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May 6, 2013

Why we dont have more Women in Leadership

Image representing Sheryl Sandberg as depicted...

Image via CrunchBase

I have written about why this is the best and by far the most exciting time to be a women in technology or for that matter in any leadership role. I have been reading Sheryl Sandberg‘s book “Lean In“. I have to say that it has been a disappointing experience to get women to take a seat at the table or to jump on a opportunity. I think context is in order, as CEO of GreenQloud one of my jobs is to hire world class people to build a world class team. In my opinion, a balanced team is more effective so I have been searching to get more women to join Team GreenQloud. Here is my experience so far… we have made 3 offers to women and all of them have rejected our offer. One of the women was still in school who was interested in what we do, I offered her to spend whatever time she could with Team GreenQloud, we would train her in what we do and when she feels that she is ready to join the team I said we could discuss the role, compensation etc the usual stuff. What do you think happened? she showed up for 2 weeks, then quit. Ok, understandable, she got another opportunity. We got requests from 2 more women who wanted to join us for Summer jobs, we made an offer to both of them to join… guess what? both of them turned it down! I am curious to learn the reasons for their decisions because I very strongly emphasized that we will train them and give them all the opportunity to take on challenging roles and tasks within GreenQloud. But they decided not to participate. I am not complaining, just stating facts. Despite my pep talk that they should not be scared about technology and we are motivated to make them part of Team GreenQloud, they still did not take it. This is not the end of my effort to get more women to join GreenQloud. We are going to make a concerted effort to get more women to join GreenQloud.

I am curious and want to understand why this is so, then I bumped into a TED lecture by Sheryl Sandberg and there it was obvious and clear as is in the book. Here is the lecture by Sheryl:

So, if you a women ready to jump into an exciting Startup company in Iceland and you are not afraid of technology, contact me bala at greenqloud dot com. We want to hear from you and we want you to take a seat at the table. I don’t believe we will win without having the talent, intuition and intelligence of women in our team.

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May 2, 2013

Economics Shimeconomics

Iceland: Viking Rune

Iceland: Viking Rune (Photo credit: vicmontol)

The financial markets generally are unpredictable. So that one has to have different scenarios… The idea that you can actually predict what’s going to happen contradicts my way of looking at the market.
- George Soros

I wrote a small comment yesterday about a news article that I read in Reuters, this article still comes up on top when you look for news about Iceland in Google. The title of the article is “Analysis: Iceland chooses lonely road back from economic segregation” by Balazs Koranyi. I am pretty sure Mr.Balazs Koranyi is standup gentleman and I don’t doubt his analysis is based on facts around what is going in Iceland because he writes for Reuters or atleast that is what one would think. The truth of the matter could not be far from it. I am sure Mr.Balazs Koranyi has never visited Iceland or met the people of Iceland. The article is based on quotes by some experts like “Investment Advisors”, “Former Bank managers” and “Economic Professors”, I don’t know these people but I would love to meet them to learn how they come to conclusion about something as complex as a country’s psyche because the article is about how Iceland is going to be lonely in its path to recovery given the current election results and the statements made by the leader of the political party which has been given the mandate to form the Government. Once again, I am not an expert and I usually remind myself to be humble when a part of my ego takes over trying to rationalize somethings that I observe and start making conclusions about them. The election results being one.

I believe that structural transformation of any economy even one as small as Iceland takes time. I have written a lot about this Structural transformation and I did not stop there I put my money, time and effort where my mouth is ie. I invested in startup companies in a space I believe can get Iceland out of the challenge of the Financial Crisis of 2008. Yesterday my bet was vindicated, the Software Company that we invested in CLARA (I wrote about it here and here) was acquired by Jive Software, a Nasdaq listed company in Silicon Valley. I will write a detailed post about the transaction later. There was a viral sharing and congratulations that was going on in Facebook. I am very pleased to see the result and it is even more sweeter when you read the analysis written by Mr.Balazs Koranyi.

My post yesterday on Facebook was

“While we are quietly creating value by Starting Companies like CLARA, GreenQloud, DataMarket, Meniga, Plain Vanilla, Mobilitus, ReKode… in Iceland mainstream talking heads are into pschyo-babble talk of economic isolation and what not. I am not sure who this Asgeir Jonsson is or Thorolfur Matthiasson but they are “investment advisors” and “Economic Professors”, they all should come to Startup Iceland and see how a country is reinventing itself out of a crisis.”

My invitation still stands, if you are a journalist or an expert or found this article searching about Iceland and Startups, come to Iceland, participate in Startup Iceland Conference, meet the young entrepreneurs who are changing the face of what Iceland is all about before you write about Economics of Iceland.

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April 14, 2013

Traction brings money; Money does not bring traction

seedforum-logoI was at the Seed Forum this year, but I could not participate for the whole day but I attended the cocktail hosted by the British Embassy in Iceland. It was fascinating to see the British Ambassador pitching to the startups to look at UK to locate or move their startups when they scale out of Iceland… he even went to the extent of saying moving to the US was not a good idea :) I am happy to see different countries pitching to startups and entrepreneurs in Iceland to move to their country, it is good for the Entrepreneur and it is good for the Startup Ecosystem that there is growth path out of Iceland. I got a good impression of all the teams that were pitching. I have written about why Startups should not be focused on raising money. I am going to repeat this until I turn blue, the focus of the startup should be to solve a really itching problem, win customers and raise capital from the customer first. As much as I support the initiatives like Seed Forum, I really believe that it muddles the real issue facing startups and entrepreneurs. The Seed Forum this year had a famous Icelandic Entrepreneur and Cofounder of Opera, Jon Von Tetchner, actually he lived and worked in Norway but he is Icelandic. He had a very good talk and Q&A session about being an Entrepreneur. His advice and the advice given by Brad Feld and every other entrepreneur who has walked through the fire of creating a company and successfully transitioning says the same thing – Delay taking money from Investors as much as you can. Sometimes it is not possible i.e if you need machines, or equipment or buildings you need Capital but with startups in Software you dont need any of that or Capital to get started… that is one of the reasons that I am so bullish on the fact that Software based companies that are building solutions on top of the new Infrastructure of Cloud Computing, Google, Apple, Amazon, Twitter, Facebook, LinkedIn, Pinterest etc will be able to bootstrap much better, faster and get through the valley of death without pledging your soul to the devil, no, not all investors are bad but there are different incentives if you are an investor vs if you are an entrepreneur.

In other news, Klak and Innovit merged into Klak Innovit… I am happy to see some movement in the Accelerator, Incubator and Institutions that help entrepreneurs collaborate and optimize in Iceland. Accelerators are a key ingredient in the Startup Community development and I believe Kristjan Kristjanson the new CEO of the merged organization has his heart in the right place. He also runs Startup Weekend, Startup Reykjavik and has been of great help to many startups since he started working with entrepreneurs in 2007-8 I think.

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March 4, 2013

Startup Risk

Cover of "Fooled by Randomness: The Hidde...

Cover via Amazon

I usually get really worked up when I am speaking with some employees in a bank about Startups and Entrepreneurship, they immediately say that it is Risky. I always ask them could they please tell me why they believe Startups are risky? Their usual answer is well 90% of all startups fail, which is anecdotal evidence because there is no way anyone has documented all the startups in the world and calculated the failure rates. I have written a lot about how we as humans are wired to be fooled by statistics and we just underestimate the risks associated with many things. What is even fascinating is that those same people from the bank were still working in the bank when the entire financial system in Iceland collapsed. I think banks are bigger risks than startups, atleast with Startups you know the risk of failure will only wipe out what you invested, whereas with Banks it can wipe out the entire equity base of Iceland. No wonder, Warren Buffett called Banks sit of Weapons of Mass Destruction. The risk on banks are exasperated by leverage, were as Startups run on equity which means what you put in is what you loose if the company goes under. Typically Startups that I have been pounding the table on require very little capital to validate, build a Minimum Viable Product and get market traction.

I have written about the books that really changed my perspective on Risks and I have Nasim Nicholas Taleb to thank for. I listen to audio books all the time and I think this is the 100th time that I am listening to his classic book “Fooled By Randomness“. There are so many pearls of wisdom in that book that I discover something new every time I listen to it. The only positive aspect of risk taking is in the Startup world because a black swan event ie. the chance of finding a Google or Facebook or Twitter or Amazon is very low but when it does happen it usually results in such a positive impact I don’t know why not everyone invest a small portion of their investment egg in this asset class. The monstrous returns that are possible can only be achieved if one takes enough bets but the size of the bets are usually very small and thats the point of doing this.

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March 2, 2013

Women in Technology

Marissa Mayer

Marissa Mayer (Photo credit: Wikipedia)

Image representing Sheryl Sandberg as depicted...

Image via CrunchBase

There is a lot of coverage and tweets about Sheryl Sandberg‘s new book “Lean In” and for the decision Marissa Mayer made to stop Telecommuting at Yahoo. If only there was this much coverage for all the decisions made by CEO’s of the Fortune 500 companies or for the books written by others? I am really happy to see them both getting good media coverage because as one of old saying goes in Hollywood “Does not matter what you write about me just get my name right!”, maybe it does not apply to these cases. I am big proponent and supporter of getting more women in the workplace, equal rights or actually increase the benefits, rewards and compensation primarily because they are a lot more committed to focusing on Work and Family, which is a very important requirement because without a proper balance anyone can burn out in the world of entrepreneurship.  There are a number of women leaders today in many large organizations like IBM, HP, Xerox etc so I am pretty sure the Glass ceiling that people talk about is not as prevalent as it was a decade ago.

I actually want more women to participate in Software development and DevOps, because I think they are excellent in it. We are running an experiment in GreenQloud, where any student especially women who are able to take a couple of hours in a week and are willing to spend that time in our office, will be paired with our Development and Operations team members so they can teach the students what we do. We now have 4 interns like that… all women! learning about running Cloud Computing Infrastructure and Software development in the real world and being part of a startup. I wish more companies would be open minded about taking on interns this way as it would really solve the skills challenge that IT and Software companies always seem to complain about. And I also believe it will solve the gender diversity problem, more opportunity for women to participate then there is no bias.

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July 29, 2012

Framework to build Great Companies

Source: Good to Great by Jim Collins

A framework is more like a guide, it does not tell you how to walk the path but gives you guideposts on what you should focus on. Building great teams is the bedrock of building great companies. I have mentioned many times that when you are investing in a startup, the team matters a lot. Building great teams that execute is an important necessary condition. All other things you can change but the team dynamics is critical, it is hard to encapsulate and constant changes in team members and structure always leads to confusion and delays progress.

I believe the framework build by Jim Collins in his Good to Great book clearly articulates what I mean. The first stage in all great companies before they became great was the build up of disciplined people. Without disciplined people all other things falls apart, what do I mean by disciplined people? I can sum this up in one sentence, disciplined people are those who Make and Keep Promises. It is as simple as that. If you one can build a discipline to do that one can get disciplined in anything. There are a number of qualities that are required to be disciplined, I like :

  • Relentless
  • Resourceful
  • Resilient
  • Responsible
  • Respects other opinions

This is by no means an exhaustive list of attributes that comprise the winning team, however it is a good start. Paul Graham wrote a very interesting post about being relentlessly resourceful, he was of course referring to startup founders. I think the concept can be applied to anyone. I would like to be in a team that is relentlessly resourceful, that is resilient ie. when adversity hits the plan the team has a way to stand up and keep moving forward. Responsible is another word that I really like Dr.Steven Covey talks about this a lot in his books, the word responsible can be broken into Response-Able ie. have the ability to respond. Respecting others is not a nice to have but a must have quality. No-one knows everything if you want to win in the market place you need to bring people together who can compliment each others weakness. Thats the way winning is done! I wanted to leave this blog post with words of wisdom from a very famous philosopher Rocky Balboa.

The world ain’t all sunshine and rainbows, it is a very mean and nasty place and I don’t care how tough you are it will beat you to your knees and keep you there if you let it. You, me or nobody is going to hit as hard as life… but it ain’t about how hard you hit, its about how hard you can get hit and keep moving forward, how much you can take and keep moving forward… Thats how winning is done!

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July 19, 2012

3 Magic tricks to get Marketing and PR right

I have a whole category in the Startup Iceland blog about Marketing and Selling for a reason and that is Entrepreneurs and Startups just suck at telling a story about their value proposition. Not because they don’t want to but because they don’t prioritize how important of a task Marketing is. Fred Wilson wrote a blog post not long about Marketing and his initial post started like this

I believe that marketing is what you do when your product or service sucks or when you make so much profit on every marginal customer that it would be crazy to not spend a bit of that profit acquiring more of them (coke, zynga, bud, viagra).

me and everyone in the avc.com community thought that it was wrong and we let him know about that. Fred being fred, wrote a follow up post with the following title “Marketing Post – The Bug Report“, I would encourage everyone to go and read the entire comments section of both those posts. The value in avc.com is the quality of people actually commenting in the blog. I believe Marketing, Selling and Public Relations for a Startup are very important strategies, almost as important as product development if not more. Obviously, being a startup you don’t have a lot of resource at your disposal to spend time, money or effort into telling the story, but that is the challenge of being a startup or an entrepreneur. You have to jump off a cliff and build your parachute on the way down and make sure that the entire world knows about how wonderful your parachute is so you can sell them while you are making it.

Image Source: newmarketinglighthouse.com

Coming back to the topic of Marketing, today, we have some of the best tools to tell a story about the value created by companies. As an entrepreneur and a startup, you have a responsibility to ensure that your value proposition and story is told in all the relevant channels. I believe the best stories are told by others about your product or service. If you can convince an influencer to write about you and your company, it is by far the best way to get noticed. I believe taking part in competitions and contests also help you to showcase what you are building, of course you need to win to get the media and story covered.

What are the 3 magic tricks in Marketing, PR and Selling? well, it is actually quite simple, you need to get out there in the world meet people and talk about what you are doing. It is as simple as that. It takes time and it takes a lot of effort but there is no other way. If you believe just buying Google Adwords or Facebook Ads is going to get you coverage you are wrong. You need to do all the channels, ie. you need to CONSISTENTLY

  1. Blog about what you are doing and share it with your network and your extended network
  2. Tweet about things happening in your startup/industry and things related to your startup/industry
  3. Participate in meetups, conferences and trade shows

How do you do this when you are bootstrapping and trying to build a product? I did mention this was a magic trick right? The first 2 tricks are not that hard to do because it is you as an entrepreneur putting your time and effort into words and spending time learning about what is going on in your industry. You cannot afford not to do this. The third one is a little harder given it takes money to participate in Conferences and when you live in an Island you need to spend money on travel, lodging etc but you can always prioritize and pick the most appropriate conferences and budget for it and participate in it. A much easier way is to do local meetup, if there is not one in your neighborhood organize one. Brad Feld wrote about Just Get A Group Together for Coffee, it is not that hard to do.

I see that some of the startup are shy about talking about what they are doing and what value they are creating, this is a BIG FAIL. If you are not passionate about what you are doing that you cannot wait to tell everyone about it then you are doing something wrong. Just stop the pain and go do something else.

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July 18, 2012

Angel and Seed Investor Awards – Guest Post

This is the first post of the “Welcome to Post on Wednesdays!” blog post in Startup Iceland. This post is a follow up post by Ashwin Bhambri and I think he has a point on trying to bring awareness, attention and glamour to the early stage investors. I am seriously thinking of including an award show as part of Startup Iceland 2013… what do you all think?

Image source: From Wikipedia, the free encyclopedia

Isn’t Angel Investing underrated or more so undervalued? The impact it can have on the global economy today is under estimated, as almost every third startup or small business requires to raise pre-revenue finance that banks or other organized institutions would typically not fund. Seed / angel investing is the only alternative left to the entrepreneur.

Angel investing is underrated simply because as a concept it is underutilized. There are just not enough proactive angel investors or money in angel / seed asset class for this activity to be considered mainstream or a serious factor in the building of economies.

Nevertheless, the potential of angel / seed financing and the overall impact it can create is colossal. If Peter Thiel had not to take a chance on Facebook it may not be the Facebook we all know today. Time and time again, those investors who took a leap of faith and invested in Angel rounds dramatically changed the course of history for many rockstar companies today starting from Google to Facebook to Twitter.

To be fair, Investing is also about capitalism and the simple theory if one does not see a return one will not invest applies. Arriving at an ROI from a pre-revenue start-up is not exactly pragmatic and an angel investor takes a huge risk here – What makes them invest is

a. They like the startup team, want to help and give back in the process
b. Their gut feel prevails over logic and tells them to go with a start-up.

Investors who repeatedly make angel / seed investments build the startup ecosystem and should be honoured with recognition and accolades for their contribution. There should be an attempt to glamorize angel investing and this could be the rocket fuel that catalysts more investors to join the angel bandwagon and can lead to more investment activity.

How do we do this?  For starters there can be the Grammy and/or Oscar equivalent for investors or the Angel & Seed Investor Awards where active investors making investments are nominated and awarded,  as investors are the early heroes of any startup ecosystem.
Glamour is also an amazing communication medium to a large audience and could convert traditional investors who typically invest in established listed companies to become angel investors.

Iceland could be the world’s accelerator of this initiative as the time & environment is optimum. Thus far I have not come across any Investor Awards event that is mainstream and it’s about time someone takes the initiative and makes it happen. If it fails it fails, if it succeeds it could do for the rise of angel investing what y-Combinator did for the rise of startup accelerators and that’s definitely a risk worth taking

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June 21, 2012

Duolingo.com

Union Square Ventures just announced their investment in Duolingo.com. The company founder Luis Von Ahn is so smart and has a track record of really creating valuable solutions on the time people spending doing boring tasks on the internet. As Brad Feld says, the machines have taken over, they are just making us enter information about ourselves into them, they are being patient and eventually the machines will run the asylum. Luis invented CAPTCHA and re CAPTCHA two technologies on the internet that everyone who is reading this blog had to do many times while signing up for service or posting a link to Facebook or Google or Twitter or any of the Web Services that we use to let the machines know that we are human. What we all probably did not know is that this “data entry” is used to digitize all the books in the world! How cool is that? Here is the TED talk that Luis gave which explains how they did this, more importantly he explains subtly WHY he did this. 

I believe this is incredibly smart investment by USV. The next frontier is language and sound, I have written about my investment thesis around sound and voice. The biggest problem we have with language is that machines don’t understand the semantics of translations and Luis is solving that using powerful motivators and incentives on the internet, the need of people to want to learn another language and making that affordable (read FREE) to everyone on the internet. Luis is nothing if not ambitious, but I have a feeling that he will be successful in translating the entire web. If you always wanted to learn another language and did not want to spend $500 to do it, Duolingo.com is the place to do it and BTW, you will be helping in translating the web which is 50% in english into a language that you are learning.

To Brad Burnham and the rest of the partners in USV, Congratulations! this ones a winner and keeper! you are really showing why USV is the top VC firm in the world.

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June 11, 2012

Generation Gaps

I was exchanging emails with a friend about Wifi access. I was tweeting yesterday on the way to the Keflavik Airport that it is cool that the Bus had Wifi in it and how I wish all airports and public transports provide free wifi service. My friend who moved from Iceland to Scotland said

Here in Scotland (and I assume the UK) nearly all inter-city, including commuter buses for shorter routes and some intra city buses have wi-fi. It’s really funny to see the generation gap on the buses. Those roughly over 45 almost never have a pad computer or iphone in use and nearly everyone from 15-30 yrs. are completely oblivious to the outside world while they hack away on their machines. Those who are 31-44 yrs. are a toss up as far as I can see (probably due to the fact that they are often with small children!).

This made me think about the generation gaps that exists today. Generation Gap The younger generation (15 yrs and younger) has grown up always knowing about computers, mobile phones and the Internet. I was also reminded by Fred Wilson‘s post about “Life Liberty and Blazing Broadband“, the needs of the younger generation are dramatically different than what it was maybe a decade ago. I don’t have in-depth data but I think the image below is representative… it is the reach Startup Iceland Page has on Facebook. I know that Startup Iceland may not be very representative of how the reach of a topic needs to be but the fact is it still reached a higher portion of younger demography (18 – 24) than the 45-54 age cohort.
This gap is real, I wish the generation that is 35+ gets over it and jumps into the technology that is going to connect them back to the younger generation because I believe this is the biggest opportunity we have today. No point in time where you could say you have a friend who is 20 years younger than you but it does not sound creepy. I have tried very hard to keep up with the younger generation and that means giving up on some biases, being empathetic and jump with the flow. I have learnt a lot watching the younger generation that last 4 years while I have been helping entrepreneurs and also being an entrepreneur myself. I think it is great, I feel very good about the next generation atleast the ones that I have been interacting with are responsible, know where they stand and want to really change the world that fits their needs. I think Technology is a great enabler, but we need to embrace it and try to ensure that we are the masters of this domain. I try to use it to build relationships with people as diverse as you can get and it has made all the difference in the world. I would encourage anyone reading this, if you don’t have a Twitter account go and create one, if you don’t have FourSquare get one… if you don’t have a smartphone go get one. It may be the best investment you made in getting connected to the future.

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