Houston, webcast, and an auto wreck

I’ve been listening in on the Houston Startup Weekend live webcast and an announcement was just made that two of the participants from Houston were in a car accident. Wreckers were involved, but no ambulance necessary. Hope they’re OK. All of the drama can be viewed here…

http://www.ustream.tv/channel/startupweekend-houston

Looking Back to Look Forward

Donna Bogatin, blogger for InsideChatter, made some wonderful comments back in July.  She opined about the original Startup Weekend decision process regarding the opportunities considered for development. The following is snipped from what she wrote:

Truth be told, Startup Weekend actually required more than a weekend; Brainstorming for startup ideas took place online prior to the on-site intensive.

Did Startup Weekend participants take advantage of pre-planning time to do in-depth plans for the “next big thing”?

Market research perhaps? Census data review? Focus groups? NO indication of any such solid business planning development tools deployed.

From where did participants draw their startup inspirations then? From themselves, and their four year olds.

We’ve taken the core of these comments to heart here in Birmingham. Soon, rsn, we’ll have a submittal form for plans (*NOT* just ideas). Donna’s line of thinking factored heavily into early discussions of the planning committee. As I have written before, we want to create viable businesses out of this effort. With only 33 days until our “business dev” weekend, we’re looking forward with great anticipation!!

Code for Equity… or not.

There’s a bit of presumption in giving away equity to participants in a weekend of development. Equal shares for everyone. Unless, of course, you’re special. Apparently, some can be more equal than others… witness Andrew’s observations about Toronto.

“… organizers decided that it would ‘only make sense’ to reward their hard work with a substantial part of the company, without telling me or any other of the founders until the day before the event. They also decided a 20% share of the company was awarded to the person who came up with the company idea that everyone was going to make.”

Then, factor in Andrew’s ambitions as noted by Brill Pappin:

“He showed up for at least several hours each day and did absolutely nothing to help or participate at all. Andrew will get his shares never the less because all who were there, even for a few hours will get them as well… no matter how much work they actually did.”

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BESIDES the obvious nature of issues with the allocation of equity, there’s an important legal one. Each lawyer with whom the organizers of Birmingham Startup spoke frowned immediately at the mere mention of 75 shareholders. Even if we could address voting rights, change of control, etc. we’d be running quickly into legal issues with (likely) these shareholders not all being “qualified investors”. The way around this is to treat all of these 75 people as ‘employees’… but then, when would we have the time to verify that all of these individuals were free of any encumbrances like pesty employment agreements? If any of these individuals’ work product resulted in the company creating generous profits, who’s to say that that individual’s employer couldn’t pursue their legal rights to the new product/company? This just smells bad.

We did warm back up to the idea of using equity as the carrot to keep everyone committed to the weekend. But, ultimately we believe the winning company could choose to raise venture capital. We don’t know of many VCs in the nation who would be willing to take on a cap table with 75 (or more) shareholders, none of whom have put in cash.

So, for now at least, we’ve shelved the concept of awarding founder’s stock or even stock options to the event organizers or participants. Truly the only people who could leave the weekend with stock are the members of the entrepreneur teams. However, we’re going to discourage this as well since partnership agreements can get complicated and some participants in the first weekend may or may not warrant equity. Instead, we expect to have the winning company form a C-Corp with officers but no equity assigned in order to move through the second weekend. We believe that only upon determining that the team wishes to move forward (after the 2nd weekend) would they engage lawyers to resolve the issues of equity.

I’m curious to hear what other startup weekend efforts are doing along these lines??

Project Selection Advice from NYC

Sewell attended the NYC Startup Weekend and posted some worthy advice about project selection for the development weekend based on the aftermath of NYC’s event…. Read it HERE.  He’s promised to post more thoughts and we’ll report on them when he does.

Whittling down the ideas

In an online interview, Andrew Hyde describes Boulder’s opening night and how things get started in a StartupWeekend:

“I wanted everyone to get to know each other, start the weekend with a friendly feel. The idea was the next big thing we needed to take care of. I facilitated the discussion of the top 10 ideas down to three and then to the one we picked. It worked out really well, suprisingly, all the founders were pretty excited for the same idea.”

In an interview with the Boulder County Business Report, he further says they started with 50 ideas:

“On Friday night we got together at 6, and we went from 50 ideas down to 10. We discussed the 10 on Friday night, and we got down to three,” Hyde said. “We really got into those three ideas, and this was the one that everyone kept talking about.” – from Startup Weekend creates VoSnap

The model fails to deliver. More recently, for the NYC weekend there was further dissension with the way things progressed on the opening night of the effort.

Once again, we differ in our planned approach. First of all, in Birmingham we’re looking to create a BUSINESS. Isn’t that what a ’startup’ is supposed to be? It seems that the tech industry at large is smelling the fumes of Web 2.0 and believing that every Internet-based product *idea* equates to a *business*. That’s why we have dedicated an entire weekend to the business preparation. Maybe, just maybe, we’ll end up with more than another copycat product or Facebook app.

We still, however, will retain StartupWeekend’s democratic (majority wins) aspect to picking THE project. Nothing wrong there.

Birmingham Dates Set

The dates for Birmingham Startup have been set. We’re holding our 2-weekend project on the first two weekends of November:

1. The first will be focused on mentoring sessions and guiding the development of business plans for numerous entrepreneurial teams. Three will make the cut to present on Sunday evening of the first weekend and one will find out on Monday night whether they’re moving forward to the second weekend..
   • Starts Friday at 6pm, November 2nd
   • 3 Presentations will be made on Sunday at 6pm, November 4th – web streaming for developers to vote
   • Reveal of the winner will be made on Monday at 6pm, November 5th
2. The second will be focused on building the prototype and/or fully functional product that can go to market for the company. This weekend closely resembles the StartupWeekend concept of a large group of individuals who get together to build the product and work out details such as marketing, hosting, distribution, etc.
   • Starts Friday at 6pm, November 9th
   • Ends Sunday at midnight, November 11th

Mark your calendars (see ours)! Then, REGISTER TODAY for a role in the Implementation weekend. Soon, we’ll post information about how to submit your ideas to be considered for the Business Dev weekend.

Jazz, Woodstock, or Barn Raising?

Andrew Hyde of the StartupWeekend crew calls his idea “Jazz for Entrepreneurs”…

“It is what happens when you get brilliant people together, using their skills to build a company they want to work on. It is a crazy idea, that countless people can point out countless holes in (and countless people just don’t get), but for some reason, it just works.” - from What is Startup Weekend?

Another blogger describes the effort as a “Web 2.0’s Woodstock”…

“Instead of getting great musicians together to play some groovy tunes, seventy Web 2.0 kool aid drinkers are holed up in Boulder, Colorado creating a Web 2.0 startup in ‘one jam packed weekend.’ In their defense, many top musicians were too busy at Live Earth to participate in a Web 2.0 concert, so a gnarly Web 2.0 music festival wasn’t possible this weekend. Startup Weekend was the next best option.” 

Making great music is great.  In fact, participants are *encouraged* to try out “other instruments”, which might degrade from the quality of the music but I suppose it makes it more fun… and most jam sessions don’t get recorded so some slips are forgiven.  But, building software that way?  Hmm… I think I’ll save that rant for another blog post. <LOL> 

Our organizing team views the whole thing a bit differently than the jazz metaphor described above… we call the effort “Barn raising for techies“.  For reference, Wikipedia describes barn raising as follows:

“A Barn raising is an event during which a community comes together to assemble a barn for one or more of its households, particularly in 18th- and 19th-century rural North America. In the past, a barn was often the first, largest, and most costly structure built by a family who settled in a new area. Barns were essential structures for storage of hay and keeping of horses and cattle, which in those days were an inseparable part of farming.”

The Meatball Wiki answers the questions of “What’s in it for me” and the community (I’ve added some boldness for emphasis) when raising a barn in this way:

A typical BarnRaising generates a sense of accomplishment within a short period of time.

The people helping expect to learn about how to raise barns, and other CommunityLore, which will help them when it comes to their own barn.

Barn raising is fun, as a social event! Having a barn to raise does more than just get people together and let them talk. It gives them something to talk about.

When the tables are turned, the barn owner does the same for anyone else, so there is an IteratedPrisonersDilemma.

When the entire town helps someone build a barn, then that person is beholden to the entire town, so it creates new and strengthens existing social bonds.

Now re-read the above bullets and superimpose “startup” for “barn” in each line.

Also, imagine changing the Wikipedia entry to read as follows:

“BIRMINGHAM STARTUP is an event during which the community comes together to build a software prototype for one or more of its entrepreneurs. In the past, a prototype was often the first, largest, and most costly effort to be embarked upon by an entrepreneur who started wanted to create a startup company. Prototypes are essential for finding the company’s first customers, pitching to funding sources, and proving to themselves that they could be growing their own company.”

Get the idea?  :^)

Start{me}Up… in Birmingham

It seems like just yesterday when a friend of mine, Bill McKinnon, sent me the following seamingly innocent email:

I don't know if/how it would work out here, but it's
a TechBirmingham-esque idea (if you're inclined to
take it on) ... see http://nyc.startupweekend.com/?p=7

For the past nearly five years, I’ve been running TechBirmingham, the Birmingham-area technology leadership alliance.  So, this suggestion was very consistent with the organization’s purpose of doing its part to grow the technology ecosystem here in Birmingham, Alabama.  Sure, Birmingham isn’t the first place some people think of when they think of tech centers… but I’m here because it is!  And, more so than even Atlanta.  This community is small enough to get to know most everyone and still believe that there’s thousands out there that I haven’t met yet.

So, I read the email above and pondered it, for about 5 minutes, before my heart started racing with the excitement of an idea too good to pass up.  I couldn’t sleep that night and the next day proferred the concept at a lunch meeting onto two unsuspecting friends (Drew Deaton and Scott Ferguson).  The quick lunch turned into a 2 hour brainstorming session.  I put myself in front of a computer that afternoon (before heading out of town with my wife for a weekend getaway) and created the wiki that is now www.BirminghamStartup.com. The site originally just housed the items Drew scrawled on the paper tablecloth (the idea was tooooo big for a napkin) and has since grown to rank number 547 out of WetPaint’s 542,783 sites!!!

Now 7+ weeks later, <sigh!> look what’s happened.  We’ve got a full fledged wiki containing our plans for the “Birmingham Model” of the Startup Weekend concept.  We’ve not aligned with the “StartupWeekend” folks… not exactly sure that we will.

While the organizing team has been hard at work filling out the wiki and making plans.  I’m going to share my thoughts as we chug along.  Some may have to do with OUR plans and some may have to do with other city’s efforts.