I don’t care how many funny or awe-inspiring commercials I’ve seen. If the products do not meet my needs, I won’t buy them. If they do, and they’re priced reasonably, I will. If a manufacturer makes a product good enough so that it ends up on shopping pages it gets noticed and considered by me. If not, it doesn’t exist, and no amount of marketing will change that. It only needs to be available and if it’s available I will find it in a meta or site specific search engine, right next to the competition where I can easily choose the one that has the right capabilities.

I admire the sales and advertising industry and derive much pleasure from seeing them perform. I’ve got a suggestion though: how about just the cold hard facts for a change? Oh, that wouldn’t be advertising would it? No salesmanship involved. All your well-honed skills of persuasion would go unused. All your expertise in marketese in vain; you’d have no use for the BS generator module you’ve got permanently installed in your prefrontal. Needless to say, I find the sales and marketing profession mildly annoying.

Money inflates egos. Science inflates something else. Perhaps even 10x more.

First off, this wasn’t my opinion. Though I agree w/ much of what the meta-data from the http://www.ES2F.org tells us, I’m just reporting it.

Secondarily, re: your statement: “If your product fills a natural existing need, there is no need to sell, only to place it on the market.”

Wow…

So where do the markets come from?

Cheers,
Kevin

Back in the day, when there were no people able to build things, salesmen thrived?
If you have dedicated your life to helping productive people get their products to end users, doesn’t mean you’re invaluable, or even important, even though you may consider yourself so. You’re a replaceable part. A tool. Money is not the problem. Products are the problem. Wikipedia informs there’s about 75 trillion of money owned by the bankers. If you’re telling me you’re doing an invaluable, unique service by placing a wad of money in someone’s possession so that they can do what they should be able to anyway, and which you or most of humanity can’t, you should look up some history books on what is valuable, to you, to me, to humanity is. Invention, the application of intelligence is. Sales, the application of greed is not. (If you weren’t greedy for money but instead for invention, you wouldn’t be working in sales and financing.)

I’m both an investor and an entrepreneur. I’ve been deeply involved in the start-up space for almost 20 years now. 2 weeks ago we had the annual http://www.AngelCapitalSummit.org here in Denver, CO USA. This was the largest investor event in the US this year. Note also that it’s a *networked* process and event, as it’s run on a SaaS platform provided by the http://www.BusinessCatapult.com. Because of the BC, there were investors and entrepreneurs from around the globe involved w/ the ACS.

So here’s what we know after having worked with over a thousand start-ups:

* Nothing moves unless it’s sold.
* Selling is the hardest thing a new company does.

Our data tells us that technical aptitude – the ability to build a thing – is about 10X less important to the success of a new company than the ability to sell a thing. (Note also that we’ve yet to find a correlation between success and IP. It appears that much time & $$ is wasted locking up intellectual property that could be better utilized building one’s market.) This means that Paul Graham’s right. The determination of the founder is key. Entrepreneurs fail until they succeed. The result of this is that successful entrepreneurs are some of the toughest & smartest SOB’s in the business ecology.

Want footnotes? Go to the Entrepreneurial Standards Forum (www.ES2F.org) and do the Benchmark Survey. Every entrepreneur that applied to present @ the ACS had to complete this survey before they were considered. From there, ask Jono Shuster, the Exec. Director, if he’d like to talk w/ you about the ESF meta-data.

Cheers,
Kevin Johansen, Chair
http://www.AngelCapitalSummit.org

Ok… so what? This is one mans opinion and one can argue that there are more then one opinion on the issue. Innovation always requires intelligence that is radical innovation does. I for one have no interest in doing boring uninnovative things and thus I would say determination counts for as much as intelligence.

“”I now have enough experience with startups to be able to say what the most important quality is in a startup founder, and it’s not what you might think. The most important quality in a startup founder is determination. Not intelligence– determination.” (http://www.paulgraham.com/startuplessons.html)”"

This has not been my experience, and to put it in perspective I first tried contracting with government at 19 the idea ultimately went part way but was never adopted that idea was in computers. I am currently starting a new business enterprise which is both pioneering an innovative product as well as dealing with the manufacturing of it and in this current startup I would say that intelligence counts for quite a bit. The math involved is not terribly easy nor are the FEAs required to simulate it.

“What are your achievements in the field? If you want to argue qualifications, you must show at a minimum that 1), qualifications are relevant, and 2), yours are superior to mine.”

Well, let’s see here AGI is a science, engineering and math problem. You tell me whether qualifications matter? If by qualifications you mean degrees… I can say in my experience degree’s in math aren’t worth the paper they’re written on. If you talk qualifications in terms of intelligence measures like IQ that is also worthless and lest there be any doubt I have an IQ of 180 (only useful if you want into Mensa), so yes I have room to talk. The qualifications that count are having the knowledge and the ability to apply the knowledge to the problem at hand to think outside of the box as it were. For example I never got a bachelors degree I skipped all of that, in fact I taught my self partial differential equations (including all needed prior math), quantum mechanics, theoretical nuclear physics, among other things by the time I was 19. I built an image based motion capture system at 14. I built a hair and cloth simulator for gaming and other real time applications at 13.

As to the second part; what kind of a dumb question is that? All of the things I am working on are proprietary and barring some how getting a signed NDA with you I wouldn’t tell you in a million years what I am working on. And if you want to talk further on this issue I suggest that you present your own qualifications for inspection since you were the one making sweeping claims not me.

> Isn’t this what the whole venture capital business is
> based on? I don’t have any statistics for venture
> capital investments, but Y Combinator
> (http://www.ycombinator.com/) companies routinely sell
> for more than a thousand times initial investment.

The statement is technically true… with Y-combinator’s typical investments are about $20K and some of their companies do sell for more than 20M…. BUT …….

1. Y Combinator is not a VC firm or even the equivalent of angel investment. Startups typically go to Y-combinator when they are too early stage for either, and with equity pay for both the money they get (small factor) and the “mentorship” (which is the main factor).

2. Selling for 1000 times initial investment means NOTHING. What matters to the investor is how many times initial valuation did it sell? I have heard numbers like $200K for initial valuations with Y-combinator, which as I mentioned earlier is largely since the extra equity pays for “mentoring” that startups receive from Y-combinator.

3. In other words a more realistic valuation for companies that are extremely early stage in angel investments is more like $1M+ for silicon valley startups that manage to get investments. It could be much higher based on the stage of the company and the credentials of the founders.

4. In other words, a necessary condition for a 1000x return on investment is a billion dollar exit (acquisition/merger/IPO), the investors putting in the first round of money when the valuations were low and the founders not having an amazing startup track record before the current startup (since that in turn would inflate the first round valuation, reducing investor margins).