here are my notes:

• Success as an entrepreneur is luck. "All you can do is improve your chances."
• His co-founder's grandfather used to say, "Entrepreneur... well, that's just French for unemployed." :)
• "You can't part-time it." - You have to be fully committed, especially in the early stages of a startup
• Understand the market, the buyer of what you're selling, and what drives them. What do they really need. Example was all the effort wasted adding dictation capability to MP3 players - no one uses that feature.
• You must validate your ideas with potential investors and customers, not your co-founders and people just like yourself.
• Pay attention to the details of your business strategy. CP/M created by Gary Kildall (deceased) vs. MS-DOS by Bill Gates. The decision to bundle MS-DOS with PCs made the difference between being the richest man in the world and being dead. -- I'm still a bit puzzled by the correlation between these events, but it made for a funny, if odd, statement during the presentation.
• VCs have a pack mentality. You need to be in an area they want to invest in right now.
• You can't bank on investors generically adding value to your business like they claim. Have a clear idea of exactly what you want from them.
• Look at a VC deal in total, not just the valuation. Every year they come up with new terms and tricks.
• Presenting to VCs
  • Focus on opportunity and your abilities
  • Don't sell subtleties about why your product is slightly better than others
  • Acknowledge and address uncertainties
  • Tell them what you know and be honest about what you don't
  • Explain what you plan to do with their money, how is it going to rapidly grow the business
  • Go big or go home - VCs want rapid growth now, not a lifestyle business
• There's usually an opportunity to exit early and if you don't take it be prepared for the long haul. A company is worth the most when it's a new technology and when it's a market leader, not when it's struggling to grow its initial customer base.
• Greed is a powerful negative influence. "If it's the right time to sell, sell." Don't keep holding out for a little more.
• Updated: I forgot one of the best tips... If you want to bake pies, don't start a pie company, go to work for one. Likewise, if what you really want to do is write code, don't start a software company, work for Microsoft. Building a business is pretty much the same in any industry, so start one only if that's what you really want to spend your time doing.

Posted by JoshC at March 13, 2007 10:54 PM

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