Sindre, if you don't know him, is one uber hacker. He is a geek, a nerd. He is Singularity. He is a friend. He is a foreigner. He is Scandinavian. He has a friend who likes to go couchsurfing.
Welcome, Sindre, back to New York. I will see you tonight.
And there is a fresh email from Brandon Diamond.
* Betterfly: connect with betterists to improve yourself
* HotPotato: share what you're doing with friends
* Learnvest: educational finance resource for women
* Frontal: rich web apps from simple markup
* StuffBuff: auctions anywhere you want them
* HowAboutWe: pick your perfect date then find a match
* Jetsetter: insider access to the places you want to go
* Comixology: read comics on the go and on the web
We'll also be hearing from Clay Shirky who'll be discussing "generosity as a design problem".
Plus, the entire evening will be guest emceed by the wonderful Dina Kaplan, co-founder of blip.tv.
So come on down to NYU Skirball at 7 PM for another evening with NYC's brightest movers and shakers.
Skirball Center for the Performing Arts
New York University
566 LaGuardia Place (at Washington Square South)
www.skirballcenter.nyu.edu / 212.992.8484
a world where many entrepreneurs see venture capital as a necessary evil ..... the tale of meeting Foundry Group’s Feld and how the VC’s unorthodox approach to learning about the company ultimately cemented Smith’s desire to have him as an investor...... Brad intrigued me because he didn’t come across like any venture capitalist I had ever met ..... ‘I’m not going to conform’ persona, and are both passionate to their core about helping startups ........ “The mindset of a typical VC is geared more towards a later stage company that has crossed the chasm and the customer base is beyond early adopters,” Smith told us. “Finding someone that knows you still need to find out where to aim your rocket is very important.” ....... Feld’s process was simple: He wanted to get to know the founders and find that each interaction had been more interesting than the last. ....... When I told him that we didn’t have an investor presentation put together yet he quipped, ‘The last thing in the world I want to see is a f—ing presentation ....... Brad and I spent the next six months getting to know each other, during which Brad and his partners repeatedly drilled us on our thinking, our strategy, our technology and our market approach. We told him we would invite him into the “sausage making” process and he readily donned his hairnet and dove in. ....... Foundry never asked for projections or historical financials. “We talked about where we want to take the product and how we want to serve customers ..... “After we signed a term sheet, I finally asked Brad if he wanted to see our deck. I sent it to him and he said, ‘That scared me.’
We quickly concluded that we needed to kill everything we had just spent six months building and go back to the drawing board. Given that we had only two months of cash in the bank at the time, this decision wasn’t an easy one but we felt strongly that it was necessary. ....... Andy has a favorite saying, “We know your plans are wrong, we just don’t yet know how wrong.” ...... changing direction like this meant he was willing to forget every one of those prior promises and start down a new path. ....... we went from 0 users to 8 million users in an afternoon. ....... he wasn’t your typical VC. Brad is an early investor in Zynga the undisputed king of social gaming. ....... we knew that having Brad as a partner would give us a huge amount of credibility with potential customers, so we began stalking him. ...... We mostly went back and forth via email, where niceties were commonly replaced with a raw curiosity of how best to build BigDoor and how we would meet the coming onslaught of demand for our platform. Brad was direct and often told me where he thought I was wrong, which laid the groundwork for me being able to do the same with him. We found some common ground and a fair amount of areas to disagree and challenge each other. We joked about 80’s bands, compared reading lists and shared paranoid rants about how machines will eventually take over the world (they will). But what’s most notable is what we didn’t discuss. Never once did anyone at Foundry ask us for projections or historical financials. We didn’t talk about the deal, valuation or board composition and we never talked about exit timing or how much money they needed to make. Product, customers and philosophy – that’s where we spent our time. ...... On two separate occasions Brad told me he was “out” and wasn’t going to invest. ..... “The word ‘no’ is simply a milestone on the path to ‘yes’.” This emboldened me to go back to Brad and tell him he was wrong and that he was the perfect partner for us. I made no attempt at all to posture or play hard to get .......... This wasn’t done out of desperation – we had multiple offers from other great VCs – we conducted ourselves in a completely transparent fashion because that’s how Foundry was toward us. ......... until one day Brad sent an email that said, “Ok – I’m ready (and psyched) to do a deal.” He then laid out deal terms in one very simple paragraph. I responded with a very long email that ultimately asked for just one change, and he simply responded with “Deal.” That was it, that email exchange was the extent of our term sheet. Instead of grinding us on terms, Brad spent the three weeks from our agreement to closing making introductions for us to potential customers. ....... we’ve never had a deal go this smooth nor have we ever had anyone who was so awesome to work with on the other side of the table. ......... Having great investors isn’t just about warm fuzzies, it should (and does) also result in real customers. ..... as we endeavor to weave the BigDoor platform into the very fabric of the Internet.
Ah I never loved you
And if I loved you
I wouldn't say I'm sorry oh no
I stand outside under broken leaves
Always and forever more
And together getting lonely
I thought I couldn't do this without you
Single in his bed somewhere
Ashes still it fall fall falls
What you do, what I do is ultimately about people. I read a quote from you a few weeks back where you are saying show me a web service that has major user engagement and I will show you a way to monetize it. If enough people show up, it will work.
Thank you for the rapid response to my blog post email yesterday. Here are some more details.
There is a concrete mathematical theory called the butterfly effect. A butterfly flapping its wings in the Amazon forest could be the reason a cyclone hit Bangladesh. What happened in Nepal in April 2006 was a political cyclone. I was the butterfly flapping my wings in New York City. In April 2006, over a period of 19 days, about eight million people out of the country's 27 million came out into the streets to shut the country down completely to force a dictator out.
Nepal: Background
Nepal is the poorest country outside of Africa. More than 75% of the countries on the planet are smaller populations than Nepal. So it is not that small a country. There are as many people in Nepal as there are in Iraq. You could have introduced democracy into Iraq the Nepal way and saved a trillion dollars in direct costs and more in indirect costs.
Nepal has been the most popular destination among Peace Corps volunteers for some reason during the half century of that program's existence. I don't really know why because I have not traveled the world.
Nepal is situated between India and China. Those two economies are growing at double digit rates. There are forecasts that show the Chinese economy will be bigger than the American economy by 2020. The democracy work in Nepal has implications for China and hence has larger geopolitical implications disproportionate to Nepal's size, especially when you take into account the Maoists of Nepal, the deadliest ultra left group on the planet since the end of the Cold War, and the Maoists of India, the number one security threat to India, as stated by the Indian government, affecting one third of that country's districts.
9/11 was a flashpoint, just like Pearl Harbor was a flashpoint. You don't want a third flashpoint in Taiwan. The Arab world and Africa and China are the three large chunks where democracy still is not in full play, but China stands out in that I don't think the American political system is what the Chinese need to convert to. The truth lies somewhere in between. America needs total campaign finance reform so it can truly become a one person one vote democracy. And China needs multi-party democracy and federalism and Tibet and Taiwan as states in that federal China. And the fermentations inside of Nepal going on right now in terms of mainstreaming the Maoists have implications for China and India. If Nepal can be turned into a multi-party democracy of state funded parties in the constitution that country is scheduled to write for itself within a year, then we will be on our way.
Iran
Just like Nepal has implications for China, Iran has implications for the entire Arab world. That country for Africa could be Zimbabwe. What is exciting about Iran is what success there could mean for Saudi Arabia and Egypt. When I see people out in the streets in Tehran I get visions of people out in the streets in Cairo.
After success in Nepal, I have witnessed wastes in Bhutan, Tibet, Burma and Iran. I have watched helplessly. The people on the ground have been doing the hard part - coming out into the streets in the face of immense brutality - and the world has been failing them in each case. A democracy movement is science, it can be made to work every single time. But you do have to mutate faster than the virus does. And you do have to take a holistic, global approach. There are basic principles that worked in Nepal that could work anywhere.
There are a few steps that the democracy movement in Iran needs to take, the most important is to shift the goal post. The goal can not be to get the existing regime to hold the presidential election all over again. The goal has to be regime change. The goal can not be to take the brutality lying down. The goal has to be to document every act of brutality to bring the perpetrators to justice once a new, interim government takes over power. The goal can not be to keep coming out into the streets. A democracy movement is supposed to last a few weeks at most, not months and years. You shut the country down completely until the regime gives way to an interim government with the mandate to hold elections to a constituent assembly within a year of taking over power. That assembly would have two years to write a constitution. The democracy movement in Iran needs a leadership change. The current leader has not been able to think outside the box. He is boxed in. He is committed to functioning within the current mullahcracy in place.
My Work
It will be transparent, it will be digital, it will be political. My blog Barackface will be the hub of much of what I do. We are counting on the fact that the world is connected enough by now that everyone and every organization I need to reach out to and communicate with I can do digitally and in a massive way because a blog scales on its own. Social media is magic. And we are counting on the fact that I did this for Nepal, I can do this for Iran all over again.
After there is regime change and an interim government takes over, I will be done, my project complete. I will no longer need to give full time involvement, although I can't imagine not maintaining part time involvement all the way to the country getting itself a new constitution. After so much and such intense emotional involvement you don't just walk away.
You put in 5K of your personal money into this now, like today, like yesterday. Fred Wilson puts in his 5K once he is back from his Italy vacation in less than a week. And you two find me 18 other VCs who will put in 5K each by the end of July. Marc Andreessen 5K, Ben Horowitz 5K, Albert Wenger 5K, Brad Burnham 5K, Vinod Khosla 5K.
I start with 100K. It comes to me at the beginning - not in monthly installments - like you would do with a startup. If I can show success by September 2011 - in 15 months - each of you put in another 2.5K each for a total of 50K as a bonus payment to me. If I can do the whole thing in less than 15 months, the 150K deal still stands.
Tech
You are a VC. I am a tech entrepreneur. Why would we do this? Because ultimately it is all about people. It is about impacting lives. When the Iranians first took to the streets it warmed our hearts as to their use of Twitter as a tool. It is all related.
I am about 15 months away from my green card, and I am about 15 months away from launching my tech startup. My tech startup will be to do with the last mile of the ISP business. And from working on democracy in Iran to working on the startup is not going to feel like a career change to me. I think of democracy as the Big Bang in a country's life. It is a starting point of sorts. Once a country gets its democracy, it is on its way. But democracy alone does not put food on the table. And universal broadband is that magic wand that will help bridge the huge gulf between the West and the Global South. I had to come to America. Others like me don't have to if they can have broadband.
This was in early 2006. I was deep into the Nepal democracy movement work. We were a few months away from grand success, but we could not have known it at the time. And I got an email from a German reporter. She wanted to talk. So we talked over email and the phone, and she wrote up an article for some German newspaper. I used Google Translate to translate it into English to publish at my Nepal blog.
Her story had a fancy title: Robin Hood On The Internet. That story got picked up by the German radio people. They emailed me asking me to come to their studio in Manhattan so they could record an interview. They said they had requests from many local radio stations in Germany. And so we talked.
And although I have been rooting for Brazil and Argentina, they are both out. Now it is obvious to me that Germany is going to win this cup. And I am happy for them.
I am about 15 months away from a green card, and about that far away from launching my startup, which right now I think will be something to do with the last mile of the ISP business. I think the best use of my time from now till then would be to pour myself fully into the democracy movement in Iran. I have done this before, I can do this again. I did this for Nepal in 2006. This is what I have had to say about that:
There is a concrete mathematical theory called the butterfly effect. A butterfly flapping its wings in the Amazon forest could be the reason a cyclone hit Bangladesh. What happened in Nepal in April 2006 was a political cyclone. I was the butterfly flapping my wings in New York City. In April 2006, over a period of 19 days, about eight million people out of the country's 27 million came out into the streets to shut the country down completely to force a dictator out.
This work will help me keep polishing my two strengths that I would bring to my startup: vision and group dynamics. Internet access is the voting right for this century, the Internet Century, and to do well in that business you have to be able to deeply care about masses of people like those that have been thronging into the streets of Iran.
Iran is a low hanging fruit. The hardest part of a democracy movement is getting people to come out into the streets. Well, that has been happening in Iran. This world is connected enough by now that one Digital Ninja/Commando based out of New York City could make that fundamental difference. Everyone I need to meet in person for this work is right here in New York City, primarily members of the Iranian diaspora. All I would need is a laptop, a smartphone and a monthly metro pass. And me.
I need you guys to sponsor this work out of your own pocket. Put in 5K each, and find me 18 other VCs who will put in 5K each. I ask for 100K and 15 months. That would be enough time. If I succeed, you get to put in another 2.5K each for a 50K bonus to me. This 5K you might put into this is the equivalent of 5 million you might put into Kiva. Democracy is the ultimate fishing net you can give to a people. Once they have a modern democracy, they can help themselves.
I am really, really good at the vision thing, vision and group dynamics, but right now I want to talk about the vision part. You have done well at scaling and monetization, but your weakness so far has been in the features department. In a recent quote in a news article Dennis has expressed a hunger for "engineers." That tells me he is bursting at the seams in terms of where he wants to take FourSquare. Naveen was throwing lops of mud on the location space wall even before he ever met Dennis. Fred is a rare visionary VC. I think you guys are swell, but I think I can help.
Price Tag: $6,000
Duration: 4 weeks
Output: An average of three posts per week at my blog, Netizen
There will be no need to worry about the public nature of my work because when you walk into a Walmart store you have seen their entire business model and so far noone has been able to copy the most successful business in the history of humanity.
I will mostly be scouring the web, thinking, and I will need to spend 30 minutes each with the five key people on the team, and perhaps an hour each with the two founders, that perhaps during the third week.
I think my work will help speed up the burn rate for the $20 million you just raised, and that is what you want. FourSquare as a company is in that sweet spot where it does not have to worry about how it will raise its next round of funding. Burn the 20 million fast and go on to raise 30 million at a 300 million valuation or something. That speed is one of the things you need to do to cement the lead you have.
I hope this makes sense and sounds like a good investment.
Image of Sindre Aarsaether
