hacking-the-core-tom-nora

Go Where They’re Not; The Cantrepreneur.

startup, startup CEO
 (Photo by Wil Stewart on Unsplash)

 

Im my book HACKING THE CORE, I write about using Creativity and Innovation to help startup founders achieve that elusive goal – sustainable business growth, along with a few other things like profitability, a fun place to work, personal fulfillment.

That’s an oversimplification, but the idea is to expand your horizons, “think different” to enhance your chances for success as well as personal fulfillment along the way.

Innovate. Be creative. Discover something no one else has. Go where they’re not.

The book also talks about Wantrepreneurs and Cantrepreneurs. In my consulting work I can identify these types of people. They’re usually struggling, losing their company, walking backward towards the edge of a cliff, failing daily. Yet they’re unwilling to change their thinking.

Creativity and innovation don’t actually make sense to them in a practical application because it threatens their status quo. Deep down, change is bad to them.

Their brains are wired to do things their way – no matter what. Usually their way is to mimic someone else’s or their own successful tactics from the past. Crazy, right?

Every entrepreneur wants to innovate but some just can’t. Even in the face of doom and bankruptcy they can’t change. Another type of cantrepreneur.

They ask for help but only to help them do things their old way, and not to bring new innovation to the problem.

Why? Because that’s a threat to their self image, their power, their reputation as being the authority. Their position as the boss.

There are other people who are totally open to change, reinvention, pivoting, innovating, threatening their own beliefs, listening to others. These are the real entrepreneurs. They’re happy to be wrong. They have much better odds for success.

Which one are you?

Buy book HACKING THE CORE on iTunes/iBooks.

Only $3.99 for the next 30 days.

noraHacking The Core Tom

Hacking The Core

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The Greenshoe = how to repay all those that helped along the way.

Angel Investor, early stage, founder, Hawaii, Revenue Growth, Scalability, startup, startup CEO, Tom Nora, venture

How is it that so many people associated with startups reap the financial benefits, yet others just as close get no financial upside This is a source of frustration among many people in the startup sphere. Imagine if you’re in Silicon Valley right now with no equity in a tech startup, but associated with several people getting six figure “bonuses” because they somehow wound up with some stock in one.

The free parties (or not free) and swag and great stories and boat rides in the bay are nice. Sometimes you’ll even score an iPad or Apple TV, but it’s not the same as being one of the insiders.

Often as startups grow and maneuver their way through the jungle of success or failure, they have a lot of help from those around them.

Often many these people don’t have any equity or upside from their advise or moral support or money lending, or even the spare couch they let you sleep on when you were in their town.

If the startup actually makes it to an IPO, there is actually something you can do.

It’s called the “Greenshoe”. You have to be very careful about this, you can’t imply or promise anything in advance, and it only works when the company goes public, but the Greenshoe is an amazing award for those involved that don’t have equity.

The Greenshoe is an over-allotment of stock options, up to 15% of the total offering at time of IPO. You can offer these options to virtually anyone, friends, family, people who helped your company. Since they’re options, acquirers only exercise if the stock goes up, and have no downside risk or capital outlay.

Upon the IPO event, the option owner can gain the upside if the stock goes up over the initial offering price and essentially collect that difference.

I’ve used it a few times when I was lucky enough to be able to offer it to friends and family. Strangely enough, some people have declined, because they’re not sure it’s legal; they’ve never heard of it. Others have bought themselves a new Lexus with it.

Here’s more info on wikipedia:

Greenshoe

The Greenshoe should provide motivation for all of us in the startup world to try to continuously build our company steadily, continuously and profitably and to know that you can make many peoples lives a little bit better by sharing the wealth. The rewards are pretty amazing.

Contact me at

 #Web #Development #Digital #Strategy #Art| tomnora.com

Silicon Valley Uber Alles? I think so… Some of their Secret Weapons.

Angel Investor, Business Development, CEO Succession, Drupal, early stage, founder, Hawaii, Jobs, Launch, Revenue Growth, Scalability, startup, startup CEO, Tom Nora, Uncategorized, venture

Can any other region “catch up” to Silicon Valley, or be the next Silicon Valley? Statistics show that it’s probably kind of futile to even try. Many have tried, but must be content with their small market shares. How can other regions will ever match the MACHINE: Stanford, Andreesen, Draper, Valentine, Doerr, Facebook/Apple/Google Millionaires, 4 Generation VC firms, Hardware/Software partnerships, over 100 Billon $ market cap cos.

svfundingshares

Because high tech and software industries are now being seen as lucrative, job creating, imperative and oh so sexy, many regions are trying as never before to get in on this – mobilizing their governments, old school industries, universities and grandmas to unite to be the next Silicon Valley, calling themselves Silicon- Beach, Forest, Plains, Alley, Prairie, Coast, etc. These towns are setting their expectations way too high while the real Silicon Valley giggles at the sight.

Here are some of the secret weapons that make Silicon Valley stronger than any other “region” and act as its barriers to entry:

1. Silicon – Uh, yeah, that word? It’s what started all this. Silicon Valley launched and was launched by the mainstreaming of the Silicon chip over 50 years ago, which is now part of everything. There was no other part of the planet where anything close in innovation, design manufacturing, equipment, marketing and sale of semiconductors has emanated from. This foundation still drives the area and the world, even thought it gets less attention now than the software side.

2. 100 Years of Growth – It all began with military electronics, low cost housing, lots of empty land and Stanford University. It has spread way beyond to the east bay. San Francisco, over 50 universities and trillions of dollars in revenue. The growth has had bumps but over time has increased more steadily than any other economy in history.

3. Recruitment – Most of the leaders in SV are from elsewhere because Silicon Valley aggressively acquires the best from all over the world. Why not? Via Stanford, Berkeley, Facebook, Google, recruiting Harvard and MIT undergrads, their wonderful PR machine, advertising free meals, free car washes, free dry cleaning, free day care. $150,000 salary right out of college. Unlimited vacation. Where else can you gat all this?

4. Stanford – Not sure this even needs explaining, but Stanford has been a wole new entity in the past 20 years, beyond anyones imagination in wealth creation, funding, computer science, a recruiting engine into SV then on to local companies, pride, confidence, location.

5. Money, money, money – There are so many giant sources of money in SV that it’s staggering. VCs of course, Angels, they invented the term Super Angel, San Francisco, Real Estate leverage, IPO millionaires, corporate funding, Asian and European money, and on and on.

6. Tolerance for Weak Links – Here’s one most people don’t know – most people in SV aren’t stellar; I know several weak players who fake it well and are millionaires or millionaires-to-be just because they’re in the right zip code. The public tagline is everybody has a high IQ, but in reality there are lots of dwebes running around – I know, I’ve managed plenty of them. SVs leaders smartly realize the win ratio can be pretty low if you have a few enormous winners. Most SV projects die, most SV companies die, but if you build the algorithm to plan for this you’ll put more possible winners in play. So what if a few totally unqualified employees that snuck in make a few million. Like any organization, there are several who skate by or get by on good politics. That’s OK if you plan for it, “engineer” for it.

That’s just 6, there are plenty more reasons why there will only be 1 Silicon Valley for along time to come. The best answer for any other local economy is to just make the most of who you are, embrace your own identity, partner with Silicon Valley. And don’t use the word “silicon” in your name. Take Boulder, Colorado as a model, they’ve successfully created their own very strong economy for startups. There’s a startup for every 50 or so people there. They have all the pieces and they are heavily connected to Silicon Valley without envying them.

@tomnora

What is Drupal? or, My retraining in Software Development

Angel Investor, Business Development, Hiring, Jobs, PHP, SaaS, Scalability, startup, startup CEO, Tom Nora, venture

Confessions of a Drupalvangelist

Anyone who’s been around me for the past 6-12 months has been inundated with my evangelism of eCommerce in general and Drupal + PHP. This is actually a bit strange for me, as a 20+ year software industry professional, I’ve spent most of my time in the world of extremely sophisticated software tools and languages – several of the startups I’ve worked at and/or launched were based on software tools to build software, so I’ve been in the middle earth of software for awhile.

The So Cal engineering gap?  I’ve been able to study the Southern Cal software dev scene as an insider for over 2 years now. As a native LA person, I’m gratified to see so much code and code talk flying around my town. But, there is a serious gap in the discipline, number of developers and community around real software development here.  Also lot’s of fake, wanna be CTOs here. (So L.A.) This imbalance keeps L.A. from catching up with Silicon Valley and New York as a stronger startup region. In my career I’ve seen many times the positive effect of a rich software development discipline, full life cycle, QE vs. QA, test driven development, all the “other” parts of SW dev.

The strongest impact on improving this situation is Silicon Valley and Seattle companies – Google, Facebook, Amazon, Microsoft and others are making enormous investments in building So Cal as a software town. They bring with them confidence, tools, brilliant people and believe it or not, Drupal and PHP.

Drupal has a worldwide engine of real software discipline. The So Cal Drupal scene is highly regarded and has several free meetings every week to teach advanced software life cycle issues. The Getty, USC, The Grammys, MTV, and many more giant websites built in L.A. are built on Drupal.

What is Drupal?  Drupal works at all levels of software development. Drupal and PHP were tools I’ve acknowledged for a decade but never studied much. Then last year I decided to re-educate myself in software development, but this time as a regular ol’ coder. Although I have an EE and CS education, my best contribution to technology businesses has been in strategy/sales/marketing/leadership. I’ve had 7 jobs in Silicon Valley in software development companies, but 6 of the 7 were in business development.

When I dove into development with a focus on the future and e-commerce I quickly saw that Drupal and thereby PHP are taking over the scene. Sure you have Ruby, Python, many others, but PHP is winning because it’s so accessible to newbies, and it manipulates the server side continuously, allowing e-commerce, social, geolocation and other apps. Big boy applications.

The world has changed – software development, app dev, and software engineering are taking over the center of the conversation, and Drupal/PHP is taking over the lead. You can actually have a successful startup now with just developers, with just one (although I don’t recommend this), if they’re savvy and humble enough.

What is Drupal?  Drupal is prevalent in the Silicon Valley ecosystem? In the birthplace of Java, BSD, SQL and many other critical software technologies, Drupal and PHP are spreading like a California wildfire. Drupal has recently permeated places like Stanford; there are over 1,000 sites on campus now. Ther are 20+ major Drupal dev shops up there, they have BAD Camp every year, one of the top Drupal camps in the world.

What is Drupal?  Drupal can make a non-developer earn $60-100,000 per year within a year of study. A Drupal or PHP developer here can make from $50 to $200 per hour; I see it all the time. The problem in So Cal is that the discipline part is weak; we’re just not steeped in the cmplete range of what full cycle development, test, etc. are as a region. PHP and Drupal are partly at fault for this – people who never attended Engineering school can learn these tools in less than year without learning formal computer sciense discipline.

What is Drupal?  Drupal is an overly friendly community of helpful people and ample free training and coaching.  Drupal is also free open source software with functionality for every possible web application. When I moved back to L.A. in 2010, I gradually saw that among our weaknesses we were very strong in E-Commerce, Fashion Commerce, Mobile Commerce, Content Communities, dynamic sexy websites and it was all based on varieties of PHP/LAMP. Drupal’s weaknesses as a software language tool (push button programming, configuring, too easy, more IT than software dev) are actually its strengths. Even the best software hackers should hack less and use that time to build more functionality and usability.

What next?

1. Go to drupal.org, join up for free, find me there I’m tomn  

And contact me if you want my help on anything Drupal or PHP…

Update: What negotiation tactics does Dave Mcclure use? #500strong

Angel Investor, CEO Succession, early stage, founder, Hawaii, Launch, Revenue Growth, startup CEO, Tom Nora
Tom Nora, startup CEO, software dev, ux Edit Bio

1 vote by Casey Allen
I’ve advised several founders from 500 su and they’ve all said Dave is fair, honest, easy going, and lets you know when you’re cheating yourself. Most venture capitalists will take a little advantage of naive entrepreneurs so this was surprising to hear over and over.

Dave McClure should be thought of more as a movement leader than asking how he negotiates. He doesn’t really have to use any tricks, the whole thing is a brilliant maneuver. Remember, this thing didn’t exist a few years ago.

By design his operation is humble (I know, I’ve lived on Castro Street twice!). He created a new layer for people to get a shot at launching a Silicon Valley start with some cash and mentoring that they never would have otherwise had.

Negotiate? He could be more hard-ass but isn’t. He could wear contacts (or real shoes) but doesn’t. He created his own ecosystem that spreads out all over the world now, and even used some of his own money.

The environment allows people learn how to negotiate. And to fail softly if they fail, which is almost critical to later success.

500 startups went from strange idea to an integral part of the world startup ecosystem. Not many major players are not involved or connected in some way. One of the things Dave doesn’t charge for in his valuations is the connections to that world, and for that he will surely make everyone involved a bit of a winner.

Edit

1+ Comments • Share (1) • Delete •   • Fri

 

Mark M. Whelan

Tom, this is a great endorsement; however, doesn’t address the question set, being fair, honest and easy going is not a negotiation tactic. I think you are suggesting he is a partner style of negotiator, i.e. looking to find common ground before determining the valuation opportunity…

 

 

Tom Nora

Good points, but I think those are negotiating tactics, everything is. Dave’s strategy is to focus less on each deal and look for the wins through volume, hence the name. Many VCs on the other hand, heavily scrutinize and try to squeeze the best terms for themselves in every deal.

One key weapon VCs use is the threat of walking away from the deal at any moment. Dave pretty much takes that one off the table before starting the negotiation, giving an advantage to the green entrepreneur.

A classic trick is “all the deals are the same here, therefore there’s really nothing to negotiate” which is never true, but works often.

@tomnora

CASH IS KING — C-A-S-H — Friction Cost Reduction — Accountants, Attorneys and Consultants

Angel Investor, Business Development, CEO Succession, early stage, founder, Hawaii, Revenue Growth, Scalability, startup, startup CEO, Uncategorized, venture

Most startup entrepreneurs focus on one thing throughout the lifecycle of their company: bringing in CASH. C-A-S-H. Cash through investments, revenues, borrowing from F&F, VCs, convertible notes, deal terms, angels, etc. All of these things are magical words to early stagers. I attend and host many meetups and conferences for startups, and consult to several startups, and every founder is inevitably talking about Cash. Cash on Hand, The next Round, we just need $XXX,XXX. Cash, Cash, Cash.

A different way to improve your cash situation is the indirect one – reduce Friction Costs in your ecosystem with peripheral influencers.

In Silicon Valley, Boston, Boulder and a few other places, the growth of the startup world has vastly been enhanced over the past 10 to 30 years by professionals who are not VCs or developers or entrepreneurs – they’re the Accountants, Attorneys, Consultants, Professors, Marketing firms and others who have tremendous influence over VCs, Angels and prospective customers. They are trusted, fairly impartial, focused, big picture and practical. They’re also critical to the processes of business.

If you want to make money rain from the sky, nurture these people with sincerity over long periods of time, not just when you need them. They decrease the friction in doing business by connecting the right people, finding the quickest path between 2 points, making warm vs. cold introductions and telling entrepreneurs when “it ain’t gonna happen”.

So find some of these people and get to know them – here are 10 things you can do:

1. buy them a cup of coffee

2. be real with them, when you don’t need anything.

3. Help them out with something they’re working on.

4. Read What Would Google Do? by Jeff Jarvis.

 

5. Join my meetup group; you’ll find many of them there and can connect no matter where you live:  meetup.com/Startup-Workshops/

6. Invite them to speak at an event you’re hosting.

7. Contact me and I’ll help you find and meet the right people.

8. Create something very cool, nothing gets attention like that.

9. Be a connector. Connect 2 people without any self interest; I do this almost daily.

10. Become an authority on the flow of cash in startups, a very valuable skill.

Tom Nora

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LinkedIn Recommendations and Endorsements

Angel Investor, Business Development, photography, Revenue Growth, Scalability, startup CEO, Tom Nora

Yesterday I was checking my LinkedIn and ran across an old colleague/friends bio – Teo Yatman. It made me decide to spontaneously write an unsolicited recommendation for him (see below). I’ve only written recommendations on request in the past so this felt really fun, and a little strange to do.

I think the LinkedIn one-click endorsements are awesome, one of the best social media tools in a long time – they are so easy to do and eventually you crowd-vote someones list of skills, so it’s pretty accurate in most cases.

But the recommendations are still valuable – I recommend (no pun intended) that you try this – write a spontaneous recommendation for someone you’re linked to from your past. It will surprise them and cause good will.

Here’s the exchange between Teo and me…
LINKEDIN RECOMMENDATIONS
Tom Nora has recommended your work as Silicon Valley Sales and Sales Management at Mentor Graphics.

Dear Teo,
I’ve written this recommendation of your work to share with other LinkedIn users.

Details of the Recommendation: “Teo and I worked together for a brief time in Silicon Valley in 1987-88 and I’ve told this story many times over the past 20+ years:

I was managing a few account managers at Mentor Graphics, a fast growing high flyer in the EDA/CAE industry, we were #1 against several tough competitors – Daisy, Valid, the brand new Cadence, etc.

The problem was that in Silicon Valley we were losing to local favorites. In the middle of all this, Teo was amazing to watch – he exceeded his quotas every month and could predict almost to the dollar how much he would sell every month. Nobody else, including me, could even come close, or would want to make that commitment. He would get in his car and drive away then come back with a p.o. time after time. I still don’t know how he did it.

I learned a lot watching his positive disposition and his confidence – he always had a big smile. I haven’t seen Teo in over 20 years, but I’ve thought of him often when I lose confidence about closing a deal – “What would Teo do?” And usually it works! Thanks, Teo.”

Response from TEO:
Hi Tom!
Thanks so much for an awesome recommendation! I was surprised and amazed when I saw this. Please let me know if there’s anything I can do to help you in any way. I honestly enjoyed working with you back in the day. Hope you and your family are doing well. Do you live in SoCal? If I head down that way I’d love to connect with you – maybe a lunch in honor of the good ole days!
Heartfelt thanks!
Teo
@tomnora
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