Startup Funding Interview with Bill Reichert of Garage

Bill Reichert, Managing Director at Garage Technology Ventures, didn’t speak at the Funding Forum that I organized, but I think he’s an investor that startups need to hear, so we scheduled a phone call–which you can listen to below.

Bill Reichert is the Managing Director at Garage Technology Ventures, a seed and early-stage venture capital fund.


Full Interview Transcript


Andrew: Hi everyone. It’s Andrew Warner of and bill Reichert, managing director of garage technology ventures. Wasn’t able to speak at the Mixergy forum on how to get your startup funded. So instead, I asked him to do an interview. He agreed, and this is a recording of that phone call. Uh, one note before we get started, we talk at the end of this interview about guy.

And I don’t think we, we say which guy it is. It’s guy Kawasaki, who co-founded garage technology ventures. Here’s the interview. Enjoy. Maybe we could start with a little bit about your background. I read, uh, I’d read your bio on, but I thought you could tell us again a little bit more about it and about Greg garages background.

I remember them as a company that helped, uh, startups get funding and now your VCs. And then we could talk about some of the, some of the ideas that entrepreneurs need to know before they even go after funding.

Bill: Okay. Okay. Sure. So briefly in terms of my background, um, I spent most of my career as an entrepreneur on the other side of the table.

Uh, I starting up a, my first software company when I was in grad school, um, up here at Stanford. Um, I like to say before it was fashionable for grad students to start their own companies. Right. Um, so, uh, we started up a company to do financial analytical software, uh, and, uh, the business plan morphed about 15 times in the first nine months.

And eventually we wound up, uh, doing, um, in essence it was outsourced software development for brand name companies that wanted to have software applications on the, uh, PC, uh, back in the early days of the PC. So, uh, That was my first company company called trademark software, um, which we sold to Dow Jones.

And then I went to a, another software company to do a restart, um, and a company called the learning company, which was home educational software. Um, and we took that public. Um, and then I got excited about Penn based computing, um, and that was a disaster. Uh, and then I got back into the educational software side of the world at the higher education level, a company called academic systems, which became the, um, leading provider of curriculum of mathematics curriculum and U S higher education.

We sold that actually we merged it with another company, took it public, and then that got sold to play the learning. Around the time I was selling academic systems. I got a call from a friend, um, who was, uh, working with a guy named Craig Johnson, venture, um, adventure lawyer up here. Who had a brilliant idea to create a firm that would help entrepreneur help, help entrepreneurs find their way through the venture financing process.

And at the same time help, uh, investors, VCs and angels find the best startup companies on the planet. And that was the origin of Um, so garage was originally what the best term for it would be accelerator. For startup companies. Um, and we took sweat equity in startups, um, in exchange for helping them fine tune their business and go out to the venture community and raise more serious capital.

Um, so that was a brilliant idea during the bubble. Um, we financed in that model about a hundred companies, um, in a two year period 99 and 2000. Uh, and, um, when the bubble burst, that was a less brilliant idea. But fortunately we had, uh, been, uh, cashflow positive and, and saved a chunk of our capital. So we decided at that point that what the world really needed, uh, was not another accelerator.

What the world needed was a seed stage and early stage venture capital fund. So in 2001, 2002, nobody was writing checks. But there were still a lot of interesting, um, technologies that were evolving and developing and entrepreneurs looking to start up companies. So that’s what we got into the business of being a venture capital fund.

We were fortunate that, uh, we’ve bumped into the folks at CalPERS who had a similar attitude that there wasn’t, um, a good, serious, uh, seed financing, um, fund out there. And so they gave us, uh, um, a little pot of money to, um, uh, augment our own funds. And that’s what we’ve been investing off of.

Andrew: Okay. Before we get into what, what garage is doing today, can you tell me why an accelerator didn’t make much sense after the bubble burst?

I mean, if it makes sense to fund companies, doesn’t it make sense to educate companies on

Bill: how to get funded? Well, the, the, the ways that we acquired value was by, um, turning our common shares into something worth more by enabling companies to, um, to get. To sell preferred shares. So when nobody, when the VC community wasn’t funding companies, it was really hard for us to create value.

So as much as it was fun to educate entrepreneurs, it was tough making, you know, creating value other than moral value, um, in that kind of market. So, and since our models did not. Originally allow for us to be lead investors. Um, then, um, you know, that was kind of a problem. So if an entrepreneur came to us, we, you know, it was, it was hard to find people who would fund entrepreneurs,

Andrew: cash out.

You would cash out. Once you got, once you got your startups funded, right? Not after they went IPO, it was

Bill: no, we took stock. So our whole model was dependent upon the liquidity events. I see. So, um, you know, we’re, so we’re now, I mean, several of our companies from back then are just now becoming major corporations.

Um, you know, companies like tripwire and left-hand networks and, um, a few others that have sold, um, more recently, um, our companies that we actually first got stock in, um, back in, um, back in the bubble days, um, a lot of the other companies just. Dried up and blew away because of the lack of venture financing.

And some, we managed to find exits at some level, um, not always particularly spectacular. So that was, that was why we decided, you know, tack with this accelerator business. Um, let’s become venture investors and actually. Become lead investors still, we would, we would be in the business of helping entrepreneurs grow successful companies.

It’s just that we would be doing that as board members rather than as accelerators slash coaches.

Andrew: Okay. And did you get any funding through any of the startups that you fund that you founded? What about the one at, uh, let’s start with the one that you’ve founded while you were still at Stanford. Was that also financed or bootstrapped?

Bill: No, we, uh, uh, yeah, all my companies were venture backed. Um, the first one, actually, it was the first one it came about because I was doing some consulting work for a venture capital fund. Uh, and we were bandying about ideas and, um, uh, this was an idea that occurred to us. And so I used my, um, you know, I, I.

Took the entrepreneurship course at Stanford business school use that as my excuse for I’m writing a business plan. Um, and it was actually, it was a one-call close. So then went to the, to the VC fund and he wrote a check for $600,000 and said, okay, start, you know, specking code. So it was, um, I thought this, you know, I thought the VC stuff was like really easy based on that experience.

Um, and then the second, my, yeah, the learning company was also venture backed. Um, but in that case I didn’t actually have to raise any venture capital because I went in after the board had fired the CEO. Um, and, uh, as part of a team of guys that were given the job of turning the company around, um, so that already had its venture investors, um, And then academic systems, uh, was myself and another guy as co-founders.

And with that one, we went out and took the plan around and, you know, went up and down sand Hill road and did the pitch and raised a serious amount of venture capital for that.

Andrew: Okay. So you’ve seen the business now from both sides as an entrepreneur and as somebody who’s funding entrepreneurs, what, what are some of the mistakes that you see entrepreneurs make?

Bill: Yeah. Well, I mean, at what point in the process they won or, I mean, it starts with a, it starts with the way entrepreneurs, form partnerships with their co-founders. So, um, you know, frequently entrepreneurs pick the wrong co-founders, um, you know, you, don’t always, it’s not always kind of, uh, uh, it’s something you pick, but sometimes it is, um, and.

Even when they get the right co-founders sometimes they set up the company wrong, um, at, from the beginning. So, you know, a couple of, a couple of things that, um, You know, stand out here at the very beginning frequently, when you have an idea or a startup idea, um, you grab your roommate or you grab a buddy or whatever you grab somebody, you know, who’s like-minded and, and, and shares your outlook and make them a co-founder.

Um, that may be great. That may be fine. And it’s, it’s, it’s critically important to be more than one loan person when you’re starting our company. But either that person is right for a, for the particular job they have upfront. Um, and then they’re your partner or they’re the wrong person. And you structure that correctly from day one, you know, maybe from the beginning, at the beginning, they can help you hack together some code, but they’re probably, you know, they may not be the right VP of engineering.

And so, you know, you’ve got, it’s very hard to do, but you’ve got to get expectations set the right way. One of the challenges later on is when you come across the team that was put together the wrong way, you got a lot of pain and suffering that comes along from unwinding, that team or from, or from destroying their expectations.

Andrew: When you say set up the wrong way, you mean legally set up the wrong way so that they’re. It’s not easy to, to break up the relationship or you mean that they found the wrong person.

Bill: It’s actually both. So there’s the legal side of it, which relates to what contracts you write and what, how you distribute stock.

And then there’s the emotional side of it. And the expectation side of it. When. Somebody has been promised to be the VP of engineering and you tell them, well, you know, really you’re a good manager, but not the VP of engineering later on. And then they, instead of them being coming a good manager of engineering, they get all mad and they quit and they Sue and they get, you know, whatever, whatever happens.

Right. So, um, there’s both sides of that, of that equation, the legal and the emotional organizational side, uh, that can be, that can cause a lot of damage at the front end. So that’s before, you know, argue that’s that may be before you even talk to a venture investor. Um, if you set things up the wrong way, uh, in terms of the way you put together, pull together the team, then you can create, uh, a situation that in essence becomes unfundable.

So you may have, you know, 20% of the stock of the company has been given to your roommate. Who’s actually a pretty good manager of engineering, but ain’t the CTO for the company. But because there was nobody else around, he gave him the CTO title and he expected to keep it until the company went public.

That’s a mess that somebody has got to clean up. And so that becomes a problem. When later on, you want to raise money. That makes sense.

Andrew: Yeah, absolutely makes sense. And I see that happening a lot, and I’ve also talked to entrepreneurs who are pissed at VCs because they said that the investor wanted them to get rid of a co-founder before they’d spend in money.

And how can you tell me to do that with when you know that we’re such close friends, right. And that happens a lot. Are you willing to be that honest with an entrepreneur and say, we’ll fund you, but you got to get rid of the.

Bill: Well, it’s, you know, rarely is it the case rarely is that the case that you have to get rid of that person?

Sometimes it is, but, um, you know, it’s, it’s, it’s, it’s not usually the case that you have to get rid of them, but it is very frequently the case they have to. You have to change their position over time. And so the issue is, you know, taking the walk in the woods and having the discussion with, you know, Mike, your roommate or buddy, or friend or whatever, and, you know, whoever takes the walk with them, I don’t know.

But, um, it varies but saying, Mike, um, you understand that we’re going to have to go bring in a. You know, experienced VP of engineering, right? Mike and somebody got to do that. And obviously it, to some extent, you know, I, I find myself in the circumstance of, Hey, if you need to blame someone, blame me, but it’s really your fault.

That, you know, you created the wrong expectations when you brought Mike on as your co-founder, it’s fine for Mike to be a co-founder and it’s fine for Mike to have a disproportionate amount of stock, but he sh it’s not fine for Mike to think that he has entitled to the DP engineering slot forever, um, or that he’s entitled to 20% of the company for forever.

So that’s the, you know, that’s where the mismatch in expectations gets picked up. Yep. Set up.

Andrew: Any other mistakes that you see entrepreneurs do before they even come talk to you?

Bill: Well, it very closely aligned with that is, is the way that that accompany gets initially structured and capitalized. So, you know, back to the early days of, Hey, you know, I’m just doing whatever I can to get this thing off the ground.

I can’t afford to hire a world-class P and much less a recruiter to hire a world-class team, much less, you know, uh, do all of the precise, legal work, uh, to set this up properly. So what the heck, I’m going to borrow some money from my uncle Bob, and I’ll give him, you know, a chunk of the company. Um, plus I’ll agree to pay him off as soon as I get venture capital.

Right? So you get these. Goofy deals that gets structured because you’re desperate. Um, and so, you know, the, the, the, the standard advice is day one, get yourself the right venture lawyer. You know, someone who’s actually done. This has worked with the venture capital community, understands how to structure these deals.

The hope is you find a guy who’s so excited about what you’re doing. That they’ll do it for deferred fees. Um, they won’t charge you an arm and a leg upfront, and they’ll also make sure that if you’re going to borrow money from uncle Bob and you have to borrow money from uncle Bob, that it gets done in the cleanest possible way.

You don’t sell common stock to uncle Bob, you know, for $5 a share. Um, when you’re hoping to price your founder’s stock at a penny, a share, you know, that’s going to mess things up. Um, They’ll make sure that, you know, you’re incorporated the right way and all that sort of basic stuff that amazingly, you know, people still do wrong.

Um, they’ll also make sure you don’t wind up, uh, you know, some of the goofy practices that mess up companies, uh, include, well, I don’t have any money to pay, so I’m going to pay people in stock. So tell you what I’ll give you. You know, a thousand shares of common stock for every week that you’re working for me until we raised money, I, or, you know, worse.

I, you know, I’ll give you a 2% of the company once we, you know, once we raised venture capital, um, so lots and lots of these practices that just having a good savvy experienced venture lawyer will, um, help you avoid.

Andrew: Say they avoid these problems. They think they’ve got a good business. They’re ready to come talk to an investor. How do they know if the business they have is fundable or not?

Bill: Well, you know, um, yeah, a one way to find, you know, one way is if people return their calls. Um, and I, you know, it, I didn’t use to say that because there was a period of time in there. And in 2003, 2004, when VCs would meet with pretty much anybody who could fog a mirror because they were so, you know, things were so dead in the DC community.

But that’s not true anymore. Um, but to go, you know, that’s not, that’s not necessarily the question you’re asking. Um, the, the question you’re asking is what’s the difference between a, a venture fundable business and a, you know, nice business that might be a decent opportunity, but is not venture fundable.

Right. And if,

Andrew: and if it’s not fundable, my up question will be. How do you, how do you grow the idea so that it’s, so that it’s big enough to interest investors, but I’ll start with, how do you know if the original idea as it is, is fundable.

Bill: Right. So the, you know, the, the thing for entrepreneurs too, to understand is that not every good business is venture fundable.

So it’s not a matter of, is this a good business or not? It’s a matter of, is this a good business that has the potential of being a venture capital home run? Right. So, and that’s something that, that it’s, it’s confusing and irritating to a lot of entrepreneurs because they see these, you know, they come up with these ideas that are clearly good businesses, but, um, the venture capitalists all turn up their nose at them and they wonder why.

Well, part of it is that, um, uh, the, the, um, The requirements for being a good venture fundable business have gotten, um, More and more stringent over the years related to the amount of money that venture capital funds have raised. So part of the challenge that entrepreneurs have in this environment where you’ve got these hundred plus million dollar funds or billion dollar funds even is that the bar is just higher for what’s interesting to venture capitalists.

So, you know, it it’s, it’s become almost trite to say. You’ve got to have a hundred million dollar company in order to get the interest of the venture capitalists. And most entrepreneurs are quite able to make Excel spreadsheets show that they have a a hundred million dollar company. But, um, uh, what has, you know, what, what you really got to do some deep soul searching into is, is it possible for the first investor in your company?

To make 10 times their money, um, by writing you a check and that’s kind of the minimum threshold that most VCs apply. But what that means is, is you’ve gotta be able to see at exit of two 50, 250 million to a billion before you’re going to get excited about a company as, as a typical venture investor, um, and getting to a $250 million exit is not at all easy, particularly in.

A web 2.0 software space these days. So, um, it’s, it’s a very challenging market right now for, um, sort of web software companies to get the venture community excited. Um, now there are, you know, enough out there. Um, what, so typically what happens is the VCs now have taken the perspective that. Yeah, it’s so cheap to start up a web company.

Now I’m just going to wait. To see which ones get sufficient traction, and then I’ll pay up for those because the guys that really win big are, you know, are going to be a big exits. And so I’m just going to put my finger on the pulse of these guys and see who is going to break out and who’s going to have a big wind and then I’ll fund them at the backend of the process.

That raises the question that you asked of, who’s going to find them at the front end. Excuse me. And so that then, um, that then depends that then forces entrepreneurs back to either their own resources, bootstrap, um, or friends and family, or the angel networks or small funds, which includes us. Um, so. It’s a, you got to make sure that you’re going to the right investors, depending upon where you are in the, in the ecosystem.

You’re wasting your time. If you’re a startup company and you’ll go to a big fund and try to convince them to write the first check.

Andrew: So at what point do you, do you invest? I noticed that you’re an early stage seed investor,

Bill: right?

Andrew: What does an entrepreneur have to have before coming to garage?

Bill: What we’ve got to see is that the company is, is founded on novel technology.

So what that means for us is we do not want to invest in the 13th of the 30th video hosting site or photo sharing site or mobile application site, um, or service, um, What we like to invest in are companies that have novel technology in an emerging area where there are not a hundred other players already try to make a market.

So we’re, we’re, um, Well, a little bit different in that regard. There are plenty of guys out there who are happy to invest in web 2.0 kinds of plays. Um, if they can, you know, if they’ve truly believed that, um, we’re, um, we’re much more skeptical about that stuff. Um, unless there’s some important novel technology underlying it.

And so we see a few of those, but generally user generated content, social networking kinds of plays, um, are not that interesting to us if they’re, uh, you know, if they’re sort of marginally differentiated. So we’re looking for novel technology. We’re also looking for capital efficient business plans. So we really liked, we prefer to invest in the kinds of companies that don’t need the big funds that actually could break out and become successful companies without having to raise 10 or $15 million.

Um, So capital efficiency is important. And then, um, we also want them to be generally West coast. So we like Southern California. We’ll go up to Seattle, uh, and we’ll go out to Denver, but we don’t go much beyond that range geographically. We also, um, We don’t invest in things like life sciences, um, semiconductors and, uh, big, expensive kinds of technologies.

Um, uh, generally we don’t invest. So we TA ours. Our investments tend to be in a frequently their software at the core. Um, we’ve invested in companies that are basically appliances where the hardware is commodity and you’re just delivering software on an appliance. Um we’ve um, and then we’ve even invested in some material science companies where they’ve got some very novel technologies that they can commercialize, um, capital efficiently.

Andrew: And you do want a company that that will be profitable. I think. The website said within three to five years.

Bill: Yeah. I mean, we, right, exactly. I mean, because you hope to make your

Andrew: money off of profitability or because you know that that’s going to give you security and a downmarket.

Bill: Well, it has, it ties to the capital efficiency.

So if you’re not, I mean, if it takes you more than two years to get to profitability, then probably it’s going to take you a lot of capital to get to profitability. And if it takes you a lot of capital to get to profitability, then we’re going to get diluted down, um, as a smaller investor.

So we will, we will invest in, you know, most of the companies we invest in are actually pre-revenue. Um, which has, which makes us pretty rare in the venture biz. Um, a lot of ECS prefer to see some initial revenues these days. Um, but we’ll invest pre-revenue, but we want you to be within spitting distance of revenues,

Andrew: and you’d want to see, you want to see a website up.

If it’s a web business, you want to see a product out there. You don’t necessarily, you’re saying, looking for revenue, but you want to see that there’s more to it than a business plan.

Bill: Right. Right, right.

Andrew: Okay. Um, so now that you’re not an accelerator, who do you see filling in filling in the gap? What, who do you see now doing what you used to do when you were an accelerator for startup has an idea and needs some help, um, getting to funding, who do they turn to?

Bill: Yeah. Um, well, in the, in the tech hubs, um, you know, Northern California, Southern California, uh, Boston, New York, um, Austin in the tech hubs, there’s, there’s generally a pretty well-developed, uh, ecosystem of associations and service providers and university centers. Uh, and, uh, conference conferences that, um, that the issue is much better taken care of today than it used to be.

Um, and so you’re down in LA, right? Um, you know, down in LA between groups like, Oh, I should probably be careful, right. Because I may be, I should know a little bit more about your organization before I right.

So, um, you know, there are another, a number of organizations that we have worked with. Um, and, uh, it includes, uh, a, you know, the tech coast angels is probably the group we work with the most. And, um, now they don’t particularly do with them, but they then, um, they’ve got, you know, a lot of members who, as individuals.

Perform a lot of this, a lot of this role of nurturing entrepreneurs, mentoring entrepreneurs, and then bringing them to the tech coast community techos angels community. There are also groups like lardo, which are much more, um, you know, sort of well-established and developed. Um, there’s the used to be called, um, software.

It’s now called the technology. Let’s shoot. Um, Who am I thinking of? There was a software association that now is called, um, The sec, they changed the name from software to technology. Um, and then there a variety of other groups that, that like entre tech over at, uh, Caltech, um, that sort of bring together entrepreneurs and investors, uh, around conferences and events.

Yeah. Um, there’s another group down in orange County. Octane does stuff like this and connect down in San Diego does stuff like this. So there are lots of organizations that are, that are specifically designed to bring, you know, to help entrepreneurs figure out this whole venture. Um,

Andrew: and they’ll mentor them from idea through investment and hope.

Bill: Well, normally what they’ll do is they’ll create an environment where they can find a mentor, um, And, and finding a mentor frequently can mean either an angel or, um, or a, uh, an exec who’s looking for their next gig. Um, and, or, um, or sometimes consultants. Um, but I, you know, I, I, I’m not sure that you can, um, I think it would be, it would be hard in a, in a narrow region to build much of a business as an accelerator.

You could build a viable business. Um, but it would be, it would be hard to. Create much scale off of that. At RP, we had six offices around the world. We had an office in Tel Aviv. We had an office in London. Yeah. We were negotiating for an office in, in either Singapore or China. Um, you know, it was, the idea was that we wanted to find the best entrepreneurs in the world, um, and get a piece of, of.

Of the founders share for helping start them and then get another piece for helping fund them, uh, of equity. And that’s, um, that’s just a really tough model to support, um, in a, in a rationally exuberant market, as opposed to irrationally exuberant what’s

Andrew: Y Combinator doing that. That’s. Helping them be so successful or, or at least get to have so many conversations center around them.

Bill: Yeah. Yeah. I mean, I love, I wouldn’t even, you know, I love that idea. Um, but Y Combinator is actually, you know, Y Combinator is actually have money, um, to invest and they’ve got real estate, um, to, uh, to, to leverage. Um, and I’m trying to remember the name of the guy, uh, who started at you. You probably know.

The guy who started,

Andrew: but

Bill: you know, his successful entrepreneur who, um, uh, whose big idea was let’s, you know, let’s find, um, uh, set up these little hot houses for web 2.0 entrepreneurs. Yeah. And, and find the best of these guys and give them a cube and give them a high-speed connection. The theory being that web 2.0 entrepreneurs, um, need very, very little, um, infrastructure and can benefit from, um, being around other web 2.0 entrepreneurs.

In some cases, you’re going to bump into some competition and conflict, right. But, um, so he’s thrown, you know, 10 to 12 entrepreneurs together for these three to six months stems. He gives them 15 twenty-five thousand dollars and takes 4% of the company in exchange for that. Um, and then just has this kind of survival of the fittest model.

Which is, um, you know, you get some, I’m going to give you enough infrastructure that you can get initial traction. And if you get initial traction, then you can go get venture capital. And then, uh, uh, he gets to tag along. Um, he can, you know, up invest when, um, when and if any of these guys succeed. So it’s a, it’s a really cool fun model.

Um, for somebody who’s got, you know, the combination of assets that he’s got. Um, so I like that. I mean, a Charles river is trying something different and I’m not sure if that’s working, they’re writing $250,000 bridge checks, um, for startup companies. But. I it’s that it’s not nearly as, um, there’s no leverage in the model.

It’s basically, it just gives them a placeholder in that company. Um, but their entrepreneurs aren’t working together. They’re not sharing space. They’re not cross fertilizing. They’re not restarting their companies. Um, you know, he’s got, you know, Y Combinator is. Is, uh, I think it might be one of the few examples of an incubator that works, but it’s, um, the trick has been that he kicks them out after a very short period of time.

Um, I think, I think the deal is that you get kicked out after three months, um, and unless you justify being able to stay longer, but, and then then the maximum one, you get one renewal. Um, I think that’s the deal, something like that. And of course, obviously he gets, he gets to choose whether he wants to violate his rules whenever he wants.

Um, so I think that’s a, it’s a very, very, um, interesting and fun model. Um, and, uh, and it looks like it could wind up being profitable for him. So, you know, God bless them.

Andrew: Yeah. It’s is it still fun for you to be around entrepreneurs? Do you? I

Bill: know you’ve got a history. Well, I mean, it’s, you know, the problem that I, you know, that, that worries my wife is that, um, you know, I couldn’t imagine a better job.

Uh, you know, I get to spend my days talking with entrepreneurs. Um, some of them I’ve got investments in some of them I’m thinking about investing in. Um, and, uh, it’s, you know, it’s, it’s just a wonderful, um, it’s a wonderful part of the world. I mean, I just, the idea of actually, uh, working with. I mean, being in a corporation is just, I mean, it’s, I did that.

I did that a couple of times in my career, both right out of college. And then, um, very briefly, um, uh, in, uh, in the middle of my career, I was, I was brought in to try to start up a new division. I was in a part of the early intrepreneurship theory. Where I went inside a big corporation to try to start up a new software business.

Um, and that was just terrifying.

Um, uh, yeah, no, I couldn’t imagine,

Andrew: uh, books about entrepreneurs. You still, you still love listening to their success stories, how they went from rags to riches, that whole thing. Right, right.

Bill: I tell ya. I, I bet I got, I don’t have the patience for reading books about entrepreneurs.

Andrew: Never did, or just now that you’re doing it so much, you’re not as interested.

Bill: Yeah, it just adds just, eh, I, it just, yeah, I guess, you know, unlike a lot of other folks in this business I’ve got add, I guess. Um, and I just, the idea of waiting through some of these, the whole story somebody tells, um, I dunno. I mean, people give me what was the, um, uh, The cliff bar book or whatever, there’s that?

And then I just didn’t have the patience for that. I did that. I very much. I heard, um, Jerry Green. Uh, field, uh, shoot Ben and you have been in Jerry’s. Um, I heard him speak recently, um, which was extremely entertaining. Um, and about 60 minutes was about right. You know, in terms of, of hearing that I, I, you know, I would love to spend more time actually talking with him.

Um, but, uh, books generally are tough inter personal. Just that. Yeah. I mean, those, those kinds of books, um, you know, um, I rather read, um, I I’d rather read for reads the carrier, um, kind of entrepreneurs story, right. Um, so I guess that’s where I am right now. Um, You know, or help, you know, help guy, um, right arm to start things like that.

That’s more fun than reading stuff like that.

Andrew: I have another book plan.

Bill: Um, you know, it’s, uh, it it’s, there’s a guy would like to write another book and he’s got a thesis around writing another book and we’ll see, we’ll see if that happens. But, um, uh, it’s not yet. I wouldn’t say it’s. It’s a fully baked, it’s the

Andrew: idea that you guys are working on?

Bill: Oh, that’s okay. I mean, it’s, um, uh, that’s the hard part is, is trying to make, trying to be truly innovative. Um, and, uh, um, so I don’t think he really wants to talk about it right now.

A few lessons from this program

Here are two of my notes.

The Trouble With Your Roommate
So you have an idea for a business and you partner up with your roommate (or cousin or best friend or whatever) and because he’s around and you like him, you make him your CTO. Your business grows and it’s time for you to get funding. The trouble is your roommate/partner isn’t capable of being CTO of a big company. He’s good, but not that good.

Now you have a problem.

And it’s a mistake that Bill says a lot of entrepreneurs make.

The Trouble With Your Uncle
You launch your business and need money, so you go to your uncle because you know he believes in you and has some money. To make it official, you have your family’s lawyer put together the paperwork.

The trouble is your family’s lawyer doesn’t know the venture business. So when it’s time for you to get venture funding, the agreement you have in place with your uncle might keep you from putting together an agreement with a serious VC. (I think Napster had a situation like that, according to a book I read.)

Use a lawyer that knows how to do business with the venture community.

[Thank you Guy Kawasaki for introducing me to Bill.]

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