Venture Capital Investment Competition at USC in Los Angeles
Mar 8 2008

For the past few years I have served as an Advisor to The University of Texas at Austin MBA team that competes in the Venture Capital Investment Competition (VCIC).  

It all started when I was an adjunct lecturer of entrepreneurship at UT Austin and since then I’ve continued to advise as they need me and my schedule permits.  This competition did not exist when I got my MBA, and even if I had the opportunity to participate I was too busy trying to start my first venture.  What a plus it would have been for any entrepreneur to have seen a term sheet presented by experienced investors in an academic environment rather than in real life when you feel like you have to learn another language just to understand parts of the investment terms!

This year the regional competition was held at USC in LA on March 7, 2008.  The UT team this year was comprised of:

Ben Jones – MBA 2008
Kyle Reese – MBA 2008
Rajiv Bala – MBA 2009
Ryan Sanders – MBA 2009
Scott Chiou – MBA 2009

I connect them with local venture capitalists and entrepreneurs to help them prepare but we had a late start with only about 5 weeks to get ready and midterms in between this year.  Other teams have semester long classes to prepare for this competition!

At the competition, 6 teams were given business plans for 3 real companies including NiLA, makers of environmentally friendly lighting, on Wednesday, March 5 at 5:00 pm.  They use the Internet and other relevant sources to research the companies and come up with questions for the entrepreneurs.  On Friday, they heard the entrepreneurs pitch their business concepts in front of 11 real live venture capitalists, including Aditya Mathur of Revolution Ventures, Nathan Joyner of Pacific Ridge Capital, Neal Hansch of Rustic Canyon Ventures, representatives from Tech Coast Angel Group and many more. 

They then go into little rooms and subject the entrepreneurs to answering several of the same questions over and over again from the 6 different teams.  Why would any entrepreneur do this you might wonder? Because the VCs are in the room while they are being asked the questions so they are getting exposure that they might not have had otherwise to them.

After the questioning sessions are over, the teams again regroup and come up with a PowerPoint presentation which outlines which company they would chose to invest in and why.   For the company they choose to invest in, they create a term sheet.  They present their choice in 3 minutes in front of the VCs.  The VCs then grill them for about 15 minutes on their company choice and investment terms.

At the end of the day, the judges decide who wins and who takes 2^nd place.  The 1^st and 2^nd place winners get money and the opportunity to compete in the national competition at University of North Carolina Kenan-Flagler Business School in April.  I have personally seen one student get a job on a team I advised in venture capital because of participating in this competition.

As an advisor I get to be a fly on the wall and watch the VCs deliberate and observe the decision making process.  Plus I build my network in areas outside of Austin.  Personally, I believe this experience has helped me gain better perspective on what venture capitalists are looking for which is why I’m currently seeking money from angel investors or smaller boutique/seed stage venture firms. 

So I’m sure the suspense is killing you as to whether or not our team placed and unfortunately they did not. They picked the company with the biggest market potential but with the highest risk and the VC judges picked NiLa, which has a great opportunity but less risk and less upside.  Goes to show you that most VCs are not early stage investors!

There are so many variables that go into winning from judges backgrounds, to student’s experience, to understanding of the market of the presenting companies, etc. that you can’t always prepare for everything.  But what an experience! 

Flying back to Austin today for SXSW Interactive and will post about my experience as a newbie SXSW attendee.  I’m looking forward to meeting many of the people I’ve met through blogging and twitter!

The Entrepreneurial 7 Year Itch
Dec 16 2007

Picture by Sandy Blanchard

As I contemplate a plan to raise angel financing for Babble Soft in 2008, I have begun mentally preparing myself for the inevitable ups and downs of the process.  I have raised funds to the tune of $15 million as founding CEO of my first start-up, Isochron, back before the first Internet bubble burst, so I have that experience to leverage.  But that was just over 7 years ago and a lot has changed since then. 

Isochron, which we started as part of a business plan competition back in 1997, was sold in 2002 after the bubble burst.  I had already left in 2001, but Erin stayed on for two more years until 2003.  The Founders/employees were washed out (i.e., got nothing) and the Investors got only a small fraction of their invested capital back.  At that time many companies were just disappearing all together.  When it was sold, Isochron was on its 4^th CEO with me being the first.   Now it’s on its 5^th, is still operating and as I understand it doing reasonably well, but not the high growth trajectory we had hoped for back when we started.  Looking back, if we (and our investors) had truly understood Porter’s 5 Forces we would have approached the business differently or maybe even run the other way because with a customer like Coca-Cola you don’t have much negotiating power!  But hey, we were young entrepreneurs (I was 27 – what did I know? ) who felt we could conquer the world of distribution to and maintenance of vending machines and other equipment after that.  Mostly because we were tired of going to school vending machines and them being out of stock of what we wanted so we figured we could help sove that problem with creative technology.

Since then, I have taken time to decompress, teach entrepreneurship at the University of Texas at Austin business school, have two amazing kids, consult, and dabble with the notion of Babble Soft.  Erin and I did some development and had a beta product ready in 2005 to use when our daughter was born, but it really wasn’t until 2007 when we launched our Web application and she started full time care, that I became serious about committing to the bigger vision of Babble Soft.  I quit straddling the mental fence probably around October of 2007 and jumped squarely onto the side of the fence that has a vast open field with mountains, land mines, cool rivers, placid lakes, tornados, sunny skies, rainy days, ego bruises, good decisions, bad decisions, no money, fun, and most importantly a yet to be discovered journey!

After Isochron, I didn’t think I’d ever want to do a tech startup again.  It was hard.  It was tiring.  I aged.  It was stressful.  I was disillusioned.  It didn’t end like I had hoped/planned it would.  But if you read my Entrepreneurial Self Portrait, you’ll see that I since discovered that it is in my blood.  Looking back, I wouldn’t trade the experience and lessons learned for anything!

Do I wish I had made the decision earlier to dive head first into Babble Soft or another tech company?  Sometimes, because I spent money on the wrong things due to not being focused/committed, which leaves us less money to spend now and means I have to raise funds sooner than  I might have had to.  But I know deep down I will not regret the decision I made to stay home with my kids when they were babies, work from home, and maintain a fairly flexible schedule for them.   So maybe now’s the right time to really scratch my 7 year entrepreneurial itch! 🙂  This time I want to make sure I laugh a lot more…which is not hard to do with little kids around.

Stay tuned for more stories about my start-up journey.  Next up in this series will be a subjective post on the pros and cons of raising outside capital.

If you are interested in reading ‘the rest of the story,’ you might consider subscribing to this blog’s feed (tell your friends too) so you won’t miss a thing!  Even if you just can’t bring yourself to subscribe right now because you have a boulder on your head, would you mind helping me increase my chances at winning $50K from Intuit in their Just Start competition by clicking on the Quickbooks widget on the top right hand side of my blog or clicking here.  Thank you!

Social Media Mania – What’s A Gal To Do?
Dec 13 2007

Wendy at eMoms at Home did a post recently where she asked her readers “How do you Use Social Media to Promote Your Business?”  I didn’t have time to answer then and I’m sure I missed out on the free books, which is OK because I never seem to have time to read any books these days.  I’ve had a few days off from software testing, so I figured I’d do a post about it.

There are so many aspects to social media that it’s tough for an entrepreneur to keep up.  I mean we still have to sleep!  Fortunately, I’m fairly social.  I mentioned on a post that Liz Strauss did recently called Business and Life: Are You Making the Most of the Conversation? that “I am a Participant, rarely a Lurker, and often a Listener.”

It is fun making friends all over the world and it’s easy to be social from behind your computer when it fits with your schedule.  In the past I resisted joining sites like facebook because of the time commitment. 

To do a social network right, I figure it means committing significant time to it.  When you are launching a start-up, planning to raise funds, taking care of kids, maintaining a house, etc., it’s not easy to be as active as one should be in these networks over time.  But so far it’s been fascinating to see how other people interact with the networks.  I mean can you believe that facebook has over 55 million users all over the world?  That is amazing!  So here’s what I’ve done and what I’ve observed:

I started this blog (it had a different name before) with the help of Connie Reece. She gave me the kick start I needed! I think I did my first post back in May 2007. The blog has been fun and I know it has driven some additional traffic to my company site, Babble Soft, but to date I haven’t seen that it’s resulted in more than just a few additional sales. As a result of having a blog, I joined MyBlogLog, FeedBurner, Technorati, StumbleUpon, Digg, and BlogHer. Wendy was also kind enough to invite me to join the Home Business & Entrepreneur FeedBurner Ad Network. I haven’t made much money from these particular ad networks (maybe in total $100) but it has given me exposure to other bloggers and made me aware of other businesses.

I entered some competitions to hopefully win prizes and get additional exposure. I can’t remember all of them but I know I did one at Alpha Moms and I just entered Intuit’s Just Start challenge where I have the potential to win $50K for my business! The ‘vote for me’ widget will be on the right hand side of my blog until shortly after their voting deadline of December 16. After I sent an email to some friends asking if they would vote for me, I found out that people had to log in to do so. Knowing how much I hate to create unnecessary logins, my guess is that I won’t win on votes, but I might win in the unique idea category and because we have jokingly referred to our Baby Insights application as “Quicken for Baby.” 🙂

I have participated in some blog memes: 8 Random Things About Me and Blogging Tip Meme. Neena just tagged me again for a My Favorite Words theme. Memes give you exposure but they are time consuming so I think after doing this last meme, I will have to put a notice somewhere to let people know not to tag me unless they let me know first because I would hate to leave a meme go unanswered. I’m answering the Favorite Word meme by bolding my favorite words in this post (in case you were wondering why some of the words are in bold text). Isabella at Change Therapy I hope that’s OK with you! What do these words say about me? I guess that I’m a driven, committed, somewhat zany, looking to learn, searching for connection/peace, sleep deprived, mom-ified, and sometimes creative.

I joined LinkedIn. I’ve found LinkedIn to be useful for business related networking…for answers to specific questions. I haven’t yet established a deal or attempted to look for employees there which I hear is what it’s meant for. I’ve been able to answer a few questions on LinkedIn but I don’t think I’ve contributed to the increase of anyone’s business yet.

I joined facebook. Mostly to learn from the king of social networking sites. I may do some targeted ads there some day when time and money permit.  I also set up a company page on facebook for Babble Soft.

I engaged a full service SEO/SEM firm.

I just joined twitter. I even added the little widget to my sidebar, and I integrated it with facebook. I really resisted joining twitter. I had no idea why anyone would be interested in my day to day activities. More importantly I didn’t think I would be interested in anyone else’s day to day activities! I already have about 20 followers. You may be wondering what pushed me over the edge and made me join twitter…well it was the Duran Duran concert I attended earlier this week. I was there and I suddenly thought ‘wouldn’t it be great if I could tell my friends and random strangers about the fact I’m at this cool concert?’ and then all of a sudden I “got” twitter! Will it result in additional business? I’m not sure. Time will tell.

I have not yet joined MySpace or YouTube (but I’ve been to the site many times).  If I had to guess, I will probably join YouTube before MySpace, but first I need to create some videos!

Overall, I think I’m still at the tip of the iceberg when it comes to building a powerful online network and I’m a little bit afraid of getting in too deep and getting stuck in a networking hole somewhere.  I’m not sure if that makes sense to anyone, but it’s a fear I face nonetheless.  Maybe I’ll find peace there instead.

Idea to Product (I2P) Competition
Nov 3 2007

Yesterday I served as a feedback judge for the international I2P competition.  I have served as a judge before and every time they ask me I usually say ‘yes’ and every time the date approaches I wonder to myself why I said ‘yes’ because of all the other things I have going on.  And every time I do it I am so glad I said ‘yes!’

In 2001, I was one of the original committee members involved in early discussions on how to set up the program and now through the hard work and dedication of the Engineering and Business schools faculty and staff, it is the premier tech commercialization competition in major universities around the world!

The Idea to Product® Competitions, founded at The University of Texas at Austin, are early-stage technology commercialization plan competitions that aim for unique product ideas with clear market demand that use innovative technologies.  The goal is educating and developing the next generation of technology entrepreneurs. The program is particularly interested in matching technologies resulting from a university’s fundamental research programs with potential markets.

It is a wonderful experience.  The students are brilliant.  They travel to Austin, Texas from all over the world.  The technology is amazing (even ground breaking).  The different approaches to the markets are fascinating.  It’s a great break from the day to day of my own start-up and so energizing to see the entrepreneurial spirit and drive so alive.  The set of student teams I gave feedback to included ideas ranging from technology to increase the life of wireless sensor batteries, tests to help pathologists decrease the time to identify and diagnose certain types of cancer, and tests to decrease the time it takes to get a cancer drug to market.

One of the most rewarding things for me is the fact that I might be able to help a couple of these teams (assuming they are serious about obtaining the full rights to the technology and starting a business) with some introductions to other people who could quite possibly help them out.

Who wouldn’t get excited about the potential of these types of technology and more importantly these students who want to change the world!

Go Teams!

Are There Any Heroes in Your Life?
Oct 7 2007

There are in mine!  My husband and I watch the NBC Heroes TV show every week (thank goodness for DVRs).  We got hooked in the first season and are hooked again.  This season has started off a bit slower than I expected, but I am hopeful that some really cool stuff is up the writers’ sleeves.

The characters are great.  The drama is intense.  The science fiction is way cool.  Wikipedia has a list of all the characters if you are interested in knowing their names and backgrounds.  I know that several critics say the show reminds them too much of X-Men but to them I say ‘pfftph’ because who actually gets enough of the X-Men (and Women)?!?  Plus since this is a TV show, there is more time to develop the lives and characters of each of the actors and actresses.

The one major criticism/comment I have is: How is it possible that the genetics genius Dr. Mohinder Suresh did not have a clue for such a long time that he was hanging out with the infamous Sylar?  How could that smart and extremely handsome Dr. Suresh not realize he was leading the EVIL dude Sylar to all of the other genetically gifted individuals so Sylar could cut their heads off and steal their gifts?  That did not make sense to me.  Oh well…he better make up for that lapse in judgment in the current season!

NOTE:  I was motivated to do this review for Problogger’s Last 24 Hour Giveaway competition.   I really, really need want to win that $2,000 Internet marketing package being donated by IttyBiz.  Since one kid is taking a nap and the other is at soccer with hubby, I said to myself “what better thing do I have to do on a Sunday afternoon than enter (by writing a review) for a great prize that if I won would really help me with my business.”  It’s strange how us entrepreneurs think, isn’t it. 🙂

UPDATE October 9, 2007: As Pearl at Interesting Observations mentioned in the comments below, I wrote a little poem for my entry. Since she mentioned it, I thought I’d share it here:

IttyBitty spider crawled up and about the web
Down came the spam upon the spider’s head
Up came the Google juice (should have written Akismet) and dried up all the spam
And IttyBitty spider crawled through the web again. 🙂

Pimp My Blog
Aug 8 2007

Randa Clay at randa clay Design is running a Pimp My Blog contest and a lucky winner will win a custom blog logo with a custom header!   Oh I so hope it’s me because I desparately need to figure out a better blog design but I don’t have the time or more importantly the design skills to do it properly.  As I mentioned in my 8 Random Things About Me post, I love Randa’s lime graphic in her header.  It’s so vibrant and makes me think about sitting on the beach sipping margaritas!

I’ve been keeping up with her blog for a while now and she writes such informative posts for us new bloggers!  Her post on The Ultimate Guide to Free Website Analytics is a MUST read.

I have even added her blog to My Technorati Faves and joined her community on MyBlogLog.

Randa – please, please, oh pretty please pick me! 😀

Aruni

Yahoo! Search Marketing Ultimate Connection Competition
Jun 24 2007

I submitted an application for the Yahoo Search Marketing Ultimate Connection Competition several weeks ago in the hopes of winning $25,000 in search marketing dollars and introductions to Ivanka Trump and other top business people.  I got the automated reply saying they had received my application, and I thought they were going to notify me when the voting began but I never heard anything.  So I went back to the site to see when the decision would be made, and I discovered they had already picked the finalists and Babble Soft was not one of them.  🙁

I was hoping we would be selected because I could sure use a lot of help with picking keywords and optimizing our online advertising.  Online search is all new to me so any help I can get in making our online awareness strategy better is hugely appreciated!  I even took off the Google AdSense ads from our site (because they said no competitor ads could be running on our site during the competition).  Apparently there were over 8,500 applicants and judging from the finalists it looks like they are much more established than Babble Soft.  Oh well.  Maybe next time…

Of the 5 finalists, I decided to vote for Moms on the Edge because they had some pretty neat products plus they have a blog but it had been a while since their next to last previous post.  After submitting my vote, I noticed that Kid’s Crooked Houses was in the lead and they have a pretty neat product too.

I was disappointed that we weren’t notified of the beginning of voting especially since I am pretty sure I checked the option to be notified, but luckily I checked back and was able to submit my vote for one of the cool companies who made the first cut.  Check it out and vote for who you think should win such a fabulous award!

Aruni