We are trying a new addition to the original Conference format in Startup Iceland 2013. I was very inspired to participate in an UNConference event that was hosted by Landsbanki last fall and the Facilitator for that event was Joshua Kauffman. It was great to get connected with him and invite him back to participate in Startup Iceland and facilitate the Startup Iceland UNConference this year. I would really encourage everyone to participate in the UNConference, it is a great free flowing atmosphere and gives rise to a lot of new ideas. I wrote about my experience of last event here. The great team
Joshua is a globally active design strategist, facilitator and investor, and principal collaborator in the Quantified Self movement.
With the Quantified Self, he works on the emerging opportunities in personal data and self-tracking that can enhance existing systems and lead to the invention of transformative new products and services.
Joshua also operates a global design practice that consults on projects in technology, innovation and International Development, and has clients ranging from large global companies to governments and foundations.
A good part of his work is in lecturing and leading workshops, including facilitating innovation gatherings, design exercises and unconferences. Some recent venues have included Credit Suisse, GE, the MIT Innovation Lab, the OECD and the Landsbankinn Innovation Unconference.
Magnús Ragnarsson (I really liked this picture, he looks good doesnt he?)
Magnus Ragnarsson was the host of Startup Iceland 2012 and we requested him if he would oblige us the same service this year for Startup Iceland 2013 and he agreed. Yay! Thank you Magnus. Magnus has been part of the media, entertainment and startup scene in Iceland since the very beginning days of OZ and Lazy Town etc and in addition to that he is avid cycler and is organizing the WOW Cyclothon. He pointed me to a new startup in Iceland called Lauf that has designed a shock absorber for bicycles that is 500 grams lighter than the competitors out there and it is all carbon fibre based there is no metal involved. I am no cyclist or know anything about bicycles but the design of this shock absorber is pretty cool. I think this startup has potential, that being said, I always come back to the same notion that it is not the idea or the product or how ingenious the solution is, it all comes back to how well you sell the story, tell the story, in what platform you tell the story and do you get attention from the main stream media to attract potential partners, investors and customers. Talking to Magnus it looks like this startup is going the same route as many startups in Iceland, i.e trying to figure out how to make this thing rather than trying to figure out how to sell this thing. I think Lean Methodology to sell this is best way to build a company. That being said, maybe the founders are doing that and I don’t have enough information to say what they are doing is right or wrong. I believe very strongly that there is a lot more to building startups and companies than a great idea. Anyways, check it out. The global bicycle market is massive multi billion dollar industry and providing parts to that industry is not a bad business.
We are keeping with the theme of Angel investors following yesterday’s post about John Sechrest. I got connected to Angela Jackson through Helga Waage of Mobilitus, a startup from Iceland that is growing at an impressive pace and has an office in Portland, Oregon. Angela brings a decade’s experience placing 30+ angel investments (multiple sectors) and a serial entrepreneur family history to Portland Seed Fund. She has advised hundreds of entrepreneurs and seed‐stage companies across a broad spectrum of industries at AB Jackson Group, and also oversees the Portland State University Business Accelerator, with 25+ resident bio-tech, technology and clean-tech companies. She is current President of the Portland chapter of Keiretsu Forum, the largest angel network in the world, and was Chair of the state’s premier angel investment event, Angel Oregon, in 2010. I am looking forward to hearing her survivability story as an Angel investor and what keeps her doing what she does and also learn about how she got started, or more importantly why she got started as an Angel Investor.
Angela and John, are at the core of building startup communities. There are a bunch of people of Iceland who are doing the same things as what Angela and John do, but they have not followed through in getting the story told. I believe strongly that there are many success stories in Iceland, maybe not Billion $ exits but through Angel and Seed Funding companies reaching a point of self sufficiency where the Entrepreneur has created something of value. There are many local businesses and services that have been around for many decades and they all once were a startup. The city of Reykjavik or Akranes or Akureyri were once startups in their own right.
Coming back to our theme of the conference Building Antifragile Startup Communities, I read a very interesting blog post titled “Antifragile Book Notes” by Taylor Pearson for the “Antifragile” book by Mr. Taleb, who has accepted to be on live broadcast through the Internet during the conference on June 4th provided the technology works and we are able to make the technology work fingers crossed. Anyways, coming back to the book, there are two ideas that falls squarely into Angel investing, Entrepreneurship and Startups, they are:
A dual attitude of playing it safe in some areas (robust to negative Black Swans) and taking a lot of small risks in others (open to positive Black Swans), hence achieving antifragility. That is extreme risk aversion on one side and extreme risk loving on the other, rather than just the “medium” or the beastly “moderate” risk attitude that in fact is a sucker game
Antifragility is the combination aggressiveness plus paranoia— clip your downside, protect yourself from extreme harm, and let the upside, the positive Black Swans, take care of itself. We saw Seneca’s asymmetry: more upside than downside can come simply from the reduction of extreme downside (emotional harm) rather than improving things in the middle.
An example is Mark Cuban’s investment strategy. He keeps most of his assets in cash (robust, not going to crash with the market) and it allows him to move quickly when he sees large opportunities (anti fragile).
Optionality
Options, any options, by allowing you more upside than downside, are vectors of antifragility.
If you “have optionality,” you don’t have much need for what is commonly called intelligence, knowledge, insight, skills, and these complicated things that take place in our brain cells. For you don’t have to be right that often. All you need is the wisdom to not do unintelligent things to hurt yourself (some acts of omission) and recognize favorable outcomes when they occur. (The key is that your assessment doesn’t need to be made beforehand, only after the outcome.)
Option = asymmetry + rationality
The mechanism of optionlike trial and error (the fail-fast model), a.k.a. convex tinkering. Low-cost mistakes, with known maximum losses, and large potential payoff (unbounded). A central feature of positive Black Swans.
Central to optionality is Taleb’s assertion that prediction in the modern world is impossible. Instead of trying to predict what is going to happen, position yourself in such a way that you have optionality. That way whatever happens, all you have to do is evaluate it once you have all the information and make a rational decision.
If you have not read the book, I highly recommend it as I have done before many time
I got connected to John through Kristjan Freyr Kristjanson, CEO of Innovit+Klak and who runs Startup Weekend in Iceland. I had always felt that what we lacked in Iceland was broader participation of investors and mentors in the Startup community. John has been solving that problem in Seattle and in the greater Washington state. I am excited to hear about how he has been able to get new Angels to invest into the startup companies. I am also really excited by the philosophy that John has put into practice through his Seattle Angels Network. Startup companies need a lot of due diligence and investors need to play a role in actually helping the startup get off the ground. I believe strongly that Investor group has to work as hard as the Entrepreneur to make the startup a success. I have been writing about Brad Feld, Brad Burnham and Fred Wilson, in my opinion the successful venture investors work much harder than any entrepreneur I know. Check out the documentary “Something Ventured“, it is obvious how much effort the early VCs started to invest much like Angel investors and how much effort they put into each of the companies that they invested in. I think the advent of the Investment Management profession has killed the spirit of each and everyone to become an investor and entrepreneur. I think we have some really smart people working in the Investment management and Asset management business but I don’t think Investment is something that we should outsource. By getting involved with early stage companies with the partnership of experienced angel investors and investor mentors I believe anyone and everyone can invest in Startups and be successful. Don’t believe the fear mongering that your Financial Advisor gives you, Risk is misunderstood consistently by everyone so Investment or Fund managers are no different or better than any of us.
Anyways, I have digressed enough. The post was about John, John Sechrest is the founder of the Seattle Angel Conference and the Willamette Angel Conference, each providing a venue for new angel investors to explore the process. He is a co-organizer of the Lean Startup Seattle, helping entrepreneurs get focused on stronger company processes. As a global facilitator for Startup Weekend, he has worked with several communities take a step forward on entrepreneurial ecosystem development. The motivation to get John to visit Iceland and participate in Startup Iceland is to bring some knowledge on how we can create an Effective Angel Investor community here. I want to expand on the idea that John and other successful Angels have created. Maybe we will launch as I had wrote about before an Accelerator for Investors so young and new investors can get started early and participate in building an Antifragile Startup Community in Iceland.
In the world of bits and bytes, the above score means a lot. If you have been following my chain of thought, I believe Software is going to run everything we use. I have written about it before, the biggest hurdle in the exciting development is a cog in the wheel called the Patent Trolls ie. companies setup to just acquire the patent rights and basically bulldoze startups or any company trying to innovate by seeking high patent infringement fees. No-one is immune to this problem. If you want to understand how this whole software patent things has become convoluted and how to solve it read the post by Nick Grossman from Union Square Ventures. Brad Feld, Jason Mendelson, Brad Burnham and Fred Wilson have been writing (here, here and here), educating and lobbying for a better way to address this challenge. However, I think New Zealand has shown the way by completely abolishing Software Patents, in my opinion we need something as bold as that in Iceland. I don’t believe Software Patents work. In addition, since the patent process is so structured anyone with enough money and backing could define a problem and a possible solutions and patent it thereby prevent/block anyone else to approach or address the problem. This is silly. I think we need common sense to define laws and not allow laws to trump common sense. IMHO, Software Patents are for loosers! there you go I said it. I have worked in the software business long enough to say that there is nothing patentable in Software, it is like me patenting my thinking what good is that if we cannot create something of value that solves a real world problem? There are many ways to solve a problem using software and I think it behooves us as a community to allow anyone to solve it better and allow the consumers to vote with their feet. Look what happens with Software Patent troll:
Brad Burnham has been a big supporter of Iceland. He has invested quite a bit of time, influence and effort to push the idea of the Freedom to Innovate and Internet Enterprise Zone in Iceland. There have been many channels of talks, efforts to initiate projects and gather support through a research and development approach. Brad has also been providing a lot of leadership to policy makers on how to look at the internet. Union Square Ventures, which was founded by Brad Burnham and Fred Wilson, is a venture capital firm based in New York City. They are a small collegial partnership that manage $450,000,000 across three funds. Their portfolio companies create services that have the potential to fundamentally transform important markets. They can work with an entrepreneur whether she needs $250,000 to test an idea, or $25,000,000 to buy an undervalued asset. They invest in New York, San Francisco, London, or Berlin and most places in between. Here is Brad talking to RUV last year when he was participating in Startup Iceland 2012.
Here is Brad talking about how Policy matter for Innovation. I am extremely excited to see the developments in Iceland, maybe Iceland call pull it off but I am more excited to see that Brad is still committed to Iceland and has agreed to come back and talk about the Freedom to Innovate. I think everyone is Iceland is going to win big if Iceland become the leader is coming up with policies that foster innovation. We are very fortunate to have access to someone who has been looking at this since for a long time and he believes Iceland is a key player in this transformation.
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.
Unless you’ve been living under a rock, you’ve probably heard the news that CLARA was acquired by Jive Software (NASDAQ:JIVE) last week. Everyone in Iceland is talking about this deal. It was the first investment my partners and I at Auro Partners made in Iceland. We are very happy to have shared the journey with Team CLARA (a.k.a Resonata). If I am not wrong, this is the first Icelandic software company to be acquired by a NASDAQ listed Silicon valley company. This was a huge win for CLARA, Jive Software and for the Startup Community in Iceland!
Gummi, Co-Founder/CMO
Sverrir, CTO
I continue to emphasize that the key to success is always the entrepreneurial team. Finding and assembling the right team to drive success is an art. CLARA’s success can be attributed to many factors aligning at once and at the right time. But the core factor in CLARA’s success was its team. Auro Partners was impressed with the technology CLARA was building, but we invested in its founders.
I have written about CLARA before and the team at CLARA. This acquisition effort was led by Gunnar Holmsteinn (CLARA’s CEO), Sveinbjorn Indridarsson (CFO), the dedicated members of CLARA’s team, a committed Board of Directors, and guided by our lawyer Justin Hovey from Pillsbury Law.
Maggi, Co-Founder/Designer
Jon, Co-Founder/Developer
There were numerous late night meetings, legal documents to review, negotiations, round table discussions and hard work that brought this win home. Like the startup team itself, the people that comprise the Board of Directors of a startup makes a huge difference in the company strategy, direction and opportunity for success. We were very lucky to have had a wonderful and dedicated Board, that consisted of experienced business minds with diverse backgrounds: Egill Masson from NSA, Paula Gould, Ragnheiður H. Magnúsdóttir, myself and Bjarni Armansson. Together we had the right mix of people with the right backgrounds and the right attitude.
The last 3+ years with Team CLARA has been a huge learning experience for me personally and I would like to thank every member of Team CLARA to have given me that opportunity to be their first investor and the Chairman of the Board.
Steinn, Developer
Tomas, Developer
On behalf of Auro Partners, I will say we are extremely happy to see Team CLARA get to do the things they love doing, and successfully. We are more confident now than ever about our Investment thesis on Iceland and excited to be part of the Startup Community in Iceland. We will continue to invest time, money and effort into building a much more vibrant business community in Iceland.
Rick, Sales
If you are an Entrepreneur or a startup team, you should definitely participate in Startup Iceland 2013. Gunnar Holmstein will be among one of the many exceptional and experienced speakers this year. He will share with us his journey, stories and strategies that worked (and didn’t work) for Team CLARA. Don’t miss out on the opportunity to learn from someone who fought the good fight to bring Iceland a huge win.
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.
Iceland voted yesterday and I have to say watching the reaction of the Icelanders is always entertaining. I have to say, Iceland has proved me right again, that they are willing to change the way the world works in their own way. The biggest upset in this swing election is that the Pirate Party actually has 3 Members of Parliament elected 6 months after the party was formed. In addition, another political party that advocates direct democracy as its platform has 6 Parliament members. This is historic in any right. I cannot remember a time when any country has done the above especially for a party with a name that means practice of a pirate; robbery or illegal violence at sea. 2. the unauthorized reproduction or use of a copyrighted book, recording, television program, patented invention, trademarked product, etc. This should be a clear message to those political parties that are holding onto dogmatic views about policies and politics.
I am not a politician and I think they are all wonderful people but for some reason politics just seems to not move things forward. I think Fred Wilson and Brad Feld, both had posts that basically outlined their understanding of working with political establishments and loosing, Brad wrote about “Compromise vs Problem Solving” and Fred wrote recently about “Immigration Reform“. I am not half as smart as either of those two men so I will let you decide for yourself my views on politics. I am just excited to see one more uncertainty out of the way in Iceland. Both the elected parties were part of the political and power establishments for over 2 decades in Iceland and they were blamed for the financial collapse. In my opinion there are multitude of things that went against Iceland and like any democracy everyone blame the politicians and politics. I think it is a pre-requisite in a open society to blame someone else for all the challenges and the best party is the political party in power. I am not saying that the government before the last had no part in it or that the next one really solved the problem. All I am saying is that Sh#$ happens if we don’t have someone else to blame then we have to take responsibility for our actions and take on a corrective course. That is hard to do so we have the political establishments and Governments, which we can blame for anything and everything. I’d rather spend my time solving some problem and helping Entrepreneurs who are trying to solve global problems… usually my request to anyone including Government is stay out of my way, I can take care of myself. Thank you very much!
