The Startup Studio, Six Months In

Six months ago we launched the new Atlanta Ventures Startup Studio. A startup studio is just a modern way of saying we partner with entrepreneurs to create new companies from scratch. In addition to investing directly into startups, which we’ve been doing for years, we saw an opportunity to develop a more formal program around ideation, market research, planning, launching, and growing. With so many talented people in town, but a more limited group of entrepreneurs, the ability to take an idea to product/market fit and beyond is the core opportunity.

Ideas

As expected, ideation is the easy part. Everywhere we look there are opportunities and ways to make people’s lives better. To date, we have a Google Sheet of 80 ideas and are regularly adding to it as well as revising existing ideas. Of course, most aren’t any good but the goal is to focus on “what ifs” and just let the ideas flow. More importantly, having a stable of ideas ready makes it easier to match potential ideas with potential entrepreneurs based on their interests and personalities.

Entrepreneurs

Finding entrepreneurs to partner with is the hardest part. There are so many great people that want to start a new company, yet we’re very particular in our focus on entrepreneurs that are positive, self-starting, supportive, and have had a prior entrepreneurial failure. In the entrepreneurial context, we look for repeated examples of working through adversity and pushing the boundaries to get things done.

State of the Union

To date, we’ve launched one company (autonomous lawn mowers), are about to incorporate a second, and have a couple more that are progressing nicely. Frankly, it’s harder than expected, but we’re pleased with the progress. Building companies takes time, and we’re excited to be a part of the journey.

Want to take the next step in the entrepreneurial journey? Apply to be an entrepreneur in residence.

No Regrets Selling the Business

Entrepreneurs love asking me the question, “Do you regret selling Pardot?”

Pardot, as part of Salesforce.com, has done incredibly well ($250M+ in annual revenue!).

SaaS is much more valuable and established compared to when we sold the business.

Private equity is eagerly buying SaaS companies and often outbidding strategic acquirers.

So, if everything has exceeded expectations, are there any regrets?

No. None.

Adam and I made the best decision we could with all the information we had at the time.

Selling Pardot put it in the hands of a well capitalized public company that had a greater chance of realizing the product’s huge potential. Today, Pardot is one of the most widely used B2B marketing products in the world.

Selling Pardot chalked up a ‘win’ for us as entrepreneurs.

Selling Pardot enabled the Atlanta Tech Village to happen.

Selling Pardot enabled me to invest in dozens of startups and pay it forward.

It could have turned out differently.

But it didn’t.

Selling the business was a deeply personal decision and we made the right call.

Home, Sweet Home

This year, I’ve had the opportunity to visit entrepreneurs all across the Southeast, both in Atlanta and their hometown. Seeing the different entrepreneurial communities, and hearing success stories from each city, continues to grow my optimism for entrepreneurship as a force for good. In addition to an optimistic outlook, it also helps me appreciate what we have in our own startup community — great entrepreneurs, great talent, and great programs.

Yet, it wasn’t always this way.

In late 2008, Adam and I flew to Silicon Valley to pitch the full partnership of a Sand Hill venture capital firm (not one of the A-list firms that typically come to mind) on investing in Pardot. One of the senior partners really liked us and was working to convince the partnership that marketing automation was going to be a big market (most VCs thought the addressable market was too small — hah!).

Toward the end of the pitch, which had flowed smoothly, another senior partner, with a professorial look about him, shot out a question, “Do you have any software engineering talent in Atlanta?” Naturally, I offered him my best chamber of commerce response about Georgia Tech and the great engineering schools across the Southeast with heavy representation in Atlanta. Without even internalizing my response, he said, “Why don’t you just move to Silicon Valley?” To him, with a close-minded view of the world, there was no way to build an important startup outside of a 20 mile radius around his office — nevermind that his firm had just invested in an Atlanta startup earlier that year!

Thankfully, the partner who made that comment wouldn’t be the lead on our potential deal (we never raised venture capital), but that question and comment has already stuck with me for a decade, and I won’t forget it. Never criticize someone’s hometown or make them feel inferior to yours. Never.

John Howard Payne’s famous line came to mind:

Be it ever so humble, there’s no place like home

With that, we flew home, turned down their expression of interest to keep moving the process forward, and continued building the best company we could.

Encourage entrepreneurs.

Don’t belittle their hometown.

Celebrate the startup journey, regardless of location.

What are my strengths?

Recently an entrepreneur was asking me questions about my own entrepreneurial journey. He was interested in learning from other entrepreneurs and potentially modeling his style and actions after others. My advice: play to your own strengths. Only you can be you.

As for myself, I have a number of strengths and weaknesses.

I love starting things, but hate finishing them.

I love dreaming up ideas and getting others excited about them, but have little interest in the detailed execution.

I love connecting people and looking for ways to add value to others.

I love seeing trends in the world and guessing where things will be in the future.

I love finding gaps or opportunities in the market and thinking through potential solutions.

I love as little process as possible that ensures the organization is running well, but eschew anything that feels like overhead.

I love challenging people and working to help them grow in their careers.

I love getting doubted and then proving the skeptics wrong.

I love trying hard things and just move right along when most don’t work, with no regrets.

I have plenty of strengths and weaknesses, no different than anyone else.

My ability to see where markets are headed, recruit people for crazy ideas, and stay out of the weeds are some of my most important strengths.

What are your strengths?

Stories of an Entrepreneur’s Resourcefulness

Earlier this week I had the opportunity to hear Jewel Burks Solomon share her entrepreneurial journey and it was incredible. Reflecting on the Partpic story, the piece that stood out the most was her neverending resourcefulness. Setbacks, adversity, challenges — no match for her.

Within her journey, here are a few stories that stood out:

  • Jewel joined a company’s management training program and was assigned to run a call center. Only, on a daily basis she was bothered by angry customers needing to solve a problem — what’s the name and number for this part? She came up with an idea for a software product that analyzed a picture to determine the part. Yet, management at the company had no interest in pursuing her idea. Hence, the idea for Partpic — a computer-vision system for identifying parts — was born.
  • After investing her lifesavings in the idea, and running out of money, she started entering pitch competitions — anywhere and everywhere — as a way to fund the business. $250,000 and multiple pitch competition wins later, she had cash (bonus: it was mostly non-dilutive!).
  • When she decided to raise money, she pinpointed Joanne Wilson as her desired angel investor. Instead of approaching Joanne directly, she worked her network and met with several entrepreneurs Joanne had already invested in, and then asked them to intro her to Joanne in the same week. Joanne was the first angel investor.
  • Wanting to get on the radar of Amazon.com, she pointed out to the Amazon Web Services conference manager there weren’t enough women speakers, and she had just the person — her technical leader that was a machine learning expert. Amazon.com took her up the idea, her technical leader presented, and Amazon.com’s corporate development team was in the audience during the talk. After the talk, the corp dev team gave their business cards to the technical leader, who then gave the cards to Jewel. Jewel followed up and the rest is history — an acquisition by Amazon.com

Resourcefulness is one of the most important traits of successful entrepreneurs and Jewel’s story painted one of the most compelling pictures I’ve heard. Special thanks to Jewel for sharing her story and helping the next generation of entrepreneurs.

Growing Endeavor in the Southeast

Earlier this week I had the opportunity to spend a day in Birmingham, Alabama with the Endeavor Atlanta team in an effort to expand the non-profit to other regions of the Southeast. Endeavor, an international organization with offices in 32 countries, is leading the high impact entrepreneurship movement around the world. Think of Endeavor as an organization that supports scale ups (startups post product/market fit in the scaling phase) with mentorship, continuing education, networking, and an all-around high impact entrepreneurship ethos.

In Atlanta, we have eight Endeavor Entrepreneurs building amazing companies. These companies range from lease accounting software to second home rental marketplaces to Bitcoin payment processing platforms. Endeavor isn’t limited to tech companies. In fact, globally, most Endeavor Entrepreneurs aren’t in tech. The key: high impact entrepreneurship. Entrepreneurship is one of the most powerful forces to help communities through job and wealth creation.

Now, with Endeavor Atlanta off to a great start, we’re looking to grow the Endeavor footprint in the Southeast with regional offices. These regional offices would support their local entrepreneurs and lean on the Atlanta office to interface with the global network. Once a regional office achieves enough scale, they’d then become their own full office. The Southeast, with 80+ million people, is the fastest growing region in the United States and has a tremendous number of entrepreneurs.

If you’re an entrepreneur, or supporter of entrepreneurs, in the Southeast, please reach out as we’d enjoy talking about ways to grow Endeavor in the region.

Frequent, Quality Communication as Success Indicator

Recently I was talking to a friend and he asked about indicators of entrepreneur success post investment. Now, pre-investment, entrepreneur personality traits like grit and resourcefulness come to mind, but after partnering with an entrepreneur, it’s a behavior that’s most indicative: frequent, quality communication.

Frequent, quality communication is an action, not a personality trait, and one that every entrepreneur can do. Only, too many entrepreneurs don’t do it.

So, if communication is an indicator of success, why don’t more entrepreneurs do it?

Easy, prioritization.

Many entrepreneurs simply don’t prioritize frequent, quality communication. To some, it’s beneath them — simply not worth their time. To others, they don’t understand the benefit.

Frequent, quality communication with all constituents — employees, investors, advisers, mentors partners — develops more clarity of thought and a vehicle for feedback and help. Just the act of communicating forces an articulation of position, strategy, and approach. More communication, more results.

Communication comes in many forms. Some of the most effective methods are the weekly update, simplified one page strategic plan, and daily check-ins.  Whether the communication is written, in-person, or virtual, it doesn’t matter. What matters is that it’s frequent and high quality.

Communicate early and often. Put in the effort. Make communication a priority.