Transcript Deputy Administrator Presentation (Star)

Thoughts on Startups
Louis R. Woodhill
President
Scalable Software, Inc.
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 1
Thoughts on Getting Ahead
• You have to own something
• Power is the willingness and ability to act in
the face of uncertainty
• You are going to make mistakes
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 2
Peter F. Drucker on
Managing Yourself
• Know whether you are a “reader” or a “listener”
• Know whether your boss is a “reader” or a “listener”
• Know whether you belong in a large organization or a
small one
• Know whether you are, by temperament, “line” or
“staff”
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 3
Four Principles for Software Startups
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Always tell the truth (The Prime Directive)
The product must work
The product must be compelling
Software is a “talent” business
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 4
Ingredients for a Startup
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Must have:
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Valid market target
“Enough” money
Nice to have:
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Contacts
Good idea for first product
Talented team
Experience
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 5
Financing
• Raise money when you can
• Always raise more than you think you will need
• Don’t fall in love with your stock:
– 10% of something > 100% of nothing
– How you use capital is more important than what you pay for it
– You always have to pay market price for resources
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 6
What Public Markets Value
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5.
Large market potential
Fast revenue growth
Profitable, but not excessively so
Good “story”
Consistently “Making the numbers”
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 7
How Venture Capital Works
(From Bob Zider, Harvard Business Review,
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Financing for commercialization, not R&D
Short time horizon (2-5 years)
High cost capital
What VCs look for:
– Large, fast-growing market
– Plausible team
– Route to liquidity
Scalable Software, Inc.
7/20/2015
Startups_99304
720 North Post Oak Road, Suite 500, Houston, TX 77024
Voice: 713-681-3341 Fax: 713-681-2945
Internet: [email protected]
Thoughts on Startups 8