The Junction

It has been a VERY long time since the last time I went on a date. and here I am, standing in front of the mirror, rehearsing my opening lines, some butterflies in my stomach… It’s pair-up night at the junction!

2 minutes pitch (VERY hard to do), followed by 5 minutes, 1 on 1, speed dating style.

You probably know how hard it is to find a partner (co-founder). If you don’t, you might want to google it.  The web if full of pair-up websites, advises about how to find the right one, what should you look for in a co-founder, etc. Very depressing on one hand, but for me it was a way to realize that I’m not alone; it seems as if everyone is looking for a co-founder.

I’ve been searching and looking around for quite some time to find myself a partner. I met with quite a few people, talked to my friends, called friends from the past, randomly sent emails to people I saw on LinkedIn and even asked people on the street if they would like to join me. nothing. read more »

What’s the right format for a pair-up night? Would love your take. What I was thinking was:

1. Each “concept pitcher” will have 2 minutes to pitch: himself, the product & status, what he/she is looking for. This is the primary driver for the pair-up to work well, so it’s incredibly important to get it right.
2. After that, we will have a 5 minute break, followed by optional 1 minute pitches by co-founders looking to join a startup. They can use it to have the founders want to meet them specifically.
3. During that time, we will have a shared google doc that people could register to meet each other. I believe that at least some of the people presenting a venture would want to join a different one. Don’t be shy – you are there to find a co-founder, don’t hang to your idea.
4. Using the doc we will set up a full hour comprised of 5 minute 1:1′s for people to get together, a’la speed dating style. We will add some random factor as well to get people outside of their comfort zone.

I suggest no powerpointing for the 2 minutes, but if you do… Need to come earlier to load everything to a single machine. Choice of hebrew/english is yours.

This post was originally posted on Venturing from Israel, Micha Porat’s blog.
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It is relatively often that I talk to entrepreneurs who tell me “it is too early to meet”, “we’re not ready” or “the product is not mature enough to meet”. Sometimes they’re right.  Actually, they’re always right, because it’s their prerogative to choose if and when to meet who and where.  But, I feel that in many cases, this statement is derived by a misunderstanding of the day to day business of venture capitalists, and where we feel we can add value to companies pre-investment. So I am writing this post to help clarify how I see my role and why I think it is never too early to hold a first meeting.

As a venture capitalist, my purpose in life is to invest & help build great companies that will generate outstanding returns to our fund’s Limited Partners.  That role can be split into pre and post investment.  Let’s focus on the pre-investment, which I would estimate accounts for anywhere from 20% to 50% of a typical venture capitalists’ time.  Pre-investment is comprised of networking, sourcing, due diligence, and deal closing.  So why is it never too early to appear on a venture capitalists’ sourcing radar? Because there is value in brainstorming and leveraging the venture capitalist’s network, while the downside of appearing ‘unprepared’ can be mitigated easily.

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This post was written by Ido Yablonka, Co-Founder and CEO of ClarityRay, and a member of The Junction wave 3.

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I’ll start at the end: if you’re located in Israel and are involved in an early-stage start-up, in particular one that is related to consumer web, you’re very likely making a big mistake not making the junction the first step in your journey. I tried to list down and explain the top ten reasons why.

1. Focus.

The odds are against you in this game, you’re outmanned and outgunned. The only way to win is by staying laser-focused on a target few others recognize, and closing in quickly. Every action you take needs to bring you closer to that target, and should do so with maximum efficiency so as to allow the next action, or a minimal margin of error in case the target shifts. Staying at the junction will not let you slip up. you will have many deadlines, presentations and constant feedback from your environment that significantly reduce the risk of waste in your battle-plan, as long as you stay attentive.

2. Know how good competitors are.

The junction filters by ‘entrepreneurial seriousness’, meaning admittance is conditioned upon the team’s willingness to work full-time on the project for the duration of the program. This is surprisingly effective. In my wave, the teams were all very able and hard-working, which made me reevaluate the level of startups out there, potential competitors in particular. Fearing competition to a point of paralysis is as destructive as dismaying it without grounds. The junction will clearly illustrate the absurdity in the latter option – people are generally not completely insane and those who are willing to risk several months, if not years, of high-paid work for a startup tend to have a real shot at winning.

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No Bullshit

A few weeks ago I participated in a panel that included myself and a couple of outstanding entrepreneurs. The event was part of an entrepreneurship and innovation class of one of the leading MBA programs in Israel.

During the panel I was asked an interesting question by one of the students (who is also an entrepreneur). She asked what not to do when pitching to a VC?

Usually the questions I am asked are the opposite types of what “yes” to do so, this question stood out. But I had an immediate answer as there is one mode of behavior that in my opinion is not only a turn-off but also pisses me off (excuse my language).

My answer to her was “do not bullshit”! It is more than ok not to have all the answers and not to always have complete answers but don’t try cover it up with bullshit. Rather be transparent and open about the fact that there are still areas you need to check and analyze or that you do not know the answer and you need to find it out. In fact I even respect this type of honesty and it even gives the entrepreneur the opportunity to come back and have another discussion about the business.

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This post was originally posted on Venturing from Israel, Micha Porat’s blog.

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Last week we had our first demoday at The Junction (our co-working space/accelerator – read more about it on our website), and I was positively surprised at the number of companies that have managed to reach a phase where they were able to present a working product (our only requirement to come onstage). This is the end of our third wave of entrepreneurs at The Junction, and it is clear that this third group had more companies that reached a working, launchable product than the first two waves. I was interested to better understand what were the reasons for this? – what have we done differently that led more teams to reach a product they can demo and launch. From my conversations with the entrepreneurs, feedback was that having a demoday was a major component.

In the early days of a startup, teams often feel they have limitless opportunities. They often change their product vision, for a better product-market fit. They think of various features that can be added to the product (Minimize!  more about this in The Startup Disease of Featuritis). They often let news and changes in the market sway them from one concept to another (future blog post…) Things are hectic in these early days (and they tend to stay hectic throughout startup life). When observing entrepreneurs at The Junction, it is often the case that 6-8 weeks into the 13 week program, teams have initial concepts of a product; but over the next several weeks, instead of going through productization and launch, they continue to iterate based on feedback from peers. They rarely manage to stay laser focused on getting to market.

The addition of a demoday, an unchangeable date where they can either demo a working product, or stay out of the mix, kept many teams focused. Over the last couple of weeks of the third wave, teams were doing everything they can to wrap up the initial product, get their pitches ready, and be able to come onstage. It kept them focused. It kept them driving to a clear goal. It made them more effective. And in retrospect, looking at their performance during demoday (which was, btw, outstanding) this unchangeable date, this set-in-stone milestone (no pun intended), brought the best out of them.

So if you are an entrepreneur, early stage or not, within a structured program or not, I encourage you to set a clear milestone for a WORKING product. Make it as short term as you can (FOCUS) and do everything in your power not to change it along the way. It will keep you effective. It will help drive you to success. Just ask members of The Junction’s Wave 3 – it already worked for them.

This post was originally posted on Venturing from Israel, Micha Porat’s blog.

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One of the most frustrating things for me as a venture capitalist is the quality of pitches I hear every day. No, I’m not talking about the content (if it was about the content, it would have been time for all of us to go home), I’m talking about the delivery. Israeli entrepreneurs, with some exceptions, just don’t know how to deliver a good first pitch – whether elevator (30 seconds), short pitch (5 min) or a full pitch (~40 min). I’ve spent a lot of time thinking about this, trying to analyze why, wondering if there is any way I can help drive change – I honestly think many promising startups are missing out on funding opportunities simply because of their inability to get their vision across. So here is the result of my initial analysis – would love to hear your thoughts – as I think getting your message across is one of the most important aspects of being a young entrepreneur.

Let’s start with what isn’t the problem:

• It is not about disrespect of the process – most entrepreneurs I’ve met have spent a tremendous amount of time in building their presentation. Usually I get to see meticulously crafted slides – with visuals, a ton of text, and animated transitions (and that’s part of the problem of course…)

• It isn’t lack of resources – there are plenty of examples for well crafted pitches and videos of promising entrepreneurs delivering them. Whether in conferences (Disrupt, TED, etc) or via other web resources (youtube, blogs, etc)

• It isn’t business incompetence (usually) – most entrepreneurs know their markets well, understand the painpoint their are trying to solve, and in many cases have built great products that solve that painpoint. read more »

This post was originally posted on Venturing from Israel, Micha Porat’s blog.

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Last week I attended the Techstars New York demo day.  It was pretty awesome.  Great venue, great people, and most importantly, a standout class of entrepreneurs who delivered pitches that I felt were right on.  I want to talk about the 3 startups that impressed me the most, and share with you my initial unfiltered analysis (so take it with a bigger than usual grain of salt).  Should give you some insight on my thought process during these 8 minute pitches.  Remember these are the best 3 in a great class of entrepreneurs – so the number of question-marks is relatively low as compared to the typical pitch a venture capitalist would hear.  If you want to read more about all the startups, I’ve shared some links at the bottom of this post that cover the entire event.

Contently – These guys went first, and boy did they set the tone for the  event…  CEO Shane Snow (@shanesnow) gave a pretty flawless pitch, presenting contently as a marketplace that connects publishers with freelance writers. Like many venture capitalists, I am interested in marketplace pitches; they have some general attributes that make an interesting venture investment – they are “close to the money” as they manage financial transactions, they can usually scale well, and they need little capital to get off the ground.  The giant challenge, which is also the case in Contently’s case, is how to build traction on both sides of the market – the “chicken and egg problem”, while keeping a balance across both sides.  Balancing supply with demand – so you don’t have a ton of starving writers and few publishers, or a ton of publishers seeking content and only few writers to supply them with it.  If the company can execute well on this challenge, I think they are operating in an interesting market that has yet to be interrupted, and are definitely one to watch…
contently.com

ChatID – When these guys came onstage it felt almost odd to hear a pitch that has a big piece of technology as part of their competitive barriers to entry – gotta love it.  Needless to say, it was not your typical TechStars pitch…  ChatID is an internet infrastructure play – it gives businesses the ability to engage with their customers directly via chat anywhere on the web.  The example used by CEO Dan Herman (@Dan_Herman) is a customer searching for a flight on Kayak and being able to connect to a chat with a Continental representative from within the Kayak offer.  This chat would be the Continental chat channel used across all publishers. Chat aggregation of sorts.  This is a really interesting play- very sticky (why would you ever want to change?), clear need, and obvious value.  Monetization is less clear for me, and would be the challenge in making this a big business.
chatid.com

Dispatch – Headed by Jesse Lamb (@JesseLamb), these guys make managing your cloud content simple – giving you a simple interface to manage your online media & files.  In simple words – drag & drop your facebook photo to picasa, your document from dropbox to google docs, etc. I actually saw an Israeli startup that had built this product 2 years ago – they had pretty strong technology, but UX had a lot to be desired…  Wasn’t sure the market was ready for it then.  Not sure if the market is ready for it now.  This is a tough one for me to asses.  Don’t get me wrong -clearly our dependency on web services and the content they store for us is constantly increasing, but I’m not sure this won’t be solved by APIs across the major platforms.  I think this is a space to watch – not sure I would consider investing now, but if the user experience is top notch, Dispatch could become a huge play when the time is right.  I just don’t know how to call it right now – but definitely worth monitoring.
dispatch.io

As I said, all 12 presentations were great – and I really felt this class is outstanding.  I hope the next TechStars NY class (starting March 2012) will include an Israeli team – I think a lot of Israeli startups can benefit tremendously from what the program has to offer.  In the meantime, if you are interested in TechStars, whether as an entrepreneur or investor, I highly recommend you take a look at the new reality show (?!?) that looks at Techstars NY first class - http://www.bloomberg.com/tv/shows/techstars.

Additional Coverage of the Event
GigaOm Coverage
TechCrunch Coverage