STARTUPS&A LOOK BEHIND THE CURTAIN AT THE MAGIC OF SILICON VALLEY

Active Angel Investor & Serial Entrepreneur,

Former CEO of Wikia Inc., and Former VP & General Manager, International eBay

angels

OPPORTUNITYOPPORTUNITYEGOEGO

ACCESSACCESS

OPPORTUNITYOPPORTUNITYEGOEGO

ACCESSACCESS

Cloud let us move faster

And cheaper

148mm148mm1,018mm1,018mm

2,000mm2,000mm

The Internet is everywhere thanks to mobile

2006 2010

Source: www.allaboutmarketresearch.com/internet.htm

1998

Which means you can shoot for

ACCESSACCESS

OPPORTUNITYOPPORTUNITYEGOEGO

NEW CROP OF ANGELS

Typical angels

NEW CROP OF ANGELS

AND SUPER ANGELS

Super angels

EGOEGO

ACCESSACCESS

OPPORTUNITY

Customer acquisition hacks On each platform are different

Capital efficiency is amazing now

Fundraising is easier

VC Associates

Seed Funds

Connected Angels

New Angels

Scary "Dumb Money"

Where does angelist money come from?

• There has never been a better time to do a internet/mobile start-up – access is easy and costs are low

• Startups are not a company. They’re hypothesis tests funded by adrenaline junkies

• Keep costs low and you can run a series of hypotheses

• Scrappy till it works, then flip to spending like drunken sailors to scale

Take aways

STARTUPMANTRAS

THE LEAN STARTUP is a resource to assist entrepreneurs, startup and established businesses make better, faster business decisions.

THE LEAN STARTUP

DESIGN MATTERS

Risk is a competitive advantage

SO WHAT DO

THESE CRAZY INVESTORS REALLY WANT?

• COMMUNICATION PRODUCTS (BEST NETWORK EFFECT)

• NETWORK EFFECTS (PRODUCT GETS MUCH BETTER AS MORE PEOPLE USE IT)

• MARKETPLACE NETWORK EFFECT: MOST BUYERS, SELLERS, WHY GO ANYWHERE ELSE?

• SCALE ADVANTAGES

• SEARCH IS ABOUT DATA, PEOPLE WITH THE MOST DATA ALWAYS WIN, SO FIRST MOVER CAN WIN BIG

• WAZE/WIKIPEDIA: MOST CONTENT MAKES BEST SERVICE, WHICH CREATES MORE CONTENT. VIRTUOUS CYCLE

• 10X PRICE-PERFOMANCE ADVANTAGE

• CUSTOMER ACQUISITION HACKS

• AMAZING TEAMS

• GITHUB IS THE FIRST PLACE I LOOK

• DEEP UNDERSTANDING OF CUSTOMERS

• MANIACAL FOCUS: 4-6 PEOPLE STANDING ON A SINGLE PIN

WHAT WE LOOK FOR

EXAMPLE

• COMMUNICATION PRODUCTS I SHARE DOCS WITH FRIENDS

• NETWORK EFFECTS MY FRIENDS HAVE DROPBOX SO I USE IT

• NETWORK EFFECTS REVENUES INCREASE EXPONENTIALLY AS MORE DOCUMENTS ARE SHARED WITH MORE PEOPLE

• MARKETPLACE NETWORK EFFECT: NOPE

• SCALE ADVANTAGES ABILITY TO INVEST IN EVERY PLATFORM

• 10X PRICE-PERFOMANCE ADVANTAGE FREE – EVEN BETTER

• CUSTOMER ACQUISITION HACKS: REFERRAL PROGRAM

• AMAZING TEAMS

• GITHUB IS THE FIRST PLACE I LOOK: SCARY GOOD TECH TEAM

• DEEP UNDERSTANDING OF CUSTOMERS : DIDN’T ADD FEATURES

• MANIACAL FOCUS: 4-6 PEOPLE STANDING ON A SINGLE PIN SIMPLE, SIMPLE, SIMPLE AND IT ALWAYS WORKS

EXAMPLE: DROPBOX

• COMMUNICATION PRODUCTS NOPE

• NETWORK EFFECTS NOPE

• MARKETPLACE NETWORK EFFECT: NOPE

• SCALE ADVANTAGES MINOR COST ADVANTAGES

• 10X PRICE-PERFOMANCE ADVANTAGE NOPE

• CUSTOMER ACQUISITION HACKS – SUBSCRIPTION ECOMMERCE DRAMATICALLY CHANGED LIFETIME VALUE

• AMAZING TEAMS

• GITHUB IS THE FIRST PLACE I LOOK: NOT THAT I KNOW OF

• DEEP UNDERSTANDING OF CUSTOMERS : MARKET LEADER, SO YES?

• MANIACAL FOCUS: 4-6 PEOPLE STANDING ON A SINGLE PIN STILL SIMPLE

EXAMPLE: BIRCHBOX

TRATCTION + MOAT