July 07, 2009

Michael Jackson, Tom Teichman, Andy Cunningham

Today marks the 4th anniversary of the July 7 2005 London bombings.   I was out in the country [somewhere - damn I wish I had a better recollection of UK geography] at Michael Jackson's country home [the former Chairman of Sage].    He had a wonderful annual summer party for his portfolio companies, and we were listening to the founder of WhereOnEarth [acquired by Yahoo in October 2005] talk about how they secured the deal.

My ex was in town from the US, and nearly missed being on Tavistock Square that morning.   My current and I were meeting for dinner that evening at our favourite, and I remember being terribly muddled, distracted - feeling like something very odd had come over me.

Michael's building of Elderstreet has been a model for me at Ariadne.    He took equity in the deals he did, most notably Sage from early on.   Very shrewd; he's been very generous with me.    He started out with a private investor network - much like Ariadne Capital has.

I suppose I took one page out of the play book of Michael and another out of the play book of Tom Teichman.

A leading entrepreneur who sold his business today at lunch was telling me how "utterly honourable" Tom was in his dealings at the time of the exit when the other investor tried to force him to hand over some of the equity or he would block the deal.   Why do investors try to get cute?   Don't they realise that 1] this usually doesn't work 2] they lose the relationship with the entrepreneur for forever, and 3] this is wrong - the deal you do at the beginning on equity is the one you are held to.

And then I get to the IO ME Kick Off Mtg, and Phil Eames's opening line was, "I just read your bio for the first time Julie, and I didn't realise that you worked for Andy Cunningham!"    It's been a walk down memory lane today.

Andy is a very special woman.   She was my first mentor, and yes, I took a page out of her play book too.    http://www.cxocommunication.com/about/andy_cunningham.php    Andy wanted to redefine public relations as a strategic board room activity.    She taught me a number of things through her example:

·         Get a brilliant CFO on board as they will measure everything, and in measuring everything, you improve and achieve greatness with the right vision

·         Great visions are simple visions which grip

·         Marketing trumps technology again and again and again - the last 30 years of the technology industry has been one big case study in this.

·         PR is only a mirror to hold up to the company and reflect it to the media; you cannot get people to say things about you which aren't true - it reflects reality

·         Early stage technology companies need momentum or they fail - momentum is that sense of inevitability they will cross the chasm -  http://en.wikipedia.org/wiki/Crossing_the_Chasm

·         Hire well

The people I met at Cunningham Communication were extraordinary.    We are today an alumni network of hundreds.   Andy built a brilliant firm, and she inspired me to believe I could do it too.

 

 

July 06, 2009

spotify, reboot britain, caspar, IO-ME

And we're off to a new week

Caught up with Paul Brown, new UK MD of Spotify - http://www.spotify.com/en/ - which Ariadne saw way back - damn, miss some good ones... on its way to being a thoroughly major big hit ...

Big sister has gone back to America.    All family contact makes me feel like a bohemian - still wearing too much black with a soft spot for the artist

Reboot Britain - http://www.rebootbritain.com/ - happened today, sponsored by Nesta, where I spoke.    The Prime Minister has also announced a new £150 million fund for innovation.   

Tomorrow I see Caspar Hobbs - http://www.linkedin.com/pub/caspar-hobbs/3/9a3/122 -  for lunch; he wrote me an email recently called - "a late thank you" - Dear Julie, Thank you for this, would love to have done but otherwise engaged.  You may not remember me but I rang you ages, like 10 years ago, after I heard you talk at INSEAD, I wanted to raise money, you put me in touch with SPARK, they gave me a bit of cash and we sold the business for £140 m a couple of years ago, thank you very much for the lead!  I would love to be involved in any further events Brgds, Caspar

What a nice email to get!

Ariadne kicks off our newest mandate with IO ME - http://www.io-me.com/ -  tomorrow - driving digital lifestyle services.   We first met Phil Eames through our work with Morse.   

Onward

July 04, 2009

spa addict

Happy Birthday America

Celebrating Independence Day with my lovely sister at Chewton Glen in The New Forest - I love this place.     Wonderful to reconnect with sister dear - like we never said good bye.   

World Friends CEO Dom Penaloza is in town this week from Shanghai.   World Friends are building a membership oriented social network service focused on making new [world] friends.   It's for the internationally minded, and there are already 2 million members with $2.2 million of subscription revenue.    The average member makes 17 new [world] friends.    

I've long been interested in cross-cultural friends, business and trends, and World Friends strikes me ahead of their time in monetising "new friends networks" - which no one else has done.    People won't pay to get back in touch with their old friends but it's tougher to make a new friends network viral.  Dom and Nick Paine, the Chairman, former founder of Lavalife [online dating site sold to NASDAQ company] are doing just that.

World Friends are the newest Ariadne portfolio company.

On the 30th of June, Karima and I went up to Manchester for the Enterprise Ventures AGM.   I presented on Trends in Venture Funding.    Kicked it off with my favorite Mike Tyson quote - "They all have a strategy until they get hit."    I love it :)

Went to the Spectator Business At Home party where the who's who of London were hanging out in the Garden behind 22 Old Queen Street.    I met Janet Daly of the Telegraph whose column I love reading.

From the Coutts Entrepreneur Breakfast this past week - "every single day we must do something that oils the wheels of life"

 

June 26, 2009

those billion people

Busy week -

Monday - enjoyed opening day at Wimbledon grace a CNBC where Steve Peck, Nicholas de Santis and I were reunited.

Tuesday - I meet Sir Peter Vardy - one of my heros - who I had read a lot about, and met in Newcastle recently; he keynoted at Entrepreneur Country on Wednesday.

Wednesday - Entrepreneur Country relaunched www.entrepreneurcountry.net, and 300 people joined forces again at the Institute of Directors grace a Andrew Main Wilson, our generous host.   Our dinner for 100 was at the restaurant at the IOD which was very good, and we spilled out into the garden afterwards.

Thursday - there is always the recovery stage.   I joined the IEA - http://www.iea.org.uk/ - run by the wonderful John Blundell, whose recently published book on Margaret Thatcher I am in the midst of - for a dinner following a talk by John Micklewait, the Editor of the Economist, my favourite publication  - http://en.wikipedia.org/wiki/John_Micklethwait

John has just written a book - God is Back - which I'm reading as well.    I've always thought it was boring to read one book at a time.  

John spoke about three things:

·         Where were we going

·         What happened

·         Paranoid Optimism

I took note, and hope that I've captured the key points of his excellent talk.

The past 25 years of capitalism have been the Great Opening.   One billion people have been lifted out of poverty through capitalism and freer markets.      He urged that when people try to tie this period with the greed of Bernie Madoff and Fred Goodwin, that we should remind them that it is / was really about those billion people.

That 25 year period he argued was good for freedom and good for Britain as well.

Interestingly, there are now 100 million Christians in China compared to only 70 million Communists.    Random fact from his book.

John argued that Barack Obama by 2017 must do two things:

·         bring the emerging world into the world order with participation in the institutions of power

·         resell capitalism

He doesn't think Obama is protectionist

When asked if he had been hired by the Church, what would he do - given his "God is Back" book? - interestingly he said abandon the state mandate.

Another week, 90 hour week ... tomorrow is Julie day.....

June 23, 2009

Building an Entrepreneur Country

1.  Individual Capitalism has come of age

When I founded First Tuesday, a network of entrepreneurs which many credit with igniting the Internet generation in the UK, in 1998, there was a niche group of digerati who came on the first Tuesday of the month to talk about building their Internet start-ups.    We were a “digital island” of sorts.  Today, I don't know a single person under 30 who wants to work for someone else.    They view themselves as their own P&L, their own brand, and are initiated into business through programs like Dragon's Den and The Apprentice.

The rise of the serial entrepreneur, the micro entrepreneur, the young entrepreneur, the portfolio entrepreneur and the lifestyle entrepreneur has been unmissable over the past decade in the UK.

This trend has arisen due to “Individual Capitalism”, a form of business where the basic unit is the individual rather than the corporation.   The Internet opens up opportunities in how people work – remotely or from home, from their phone, as a small firm looking much bigger than they are -  so that this shift away from “Company Man” to “Individual Capitalist” has gained enormous momentum.    The recession has created many Individual Capitalists in the form of freelance consultants, but even more are corporate refugees of their own choosing.

So while not all of us will make millions upon a tradesale of our firms to a multinational, and we may not call ourselves entrepreneurs, we are actually all becoming “Individual Capitalists.”

Those of us who have run our own firms understand the enormous pressure of keeping a team aligned, making payroll, keeping fixed costs low, staying ahead of the competition, and getting people to buy what we sell.    All of society benefits from the work that we do to develop our businesses, create jobs and generate wealth.    Many of us feel, however, that we go to ‘another country’ everyday when we go to work.    The speed and intensity at which we must work, the values it requires to build trust in an organisation, the level of dedication and drive seem inconsistent with the rest of society.    Others  just “don’t get it”.    We would love for the corporate titan who never has had to worry about cashflow in a personal way  to walk in our shoes for just an hour; entrepreneurship is not for the fainthearted.    If you open the newspaper on any day of the week, you’ll see that the media focuses on the FTSE 100 - old, established, "big business", and on governments who are actively defrauding the “little guy."   The media don’t really start paying serious, regular attention to any emerging company until it has arrived in a big way.

And yet small does become big, and start-ups do change the world, in the process creating jobs, new industries, wealth and pride in our ourselves.

So the average company owner, the SME entrepreneur, the Individual Capitalist goes to work each day in a fictional place – let’s call it -  “Entrepreneur Country”.      He or she manages his firm from ‘near death experiences’ to ‘breakthrough moments’ and back again.   There is no work-life balance, and the stress rips through their personal life pretty regularly.     It’s not because they aren’t good business people.     Business is a rough old game, and there’s no job security if you are the owner.

And yet business creates the wealth from which all of society operates, so an inspection of “Entrepreneur Country” might be worthwhile if we are to understand how to build more successful global leaders out of the UK.

What are the best practices of the UK’s more successful start-ups?    What is it like to spend a day in “Entrepreneur Country”?

2.   Reduce the size of government in order to reduce the tax burden on SME's

Because cash is king, effective business founders learn to keep fixed costs very low.   They don't build infrastructure  ahead of having recurring revenues.    They keep the team on consultancy contracts, sometimes flaunting IR35 in order to keep the PAYE and National Insurance bill low.   They learn to barter or to finagle for free  just about everything.   Don't hustle; don't survive.

So not surprisingly, the single biggest benefit that government could provide start-ups at the beginning of the entrepreneurial journey is to charge them less PAYE and National Insurance.  not defer it - make it smaller.    By shrinking the size of government overall, the “little guy” running his own business creating employment would thrive due to the lower tax burden.    Last year in a government-led focus group in which I participated  along with the CEO’s of leading UK start-ups, the high PAYE and NIC amounts to HMRC were frequently cited as one of the most debilitating factors in running a private company.   

3.  Challenge the Media to step out of their comfort zone

Leading entrepreneurs learn early to communicate their vision or fail.    However, little of that vision gets captured by the media.    There remains in society a view that small business is quaint but rarely moves the bar, or creates new FTSE 100 companies.    In short, that the economic growth that will fuel the recovery won't really come out of the entrepreneur-led new businesses, but by existing large businesses being propped up and stumbling to a new day.     Open any national newspaper, and count the number of articles on SME's or start-ups, and you'll have to look hard.     If we want to build an ‘Entrepreneur Country’, then as consumers of media, we must demand that more coverage of the emerging giants is given to high-growth businesses which are creating new industries.     One easy way to test this theory is to develop forums online where the entrepreneurs are given opportunities to be profiled, answer questions, and share their view of society and markets.    

4. Treat the SME as your corner store

One of the most important ways that Britain can support its start-up ecosystem is to buy from the companies in it.    For SME’s who sell to enterprises [instead of consumers], convincing corporate buyers to purchase from them and pay on time can be a major problem.     I advised a tech start-up in December 2003 which was very nearly made bankrupt by the stalling process which it endured by an incumbent telco which had promised to become a customer.    Just because a company doesn’t have a balance sheet with assets of £10 million, doesn’t mean it might not be solid.    Good executives know how to manage the risk of working with start-ups – giving them a chance to bring transformational  innovation into the corporate landscape.   Make buying from SME's a part of your corporate vision.

5.  Educate the young to expect success.

Leading entrepreneurs cite factors such as teachers who encouraged them to be everything they could be or learning environments where they were taught to think outside of the box early on in their lives as chief reasons why they became entrepreneurs.

At Ariadne Capital, I can tell within 10 minutes of speaking to an entrepreneur who has come to pitch whether or not they expect success.    They exude confidence, not a nauseating sense of entitlement, and convey that they will achieve their goals whether or not you come along for the journey.

6.  Privately backed Social Enterprise

Entrepreneurs are some of the most generous people I know.    They “send the elevator down” to the next generation as the overwhelming majority remember that they have been crucially helped along their way by others before them.    Provoke their generosity by giving tax incentives for their work.     One of the leading IT entrepreneurs of the UK, Paul Barry-Walsh set up the Fredericks Foundation which is the leading micro-financeorganisation in the UK.   They have given 600 loans to those who have fallen by the wayside whether through crime, drugs, disability or life choices.   The Fredericks Foundation saves millions for the UK government because it moves individuals from a cost to society to taxable micro-entrepreneurship.    Each of the Fredericks entrepreneurs then - by their example in their families and neighborhoods - sets examples of business transforming lives.     As Barry-Walsh says, "pure and simple, business is the answer."  Set people like Paul Barry-Walsh loose to find more ways to tackle social problems by facilitating his work and that of others like him.

Social enterprise is a hot area where many leading entrepreneurs are flocking whether it's Hoult's Yard in Newcastle, or DoTheGreenThing out of London, or Bono's Red led by Seb Bishop, the founder of Espotting, or Just Giving which is transforming charities.    Not only do entrepreneurs know what to do to fix social problems, they do it.

7.  Ecosystem Economics

There is a profound network orientation to business today.   Companies that win know their place in the ecosystem in which they operate and crucially align the economics for the entire ecosystem.     I first learned this in 2004 through Alastair Lukies, the CEO of Monitise, a global leader in mobile banking services based in the City of London.    Years before the business was successful, his dogged determination to make the mobile banking world "work" for all parties involved - the customer, the bank, the mobile operator - was impressive.   Simpay and other schemes failed because they had a bias or a dominant player in the ecosystem which wouldn't relinguish their market power.

One of the smarter examples of a government-funded organisation's involvement in building the innovation ecosystem is the way that the Technology Strategy Board operates.    They have identified various social or business challenges where  innovation is necessary such as a low carbon or digital economy.     Their model is to organise an ecosystem approach to meeting the challenge by aligning start-ups and corporates to work closely to achieve success.

8.  Small Government = Strong Individuals

A  thriving "Entrepreneur Country" exists when small government begets strong individuals who are encouraged early on to understand they are the architects of their own destiny.   We will gain hugely towards achieving an Entrepreneur Country if we tie the outcomes of people's actions most directly to the effort they put into architecting their lives.   If the media then cover the achievement of the breakthrough moments in a more profound way, then the young learn that society does value risk-taking and achievement in new business and industries.   

9.  Britain can handle BIG

The United Kingdom is good at building frameworks for the next paradigm shift.   Witness the on-going role of the Royal Society, or Tim Berners Lee's role with the world wide web, Jonathan Ive's iPod, Robin Saxby's breakthrough with the ARM microchip, Dr Wolfram's Wolfram Alpha, Charles Dunstone's empire in mobile phones, or game-changers in the financial services sector like Travelez, Zopa, Egg, Monitise and Wonga.     

Part of the reason that the average 28 year old who is setting out to build his new venture thinks big is that he or she knows that Britain can do big.    Indeed, it has been "doing big" throughout its history.

We owe it to those creators of the next big thing to suspend disbelief and negativity, to find our optimism every morning, and to don the cloak of 'early believer' and facilitator of their success in every way that we can.

We are fortunate indeed that there are people in society who are obsessed to bring the new to life, and choose to live abnormal lives in the doing of it.

Our response to their drive and hard work should be an embrace and a recognition that while they conduct the orchestra, we play the flute, horn and keyboards.     

So I say it's actually very simple - Follow the Entrepreneur.   He or she has the market insight, is the creator of value, is the Hero.

So let's refuse to participate in this recession, and internalise  these nine points above which - I believe - will lead to understanding and living in Entrepreneur Country.

June 20, 2009

Happy Fathers Day - Fathers Be Good to Your Daughters..

http://www.youtube.com/watch?v=41-oA7HLonY 

I know a girl
She puts the color inside of my world
She's just like a maze
Where all of the walls all continually change
And I've done all I can
To stand on her steps with my heart in my hands
Now I'm starting to see
Maybe it's got nothing to do with me

Fathers be good to your daughters
Daughters will love like you do
Girls become lovers who turn into mothers
So mothers be good to your daughters too

Oh, you see that skin?
It's the same she's been standing in
Since the day she saw him walking away
Now she's left
Cleaning up the mess he made

Fathers be good to your daughters
Daughters will love like you do
Girls become lovers who turn into mothers
So mothers be good to your daughters too

Boys, you can break
You'll find out how much they can take
Boys will be strong
And boys soldier on
But boys would be gone without warmth from 
A woman's good, good heart

On behalf of every man
Looking out for every girl
You are the god and the weight of her world

So fathers be good to your daughters
Daughters will love like you do
Girls become lovers who turn into mothers
So mothers be good to your daughters, too
So mothers be good to your daughters, too
So mothers be good to your daughters, too 

May 24, 2009

Dispatch from Newcastle and Fontainebleau

Last week found me in Newcastle and Fontainebleau speaking at Entrepreneur Summits about Individual Capitalism and Following the Entrepreneur.   I'm helping Iqbal get some mileage out of his quote:

“Aid to governments has empowered authorities and not necessarily citizens. Mobile phones, the Internet and similar technologies that empower the individual turn that on its head, and shift the power to the Individual – making Individual Capitalism the force for prosperity and democracy in the 21st Century.” - Iqbal Quadir, founder of GrameenPhone

The highlights for me in Newcastle were meeting Sir Peter Vardy, the successful business person, http://en.wikipedia.org/wiki/Peter_Vardy_(businessman)  - after reading a lot about him, he didn't disappoint in person.   

And in Fontainebleau where I spent 1997 at INSEAD, I was able to meet the new Dean, Frank Brown, get back in touch with Raw Communications Ab Banerjee, who was way ahead of his time with Raw Communications [ultimately sold to Thomson], and get an update from Gwyn Jones who is building iSyndica, a virtual distribution server.    They were the team behind Vistaprint, a billion dollar successful ecommerce company.   http://corporate.isyndica.com/   This is a hot one.

And today Warren Cole on Dragon's Den Online pitches and secures investment... from me!   http://www.bbc.co.uk/dragonsden/  - - we'll be doing a lot with Warren this coming year, helping him to properly launch himself and his music.    If you are registered at Entrepreneur Country, you'll get a weekly digest on his launch and music.

I got an update from David Courtier-Dutton on SliceThePie  this week.   They continue to rock with their crowdsourcing model for unsigned artists; their artists are getting funded, and one may go big soon.     I was struck by David's comment - "We can only get really big if we stay really small".    He may have perfected the art of leveraging partners.    He's got some big announcements to come.

Opentable IPO last week - one can hope - is a sign of things loosening up and optimism returning:   http://venturebeat.com/2009/05/21/opentable-wins-big-with-hearty-ipo/ 

May 18, 2009

Talent Puzzle

Met a great young Swiss entrepreneur today - Virginia Raemy who is building a European Bounty.   They are creating a marketplace between corporates and recruiters and taking a cut for their work.   Very interesting model - Talent Puzzle - I have a good feeling about her.

Crazy Indian Videos - Cringe!!

http://www.youtube.com/watch?v=ZA1NoOOoaNw

The subtitles do an amazing job of saying what the video sounds like in English (with no translation whatsoever).

Billiards-Dominos.wmv - impressive

 

May 16, 2009

Nottingham, Liverpool

I spoke at the HSBC's Guru Dinner Series in Nottingham on Tuesday night, meeting Paul Gratton, the former CEO of Egg, who was there.    Egg was co-founded by my friend now deceased Richard Duvall.     Richard and I would meet up for drinks at Amaya, and plan how we were going to change the world.     He was so much fun, and I really loved him [as a friend].    

Thursday found me in Liverpool where we are advising Qire, a new voice company, Ariadne's second in the sector.     I spoke at the Software City Pre-Launch event.     The crowd seemed to love Churchill's quote - "As for me I am an optimist; it doesn't seem to be much use being anything else."

I missed the Astia reception and the Somesso conference - Arjen Strijker's social media forum - which is going from strength to strength.   Astia is one of the networks of powerful women from the Valley.

I've been reflecting a lot on marriage and divorce due to all the interesting media stories on said subjects:

·         Bryan Myerson recently showcased his polygamous lifestyle in the Evening Standard;

·         Jerry Hall's book deal feel through but it seems that the goods have been spilled all over the press.

I keep wondering if I'm just weird or what, but why do these women allow themselves to be treated this way?   I simply don't get it.

May 10, 2009

from the trenches

Good week - ended with  many wins for the week scrawled on our white board at global internatioal AQ for Ariadne Capital.

Monitise had its first week where it acquired 25,000 new customers.

We met the CEO of Eyeka which taps into the freelance creative community for brand and advertising work, but working with agencies.    It's a Gilles Babinet company, a leading French entrepreneur.     Ariadne met with Open Ad a while ago, but we found their projections to be unrealistic.  

Met a very hot company today - could be Ariadne's 4th Voice Application company

Julie

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