Startup Mixology / Techcocktail in Chicago–Insights from Travis Kalanick
Finally made it to #Techcocktail / Startup Mixology conference in Chicago
First guy I see is Travis Kalanick (@KonaTBone), a co-founder of Scour and later RedSwoosh (acquired by Akamai). He’s full of fun factoid (such as influencing Parker in “getting” Zuck and fb, says he’s been replaced by an Asian woman in the movie, or getting sued for $250bn). He’s a mix of arrogant and brilliant, pitches himself as a “startup curator”. JamPad is his gig, “startup jamming” is the high concept. He can be “The Wolf in Pulp Fiction, your Funding Shepherd, Your Interim CXO, and Curator of Entrepreneurs, your Eminence Grise”. Ultimately though the guy has got plenty of substance once he gets going; I would want him on my side if I was a founder.
A few points from him I wanted to share:
- Preemption is bad; don’t trust VC’s who pitch pre-emptive deals, you usually get a raw deal. I am sure there are a ton of counter examples, but he’s basically saying “don’t fall for VC marketing, raise money on your own terms”. Can’t disagree, will still try to pre-empt… Would you not think less of me if I didn’t ?
- VCs want to kill founders, even those who perform well. I have a lot of sympathy with this point. I have seen this tendency at work of replacing founders, which usually means losing part of the soul of the company. Pattern recognition iswhat drives this, in the sense that many companies fail because founders don’t "scale" (fact). But it’s become a disease in the industry to seek “professional CEOs'” too early or when it's not warranted. Often the supposedly rational choice is not the RIGHT choice. In a way this is where art and intuition trump method and experience, the ability to recognize when to take a real risk on an unproven but talented entrepreneur so as not to kill the spirit of the business. Hired guns don't do miracles, but founders often do.
- “Fear is the disease; hustle is the antidote”
- “Fake it till you make it” is bullshit; don’t live a lie, this is not a sustainable but an insecure strategy driven by fear. His message: don’t fake it, you won't make it.
- Funding does not solve all problems. Absolutely. Funding does not solve product/market fit and can make the pressure worse. Sales and hustle solves problems. No point raising too much too fast when you won’t use that money because you haven’t figured out p/m fit yet.
- CEOs that survive are CEOs. If you are not tough enough to survive the pressures, you won’t make it. Magic is not enough to take you through, you need the grit and toughness to make it through, and you need to be self-aware enough to recognise when you don’t have the toughness in you.
- Many, many entrepreneurs have had bad / disappointing advisor relationships. Part of the problem is that entrepreneurs try to squeeze too much out of advisors. Think about full time value (cash and equity) if they come on board, and pro-rate to how much you would give them for the time they actually commit. It’s probably going to be more than you would normally give them, but now expectations are set and you are likely to get real value. I agree wholeheartedly, there is an art to being a good mentor and advisor that few people master, and there is an art and a method to getting real value out of advisors, that few founders master. Much work to do here and a necessity to reference and create feedback loops.
- A finally let me reference a good post he wrote on angel fundraising skillzzz.