Benjamin Kuo’s Blog

One issue I hear about a lot from venture capitalists in town, is the problem of sorting through what I think of as “real” entrepreneurs from “wanna be” entrepeneurs.

“Real” entrepreneurs are those who really have a business model, are fundable, and have the experience and knowledge to make a “real” business.

“Wanna-be” entrepreneurs usually do not have any experience/knowledge, don’t have a business model, probably will never be able to get a venture round, and generally are  a waste of time for VCs to deal with.

Some hallmarks of “real” entrepreneurs:

1. Have relevant knowledge in the field they’re attacking, usually in some sort of senior/executive role at a related firm. (i.e., starting an Internet ad startup, was a VP at Overture/Google/etc.)
2. Have been willing to invest their own money and time into the venture.
3. Track record of success bringing prior products to market.
4. Are well into implementation of their idea

Some warning flags on “wanna be” entrepreneurs:

1. Do not have any relevant experience in the field they are attacking. (i.e. starting Internet ad startup, used to be a insurance salesman)
2. Pitching a power point and idea, not a running business.
3. No track record of bringing anything, much less a company, to market.
4. Have been looking for $ for their idea for 2 years and don’t have anything running yet.

Which one are you?

I read this article on Mashable today on Seven Ways To Get Your Mom On Twitter, and just had to write my own version of this: Seven Reasons Not To Get Your Mom On Twitter.

Here are my seven reasons for NOT getting your mom on twitter:

1. Keep your mom from tracking your every movement. Based on the traffic I see on twitter, I’m not so sure having your mother know what you are doing at every moment is such a good thing. Maybe I’ve been gone from home too long, but really–I can imagine the tweets now: “Why are you always out drinking late at parties?”  “Honey, who’s that strange person tweeting you about doing beer pongs tonight?” “Dear me, oh my. Did you know one of your twitter followers just tweeted you a url to a naughty site?”

2. More twitter noise: and from your parents. Sample tweets: “Worried about Charlie. He coughed up another hairball this morning.” “Booked golf game. Weather is lovely today.” “Did you hear? The neighbors up the street just moved.” “I’m going to live-tweet the next weeks worth of daytime soaps, isn’t that wonderful!”

3. More guilt for not calling mom. “Honey, how come you haven’t tweeted this morning to me? I sent you 4 tweets last night about my bingo game!” “Your brother Bill tweets all the time, how come you never do?!” “The neighbor’s boy Sam just got a big raise and a company car. Why can’t you be more like him?”

4. You mom might follow all your friends. Likely since it seems people seem to follow everyone their friends are. Do you REALLY want your Mom to know what you and your friends are doing? Tweets: “I’m shocked by the language your friends are using on twitter! You shouldn’t be following folks like that.” “Don’t any of your friends work, or are they all just unemployed and tweet all day?”

5. All of your mom’s friends might follow you. “Just saw @yourmom just followed you, thought we’d invite the whole bridge club” “Why don’t you talk to your mother more often?” “Our lady’s auxiliary is having a bake sale, could you invite all your techie friends over?” “Your mother is very concerned about you, how come you weren’t at church on Sunday?”

6. You might learn more than you’d ever like to know about mom. Tweets: “Oh dear, my constipation is really acting up this morning. Anyone have any ideas?” “Your father has really bad gas today. We’ve got to stop making baked beans.” “Just saw the UPS delivery man. Gives me chills just thinking about him!”

and, the last reason not to get your mom on twitter:

7.  Your mom might have more twitter followers than you do.

The Technology Council of Southern California has just opened up applications for their annual VentureNet conference. The Technology Council’s annual VentureNet event has been a great opportunity through the years for great companies to pitch venture capitalists from both Southern California and Silicon Valley.

What very few entrepreneurs realize is that just applying to VentureNet is a great way to get exposure for your company, because all of the venture capitalists on the panel review the PowerPoint and business pitches submitted into the conference.  (I’ve been on the selection committee for a few years, and I’d highly recommend serious entrepreneurs submit their info early–it’s really a great opportunity). It’s very rare that you’ll get your business in front of these capital providers so directly.

I happened to run across an interview by Private Equity Hub (which is published by Thomson Private Equity), and was surprised to see a legitimate publishing organization violating copyright law. You’ll note the photo they are using (which I took; folks in Westlake Village might note that the building on the left is Brent’s Deli where Richard Wolpert and I had breakfast) is copied from the socalTECH flickr account here. Hello guys?

Update: looks like they’ve swapped in another photo. Thanks — and please ask us next time!

Many of you in the SoCal technology community have seen the events run by Andrew Warner, of Mixergy. He’s been organizing the Lunch 2.0 events here in Southern California as well as other educational seminars and useful networking events. We’ve just posted a short video from Andrew on how to keep your inbox clear in our Insights and Opinions section. It’s a nice short clip, and worth watching.

Random gripe of the day: there’s been way too much hype about Mozilla Firefox 3.0 web browser. I recently installed Mozilla Firefox 3.0, and my experience has been summed up in one word: dismal. As much I have been a fan of the browser, there’s been way too much hype around this release. I regularly use both Firefox 2.0 and Internet Explorer, and Firefox 3.0 crashes roughly two or three times a day for me, freezes up my system doing who-knows-what on Javascript enabled pages, takes forever to load extensions, and still is a memory hog. So if you are looking to install it, I’d wait until the next version (or go scrouging through archives to find an old version of Firefox, like I did this morning…).

In our continuing series of Insights & Opinions from readers and others in the community, we’ve been trying to add articles that might be useful to entrepreneurs and others. With that goal in mind, our anonymous contributor, “Uncle Saul” has just posted a lengthy and very informative article entitled Kiss of Death - Contract Provisions Entrepreneurs Should Avoid at All Costs. He goes into deep detail on some of the major points you ought to consider when drafting a legal agreement with a larger company.

As a startup, your most meaningful agreements will likely be struck with BDCs (Big Dumb Companies). You will no doubt craft agreements with companies of similar or even smaller size compared to your own, but the risk associated with such agreements will be tempered by the fact that you will negotiate such agreements as a relative peer. As such, your greatest risk and greatest opportunity will arise from the deals you cut with larger entities.

Tim Kane, a senior fellow at the Kauffman Foundation — which is focused on fostering entrepreneurship, and is behind many studies on the area — recently talked with a couple of venture capitalists, including Southern California’s Ted Alexander, who is at Mission Ventures, and shares his takeaways on the challenges of the venture industry.

The last few years has been notable in the lack of major cutbacks (or at least, attention to layoffs) at local companies. The go-go environment has spawned far more companies than are being lost, and far more employment and jobs created than losses.

However, I noted two stories today which we haven’t seen much of lately, which are layoffs and consolidation in technology companies. It looks like it’s a particularly bad day for Ventura County:  Imation (in Camarillo) closing its plant and Midway Games closing its operations in Moorpark. Ventura County (and the 101 technology corridor) has been fairly quiet lately, as venture capital interest has moved more towards the consumer Internet and away from the hardware/electronics firms which have a greater presence in the corridor, but technology companies in the county have been plugging forward. These two closures — which follows higher visibility cuts over the last few months at big employers Amgen and Countrywide — are not good signs for the economic environment in Ventura County.

Aside from the local impact on jobs and employment, the actual fact that companies are closing or laying of employees is a story we haven’t seen for a long time. Whether that’s because there have been so many new companies and interesting developments in Southern California, or a booming economy, I don’t recall having covered two layoffs/closings in a day since the dot com bust. Hopefully this is more of an anomaly than the beginning of a trend.

I spent a little time today chatting with Michael Schoenfeld, director for Ernst & Young’s Pacific Southwest venture capital advisory group, about the numbers released from Dow Jones earlier this week on venture activity. We follow this market very, very closely, but it’s always good to get another viewpoint on what’s going on here. Michael pointed out to me that the second quarter was one of the best we’ve had here — you have to go back to 2006 to have another quarter similar to this one in terms of capital raised. He also pointed out that one aspect of the area’s activity has been that our activity is not all in one industry. There’s a healthy mix of industry sectors receiving dollars. Compared with national data, Southern California has been bucking the national trend. All in all, Michael felt it was a very positive quarter for the region.