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Cornucopia

Welcome to my learning center, called Cornucopia, because my interests are diverse.  I plan to post a number of learning opportunities around entrepreneurship, running, native California gardening, and other topics where I feel I have something to share.

I am the founder and CEO of Knoitall, a start-up knowledge network (still in beta) that we hope will revolutionize how people learn and consume information.  

Thank you for visiting my page and I hope you will consider joining our network and educating your world and ours.

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Learn how to move the VC from fear to greed

Learn to maximize your value once you have moved the investor from one end of the spectrum to the other

Free Resource (Video, Article, Pod Cast or Other)
Adult

It's been said that venture capitalists operate on two ends of the spectrum. Either they are fearful that they may make a bad investment by putting money into your deal, or an entrepreneur has successfully moved the venture capitalist to the "greed" side, where a financing deal can take place.  

In my experience, venture capitalists will never finance a deal out of fear.  Instead, they need to be comfortable enough through their due diligence that they believe the opportunity has a chance to be one of the next BIG exits for their firm.  

So, how do you move a venture capitalist from the side of fear to the side of greed?  

There are a number of ways.  The best entrepreneurs cover all of these bases as best as they can before they approach a VC:

  1. Have great people involved in your deal already-Even if these people aren't investors, if the VC knows these people personally, or if he or she can search them on LinkedIn and get excited about their involvement in your deal, that's a great start.  Most venture capitalists don't like to be the only person who believes in your deal...they like to be one of many.  NOW, THAT IS NOT ALWAYS THE CASE.  You may get lucky and find a VC who has been successful finding great companies where no one else is looking.  A lot of top-tier VCs looked the other way when Air BNB and Uber came knocking.  
  2. Get industry insiders and experts to validate your idea-Most VCs are not going to be as knowledgable about your deal and space as you are...they don't have the time to do all the research.  Instead, they'll look to the experts in your space to tell them that you have something worth looking at.  So, reach out to these people yourself and get the requisite feedback, quotes, and validation that tells investors that you are an "up and comer" hitting a hot market with something new and exciting.  These industry insiders could be analysts, or other investors in your space.
  3. There's nothing like traction to remove a VCs doubts about your deal-Traction is the great equalizer.  It tells the VC that many of her doubts about your ability to succeed may be unfounded, because, in fact, YOU ARE SUCCEEDING!  Software has moved beyond the question of whether or not you can build it.  VCs know just about anything can be built these days.  The question is, WHO CARES?  Will anyone use your software, and, if it is a B2C opportunity, will they use it in big numbers?  I have found that there is no better way to get a VC over onto the greed side than by showing solid growth that allows the entrepreneur to paint a picture of what this opportunity looks like if this growth continues exponentially.

  4. Attack a huge market-If you want to move a VC off of the fear side, show him that the opportunity is larger than he initially believed.  What many VCs didn't understand at the time was that Uber wasn't just a replacement for the taxi cab, it was going to revolutionize all of mobility.  So, don't show the Taxi cab market, include everyone who drives today and show how their behavior changes when Uber makes it so simple to get a ride that people actually leave their cars at home.  Find ways to expand your market and then describe the path by which you will gobble up the whole market over time.  Sure, you need a beach head, but once you have that beachhead, you're going to revolutionize your space in ways that investors may not have thought of.
  5. Build momentum for your deal-I have a friend who is an expert at this.  He convinces the VCs that a bidding war is already occurring around his deal, and, if VCs don't move quickly, the opportunity will close.  Now, there is some science and some art around doing this well.  But understand this; VCs like exclusivity, and you want as many VCs looking at your deal as possible.  Once you go out to raise financing the clock starts ticking on your deal.  And if you're 3 months in and you don't VCs circling around your deal, it will get stale.  So, once you go dive in, you need to be all in.  The process of fundraising must consume you.  And you must have a structured approach to organizing your investor interest so that you can keep as many firms engaged as possible.  

OK, so now you've moved the VC from fear to greed.  You'll know it because the VC will start reaching out to you and asking about things like pre-money valuation ranges, and selling you on their firm.  They might mention due diligence process, and start to feel you out around terms.  All of this is precursor for a potential term sheet.  So, how should you proceed?  Well, every deal is different, but let me say this..."You will never be in a better negotiating position than right now", before that term sheet gets signed.  It's like a marriage pre-nup.  Once the wedding is over, you've lost any negotiating position you had.  So, figure out what is important to you and negotiate hard.  

What should you negotiate for?  I can't speak for you, but I certainly have a list of things that are important to me:

  1. Board compilation-For most smart VCs, their interest in ownership at this stage is superseded by their interest in controlling the board.  Why? Because if they control the board they can control the direction of the Company, and the hiring and firing of the CEO.  Therefore, I want to make sure that the board compilation favors me.  How to do this?  Usually, the VCs will want a 5 or 7 person board.  If it's 5, they'll want 2 from their side, 2 from your side, and 1 who is agreed upon by both sides.  SO, MAKE SURE YOU FIND THE ONE!  Bring board candidates who are so qualified for the job the VCs can't help but accept her.  Don't let them be the ones who drive the process.  You drive the process.
  2. Severance-VCs will want to cover their downside risk that you may not be the right person to run the Company going forward.  Usually they will do this by using their preferred shareholder status to control the hiring and firing of the CEO.  Many times that is you.  So, you want to do two things...both are onerous to the VCs if they fire you.  First, you want to make sure that your severance package is rich...minimum 12 months salary and benefits if they fire you.  Second, you want acceleration of any stock options that may not have been exercised.  If the firing was for anything other than for cause, you should be able to achieve this.  Third, you want to make sure that if there is a recap of the Company, you have some ability to maintain your ownership position.  As soon as you're fired, most VCs will want to up the pool to bring in a "Rock Star" CEO to replace you.  They no longer care about your ownership position...you're out of the Company.  So, now is the time to negotiate.
  3. Options-Most entrepreneurs come into the financing round owning all of their shares since they received them when the Company was founded.  But most VCs want to incentivize you to keep working as hard as possible to make the Company successful. One way they do this is by taking a portion of your existing shares, and reallocating them as options to you that will exercise over a given period of time...usually 2-3 years.  If you're in a strong negotiating position, you want to push back on this.  Best case scenario is that you get to keep all of your shares, and the VCs find another way to incentivize you, perhaps through a bonus plan that is based upon company performance.  

GOOD LUCK AND HAPPY HUNTING

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Learn how to answer the tough questions you will be asked by VCs

Free Resource (Video, Article, Pod Cast or Other)
Adult, Senior

Lets face it...most venture capitalists are very bright people.  Many have built their own successful businesses prior to getting into the business, and they have read through hundreds of decks and sat through numerous pitches.  Many times they know more about your space from a macro perspective than you do.  In fact, they very well may be considering an investment in one of your competitors if they are looking at your space in particular, and have already done quite a bit of research.

All this to say that it's hard to BS a VC.  And the alternative can be very ugly.  I learned this the hard way when I pitched my first VC for a business I formed in the mid-90s.  I came into the session prepped with my pitch notes and canned answers to the questions i thought I would be asked...who was my competition, what was my IP, why would I win?  All the good stuff.

Instead, the VC allowed me to introduce my business in the first slide and then quickly went to some financial questions directed at the size of the opportunity and our potential revenues within that size.  Needless to say, I was unprepared for this line of reasoning, but, not wanting to show my weakness, I decided to throw out some general numbers based on my research and hope that would suffice.

Big mistake!  What I had done, without even knowing it was to open up a rabbit hole that the VC, who had a much better understanding of the financial levers in a business like mine, was happy to drop into with me.  Using the numbers I had given the VC, he began to run through various scenarios, asking questions around our margins, growth segments in percentage terms, addressable markets for our particular solution...you get the point.  And, as I went deeper into the weeds around specific numbers, I began to see myself trapped.  What started out as a discussion around a Total addressable market in the billions became a micro analysis of the sub markets that I could conceivably attack, and what I had effectively done was paint myself into a corner, tackling a market that, at best, was a $25 million per year revenue opportunity.  I had successfully taken an opportunity in the billions and ended up at $25 million.  How did I get there?  I'll tell you how...the venture capitalist gave me the rope to hang myself, and I took it. 

The lesson learned?  Don't BS a VC.  Instead, if you aren't confident in the answer to the question, tell the VC.  And tell her that you will find the answer out as soon as you leave her office and email her with the answer.  Realize that you are being tested, not just for your knowledge and command of the business, but also for your integrity.  It's always better to acknowledge weaknesses than to try and cover them up with incorrect or incomplete data.  Trust me...a good VC will either already know the answer to the question he or she just asked, or they will find the answer during due diligence...if you ever get that far. 

Entrepreneurs have weaknesses...but a good entreprenuer will understand and accept his or her weaknesses, and convince the VC that she can hire A-level people around her to fill those gaps.

GOOD LUCK AND HAPPY HUNTING

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Learn what it takes to run a sub-3 hour marathon

Take away information that you can apply towards building your own training plan

Free Resource (Video, Article, Pod Cast or Other)
Teen, Adult

I have been at this thing called marathon training for over 15 years now.  And I still have a lot to learn.  BUT here's one thing I've learned that has served me quite well; "Monotony is the key to success at the marathon distance".  What I mean by this is that, in order to train effectively, you need each day to be like the day before.  You go to bed the same time the night before (usually no later than 9:30), you get up the same time after a solid 8 hours of sleep, and you run at the same time...sometimes twice a day...7 days a week.  

As Bill Murray eloquently stated in Ground Hog Day, "It's going to be cold. It's going to be dark, and it's going to last you for the rest of your life."  That's how your marathon training should feel.  Here's the cold reality.  If you travel a lot with work, or you work a constantly changing schedule, it's much harder to get into the rhythm of marathon training.  Sure, it can be done, but it's much more difficult to optimize your results.

This is why you need to clear the deck of just about everything other than work and running if you want to optimize your outcomes at any age.  Notice I didn't mention family.  That's because, inevitably, sacrifices will need to be made to allow yourself the time to train...and, if that time isn't coming from work, it's coming from family time.

I'm an entrepreneur.  I work very hard.  I take the products I build personally.  Because of that fact, and because I want to be the best marathoner I can be, I made sacrifices in just about every other area of my life.  I create a monotonous environment with sameness being the defining quality from Monday-Sunday. 

For me, I have carved out some interesting solutions to allow me to get in the 90+ miles of running per week I feel I need to be at my best.  First off, instead of driving to work, I run to work...4 days a week...every week.  The only reason it isn't 5 is because I need a day to swap out all of the dirty clothes at the office with clean clothes.  On that day I run before work, drive to work, and then run after work and drive home.  

I do all of my appointments through Skype, FaceTime, GotoMeeting, or at my office.  I rarely travel during a training cycle.  This approach allows me to be working at 8 AM with a 9.5 mile run before the start of the day.  Then, on a number of days, I take the train home at night and run the 5.5 miles from the train station.  I'm home by 7 or 8 PM...dinner, some time with Heather, some time writing or working on the computer, and then to bed by 9.

Weekends are even more boring.  I keep most social events to a minimum...I try and get to bed by 9:30, and I run the same course every weekend. One of my running idols, Ed Whitlock, who is the only person to have run a sub-3 hour marathon at age 70, ran the same course every day.  The only change in his training was how long he would run through the cemetery near his home.  Two weeks prior to the marathon he would run the same circle around the cemetery 3 hours a day, every day.  

So, if you want to run a sub-3 hour marathon (and I don't care what age you are), clear the decks for the next 6 months, and get used to re-living the same day over, and over again.

 

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Find out what I learned trying to transition from an early 90s web founder to the founder of a web 3.0 market network

Explore some of the new key success factors  and what is working for others

Hopefully this will help you in your own entrepreneurial endeavors

Free Resource (Video, Article, Pod Cast or Other)
Teen, Adult, Senior

Boy did I think I was cool back in the mid 90s as the founder of a "hot" internet start-up at the center of seemingly everything.  All the hot publications back then wanted to cover us and our exciting new business model for education, and we could attract top level talent just by offering stock options.  Everyone was a day trader investing in the internet companies going public as fast as possible...many with little or no revenues at all.  And I was right smack in the middle of it all, with 80 employees, $20 million in VC funding in the bank, burning $700k/month and looking towards a massive exit.  Then, as they say, the rest is history.  I knew the gig was up when AOL laundered their obscenely high valuation in the purchase of Time Warner.  What was equally impressive were the other acquisitions AOL was considering, from Disney to ABC.  

We scrambled to get an exit as quickly as possible after that announcement, but we didn't get across the chasm.  Instead, we were one of hundreds of internet companies that ended up on the scrap heap of Web 1.0.  It was a humbling experience, to say the least, and I learned a lot.  One of the most important things I learned is that, as tough as VCs can be on you when things aren't going well, most good ones will part ways as friends when it's time to cram down the business.  There's no hard feelings.  We all took a big bet, ramped as hard and fast as we could, and didn't make the cut.  It happens.

So now, here we are in 2017 and I'm quite a bit older, seemingly less wise, trying to launch a market network that will compete for people's time with Twitter, Pinterest, and Facebook.  None of these companies, by the way, existed when I closed the doors on my first internet start-up, EduPoint.  And as we all know, nothing stays still in the internet space.  It moves at warp speed.  So, with that as a backdrop, here is what I am learning in this brave new world:

  1. You need a growth hacking culture with a CTO on the founding team-Back in the mid-90s there was one primary way to reach consumers...Yahoo.  And they piled on the ad rates with banner ad packages in the hundreds of thousands of dollars.  The good news is, orgaic growth is possible today, but you need to have a killer team and strategy in place to manage this growth.  Organic doesn't just happen.  You need a hacking culture focused obsessively on organic growth.  For LinkedIn, seemingly everything Reid Hoffman and his team did in ther early days was focused towards getting to 1 million users.  Read up on their "Double Viral Loop" to learn more about how they did it. Bottom line...you'd better create a viral loop if you want to be in the B2C space or go play in a different sand box.

  2. Understand what you are measuring and why-Everything is measurable today, but many start-ups measure the wrong things.  New users are great, but if your model is predicated on user-generated content or producut sales, you should be measuring the number of listings you get from each new user.  And, as you'll find (just like we're finding), only about 5% of your users will contribute to your community by creating content that benefits others.  So, you need to get laser focused on who these people are and get more of them.

  3. Build a minimum viable product to solve one specific problem-In the early days you need traction with one key user population and then you can extrapolate that to other populations (at least that is how it's supposed to work).  In our case, we uncovered a problem that millions of bloggers experience today...monetizing their audience.  They use google ads and Amazon affiliate programs, which are highly sub-optimal for many bloggers.  We believe we have found a way to help them better monetize that audience by selling what they know.  So, now we're building a minimum viable product to do just that.  Sure, I believe we can help anyone sell what they know, but we found a ready audience from bloggers who list making money through their blogs as one of the top three reasons they launched a blog in the first place.

  4. You need to build a business model where customer acquisition costs are significantly less than the lifetime value of the customer-Makes sense, of course, but nobody was talking about the lifetime value of a customer back in the mid-90s.  Network platforms and push technologies have brought this concept to the forefront.  So, we B2C entrepreneurs need to be laser focused on how to increase the LTV of every user on our platform.  

  5. Raise enough money to get to the first milestones-This was true in the 90s and it's still true today.  What's changed is the milestones being used today to show traction and success.  Back in the 90s one of the key milestones was the number of employees you had...TRUE.  When we went out for our series B round we had little to no revenues but we had 35 employees and top tier VCs in our A round.  Number of employees helped us fit into the parameters of a company raising a series B.  Anyways, my philosophy has always been, "TAKE THE MONEY".  If the VCs offer more than you think you need, take the additional dilution and take the money.  Problems will invariably occur, and you will tweak the model.  You want the runway to make those adjustments.

  6. It's incredibly hard to try and build cash flow and create a unicorn at the same time-Look at LinkedIn. The company had over 1 million users before they ever implemented a revenue model.  And their early models weren't that great.  That's ok, because they had VCs that were patient and allowed the network to grow, understanding that the value of the network grew exponentially with each new member.  At 1 million users you can find a way to make money.  You need to find VCs who allow this to occur without focusing on revenues right out of the gate.

  7. It sucks to be old-I'm no longer the young, vibrant entrepreneur who seemingly had the secret to monetizing these new internet business models.  I had been in the internet at the earliest of days, and I had seen it grow.  I was there when Jeff Bezos launched Amazon...in fact, I had one of their first coffee mugs for being an early adopter, back when all they sold were books. Now that I'm older, I seemingly Know nothing....and there's a new generation of entrepreneurs who look like I did back then and who supposedly have the key to the future.  It's hard to compete against that, but I have found that the best strategy is to keep my head down and try and build a great company around a great product.  If I do that, it won't matter how old I am.

GOOD LUCK AND HAPPY HUNTING.

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I'll help you revise your Deck for your VC pitch

We'll get your deck into the right format 

Make sure to include the right slides, and only the slides that the venture community needs to see

$50.00
Online - Advising
Adult

I will work with you to help you revise your slide deck so that it hits the key points the venture community is looking to see to assess your opportunity for a seed round of funding.  We will focus on building out:

  • Your mission statement
  • The Opportunity
  • Key IP
  • Competition and Competitive Advantage
  • The Team
  • Your Business Model

You will send me your existing deck so that I can review it prior to our session.  Then, after the session I will review it one more time.  The session will take appx. 45 minutes to go through your deck with you over skype.

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$ 50.00

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Learn how Reid Hoffman positioned his pitch for a series B investment

Learn where he focused the attention, and how he managed the fact that they had little to no revenues at this point in the Company's history

Get Reid's own opinions as to how founders can use what he learned to refine their own pitches

Free Resource (Video, Article, Pod Cast or Other)
Teen, Adult

This is one of the best blogs I've read on how to pitch VCs.  Even if you are just starting the fundraising process Reid's insights are of high value, especially since he is now on the other side of the table as a VC.

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Learn how to build a bird bath

Free Resource (Video, Article, Pod Cast or Other)
Teen, Adult, Senior

This is a great article on the various types of bird baths you can build to attract native birds to your backyard.  Las Pilitas is one of the foremost nurseries for native California gardening

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Learn how to build an easy and cheap gate from a pallet

Free Resource (Video, Article, Pod Cast or Other)
Teen, Adult, Senior

This is another great DIY artticle from my favorite nurser, Las Pilitas.

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Begin the design of you California native landscape

Understand the plant communities and what will work with your property

Learn about specific native plant types and their uses in your garden

 

$50.00
1 session(s)  1 Hours
Face-to-Face - Class or Seminar
Teen, Adult

In this class we will start the design of your native California garden.  We will look at the various native plant communities, from Coastal Sage Scrub to chaparral, mountains to beach.  We will discuss the proper use and care of native plants, and discuss the various uses of different plants, from foundational plants to rock gardens, ponds, riparian, trees, and flowers.

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$ 50.00

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Find out what I learned from my almost 20 years of racing...who knows, maybe there are some contrary views here

Free Resource (Video, Article, Pod Cast or Other)
Adult

In no particular order, these are some of the things I now believe I learned after putting in over 54,000 miles of training, over 60+ half marathons, 18 marathons, and countless shorter races:

  1. The last 6 miles of every marathon are like Groundhog Day; "It's gonna be cold, it's gonna be grey, and it's gonna last you for the rest of your life."
  2. When you get to the front of the beer line after a race always get two beers. You're going to want the second but you aren't going to want to get up again.
  3. It aint about how fast you get to the top of the hill. It's what you have left once you get there.
  4. If you're looking for positive feedback from your body during a race, STOP IT!  You won't get any.
  5. If you're running to meet attractive, fun people, don't run marathons...run 5ks, preferably ones where they spray paint on you along the way.
  6. Your body can handle way more than you think it can.  Get started on every training run before you decide you need the rest.
  7. There's a difference between pain and injury.  Learn the difference and train through pain.
  8. The older you get the harder you want the course to be. It slows down the peacocks more than you.
  9. Speed comes from strength...strength comes from mileage.
  10. We all have our demons.  Running is a great way to face them head on.
  11. The great thing about running is that you can't fake it...ultimately you are who you are.
  12. The marathon is like a trial and you are the one being prosecuted.  Your only defense is the training you put in to get there.
  13. Aid stations should only matter in marathons.  If you need fluids in anything less than a marathon, you weren't hydrated enough when you started.
  14. The best runners find a way to create incredible monotony in their lives.  Every day looks just like the day before and the day after.
  15. Always hit the restroom BEFORE you get on the bus
  16. When you get to a race, go straight to the bathroom. Then, get right back in line and go to the bathroom again.  Now you're done.  
  17. Diet and nutrition are overrated.  Just run.
  18. If you get tired, try to run faster.  Some times speed will help your form and form will help your fatigue.
  19. If you want to run fast, train fast.  Sounds simple, doesn't it?
  20. At some point in your life you may put forth an effort that will completely break you.  You may collapse.  You may weep when it's over.  And you may never be the same runner again.  Don't cry about it.  Be thankful that you made it to the top of the mountain.  And while you're up there, take a few minutes to look out over the vastness; the deep dark valleys that you climbed out of, and the smaller peaks that you conquered, and be thankful...thankful to those who climbed with you along the way...thankful to your friends and family that helped you get here...and thankful to God for your many blessings...most of all be thankful to God that you are a runner.

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Competencies

  • Business: Venture Capital
  • Business: Small Business & Entrepreneurship
  • Home & Garden: Gardening
  • Sports & Leisure: Running, Cross Country & Marathon Training
  • Arts & Crafts: Landscape & Landscape Architecture
  • Business: Sales & Selling: Selling Techniques
  • Business: Marketing: Market Research
  • Business: Marketing: Advertising
  • Computers & Software: Amazon, AWS & Kindle
  • Computers & Software: Cloud Computing

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