Alex Castellarnau at IDEO – The Creative Thinking

Last week the LANDING project met Alex Castellarnau at his office in Palo Alto. Alex moved from Barcelona a year ago to Palo Alto and he is now a member of the design community at IDEO. We know that IDEO has been studying the possibility of opening a new office in Spain. They travelled to Spain some weeks ago to meet some managers from big companies and some technology parks, 22@Barcelona among them.

What were their impressions? What are the conclusions?

IDEO is a global design consultancy: they work with their customers to provide them creative solutions –from competitive marketing strategies to incredible product designs.

Philosophy: work with customers; look for the right problem or question to be rapidly solved and prototype the solution roughly. IDEO has a bottom up strategy which puts the customer in the centre of the process.

Customers: Apple, Bank of America, Caterpillar, Stanford University, Intel and Nike.

Locations: Palo Alto (CA), San Francisco (CA), Chicago, New York and Boston in the US. London and Munich in Europe. Shangai in Asia.

Some weeks ago IDEO team travelled to Spain and met the managers of some of the most important multinationals and technology parks in Spain, including the managers at the 22@Barcelona. Alex said that they were warmly received and that professionals from this Spanish multinationals were very interested in the way IDEO interacts and works with their customers.

In Alex's opinion, opening a new office in Spain, and why not at the 22@Barcelona, could be a good opportunity to reach new customers in the Mediterranean area.

Theoretically, it seems that IDEO could benefit from being close to other industries at the design-cluster. IDEO considers design as a way of thinking, as a different way of addressing all sorts of business challenges. IDEO's Design Thinking, goes far beyond a project outcome. Its presence at the 22@ could positively complement and enrich the design-cluster.

Find detailed information about IDEO at their new website! http://www.ideo.com/

The Keys of a Killer Presentation

Reporting the Start U SFO event celebrated on the 14th August at the DLA Piper in San Francisco.

Speakers:

1. Scott Milener, CEO, AdRocket – more than 15 years of experience leading technology businesses
2. Bob Bozeman, Serial Venture Capitalist – Investment success included Google, PayPal, Ask Jeeves, AvantGo!, BrightMail and RedEnvelope

The Principals:
1. Self Confidence– Show off the team, board and advisory board
2. Express the motivations behind the opportunity
3. Pitch Effectiveness – NO MORE than 15 slides and 20 min!!

* Show in 5 words: what you are? What you solve? Why should the VC invest in you?
* Show the need and the concept ASAP – use GRAPHICS and finish with a DEMO

and some advises
4. Sizzle – tell the VC something that they will not expect

5. Practice – make a list of VCs and go to the best for you LAST!
* LISTEN the feedbacks
* Use FEEDBACKS to improve your presentation and pitch

6. Respect your Competition
* Reflect the reality – everything has competition! WHICH IS YOUR VALUE?
* Show that the opportunity is STABLE
* Panel the competition & YOUR CO.

7. Develop Board and Advisors
Board and Advisors are not the same→ but they are complementary
* Advisors are specialized and temporary
* Board Members are for ever

8. Know the Investor – what are they investing in? How do they screen?
Again, http://www.punctuative.com/vcdb/ can help you

9. Get an Introduction – it gives you priority, respect and feedback

10. Develop Traction – do not give up visiting VCs although any of them show to be interested in your opportunity

11. Be helpful - to close the deal and the due diligence & to understand the technology

12. Explain your current situation but look to the Future not the Past
Step 1 – Done!
Step 2 – In process
Step 3 – What’s next?
… have the EXIT mechanism in mind.

And prepare some Extra Slides for supporting the questions and the discussion

Good luck!
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Book recommendation: “Founders at Work” by Jessica Livingston (2007) - is a collection of interviews with founders of famous technology companies about what happened in the very earliest days.

What types of startups are getting funded in the Silicon Valley?

The Silicon Valley Association of Startup Entrepreneurs – SVASE - organized an event to explore the current trends of venture capital investments in the Silicon Valley. The event was sold out three days in advance.

Date: 2008 August 7th – 6pm
Location: Wilson Sonsini Goodrich & Rosati in Palo Alto – one of the premier legal firms to technology and growth enterprises
Participants: 130 in attendance, most of them entrepreneurs, and a panel of 4 investors:

1. John C. Occhipinti, Managing Director, Woodside Fund
2. Carol Sands, Founder and Managing Member, The Halo Funds
3. Daniel Joensen, Deal Screening Committee, Band of Angels
4. Anthony Lee, General Partner, Altos Ventures

All four investors seemed to be actively investing in early stage of high tech companies. Anthony Lee stated that he closed three deals during the last week!

Main conclusions:
Hot Sectors: although investors do not usually specialize in one sector or stage of investments, “it seems green is the hot sector now”.
The Team: -better than an individual founder- they have to be passionate, enthusiastic, committed, motivated, realistic, and have specialized technical knowledge and business experience –even failed experiences are positive. “the failure makes the entrepreneur trustworthy”
Screening and Investment Period: an average of 6-8 months are required.
International investments:
- Growing international investments; It is typically required for the invested companies to open a location in the Valley.
- VC’s look for partnerships in the US and in also in other countries.
Protection of Ideas: investors are not going to “steal” opportunities, so entrepreneurs do not have to be afraid of sharing their idea.

Tips for Entrepreneurs:
Have the exit strategy in mind: the investors are looking for huge returns so they want to know about the exit strategies from the very beginning.
Aim for the key investors: do not waste time meeting all the investors. Identify the ones which will be interested in your technology, sector, stage, business model,…
The Venture Capital Data Base -http://www.punctuative.com/vcdb/- can help you to identify your key investors.
Meet high quality lawyers: they know all investors and are well connected. They will give you good advice about the key investors for your idea. Frequently they do it informally for free!
Meet the companies in the portfolio of your key investors: they will tell you what this investor is like.
Power Point presentations: should start with:
1. What is the problem?
2. What is the solution?
3. Why should the investor invest in your idea?
4. Include a case of a customer whose problem has already been solved.
Look for other financing sources: angel investors, banks, government grants, incubators, corporate ventures…

A priori it does not seem difficult. Silicon Valley attracts a lot of investors, but also a lot of entrepreneurs. Identifying the key potential investors for your business idea seems to be the key strategy.