TechCrunch Disrupt has 30 companies on stage and 200 more in the Startup Alley. Here are the 7 finalists picked by judges. And here is a good review by Jeremiah Owyang. So, what looks interesting and what are the trends?
Easier to start a company, harder to build a business - It has never been easier or cheaper to start a company. Venture capital is plentiful and Angel investors are more active than ever. Ycombinator pumps out over 150 companies a year. TechStars launches another 100 or so. 500Startups is getting close to helping 500 or more. But, many of these "companies" are small apps that are more like a "feature" not a product, and certainly not a viable stand alone company.
Building a business - Most startups fail, that is a fact of life. The difference is that in the past it cost so much to start a company that fewer were actually started. Then, because it was so expensive, these startups would either live or die (run out of cash) within 12 to 24 months. Today, web startups can start for less than $50K, and stay up and running for peanuts.
Rising above the crowd - It is easier to start a company, but harder to rise above the crowd, attract an audience, and build a viable business. Social networks help build viral growth. Buying keyword advertising helps get your message to a very targeted audience. Influential bloggers and Twitter titans can help attract a lot of attention. The old school PR approach doesn't work as well unless you engage the super plugged in mavens.
Me too - I have seen 20 or 30 Groupon clones, deal aggregators, mobile deals by location, social network deals, etc. Sorry, but that game is over. Every product segment tends to have a gorilla, chimp, and monkey that dominate most of the market. Everyone else fights for the crumbs.
Another meme is "I'm the AirBnB for ...", meaning we provide a market to rent out your personal car, apartment, boat, office space, etc. on a short term basis. Social networks and web based marketplaces make it possible to sell or rent anything.
Cream rises to the top - One well known VC told me he was so tired and overwhelmed by all these startups. He was having trouble calibrating and sorting them all out. I told him this is an important part of the process, and in my view, actually makes it easier for the really great ideas or entrepreneurs to stand out. The secret to success in the VC business is to spend a little time with a lot of companies, and a lot of time with a few companies. The trick is to quickly figure out which are the few companies to focus on. After seeing so many companies and pitches the good ones actually stand out pretty quickly.
How to stand out - My last post was "How to pitch your company to investors, customers, and employees". Take a few minutes to read this post and learn why the "elevator pitch" is so important, and how to determine if someone is really interested.
Do your research - A conference like Techcrunch Disrupt, DEMO, or Launch lets you see over 100 companies in a couple hours. You can get a very good look at trends, possible competitors, features you might want to add to your product, or potential partners. When pitching a VC you must know the competitive landscape. If you don't know about an emerging competitor you look clueless. There is no better place than a conference to quickly do your market research and see all the players in one place.
I am a big fan of conferences, but I work them. I don't just sit in the audience and listen. I spend my time trying to see every company, talking to people back stage, and asking lots of questions. You can learn a lot in a very concentrated investment of time. The parties are pretty good too :-)
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