In Atlanta there’s an ongoing discussion about the lack of early stage risk capital for startups. One side argues that if more capital is present, more deals will get funded. The other side argues that there aren’t enough talented entrepreneurs yet, and that when the entrepreneurs are here, the money will follow. From my perspective, capital is mobile and entrepreneurs with a good market, team, and idea will be able to get funding, locally or otherwise.

There’s another tightly related topic that needs more discussion as well: startups in Atlanta and other places outside the major startup centers have a higher bar for an exit. Here are a few thoughts on exits in Atlanta:

• Historically, 4-6 total tech startups get acquired per year for more than $10 million, meaning it’s a rare occurrence
• Strategic acquirers, in order to have a new remote office, need to have meaningful scale to be worthwhile (e.g. 50+ employees)
• Press and PR is harder to come by when bootstrapping or raising limited capital, making awareness by potential acquirers less likely
• Acqui-hires, regardless of being good or bad, almost never happen

For a startup, the best approach is to build a successful, sustainable business and not focus on an exit. As for exits, in Atlanta and most other places, the bar for an exit is much higher than expected.

What else? What are your thoughts on Atlanta startups having a higher exit bar?

On Thursday morning I’m honored to have the opportunity to share my personal story and thoughts on the Atlanta startup community with the Metro Atlanta Chamber. Atlanta has a strong business community that’s well-known for getting involved and making a difference. For their most recent strategic plan, fostering entrepreneurship and startups were identified as key priorities.

Here are a few notes on the Atlanta startup community:

• Atlanta has all the natural resources to be a top 10 tech startup city
• Startup strengths include technical talent, low cost of living, abundant young professionals, and great quality of life
• Startup weaknesses include experienced entrepreneurs, entrepreneurial density, and risk capital
• Atlanta needs to focus on companies that generate revenue from outside the region thereby creating net new jobs
• Georgia Tech has significant untapped entrepreneurial potential
• Atlanta Tech Village is the largest tech entrepreneurship center in the Southeast with a goal of creating 10,000 jobs in 10 years
• 2012 marked nearly half a billion in exit value for marketing software companies in Atlanta
• Atlanta has another handful of marketing software companies currently worth over half a billion in value
• Atlanta’s startup energy is at an all-time high with no signs of slowing down
• Atlanta’s startup community needs more support from the large, local companies by way of mentoring, investments, and doing business together
• Seed stage risk capital is scarce while capital for fast growing tech companies with modest scale is readily available
• Metro Atlanta Chamber has an opportunity to help strategically with industry introductions as well as capital sources

I’m looking forward to talking to the Metro Atlanta Chamber on Thursday and getting them excited about changing the entrepreneurial trajectory of Atlanta.

What else? What are some other thoughts to share on Atlanta’s startup community?

At the Atlanta Tech Village we’ve had a number economic development agencies come through for a tour. As a new initiative for Atlanta and the Southeast, there’s a significant amount of interest and curiosity. Several of the economic development people have mentioned how they’re working on co-working space for startups in their own cities and neighborhoods.

Co-working space is great for the freelancer and entrepreneur starting a business, but there’s another, more important issue not being addressed: innovative vs replicative businesses. Not all companies are created equal. Most companies are replicative businesses where they are replicating something that is already well defined and a known quantity, like a law firm or accounting firm. Innovative businesses, on the other hand, are building something new and trying something that hasn’t been done before. With innovation comes a high rate of failure, but also an opportunity for net new jobs due to being able to generate revenue from outside the region.

In the context of job creation, it’s important to recognize that innovative and replicative businesses are two different things. Innovative businesses have greater risk, and greater reward. Co-working spaces often have both types of businesses, but their needs and challenges differ, such that one approach isn’t right for both types. To excel, it’s best to choose a focus and be the best in that target area.

What else? What are your thoughts on co-working, job creation, and innovative vs replicative businesses?

Tonight the Atlanta Tech Village hosted the eight edition of the Atlanta Startup Village. Being the second ASV at ATV it was much smoother with more chairs, more TVs, more food, and, of course, more drinks. With 263 people signed up and well over 200 attending, it’s the largest monthly startup event in the Southeast.

Here were the five presenters:

• Deductmor - Expense management focused on independent contractors
• QGenda – Physician scheduling software
• Kevy – Cloud integration middleware
• PeachDish – Weekly meal ingredient delivery service
• BitPay – Bitcoin payment processing platform

The companies did a great job and I’m looking forward to tracking their success.

Part-time entrepreneurs are more abundant than full-time entrepreneurs. Just think how many people work an hour or more per month on a new business idea. Now, let’s define part-time entrepreneur in a very simple manner: they have a day job that pays the bills. The day job might not even be full-time, but it’s still their primary means of making a living. So, today’s question is “How do part-time entrepreneurs fit in the startup community?”

Here are a few thoughts:

• I don’t know of any group that caters to the part-time entrepreneur audience other than general meetups where anyone can attend
• It’s extremely difficult to get a business off the ground working nights and weekends on it (I only know of one entrepreneur, out of hundreds I’ve met, that was able to do it)
• Peer groups, like Entrepreneurs’ Organization (EO) and Young Presidents’ Organization (YPO), are amazing resources, and a simpler version of one of those would be beneficial for part-time entrepreneurs (peer groups are great regardless of profession or career)
• More open dialogue is needed about part-time entrepreneurs as the most common response is that you aren’t serious if you aren’t full-time

I don’t have the answers but I believe more dialogue is needed about how part-time entrepreneurs should be nurtured and incorporated into the startup community.

What else? What are your thoughts on how part-time entrepreneurs fit in the startup community?

After publishing the most recent Pricing at the Atlanta Tech Village post, and talking to companies that have signed up for private rooms and private suites, we’ve learned that startups would prefer a fixed-rate pricing methodology whereby the rooms or suites are a flat-rate, regardless of number of people.

The idea is that tech companies and startups want to have the option of being high density or low density with respect to the number of people and not feel like they are being nickeled and dimed. If two contractors or interns are needed, and there’s room to double up a couple desks, pricing shouldn’t change, resulting in more predictability and flexibility. Use cases like temporary workers, part-time workers, interns, guests, etc kept coming up and the original idea of additional membership types became more cumbersome than it’s worth.

Going forward, we’re going to try out our next iteration of pricing for rooms and suites where everything is labeled for the ideal number of people, with no extra per person charges if you want to cram more people in. We’re playing to the law of averages knowing that some companies will have less than the target number of people and some will have more. Here are the new prices for all inclusive memberships:

• 3 Person Office – $1,000/month
• 4 Person Office – $1,300/month
• 5 Person Office – $1,625/month
• 8 Person Suite – $2,600/month
• 14 Person Suite – $4,550/month
• 18 Person Suite – $5,850/month

Service provider pricing is 20% higher and follows the same idea where there are no additional per person fees.

Pricing is a very interesting topic as it plays into the financial model, positioning in the market, and more. With this new pricing change we’re working hard to make the pricing as easy to understand and streamlined as possible for a wide variety of use cases. I’m sure we’ll continue to make changes but this feels right based on input from customers.

What else? What are your thoughts on these pricing changes?

One of the topics we’re debating now within the Atlanta Tech Village is that of measuring member progress and how to create a culture of success. If we merely provide a great community and a great building without great success stories, we won’t be a success. Members of the Village need to continuously make progress with their startups and build sustainable, high growth businesses.

Here are some ideas on measuring member progress within the Atlanta Tech Village:

• Require quarterly and annual SMART goals as part of the application progress along with mandatory monthly updates in a Google Spreadsheet (documenting them in a spreadsheet makes it easy to look back and see what was, and what wasn’t, accomplished)
• Require a monthly 15 minute meeting with each member company to go over their current One Page Strategic Plan or Business Model Canvas
• Require a monthly review of the Killer SaaS KPIs and require a minimum growth rate (e.g. numbers must improve by at least 1% per month)

Startups that are working hard and helping each other out will make significant progress, even in a short period of time. Results matter and measuring member progress will focus efforts on the important areas. It will also make it easier for mentors to make introductions and provide advice when challenges come up.

What else? What are some other ideas on measuring member progress with the Atlanta Tech Village?

On a daily basis, when meeting someone about ATV, I almost always get the question “How can I help the Atlanta Tech Village?” This goes to show the awesome community support and pay it forward mentality we have as a city. Of course, when people are asking how they can help, they expect an answer like “please refer tech companies and tech startups to ATV” or “please get involved in our community.” Those are great, and important, but the real ask is even more strategic:

Help us nurture startups so that they grow, succeed, and graduate

No matter the coolness of the building, the greatness of the people, and the excitement of the vibe, if we don’t have startups becoming successful businesses, we’re not succeeding as a community. Simply put, we need success stories to create jobs, wealth, and to put Atlanta on the map.

The next time you hear someone mention the Atlanta Tech Village, bring up the ultimate goal of nurturing more successful startups.

What else? What are your thoughts on answering the “how can I help” question?