StrartUp.com

StartUp.com is documentary movie that tells the story of the founding of GovWorks.com, a startup company which connected its site users with government operations. Makers of the film followed the two founders, Tom and Kaleil from day one. This is classical story about conflict between personal and business relationships. The movie starts when Kaleil leaves his old job and becomes CEO of GovWorks.com, and ends more than a year after that. 
In short period of time 28-year-olds Kaleil Isaza Turzman were given $60 million and asked to turn it into something grand. VC gave those money for Isaza's belief that people need this service without a proof. Great picture of the dot.com bubble time. The size of company was growing from 8 employees at the beginning to 250 at the peek. The site GovWorks.com, which was up and running from May 1999 to December 2000, was intended to link people with government, ultimately making it easier to pay parking tickets and taxes and buy licenses.The company's business failings were flat revenues, and a sales cycle that was too long.

Congressman Adam Smith

The first time in my life I listen to a professional politician. The U.S. Congressman Adam Smith, who represents 9th district of Washington State, was the fifth guest in our class. His speech was about 20 minutes long.  I was trying to write some notes, but it was impossible for me to write and listen to at the same time. The Congressman covered so many topics in short period of time.
Adam Smith talked about instability in the modern life. He told us about his father's life who worked for one company entire life. One of the ways to improve the current situation is providing universal health care system. Adam Smith expressed his view about the competition between American Boeing and European Airbus for building Aerial Refueling Tanker for U.S. Air Force. The bottom line of his speech was the world has changed and we should compete with other countries in the new technological, political realities and on the market.

   

Raising Seed Capital

"In the business world, the rearview mirror is always clearer than the windshield", said Warren Buffett, who  is widely regarded as one of the most successful investors in the world. Driving a "car" of my own business I would consider three $$ stops for the initial funding: 
1. Family and friends -  <= $ 5,000. 
       In my case it almost equals to self funding, because I have only immediate family in the USA, and just a few friends. Recommended amount is $50,000. How to get fixed this gap? One of the ways is to start working as a sole proprietor by providing consulting services to the customers without quitting the full time job and saving extra money for future business. It would take longer to start the business venture, but I might get a better picture about the market and build the customers base.
2. The Angel Investors - >= $350,000
     According to John Dimmer, I have some advantages over 97% of students because I am a woman. I follow his advice and will identify the regional women investors group "Seraph Capital Forum" http://www.seraphcapital.com as the audience for my business plan.   
3. Venture Capital - ???
    The VC would be the last source of raising seed capital only in the case when the amount of Angel's investment will be insufficient. The getting VC funding would be stressful and associated with risk of selling stoke too cheaply. 

Additional reading

Trying to find answers on many questions that arising in my head after each class I looked on the list of recommended readings for TINST 475 syllabus. The title of the first book on the list was "The Complete Handbook for Creating Successful New High Tech Companies" sounded appropriate. I checked the UW library web site and discovered that book is available at Tacoma campus, and remaining books from the additional readings list are available as well. I borrowed that book and looked on the publication date - 1997 - seems outdated, but... I read the first 4 chapters on one breath. I would like to distinguish the chapter 2.

John L. Nesheim, in chapter 2 “The process of Forming the Company” describes in great details the whole picture of a company’s lifecycle by classifying each cycle into 14 stages starting from business idea and finishing with Initial Public Offering (IPO). Each stage has been analyzed from following points:

• Main Focus activity
• Time required to complete each stage
• Typical participants
• Help needed
• Major cost – time or money
• Main risks
• Results: ROI (Return on Investment) and Output.

One of the stages is ‘Pullout from Employer’. The author describes two possible ways to quit your current full time job before writing a business plan or continue earning wages until last possible minute. The goal of this stage for all founders is to “achieve a clean pullout” which means without lawsuits from their former employers. The help of legal consulting might be helpful to achieve this result. The author gives describes potential difficulties and gives useful advices on each stage.

I would recommend this book for students in TINST 475 who is seriously thinking about own business.

  

The Angel Investor

Our fourth guest was John Dimmer. He talked about himself, his educational background, and about business and investments. He said that after graduation from University of Oregon with B.S. Finance degree, he was not ready to run an own business. It took several years before John Dimmer became the entrepreneur. John Dimmer said about the 3 Cs that important for entrepreneurs: Character, Capacity, and Capital. While Character and Capacity are related to personal qualities, the Capital is the business related. John Dimmer explained the ways of obtaining the seed capital. First source is your own money. The second one is your friends and family. The Angel Investors is another source of financing. The Tacoma Angel Network https://www.tacomaangelnetwork.com  “is a non-profit alliance of accredited investors, who are successful entrepreneurs, retired executives, and other business leaders in the greater Tacoma and South Puget Sound area”.  He encouraged students by saying numbers of possible investments and investors' expectations. As the last source of investment John named VC Investors and shared with us his own experience of getting money from Venture Capitalists.

One interesting fact which facilitates me is that John Dimmer and Andrew Fry have been friends since school bench. They are not only friends, but used to be a business partners running Free Range Media. They are so different, but it looks like the time and business interests don’t affect their friendship. The second interesting fact that I found is the John’s family has traditions of charity since 1993. His parents’ foundation http://www.dimmerfoundation.org/index.htm  has positive impact on local community.

Ron Kornfeld

Ron Kornfeld, the business plan template author, was the second guest in TINS 475 class. His lecture was so short in time and a lot of topics were covered. In addition to it, his manner of fast speaking left me feeling that I was listening to him, heard his words, but I didn't understand him. I have not even memorized 5 business plan steps which were the key of his lecture.  Feeling bad about myself...

Brian Forth

Brian Forth, the third TINST 475 guest speaker, represents the Tacoma business company “Site Crafting” http://sitecrafting.com/ that has been run successfully for 13 years. I was impressed by his ability to organize and unite people into one team. In simple and as it seemed to me in sincere form Brian spoke and showed photos of scenes from the company life and shared with us the secrets of doing business. The tradition to celebrate the holidays together and the custom to keep financial information open to employees create an atmosphere of a big family, where success depends on each member. The fact that only 2 employees (both chose to be mothers) had left since the moment of the company founding speaks for itself.

An amazing transformation from an elementary school teacher into a successful entrepreneur deserves admiration. Hence, there is nothing impossible if you want to do things you love and have aspiration