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I love the Seattle startup scene. I think we have a really

unique culture that makes us a special place to build

companies. Part of it is the natural beauty of our surroundings

but part of it is the culture of our people.

Seattle’s a terrific place to recruit people to. We have wonderful

recreation, a great economy, many choices for types of lifestyle.

Are we affordable? Some would say “not so much.” But in fact

given the salaries of high tech workers and the wealth that’s been

created from so many successful startups, we are probably not too

bad from an ability to live well perspective.

Seattle has a wonderfully collegial startup environment. It isn’t “I win,

he loses.” It’s “If you win, that’s good for all of us.” People are willing

to share their experiences for how they did something or learned a

lesson on something not to do.

I’ve been working with two founders on a stealth company that we’re

not ready to share with the world quite yet. However, we have been

bringing many serial entrepreneurs into the fold to show them what we’re

doing and to get feedback on the idea, technology, business model. It’s

been a wonderful experience as these very busy people (many of them are

out getting funding for their own company right now or deep in product

development cycles or with pressures of VCs to answer to over revenue

commitments…) have been so giving and willing to see the product, offer

advice, and make introductions. And with no expectation of what they

might get out of it.

I think why we’re unique is our sheer collective joy and enthusiasm for company

founding and in working together to make our state a world class startup

culture. I hear this reiterated from serial entrepreneurs I have met here who have

moved via acquisition or lifestyle choice from Atlanta, Boston, San Diego, Texas, and

Silicon Valley. They all share how open we have been to them and their endeavors.

What does this mean? Use the community to recruit cofounders and exec team members

and employees. Use fellow CEOs for introductions to angels and VCs. Find companies who

might have similar customers and get them to endorse your technology or introduce you

to the decision makers you need to reach. One CEO had his VP Sales sit down with a client

of ours and lay out their sales pipeline and current customers and brainstorm what would

be the ideal beta sites to have him help my client recruit. What gold there was in that

conversation and door opening. He just wanted to see another company behind him get

further up the curve faster than he did.

Maybe it’s all the coffee shops and gathering spots we have. Maybe it’s free WiFi at

Tully’s. Maybe it’s a better work life balance culture that supports civic mindedness

and doesn’t yell “what’s in it for me.” All I know is that I am grateful to be part of this

tremendously vibrant startup community.

Many founders of technology companies are technologists and not sales ormarketing people. If this is you then you should take a course or a program on strategic sales. Why? Because pretty much everything you do in running a company is about selling. And most of you are not naturally good at this. First, you raise money for your company. What’s this? It’s about selling equity in your dream. You have to talk to a LOT of people to get one person to invest.You have to actually ask for the order. This means closing someone by asking them to write you a check. This is really hard to do. Most founders forget to ask people to write the check-they have to be asked, they don’t naturally do it.  At first it might not seem that hard because you talk to people you know. But once you start meeting with angels and VCs it becomes a lot harder and you hear NO a lot, or worse you hearing nothing back after the meeting. Once you have money you will hire people. What’s this about? It’s about selling potential employees on your dream. It’s about making your company more compelling than Amazon or Google or Microsoft (name any big company that’sgoing to pay people more than you can afford to pay them). It’s also a marketing event as how potential employees view your company creates buzz in town about how good (or bad) you are.  Then you have press and analysts to sell so they write good things about you.Then you have to get initial customers and who better to get those customers than the founder who has unwavering belief in what their company’s about. Once you start selling then you raise more money and then you do more press and then you hire more people and meet with bigger and more customers. See, most everything you as the founder do is about selling. Get good at it!

Entrepreneurship is something so exhilarating to see in action.

Entrepreneurs are in a class by themselves as it relates to positive

outlook, optimism, and enthusiasm. Every entrepreneur believes

what they’re doing will change the world or at least make some

lives better. Everything is possible for an entrepreneur and that

makes me think anything is possible too! When I come away after

meeting an entrepreneur with a new idea or product I too feel

invigorated and like anything is possible.

Entrepreneurship is all about tomorrow and what’s possible.

It makes you feel as if the world can be made a better place

and that the world will be changed and improved. That always

is a message of hope and optimism. New companies are the

future and the growth of our country-more new jobs come from

small businesses than any other sector of our economy. That is

worth supporting in any fashion possible, even it is means giving

an hour to an entrepreneur with a new idea when you don’t

have the time to do so. Who knows who the next Google or

Facebook or MySpace founder will be?

Entrepreneurs want to tell the world about what they’re doing

and why it’s the best idea ever. The best ones also want to hear

why the idea isn’t maybe as good as it could be and will listen

to constructive feedback. However, they’re still passionate and

unwavering in their belief of their idea and won’t let obstacles

get in the way or let naysayers stop them from achieving their

goals. Where others see roadblocks they see bumps

in the road to hop over. That’s why I love entrepreneurs. It is

all possibility and not letting anyone get them down. It’s so

hopeful and exciting and worth being part of in some way.

We meet/talk with a lot of entrepreneurs who are raising money.

In these conversations, in the executive summaries and

investor PPTs there is often missing a breakdown on use of

investor funds. It is important for an investor to understand

exactly how you will be spending their money. Are you going

to scale a sales force? Is the capital to build release 1.0 of your

product? Is it for marketing and company launch? What is the

breakdown of headcount versus other spending?

What we suggest is to focus on milestones and what can be

accomplished for each round of money that’s being raised.

Show investors what your operating plan looks like for each

functional area of the company. They will be more comfortable

if they see what your plans are for each quarter of a fiscal year

and how you’re measuring each area of the company: development,

sales, marketing, bus dev, G&A. If there’s an assumption of what you

can accomplish if you raise $1M show that. If there’s another set of

milestones you can accomplish with $2M then show the incremental

between $1M and 2M. If you only end up raising $500K instead of

$1M what would that look like?

Milestones are also helpful in assessing how the business is progressing

and can focus your discussions with your board. If you find that your

milestones are not reasonable then remap what is achievable based on

what you learn along the way. Good information that materially changes

your operating plan is to be expected and investors will appreciate that

you’re building a “learning organization.”

We meet/talk with a lot of entrepreneurs who are raising money.

In these conversations, in the executive summaries and

investor PPTs there is often missing a breakdown on use of

investor funds. It is important for an investor to understand

exactly how you will be spending their money. Are you going

to scale a sales force? Is the capital to build release 1.0 of your

product? Is it for marketing and company launch? What is the

breakdown of headcount versus other spending?

What we suggest is to focus on milestones and what can be

accomplished for each round of money that’s being raised.

Show investors what your operating plan looks like for each

functional area of the company. They will be more comfortable

if they see what your plans are for each quarter of a fiscal year

and how you’re measuring each area of the company: development,

sales, marketing, bus dev, G&A. If there’s an assumption of what you

can accomplish if you raise $1M show that. If there’s another set of

milestones you can accomplish with $2M then show the incremental

between $1M and 2M. If you only end up raising $500K instead of

$1M what would that look like?

Milestones are also helpful in assessing how the business is progressing

and can focus your discussions with your board. If you find that your

milestones are not reasonable then remap what is achievable based on

what you learn along the way. Good information that materially changes

your operating plan is to be expected and investors will appreciate that

you’re building a “learning organization.”