Startup Lessons from Garage Ventures Bill Reichert

Silicon Valley icon Bill Reichert from Garage Technology Ventures recently spoke at Startup Grind Sacramento and offered some invaluable insight. With over 20 years as an entrepreneur and two public companies, Bill’s resume is quite impressive.

Originally from Chicago, Bill grew up spending quality time with his grandfather who exposed him to the adventurous world of entrepreneurship. He was in Silicon Valley when the PC was first released and arguably ran one of the first app development firms in United States history, which was apparently amazingly successful but eventually “crashed and burned.” In 1992, Bill and his buddy helped save a failing organization called “The Learning Company,” which later became the first business they took public for $60 million. Later down the line, the Learning Company was sold to Mattel for $3.6 billion. Ouch!  Bill eventually stopped kicking himself for selling too early and learned the ingredients to achieve success years later at the National Venture Capital Conference with Peter Lynch.

“I only invest in companies that even a complete idiot can run.”

This statement hit home for Bill, making him simplify his approach and become cautious with ventures that seem overly complex. When he looks for investments, he wants startups that have novel technology, a sustainable competitive advantage, and can make a significant impact in its designated sector.

Take for example Voke VR that “utilizes a synchronized multiple point-of-view stereoscopic panoramic camera system” technology. They’ve partnered with the Sacramento  Kings to enable mobile users in the stands or at home to receive an advanced VR spectacle without the bulky headset. The audience is able to pause, rewind and review the action from virtually any angle on the court.

When asked about ways for entrepreneurs to receive funding, his response was surprising:

“The best way to receive funding for your startup is to get endorsements from bigger companies for validation and reach out to venture capital sources.”

Bill firmly believes that by following these simple words of advice, you will be “head and shoulders” above your typical startup seeking that almighty dollar. Of course, you will most likely still need to meet the criteria that he mentioned when looking for a potential investment (i.e. novel technology, etc.).

Watch the full interview with Bill Reichert at Startup Grind Sacramento here.

By Rich Foreman, CEO / Apptology and Director of Startup Grind Sacramento. Rich co-authored the book Tap into the Mobile Economy and his blog has been listed in the Top 20 Mobile Marketing Blogs of 2014.  Follow Rich on Twitter at @ApptologyCEO or attend a Startup Grind Sacramento Event.

4 Tips to Attract Mobile App Investors

If you’re thinking of starting a new business, you’re not alone. With so many new applications being developed in recent years, it seems that the young entrepreneurs are taking over. In fact, according to the Kauffman Foundation, new businesses (0-5 years old) make up almost 20% of all of the net job creation in the United States. The hardest part of a new business, though, is finding the funds to get it up and running. Here are some things to keep in mind when pitching to potential investors without scaring the living the daylights out of them.
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Mobile App Tip #1: Be original

Before an investor gets involved, he or she wants to be wowed. In short, they’re unimpressed until they’re impressed. This is clearly demonstrated by Angel Investors’ deal acceptance rate of 21%. They’re not going to shell out thousands of dollars just to produce a copycat product of something that has already been invented.
Your product needs to be fresh, it needs to be relevant, and it needs to be a sure thing. Investors are more likely to give their money to people who produce an original product than those who try to recreate the wheel.

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Image Source: Technology Pep

Mobile App Tip #2: Put it all on the table

Investors value honesty above all else, since the lack of information can come back to bite them more often than not. As of 2011, the percentage of “bad exits,” or bankruptcies were as high as 24% – so you could see how they would be a little sensitive

Make sure that from day one you are as honest about the strengths and weaknesses of your product as possible, because if you aren’t, investors will sense it and back off. The people you are pitching to didn’t get to where they are by being stupid. They most likely have a keen sense for when something isn’t right, so be respectful of that.

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Image Source: PCMA

Mobile App Tip #3: Be flexible.

Nothing turns an investor off faster than an attitude of “my way or the highway” from an entrepreneur. An investor wants to feel involved from the very beginning, and wants to feel their entrepreneur is coachable. More deals happen in the early stages of the company’s life than any other stages for a reason: The investor wants to have had enough time to see potential, but wants to get in early enough to ensure their role in its growth. You may have birthed the idea for this company, but if you want the investor on board, you’re going to have to be flexible and let them develop it.

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Image Source: Savor the Success

Mobile App Tip #4: Have the Four M’s in place.

Mark Suster, a successful entrepreneur turned venture capitalist, outlined in his article The Four Main Things That Investors Look For In A Startup that an entrepreneur should demonstrate the four golden M’s: fast, upward Momentum, a stellar Management team, a large Market, and, of course, a great deal of Money or earning potential. This should all be demonstrated very early on in the first presentation.

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Image Source: MarketUmbrella

As with anything else, put yourself in the investor’s shoes and you’ll understand why and how they do the things they do. Do your research, not just on venture capitalists, but on the specific people you’re trying to meet – and you will go far. When you’re able to seal the deal, the next phase is to maintain it. You should read the 5 challenges of a startup appreneur so you can best prepare for the journey ahead.

 

Written by guest writer: Jeanine Amella