Springtime Startups and the Road to Austin for SXSW Interactive
The snow has melted and each following days bring with it that extra little bit of warmth signaling that spring is almost here, and with the arrival of spring comes SXSW (South by South West), an annual conference held in Austin Texas that meshes interactive, music, and film all into one, and does a dang good job of it to boot.
Most recently the cultural impact of the interactive portion of the conference has been superseding its counterparts, and in many ways making a real cultural splash as startups head down to Austin to launch guerilla-style campaigns to foster user growth and get the wheels turning on their growth. If you’ve ever heard of Twitter or Foursquare, you’ll be glad to know their presence at SXSW gave them the extra push to escape their limited market size.
Some startups may just launch too early, some may launch because they’ve run out of money, and some may have simply waited too long trying to launch an imperfect service, but one thing is certain, and that is that SXSW is a great place to be if you’re a tech start-upper.
And speaking of start-ups and the interactive portion of the conference, there is one thing which is fairly clear in 2011, a new emergent gaming theme focused not only on video games but on the consumer-focused product. The ScreenBurn panel shows it all, and quite frankly, I’m looking to attending a few of those discussions myself. Chief among them are.
Digital Avatars and Social Perception – Online, has stirred a new behavior in us, and these two panels discuss that behavior
There are more panels focused on gaming and if you’d like you can see them all here, but before wrapping this up, just wanted to add two last things, one SXSW Accelerator startup I’m looking forward to seeing is Qonqr a massive mobile real-world online game.
The first edition of “Next Top Startup” took place in Barcelona over the course of June 16th and 17th. Contestants braved the journey from as far afield as South Africa and Brazil just to take part in the competition so at f3fundit we believed it was extremely important to give the participants real added value, key learnings, and new connections that will help facilitate their growth both in terms of strategy, commercialisation, and raising capital.
Two intensive days of workshops saw many teams work closely with the experts to answer doubts and improve their business models to the extent that the overall response was very positive. The winners – Touchland – were asked to join CEO Collaborative Forum and invited to their main forum where more than 100 CEOs of growth companies with a combined turnover greater than $3 billion are present. In addition, five other teams are either being put forward for financing or in talks with our experts to continue collaboration in some form. Over the coming weeks and months we will continue to support them and hope to confirm more news about the progress these ventures are making following their time with us.
As with any competition, some teams fared better than others and we feel that the value they received from the competition depended greatly on their approach and openness to the experts, as well as other teams.
However, aside from in kind services we had hoped that the business community – and especially those companies who actively claim to support entrepreneurial initiatives – would have come forward and helped sponsor the final prize. While here at f3fundit we did what we could and waited until the final moments to hear word of a cash prize for the contestants, at the end none came. Even though it was a freshman effort we can honestly say that we considered the level of experts, and contestants as well as the locations in which the competition took place to have been sufficient to at least secure some form of commitment, unfortunately, we were disappointed in the outcome as surely as the winners were.
In all however, the event was a success, both the experts and participants were overwhelmingly enthusiastic about the experience and so with that, we close the 1st chapter of Next Top Startup, and open the second. Be sure to check the site for info on the next competition and our development of the community…
When we started planning for Next Top Startup, we had in mind that the first installment of the event would span maybe two to three European countries, and that if we’d get any traction whatsoever from across a major body of water, it would be excellent and a successful achievement on it’s own.
We had no idea however, that the scale of this competition of ours would reach as far and as wide as it did – in the end, people from 14 countries are coming together to participate in this competition in both a mentor-ship scope and contestant capacity, and as of now we still haven’t reached out to the investment community.
By trying to challenge convention, and doing what we can not to become just another Y Combinatorcopy, we opened the contest up to all industries – and as such saw projects come in from across the board, some of the more interesting sectors applications that we received came from the following industries: Sports, Clean Tech, Aerospace, Cloud Computing, Social Enterprise, Fast Moving Consumer Goods, amongst many others.
There was one concurrent theme in all this – technology – in one way shape or form it’s the decisive communal factor which is driving today’s entrepreneurs forward, and while we would have liked to invite all our applicants to participate, ten does seem to be about the right number, and with that we would like to announce the ten finalists to compete for the title of – wait for it – Next Top Startup.
In alphabetical order they are…
. FastTaxi – will be an interactive platform for taxi drivers and customers to get real time information through their smart-phones in order to find and order cabs within easy reach in urban centres. . Foundation for Global Collaboration & Peace – A serious non-profit concern that aims to build a virtual peace network that benefits the global community through the dissemination of universal human commonalities. . Getagreatboss.com – The concept is built around a crowd-sourced Interactive Manager Review. . INBLOON / Zero2Infinity – is a start-up whose mission is to raise our planetary consciousness by offering near-space experiences. . Lexpertia – aims to commoditise the legal services profession by creating a database and online directory for lawyers based on specialty, operating as a legal advisory search platform for lawyer services. . Teambox.com – Is an online resource collaboration tool for enterprise and project management. . Touchland – provides environmentally friendly disinfectant hand wash to the consumer via direct sales and 3rd party resellers that install their dispensers. . WeCard – is not a typical static loyalty card but an innovative smart channel of information, and user-business relations. . Wellknown.as – A mobile platform for delegates, exhibitors, conference organizers and sponsors. . Xtremgo.com – enables people to easily access action sports through Internet by creating a one off marketplace to book activities online.
Good luck to all of them, and we’ll keep you posted as to the winner, and we ought to have some other treats in store for all our readers after the competition closes. Stay tuned!
VIDEOS
And to get you as excited as we are about our contestants, we’re including those videos that we received from them. Enjoy f3fundit TV 🙂
There’s something to be said about not listening to your teachers, and there’s something about entrepreneurs that makes them not fit the average mold. So if you happen to find yourself at the next seed _enter_name_of_competition_here_ remember one word.
.DISRUPTIVE
Sure it may be the next “synergy” but even ten years after synergy went out of style it still means something. Disruption is now that which is in. But what’s it mean?
It’s not interrupting the class but it’s a plane that your project, you and your presentation should exist in. Esoteric description aside, it should challenge something of the status quo and provide a solution to that status quo, it should challenge everyday conventions, not augment them or add to them. This is disruption.
That is your project – now how about you? First and foremost, don’t get boggled down by others – think of yourself and try and make yourself stand out. Be it engaging questions, or coming in on the left flank when everyone else is preparing on the right, it’s putting yourself in the mentor / judge / audience’s eye – by intelligently – you got it – challenging convention.
Finally, presentation – the majority of presentations will typically focus – intro – contents – body, and have text and a few images. While this can convey your message, having too much text on your slides especially if you’re presenting your concept can work heavily against you. Why you ask?
Think back to the last time you sat through a presentation – was there text on the slides, did you listen to your speaker or did you read the sides. If you listened good for you – most people will read. Try a mix, or better yet, have no text at all. Steve Jobs, you know that Apple guy, does not use text in his presentations. Why?
Because they take away from his – on stage – presence for lack of a better word, simply put he stands out. Text is boring, conversation is interesting, and more importantly engaging. And when we say engaging – your audience needs to be involved. This doesn’t necessarily mean a Q&A – typically in the 5 minutes you have there’s no time, but that’s not to say that something can’t stir inside them.
Emotion is a powerful tool. Understand it, and use it. And remember, disrupt, disrupt, disrupt.
As a startup ourselves, we figured we may as well convey some of the things that we’ve been going through in these last few days since we’ve opened up the site to the community.
So far reactions have been overwhelmingly positive, we’ve gotten press coverage in the U.S., U.K, Ireland, Romania, Poland, and Spain, regarding next top startup, we’ve since seen out traffic skyrocket, and have identified a number of issues with the website (and are working on remedying them), implemented user functionality improvements for registered members and have seen traffic go through the roof, at least in comparison to previous days and for that matter weeks.
So all in all good, notwithstanding we’ve seen a few new registrants, and the event is definitely gaining traction. All in all we’d say good. And while we have you here, why not register on the site, and see what all the hoopla is about behind the scenes.
As for what the past few days looked like, here goes.
Sunday: 01:00, the site opens up – and anyone and everyone can register, we feel as if though an era has ended, the day to do day is no longer about design, strategy formulation, but about actually doing those things that we’ve laid out.
Monday: Final touches on the press release are going back and forth between us, around 10-11am it’s finalized, and so the distribution begins. The next few hours are spent what for openness we’ll just call PR spam. Sites in the US, UK, Ireland, Poland, and Romania pick up on us and the event, some tweet, others post blogs. Traffic goes through the roof and we’re very pleased.
Tuesday: Can’t speak for the rest of the team, but definitely a turbulent night. Woke up a few times, but upon waking up in the AM was greeted to a media inquiry from Read Write Web, quite cool. Traffic was still going through the roof, and then we got featured on StartupIsrael, and EnergyByte. Rest of the day spent strategizing, figuring out where the gaps are in our launch plan, what we can improve on, and what we can leave for the time being. We also had to move servers, too much traffic. 🙂
Wednesday: Highest traffic day to date, an inquiry from ibusinessangel.com, and a response that we’re going on the site within the next few days, and can’t wait to see it. More work on the site, in terms of fixing bugs that popped up, and just reaching out to possible sponsors, and wrapping up mentors. Results – again – overall positive.
In all, it’s been a good week thus far for f3f and we’re excited about what the future will bring, we know this wasn’t the usual f3f article but what better way to celebrate the good news, than to share it with the community.
Thanks for reading and for those that did, thanks for signing up 🙂
Turns out there are groups of Business Angels (BA’s) out there that charge entrepreneurs and startups to pitch. What? Yes you heard that right, Angels charge startups to pitch. These fees range anywhere from €1000 to €18.000 + 3{abb65e2b6815f549a727af2ea9f3a377a727ddc064972a198a74f88a6b766686} of the capital raised to pitch your company to a forum of Angels.
What do you get in return? A fifteen minute slot in front of people that may, or may not invest in your company. Nothing more. Is the price tag worth it? Absolutely not, no angel should require the entrepreneur to pay a fee that will go into their own pocket. These people are after all supposed to be financiers, they are the ones that have the money, not the other way around. Notwithstanding 15 minutes of someone’s time, and especially if they were to have a vested interest in a company is not worth the money.
They will tell you, it’s for screening purposes, they will tell you it’s for x, y, z, but at the end they’re looking to take an equity stake in your enterprise – which according to normal investment criteria should bring them 30x return. Given not all will, but a well differentiated portfolio ought to at least bring in 10-15x return on investment.
Greed, Greed and More Greed?
So why are they charging? Long story short, it’s greed. But it’s not only the angel, there are groups out there that say they will put you in touch with BA’s for a few grand of your “lifeline support system” – basically those few grand that could mean life or death while your company traverses the valley of death. Nonsense. If a filter group wants to earn money through deal flow facilitation there are better ways of doing it than charging the entrepreneur for a fifteen minute slot.
A filter should be paid by all means, no work should go unrewarded, but how? Via percentage of the deal they set up, and a fee – paid for by the BA, and if the startup gets financed from the investment amount.
For example, Joe Filter, finds SuperSatrtup and introduces SuperStartup to BA – BA agrees to pay X for the introduction to Joe Filter, and then after some deliberation BA invests 300k in SuperStartup, due to the positive outcome Joe Filter takes 3{abb65e2b6815f549a727af2ea9f3a377a727ddc064972a198a74f88a6b766686} investment fee, or 9k. What do you have as an outcome, Super Startup is happy, as they now have 291k in cash for operational and growth activities, the BA is happy as the BA has a new high growth company in his/her portfolio, and Joe Filter is happy as he’s made some cash. BA = Expected 30x, Joe Filter = 9k+Intro Fee, SuperStartup = Investment, or Win, Win, Win.
If the startup has to pay Joe Filter, and no deal happens, It’s BA = 0, Joe Filter = 1, Startup = -1; or Null, Win, Loss, zero sum game. Or in layman’s terms – just bad economics.
So what’s this all boil down to? Greed. Once again, BA’s are more concerned about themselves than the nature of their business, and filtration systems target the wrong market segment. A “good” BA should have a vested interest in seeing the startups they want to see, as they will be investing in them, they should also then have a vested interest in helping these startups grow. So what does this all mean? Those BA networks that charge the entrepreneur a grand aren’t worth speaking to, especially since the “best possible outcome” is an equity stake in a company.
Any Value Added?
Is there any value added to the Entrepreneur? Nope. Typically, you pay, you pitch, you get rejected, or if you build interest, you’ll wind up covering additional fees. Then you have new funding initiatives such as Revolutionary Angels – that charge 5k to participate in what is effectively a business plan competition that results in two companies receiving 10{abb65e2b6815f549a727af2ea9f3a377a727ddc064972a198a74f88a6b766686} and 2{abb65e2b6815f549a727af2ea9f3a377a727ddc064972a198a74f88a6b766686} equity investments from the group. But here’s the rub, that equity investment comes from the coffers of other entrepreneurs. An excerpt form their website reads “There is no obligation to submit a plan for review. Companies that are a selected to participate must pay a fee of of $4,995.” – Why do I have the feeling that if you’re willing to dish out 5k, you’ll get selected any way?
Dodgy business practices. By all means?
Value Added Service Fees?
This is different, if as a startup I can get some form of value added service – be it training, non equity mentoring, press, access to a new network, feedback on my business model, where it needs adjustment, how to extend my scalability, how to enter new markets, advice on joint ventures, learning and or education about the process. Then a fee is worthwhile, after all people putting these things together need to eat as well, and as we all know money does not grow on trees, but that value added has to be worth the fee in question. Is that fee worth €18.000 +3{abb65e2b6815f549a727af2ea9f3a377a727ddc064972a198a74f88a6b766686}, absolutely not, is it worth €1000, probably not. Is it worth €100, depends what the service is, and how it will help me as an entrepreneur, but then at the end of the day, it’s a service and not an intro fee, or a 15 minute slot in front of me and my network for a grand.
In summation any BA network charging you for 15 minutes of their time is not worth it. If your company has mettle, BA’s in their nature should be more than willing to speak to you about your enterprise.
To read more about the topic of BA networks charging, click here, here, and here.
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We want to know what you think?
This topic is of very special interest to us at F3FUNDIT, why? Well we’re in the process of putting together a new concept event that will truly be focused on the entrepreneur, yet we plan on charging a nominal application fee along with it. Why? Well we need to pay our staff, we need to pay for parts of the event, speakers, training materials, and our time, as well as put together a winner take all cash prize.
We’re not ready quite yet to let the cat out of the bag, but every startup that applies will get something in return, we’re on the side of the entrepreneur and don’t believe that something for nothing should exist, but nonetheless, we’d like to hear your thoughts.
