Don Dodge on The Next Big Thing

Startup founders can have their cake and eat it too

Back in the day Venture Capitalists were  king makers. They decided who got funded, facilitated strategic partnerships, and brokered M&A transactions for their portfolio companies. The world has changed...a lot. Evelyn Rusli wrote an insightful story for the New York Times about how startup founders are more in control now. Angel Investors are willing to invest more at higher valuations, and Private Equity investors are willing to invest huge sums at later stages and allow founders to cash in some of their stock. VCs are left in the middle with much less power.

Now startup founders can "have their cake and eat it too". They can get the funding they need to start or expand their company, AND maintain ownership control, AND take some money off the table by cashing in some of their stock before an exit. This is a big change.

Traditional Venture Capital (VC) investors would invest $1M to $3M in a Series A and take 40% to 60% of the company. More importantly, they would take Board seats, and sometimes control the company. Sometimes the BOD would replace the founders with seasoned executives, and later take on additional rounds of financing that would dilute the founders ownership to minimal levels. The VCs had all the power. Not anymore. From Evelyn Rusli's the New York Times story;

“For the next-generation opportunities around the Internet and social networks, I believe the biggest opportunities will be driven by young founders who maintain their C.E.O. positions,” said Jim Breyer, an early investor in Facebook and a partner at Accel Partners.

Angel Investors, "Super Angels" and some forward thinking VCs like Founders Fund and Accel Partners changed all that. Angels are typically wealthy entrepreneurs that have started and sold several companies. They are founders themselves and identify with the startup founders. Ron Conway, Mike Maples, Aydin Senkut, Jeff Clavier, Paul Graham, Brad Feld, Dave McClure, Paige Craig, and lots of former employees of PayPal, Google, Facebook, etc. are very active Angel investors. Often they can invest enough to cover what would have been a traditional VC Series A round.

Later stage investors like Yuri Milner (DST), Founders Fund, and Andreessen Horowitz are willing to invest from $50M to hundreds of millions in private companies at very high valuations. In the past only an IPO could support such high valuations. Not anymore. Now later stage investors are investing at billion dollar valuations and allowing founders to cash out some of their stock. In the NYT story, Andrew Mason, founder of Groupon says;

“By taking money off the table, you’re expunging a big source of risk, allowing you to focus on the interests of the company you’re building instead of your own,” said Andrew Mason, the 30-year-old founder and chief executive of Groupon. He said he was able to sell some of his shares in D.S.T. Global’s initial Groupon investment, a $135 million round last April.

Still Not Easy - Plentiful capital, and low cost of startup resources like Open Source software, cheap hosting, and pay as you go services, has made it fast and cheap to start a company. That doesn't mean it is easy. Far from it. It may be easier to start a company, but it is much harder to be discovered and gain traction with users and customers. There is a lot of competition for user attention.

There is another disruption happening in Press, PR, and startup promotion. The traditional PR agencies are of diminishing importance. The press editors don't have the king maker power they once had. The old line startup conferences can't charge the high prices they once did. Social media, blogs, Twitter, and Facebook are changing the way startups market to their customers. Techcrunch Disrupt, Ycombinator, Launch Conference, and TechStars provide a grand stage for startups to strut their stuff for little or no cost. That is disruptive.

All these changes have put more power in the hands of the startup founder. That is a good thing.

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Startup founders can have their cake and eat it too

Back in the day Venture Capitalists were king makers. They decided who got funded, facilitated strategic partnerships, and brokered M&A transactions for their portfolio companies. The world has changed...a lot. Evelyn Rusli wrote an insightful story for the New York Times about how startup founders are more in control now. Angel Investors are willing to invest more at higher valuations, and Private Equity investors are willing to invest huge sums at later stages and allow founders to cash in some of their stock. VCs are left in the middle with much less power.

Now startup founders can "have their cake and eat it too". They can get the funding they need to start or expand their company, AND maintain ownership control, AND take some money off the table by cashing in some of their stock before an exit. This is a big change.

Traditional Venture Capital (VC) investors would invest $1M to $3M in a Series A and take 40% to 60% of the company. More importantly, they would take Board seats, and sometimes control the company. Sometimes the BOD would replace the founders with seasoned executives, and later take on additional rounds of financing that would dilute the founders ownership to minimal levels. The VCs had all the power. Not anymore. From Evelyn Rusli's the New York Times story;

“For the next-generation opportunities around the Internet and social networks, I believe the biggest opportunities will be driven by young founders who maintain their C.E.O. positions,” said Jim Breyer, an early investor in Facebook and a partner at Accel Partners.

Angel Investors, "Super Angels" and some forward thinking VCs like Founders Fund and Accel Partners changed all that. Angels are typically wealthy entrepreneurs that have started and sold several companies. They are founders themselves and identify with the startup founders. Ron Conway, Mike Maples, Aydin Senkut, Jeff Clavier, Paul Graham, Brad Feld, Dave McClure, Paige Craig, and lots of former employees of PayPal, Google, Facebook, etc. are very active Angel investors. Often they can invest enough to cover what would have been a traditional VC Series A round.

Later stage investors like Yuri Milner (DST), Founders Fund, and Andreessen Horowitz are willing to invest from $50M to hundreds of millions in private companies at very high valuations. In the past only an IPO could support such high valuations. Not anymore. Now later stage investors are investing at billion dollar valuations and allowing founders to cash out some of their stock. In the NYT story, Andrew Mason, founder of Groupon says;

“By taking money off the table, you’re expunging a big source of risk, allowing you to focus on the interests of the company you’re building instead of your own,” said Andrew Mason, the 30-year-old founder and chief executive of Groupon. He said he was able to sell some of his shares in D.S.T. Global’s initial Groupon investment, a $135 million round last April.

Still Not Easy - Plentiful capital, and low cost of startup resources like Open Source software, cheap hosting, and pay as you go services, has made it fast and cheap to start a company. That doesn't mean it is easy. Far from it. It may be easier to start a company, but it is much harder to be discovered and gain traction with users and customers. There is a lot of competition for user attention.

There is another disruption happening in Press, PR, and startup promotion. The traditional PR agencies are of diminishing importance. The press editors don't have the king maker power they once had. The old line startup conferences can't charge the high prices they once did. Social media, blogs, Twitter, and Facebook are changing the way startups market to their customers. Techcrunch Disrupt, Ycombinator, Launch Conference, and TechStars provide a grand stage for startups to strut their stuff for little or no cost. That is disruptive.

All these changes have put more power in the hands of the startup founder. That is a good thing.

Subscribe - To get an automatic feed of all future posts subscribe here, or to receive them via email go here and enter your email address in the box in the right column. You can also follow me on Twitter @dondodge

The Crunchies photos and videos

The Crunchies Award show was produced by TechCrunch, GigaOm, and VentureBeat. It is always one of the best parties of the year. This year was no exception.

The hit of the show was another clever song by the Richter Scales. Last year's prescient instant classic was "Here Comes Another Bubble". This year they came back with a hilarious song "RIP Good Times...Hello Great Times".

The song chronicles a startup CEO rallying his troops through the recession, turning down a $500M buyout offer, focusing on the positives (pounds of brains, and months of cash), and adding porn to juice up their product offering.

Rather than expound on all the highlights, let me just share some photos from the event.

Ray Ozzie (Microsoft - LiveMesh) accepting the Crunchie for Best Technology Innovation/Achievement for 2008, Steve Gilmor was the presenter.

Dan'l Lewin (Microsoft) presenting Best Startup, won by FriendFeed.

David Treadwell, Ray Ozzie, Om Malik interview

Jason Calacanis adding a touch of humor to the night. (Photo by Chad Scott)

Pictured below;  Ray Ozzie, MC Hammer, and Geoffrey Arone (DanceJam)

The TechMeme crew. Megan McCarthy and Gabe Rivera

Silicon Valley Angel investors; Jeff Clavier (SoftTechVC), Paul Graham (Ycombinator), and Dave McClure (500Hats).

Mark Zuckerberg (Facebook) and Don Dodge (Microsoft)

Microsoft Surface Computer attracted a huge crowd

Midori Lawler (Microsoft) and MC Hammer at the after party.

Microsoft launches BizSpark program for startups

Microsoft today announced BizSpark, a global program designed to help accelerate the success of early stage software Startups. Microsoft has worked with startups for many years by providing software, support, and introductions. But the programs were little known and narrow in scope. BizSpark is world wide, and now includes over 300 Network Partners who can offer the program directly to startups.

 

BizSpark provides Visual Studio, Windows Server, SQL Server, SharePoint, MSDN, Microsoft Office,  and lots more.

VentureBeat describes BizSpark;

It’s an enticing free upfront three-year package, bundling together software, support and promotion for no upfront cost — requiring merely a $100 payment when you leave the program. It’s an aggressive move by Microsoft to ensure that technology startups at least consider using Microsoft’s tools when they are putting together their initial infrastructure — and comes a time when competitors are bidding for the business of those same startups by offering them low cost, often open source initiatives.

ZocDoc chief executive Cyrus Massoumi says Microsoft approached him to join the program at this year’s TechCrunch50 conference, where ZocDoc had a booth. The startup has now been part of BizSpark for about six weeks, and although the service was already built on Microsoft’s platform, Massoumi and chief technology officer Nick Ganju say the program has already paid off by connecting them with expert help when needed, and helping them increase the site’s security and scalability.

The free software is nice, Massoumi says, but he’s even more excited about “being able to get access to people at Microsoft who are building these products. This is stuff that we couldn’t buy.”

CNET says "In its boldest bid yet to win the affections of emerging businesses, Microsoft on Wednesday announced a program that will allow some start-ups to use its server software free of charge. "

 

eWeek included this quote "“We think Microsoft BizSpark addresses a fundamental challenge startups face: access to current, full-featured tools and technologies that help turn ideas into a thriving business,” said Suren Dutia, CEO of TiE Global, in a statement. “We will work closely with Microsoft to help startups bring their innovative solutions to market more quickly and effectively by providing educational programs, business mentoring and peer networking."

 

TechMeme has lots of other stories covering BizSpark.

 

By joining BizSpark, Startups get:

o   Software:  fast and easy access to Microsoft’s current full-featured development tools, platform technologies, and unlimited production licenses of server products for immediate use in developing and bringing to market innovative and interoperable solutions with no upfront costs and minimal requirements. Startups will also get access to the community technology preview (CTP) of the Microsoft Azure Services Platform.

o   Support:  professional technical support from Microsoft (MSDN) and community support from BizSpark Network Partners around the world who provide a wide range of support resources for software startups.  Network Partners are incubators, investors, advisors, government agencies and hosters who are vested in software-fueled innovation and entrepreneurship.

o   Visibility:  a dedicated online startup directory, BizSparkDB, on the Microsoft  Startup Zone website (www.microsoftstartupzone.com)where we will highlight  promising companies from around the world, including the “BizSpark Startup of the Day”. Through their relationship with Microsoft and BizSpark Network Partners, startups will achieve global visibility to an audience of potential investors, clients and partners.

Startups get access to BizSpark through Network Partners like TiE, NVCA, select Venture Capitalists, and over 300+ entrepreneurial-focused organizations with a strong track record of helping young and promising technology companies. Startups can find both at Microsoft.com/bizspark.

In the US, partners like Kliener Perkins, NVCA, Sigma Partners,Hummer Winblad, Polaris Venture Partners, Common Angels, eCoast Angels, TechStars, Angel Capital Association, and over 200 others are ready to help startups get into the BizSpark program.

Program Details:

·        Eligibility:BizSpark is available to startups that fit the following criteria, nominated by Network Partners:

o   A private company building a software-based product or service

o   In business for less than 3 years

o   Less than USD $1M in revenue

o   Participation lasts up to three years

Start a company in a recession? Absolutely!

Now is a great time to start a company. Why? Because great people are available to join you, VCs are loaded with cash, and office space is available cheap. Everything is cheap and readily available in a recession.

Paul Graham says "If we've learned one thing from funding so many startups, it's that they succeed or fail based on the qualities of the founders."  "Which means that what matters is who you are, not when you do it."

In good times all the really great people are busy doing fun projects...and not available to join you in a startup. In bad times projects are cut, people are laid off, and big companies retrench to improving the existing stuff. New projects don't get any budget. So, great people get bored and start looking for the Next Big Thing...a cool startup.

Raising money is a little harder, but not much. Good teams with good ideas can always get VC/Angel funding. In fact, VCs are sitting on tons of cash right now...and they want to invest it in hot new startups. Many VCs are reluctant to dump more money into an existing startup that is struggling, but will invest in a new startup idea. The promise is always more appealing than the reality.

Everything else is cheap and readily available too. Office space is always cheaper and more available in a recession. Existing companies will sub-lease space really cheap to offset some costs. Computers, software, networks, desks, equipment...everything is cheaper.

Expectations are lower during bad times so it is a good time to be in development mode, building a product, getting an audience, and starting a tiny revenue stream.

Customers are willing to try new things to save money in bad times. When things are going great they don't want to take risks on a tiny startup. If you can save them money in bad times...they are happy to deal with a startup.

Go for it! Now is a great time to build your great idea into a company.

MyPunchbowl party planner - design studio

MyPunchbowl, a web service to plan and organize parties and events, today announced a new invitation designer. MyPunchbowl takes party planning and invitations several steps beyond eVite.

The new invitation card designer has an intuitive and simple user interface. Users can choose from a library of pre-made cards and templates, or you can create your own invitation with your own pictures and graphics. The templates can be customized to include user-defined text, fonts, colors, pictures, and graphics.

Key features of MyPunchbowl include:
• Pick a Date feature to drive group consensus to an event date
• “Save the Date” to inform guests early in the planning process
• Design Studio with an attractive selection of paperless papers, ribbons, and fonts
• Ability to instantly customize the color and fade of any paperless paper, ribbon, or text
• Hundreds of pre-made free invitations that can be customized for any occasion, such as
birthday invitations and Halloween invitations
• Party checklist and potluck checklist to keep hosts on track
• Easy import of email addresses to manage guest lists
• Stress-free RSVP to ensure a more personal interaction between host and guest
• Party planning advice and tips from MyPunchbowl resident expert Penelope
• A party store locator to find local stores anywhere in the United States
• Numerous “after party” features to reminisce and share party memories

TechCrunch did a nice review of MyPunchbowl highlighting the "gorgeous custom invitation editor".

MyPunchbowl recently closed a $2.1M financing round. Investors included Intel Capital, eCoast Angels, and Contour Ventures.

The 7 deadly sins and 10 lessons of a failed startup

Failure is part of the maturing process in the startup world. If you haven't failed...you aren't trying hard enough, or you aren't  "pushing the envelope" far enough. I have always said "Success is a terrible teacher. Success masks over flaws that may hurt you later."

Roger Ehrenberg - the co-founder of Monitor 110, wrote a story on the lessons he learned from this recently failed startup. [found via Fred Wilson] He lists "seven deadly sins" that lead to their demise.

• The lack of a single, "the buck stops here" leader until too late in the game
• No separation between the technology organization and the product organization
• Too much PR, too early
• Too much money
• Not close enough to the customer
• Slow to adapt to market reality
• Disagreement on strategy both within the Company and with the Board

In my opinion there are two key reasons Monitor 110 failed; first, no clear CEO leader, and second, too much money. Trying to run a startup as a group of friends or make decisions by committee will never work. Too much money allows you to waste time, ignore danger signals, and continue down a wrong path for too long.

More Lessons - But here is the story of GameClay, another startup failure at the other end of the spectrum. They didn't raise any VC money...and still failed. [Found via Jeremy Liew]

1. If your idea starts with “We’re building a platform to…” and you don’t have a billion dollars in capital, find a new idea. Now.
2. It’s a marathon, but it’s a marathon made of sprints
3. Initial conditions matter. A lot.
4. Developing in a vacuum never works.
5. Beware the chicken and the egg.
6. Prototype any 3rd-party libraries that you’ll be depending upon, before you base your product on them.
7. If you’re doing anything other than building your project and getting users, it’s premature.
8. The product will take longer than you expect. Design for the long-term.
9. People have an incentive not to crush your dreams. Take everything they say with a grain of salt.
10. Know your limitations.

Building a startup is the most difficult, and most rewarding, thing anyone can do. Sometimes you can even make some money at the end of it all. There are so many things that can go wrong it is a miracle when a startup actually makes it.

It is important to celebrate our successes, learn from our failures, and value them equally. Failure is important...because success is a terrible teacher.

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ClearContext for Outlook announces public beta

ClearContext – is an organizer for Microsoft Outlook email that analyzes how you handle email, who you respond to, what gets saved and what gets deleted, etc., then forms rules and priorities for how to deal with future email.

I have been following ClearContext and Xobni for more than a year now. I believe it was Om Malik who pointed me to them. Today they announced public beta for the personal version of ClearContext. Om Malik and TechCrunch have good reviews of ClearContext.

“Email applications are built around the concept of processing messages on a one-by-one basis, an approach that is no longer viable for many people due to the number of emails they receive and all of the different tasks now being done in email,” said Deva Hazarika, co-founder and CEO of ClearContext. “We provide the context to help people go beyond just dealing with individual messages, taking email productivity to a new level.”

ClearContext helps with project management: sorting and categorizing emails relating to a particular subject or project. The user can also separate emails according to their priority, set them to re-appear later, delegate them to a different user or file them into various project views.

The ClearContext Dashboard offers a consolidated view of e-mails, tasks, and appointments related to a project. Results can be pulled from multiple folders and data stores within and across Outlook and Exchange.

Try it out and let me know what you think.

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The Entrepreneurs Dilemma - Sell now for $Millions or holdout for $Billions?

If you had to choose between selling your company now for $100M or continuing on for another 5 years or more and maybe selling for $ Billions, what would you do? Every entrepreneur hopes to have this dilemma, but when it happens it is a difficult decision with many different factors.

This week I had the opportunity to talk with several entrepreneurs who faced this decision. The results were different in each case, but the major factors in the decision were the same.

Competitive environment - Are you in a leadership position? If you have already carved out a dominant position in one market and could move into other market segments or geographies, that would argue for staying private and going for the big exit. On the other hand, what if the big billion dollar players are  entering the market? What if the market is consolidating, and your competitors are being acquired by big players?

Financial structure - Is your company well capitalized and profitable? If so you could probably grow organically, without raising more money or taking dilution. However, even in this case you may not be able to grow fast enough to keep up with the competitors and market movement. If you need to raise more cash, or are not yet near cash flow break even, the decision is more complicated.

Economic environment - Is there a recession looming or is the market booming? If the market is booming and you have a good competitive position, you may want to raise more money and holdout for the big exit.

Age of company - Startups are full of enthusiasm, vision, and hope. After 7 years or more is the fire and passion still there? Most employees are fully vested by then. Are they still totally engaged or are they leaving? A startup can't stay a startup forever. The dynamics change. You need to keep a finger on the pulse of the whole company.

Founders - Are the founders still at the company and still passionate? Are the founders financially secure, or are the looking for an exit? Can the management team take it to the next level? These are the toughest questions to face and answer honestly.

Investors - Venture Capital investors need to answer to their Limited Partners each year. If the fund has already generated a nice return for investors they may be more inclined to holdout for a bigger exit. If the fund is not doing well they may push for an early exit.  You may have several VCs on your board who have opposing views and motivations.

Employees - After 5 to 7 years many employees are fully vested. They may want to buy a house or put away money for the kids college education. Engineers and creative people may be looking for a new challenge. Keeping key employees is always a factor to consider.

Alternatives to selling out now

Raise more money - You may be able to raise more money but the valuation is likely to be less than a buyout offer. Investors may demand onerous liquidation preferences that put prior investors and employees at a disadvantage. Raising more money also means your eventual exit valuation must be much higher to satisfy all investors. This is actually something to consider at every stage of raising money.

Take some money off the table - Many times the founders have not made any money previously. They want to cash in a few million dollars so they have some financial security for their family. Then they can push ahead another five years and hope for the big payoff. Most VCs don't like this idea. They don't want the founders taking "their" money out of the company. The VCs want the founders to be "hungry" and push for the long haul. Founders Fund, and a few others, think their interests are better aligned in they allow the founders to take some money off the table. As you might imagine there are some very strong opinions on each side of this question.

Give the founder a break - Sometimes the founders are tired after 7 years of pushing hard 7 days a week. Sometimes it is a good idea to rotate the management team and give them new challenges. There are cases where the founder / CEO moves to chairman or CTO, or even leaves the company but stays on the board.

New management to take it to the next level - Many times founders are great at starting a company but not so good at managing growth, hundreds or thousands of employees, international complexities, and all the other challenges of big companies. The skills required to go from zero to $10M are very different than those required to go from $50M to $500M. So the question becomes do we sell out now for millions, or do we reorganize the company to prepare for the billion dollar trajectory?

What would you do?

One CEO I talked to evaluated the situation and decided to sell now for about $150M. The VC investors agreed that it was the right decision. Employees are happy. The merger just made sense.

The company was not profitable. He said he could have raised another $30M, but at a valuation that was 20% to 30% below the buyout offer. Raising the additional money would have raised the acquisition envelope to $300M to $500M in order for the new investors to get the multiples they were looking for. He asked "How many companies sell for $500M?" Very few. So, the investor multiples worked at $150M, but they would need to be much higher if they took on new money. He also mentioned the competitive environment with new big players entering the market and consolidation happening all around him.

Another CEO I talked to decided to take the plunge and go public now rather than wait for a better market and higher valuation. This company is a leader in their market. Going public was important for several reasons. First it gave them increased credibility with their customer base. Second, being public also gave them stock currency to make acquisitions. Third, it gave them access to raising more cash on the public markets with much lower dilution than they would get from VCs.

Another CEO said they decided to sell out in the $150M to $200M range. They had been at it for over 12 years and decided the acquisition made sense for many reasons. However, he did say the integration issues with the big company were a hassle, and that the culture of the startup company was changing.

The conversations with these founder/CEOs were fascinating. It was interesting that each of them, almost without recognizing it, had to deal with many of the factors mentioned above. I suspect that every company faces these issues when contemplating a buyout offer whether it is $10M, $100M, or $1B. No matter how many zeros you add to the number the basic issues remain the same.

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Guitar Hero a 10 year overnight success

Eran Egozy, co-founder and CTO of Harmonix Music Systems was on a panel at the Nantucket Conference entitled "Tipping Point: The keys to getting new ideas to take off". Harmonix is the maker of Guitar Hero, the wildly successful video game.

Guitar Hero was an instant...overnight success, 10 years in the making, selling over $1Billion to date. Harmonix was founded in 1995 but Guitar Hero didn't come along until 10 years later in 2005.

What did Harmonix do in the first 10 years? Harmonix founders met at the MIT Media Lab and their first idea was to create new ways for non-musicians to experience the joy of making music. Similar to another MIT Media Lab company called HarmonyLine, this idea never really took off.

Eran joked "For the first four years we couldn't sell anything but stock. We knew that wasn't a business model, but at least we had money coming in to keep us going."

Around 2000 they decided to try applying their music technology to video games. But it was 5 more years until they tasted success. They released eight video games over that period, with modest results. Eran said "The trick in the video game business is to make enough money from your game to keep you going until you can release your next game."

Most new video games don't make a profit. The game business is very much like the music business, or even the venture capital business, in that it is a "hits" driven business. One big hit pays for lots of losers.

Guitar Hero was the 9th video game produced by Harmonix, 10 years after founding the company, and it put them on the map with more than $1 Billion in sales. They recently sold the company to MTV Networks, a division of Viacom for $175M.

iRobot a 12 year overnight success. Colin Angle, founder and CEO of iRobot told a similar story. iRobot was founded in 1990 with the idea of creating robots to do interesting stuff. For 12 years they did projects and built products but never really achieved financial success. Colin said they paid employees once a month at the end of the month. They never had enough cash at the beginning of the month to meet the payroll at the end of the month. But they persisted in their dream.

September 11th 2001 changed everything. They decided to apply their robot experience to help the military in dangerous situations. DARPA, the research arm of the U.S. Defense Department paid out grants to lots of companies to develop proposals for new defense technologies. iRobot won a $200K grant to write a proposal for a battlefield robot.

Colin Angle said the company had never had $200K in the bank...ever. So, rather than use the money to write a proposal they just built the robot. What a concept!! DARPA had a big meeting to review all the proposals from various defense contractors. iRobot showed up with their robot and a tiny written proposal. They won the business and DARPA awarded them a $4M contract to build robots for use in Afghanistan. They have since sold over $150M of robots to the military.

Colin said that iRobot entered and exited 18 different businesses over their 12 year existence before finally landing on the military robot idea. They have since entered the consumer market with robot vacuum cleaners and swimming pool cleaners.

Persistence and tenacity are hallmark qualities of successful entrepreneurs. Harmonix and iRobot are excellent examples of that never die attitude. There is a fine line between success and failure. There is no secret formula or obvious path to success. Just one common trait...an indomitable desire to succeed against all adversity and doubt. Very few people have this drive and the leadership ability to attract great people to their cause. This drive is indefinable but we know it when we see it. It is sometimes misdiagnosed as being delusional and fanatical. The difference in diagnosis is success or failure. Succeed and you are a brilliant visionary. Fail and you are a delusional loser. The line between them is very fine.

Sim Simeonov of Polaris Ventures is also at the Nantucket Conference and has a great blog post about "Top 5 suggestions for startups from IDEO". Lots of great speakers and content here at the Nantucket Conference.

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