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Tim Langley pointed me to this intersting presentation.

Startup 2.0

Manoj threw another great event tonight with interesting speakers and audience alike. Stuart Scott-Goldstone of Aaron and Partners gave a thorough introduction to the range of legal issues that startups face on raising their first round of venture capital. the long list or issues seemed seems like it must be scary to any startup listening! Doug Stellman of YFM Private Equity started his presentation with a disclaimer of small print lest any of us fancied investing. Interestingly the proportion of Software and IT deals had shrunk from around 35% in 2006 to 20% in 2007, apparently due to concerns about the ease with which software companies could be established. His presentation focused on the management team as a key driver for their investment decisions. He cited that he sees applicants with a management team with a prior record of success "more often than you'd think". Paul Barraclough of TecMentor praised the Crossing the Chasm approach to getting to early sales momentum in startups. For me, Pam Holland gave the star presentation- starting off with a video (link to follow if I can persuade Pam to let me upload it) portraying how rapidly Telecity had grown pre-dotcom crash. She explained how they'd managed the spectacular growth in staff numbers and the attendant HR issues. I loved the story about how she had to persuade the founder to go home for his meal in the evening to encourage the staff to go home at night- even if he returned later each night! She explained the "competency based" recruitment approach she used, biased towards the attitude and raw capabilities of the individual rather than solely their technical skill-set. She also related that it was a "little bit disappointing" when the share price slumped from £23.00 to 2.3p, and she had to handle a new set of challenges!

NW Startup 2.0 Demo & Mashup Manchester Events

Manoj doesn't look too happy in this picture, and he didn't look too happy tonight after a string of mishaps hit these events tonight. But they weren't significant problems, and the event was a great success. The audience was full of interesting people and the presentations punchy and clear. I'm looking forward to the next one!

Project Sahara

shadow train
Originally uploaded by bendylan

Lee Strafford and friends have established project Sahara and thenetstart with the aim of establishing a community of internet companies across the North of England. It meshes with initiatives such as dotnorth.org which have compatible aims in this area.

What Lee evangelises, and rightly so, is that the most successful internet companies in the UK were those that sprung up in the North of England: he's therefore brought together some of the leading players in those companies to build a repeatable model around this opportunity.

I admire Lee's energy, and am hopeful that his experience and track record will help bring the various parties together to create a set of really exciting new enterprises; this may be challenging but it's surely a challenge worth serious pursuit.

In our own small way I think we could claim to have been the most active investor in this sector across the North in recent years, and we're looking to do more in future. I think we'd suggest that the problems Lee is addressing are important and prevalent. Most start-ups in this sector do have the feeling of being "on their own", and they'd benefit greatly from being part of a community in many different ways. The powerpoint embedded below gives more detail on the problems the project is addressing and what is being built.

I'm keen to see the project grow and succeed. There seems to be a growing momentum behind the initiative and I'll be keen to contribute where I can. In recent months Mashup, GeekUp, Opencoffee and now Project Sahara and DotNorth have exposed the size of the pool of both entrepreneurs and technical experts interested in this area of activity, and I'm looking forward to seeing us play our role as an active early-stage investor to help nurture the companies that will surely emerge.

Startup 2.0 in Manchester

Manoj has again done a great job of preparing the next Startup 2.0 event in Manchester on Wednesday night. Annoyingly I have to be in Glasgow, but otherwise I'd be looking forward to hearing from Lee Strafford, CEO of PlusNet which was recently sold to BT for lots of money. He's got some really interesting plans to help web startups: I'm sorry I can't be there to heckle ;-)
Manoj has lined up a VC, Peter Leather, and Billa Bhandari who runs a biometrics company and has lots of tech startup experience, to complete his line-up.
It's great that KPMG continue to support this event, I'm looking forward to the next one!

What type of web startup are you?

Rail Mail Sorting Slots
Originally uploaded by Potjie

I had a very thought provoking conversation yesterday with Lee Strafford the former CEO of Plusnet about web companies. One part of the conversation I think might be interesting was around classifying the different types of such companies by the way in which they build competitive barriers:

Class of barrier	Characteristics
Tech Heavy	Some piece of technology is strikingly difficult to do, perhaps requiring realtime communication or tricky client software to make it work. These companies can take a little longer and can raise money earlier in the adoption lifecycle due to the inherent IP. We've got a couple of these in the works, but they're in no hurry to tell the world what they're up to!
Execution orientated	In these cases the company is not doing anything that technically that groundbreaking, but they're getting the business model, user experience, pricing etc. right in a way incumbents with more inertia would struggle to do. Here the key is about speed and quality of execution. I think I'd probably put Yuuguu in this category at the moment...
Critical mass orientated	Lots of web1.0 gravestones here! This is where you have to find ways to get the kind of critical mass of users which means that the service can gain a strong lead. This is more like the Facebook model. To be honest we've only tried this once and we ran out of capital before we reached critical mass. You can't sell these early and the key is probably to find ways to reach that early audience cheaply. I believe that Facebook did this early by getting links with US colleges.

Perhaps it's interesting to think which model fits your company best, and then what that implies for strategy?

b.tween presentation on VC post web2.0

'nuff said: