Friday Feb 06, 2009

What can you expect from a cloud?

What can a cloud bring you more than a traditional type of hosting?

The short answer: the advantages of virtualization without the inconvenient.

The detailed answer...[Read More]

Friday Jan 30, 2009

Startup Essentials January News Letter


Offers & Resources

Storage Systems Now at Up to 70% Off List Price
On November 18th, Sun introduced a new line of Open Storage appliances, Sun Storage 7000 Unified Storage Systems, also known as "Amber Road." Sun Startup Essentials program members can buy these systems right now at up to 70% off list - with member prices starting at €4.950.  At this discount, Amber Road storage can cost less than €0,80/GB!  Find out more! 

Low Cost Solutions for Web Applications
When used together, MySQL and GlassFish provide an excellent, low-cost solution for quickly developing and deploying web applications that are not only secure and reliable, but also scale to meet increasing demand and are highly responsive to user requests. Find out more in Part 1 and Part 2 of this article.

What's Cool

Is your startup a software developer or system integrator?
If so, you can promote your apps in the Sun Solution Catalog, in addition to taking advantage of:
  • Remote computing infrastructures to tune, benchmark and test your software solutions on Solaris platforms - SPARC and x86
  • Go-to-market opportunities with Sun around the world
  • Developer tools and specific technical support and training, and much more!
Register now to the Sun Partner Advantage Program!  It's free!!

Events

Meet Us At:
Israel MySQL User Group Kickoff Event - January 29, Tel Aviv, Israel
Startup Camp Event - January 31, Basel, Switzerland
FOSDEM - February 7-8, Brussels, Belgium
Startup Camp Event - March 6, Cologne, Germany
ETech - Emerging Technology Conference, March 9-12, San Jose, CA, USA. Use discount code et09sed when you register for a 20% discount
PLUGG - Web 2.0 Startup Conference, March 12, Brussels, Belgium
DevDusk - March 19, Frankfurt, Germany
NextWeb - April 15-17, Amsterdam, The Netherlands
Our full calendar is posted on blog (upper right hand corner).

JavaOne Special for Sun Startup Essentials Members Only
Would you like to be an exhibitor at our next 2009 JavaOne Conference, June 2-5?
As a Sun Startup Essentials member, you're entitled to 10% off the price of the Startup Exhibit package, which is USD$3.600 (€2.732) - normally USD$4.000 €3,036). Please contact Leslie Jones, Leslie.Jones@gpj.com, to request the Startup Exhibitor prospectus.

Startup of the Month

Flexilis Inc. Develops Mobile Device Security Solution with MySQL & Sun Servers
Flexilis offers mobile security solutions designed specifically for mobile devices. Scalable to support both individuals and global corporations, Flexilis protects mobile devices against threats including, viruses, malware, spam, lost or stolen devices and hackers. In addition, users gain the protection of a secure, global communication link to the Internet.


Was this information helpful?  Please send your comments and suggestions to: sse-newsletter-feedback@sun.com

Soundcloud up and running on Sun servers, Solaris and a mixed architecture.

http://blog.soundcloud.com/2009/01/29/faster/

So Sun is great at making clever hardware and software, glue it together and it works, but its our partners that deliver and deploy this, so Ive been working with Every City since last summer, they are a Startup Essential member, and have moved to a Sun/Solaris infrastructure through their own decision. What really makes a difference is their personal focus, by being part of the community, they understand the pain points and how to solve the problems that exist, and this shines through so much with SoundCloud. So a big massive thanks to Every City for listening, and deploying a solution that is flying, at a price point the startup can afford and also buying the beer for startups as well..


Sunday Jan 25, 2009

CloudCamp London #3

London CloudCamp #3 Logo

cloudcamp.com/london

Date: Thursday, March 12, 2009 from 6:45 PM - 10:00 PM (GMT)
Location: Queen Elizabeth II Conference Centre, Westminster

It can also be found in the calendar in the sidebar :-) feel free to subscribe!

Matt

Friday Jan 23, 2009

Techfluff TV Episode 6

The latest edition of Techfluff TV is live now, and sponsored by Startup Essentials. I think it was my hat that forced Hermione to use the beach scene :-))

We’ve gone all exotic on you this week, broadcasting from one of the most idyllic places on the planet. Also, we bring you the latest in the Yelp vs Qype saga, watch an ‘interesting’ take on the start-up pitch and put your questions to top entrepreneur Alex Hoye of Seedcamp.


UK Startups - Accept it, failure is good

Startups in the UK are always under pressure, to succeed, whilst in the US failure means something different, just get on with it and try again. Ive highlighted this video from Honda, that shows Failure is something we should all learn from and move forward, I never failed it just didnt work 10,000 times is the classic statement from Eddison.

So UK startups and EMEA startups, go out, strive to be the best and accept failure and your mistakes as it will make your business more successful over time.


Wednesday Jan 21, 2009

You looking to recruit high class developer ? one that worked on iplayer.....

Are you looking to outsource some of that development work ?

Are you unable to get the correct skills or person to finish that project off ?

 Well a good friend of mine, who I can vouch for, is available at present and has the following background and skills.


- 10 years of development experience, have worked in BBC iPlayer, eBay product development, Many Startups in UK, USA
- Development using PHP5, Zend Framework, PHP Dcotrine (ORM), JQuery, Smarty, MySQL, Memcached
- Database modeling, Schema/Table Designs, SQL Query development
- Expert in managing the complete Development- Integration -Live life cycle of product development
- Capable of developing application from web tier to backend

- Development using Java 5, Spring, Hibernate, Web services (I was involved in BBC iPlayer product development)
- Have developed products in media, Social Networking, insurance service, betting, telecom service delivery domains

- Hands on in UML, Class diagrams, Requirement analysis, scrum planning
- Proficient in Development and maintenance of products on Solaris, Linux

Contact me directly stewart.townsend(at)sun.com and Ill do an introduction for you.

Want to expand to the US ? Learn what the legal implications are on Feb 19th at a Free Seminar in London

Two Nations Divided by a Common Language:

Leaping Across the Pond to the U.S.

A U.S. Legal Roadmap for Expanding U.K. Technology Companies

Winston & Strawn, in collaboration with UK Trade & Investment, invites you to join us for a practical, interactive seminar designed to equip you with the information you'll need to expand your business to the United States.  Far from an ordinary lecture on the U.S. legal system, you'll hear from experienced U.S. lawyers – live in London and in the U.S.– who will provide real world advice to help you successfully navigate the complexities and avoid the pitfalls as you plan to enter the U.S. market.

To complete the picture, you'll hear from UK business people who have successfully made the jump to the US tell how they did it, so you can learn from their experiences before you begin your own journey.  After the presentations, the experts will be available for one-on-one discussions in an informal networking environment.  

Hear the latest best practices and get answers to your questions on the following critical issues:

Setting Up - Where and how to create a U.S. entity, corporate contractual issues and dispute resolution;

Staffing Up - Policies and practices to keep your business in line with federal and state labor law requirements;

Paying Up - What you need to know about international, federal, state, and local tax issues; 

Keeping Up - How to protect trade secrets and manage your intellectual property rights and unique Web 2.0 issues.

Any company considering expansion to the U.S. should not miss this informative and entertaining session!

For more details and registration go to :

http://www.amiando.com/winston.html
and use registration code UK2US.

Tuesday Jan 06, 2009

Cloud Relationship Model

Hiya All, welcome to my first guest post at Startup Essentials; today I'm going to be talking about the cloud relationship model I've developed and it's use as an artefact when discussing cloud computing.

I wanted a simply model which I could share with people and use as a discussion point, whilst still capturing the major areas of cloud computing which I considered most pertinent.  I developed a model about six months ago and have since found it useful when talking with people about cloud computing.

Here's the model and I'll go though it's major elements below.


Major Cloud Communities

In the cloud there are three major participants:

  1. the Cloud Providers; building out Clouds, for instance Google, Amazon, etc. Effectivetively technology providers.
  2. the Cloud Adopters / Developers; those developing services over the Cloud and some becoming the first generation of Cloud ISVs.  I have included Cloud "Service" developers and Cloud ISV developers together. This group are effectively service enablers.
  3. Cloud "End" Users; those using Cloud provisioned services, often without knowing that they are cloud provisioned, the most obvious example of which are the multitude of Facebook users who have no idea there favorite FB app. is running on AWS. These are the service consumers.

I think it's important to talk about these communities because I keep hearing lots about the Cloud Providers, and even more about the issues and 'needs' of the Cloud adopters / developers, but very little in terms of Cloud "End" Users.  In a computing eco-system such as this where "services" are supported by and transverse technology providers, service enablers and service consumers an end to end understanding of how this affects these reliant communities is required. Obvious issues such as SLAs for end users and businesses which rely upon high availability and high uptime from there cloud providers come to mind; however other "ilities" and systemic qualities come to mind such as security, and that's before looking at any detailed breakdown of functional services.

The point here is that the cloud adopters / developers and interestingly the cloud "watchers" (i.e. the press, media, bloggers and experts) would be mindful to remember the needs and requirements of genuine end users; for myself it'd certainly be invigorating to hear more on this topic area.

Billing / Engagement Models

Simon Wardley, a much more eloquent public speaker than myself, does a wonderful pitch which includes a look at the different "as a Service types" which he boils down to being a load of "\*aaS" (very amusing, and informative, try and catch Simon presenting if you can).

I wholeheartedly agree that there is a large amount of befuddlement when it comes to the differing "\*aaS" types and sub-types, and new ones are springing up relatively frequently, however I also think it's important to not ignore the differences between them.

For me, and many others, I think first popularised by the "Partly Cloudy - Blue-Sky Thinking About Cloud Computing" white paper from the 451 Group, the differing "\*aaS" variants are identified as billing and engagement models.  That white paper also postulates the five major Cloud Computing provider models, into which the majority of minor "\*aaS" variants fall.  They are:

  1. Managed Service Provision (MSP); not only are you hiring your service from the cloud, you've someone to run and maintain it too.
  2. Software as a Service (SaaS); pretty much ubiquitous as a term and usually typified by Salesforce.com, who are the SaaS poster child.
  3. Platform as a Service (PaaS); the application platform most commonly associated with Amazon Web Services.
  4. Infrastructure as a Service (IaaS);
  5. Hosting 2.0

One of the best breakdowns and visual analysis of this space is the model in Peter Laird's "Understanding the Cloud Computing/SaaS/PaaS markets: a Map of the Players in the Industry" article which is well worth a read.

Major Architectural Layers

Also included in the diagram are the major architectural layers that are included in each of the above billing / engagement models offered by the Cloud providers. They are:

  1. Operations; and this really is operations supporting functional business processes, rather than supporting the technology itself.
  2. Service layer; made up of application code, bespoke code, high-level ISV offerings.
  3. Platform layer; made up of standard platform software i.e. app. servers, DB servers, web servers, etc., and an example implementation would be a LAMP stack.
  4. Infrastructure layer; made up of (i) infrastructure software (i.e.virtualisation and OS software), (ii) the hardware platform and server infrastructure, and (iii) the storage platform.
  5. Network layer; made up of routers, firewalls, gateways, and other network technology.

This rather oversimplifies the architecture, as it's important to note that each of the cloud billing / engagement models use capabilities from each of the above architectural layers; for instance their can be a lot of service simply in managing a network, however these describe the major architectural components (which support the service being procured), not simply ancillary functions, effectively what are the cloud providers customers principally paying for. 

Delta of Effort / Delta of Opportunity

This is much more than the 'gap' between the cloud providers and the cloud users, wherein the cloud adopters / developers sit, the gap between the cloud providers and the end cloud users can be called the delta of effort, but also the delta of opportunity.

It is the delta of effort in terms of skills, abilities, experience and technology that the cloud adopter needs to deliver a functional service to their own “End Users”.  This will be potentially a major area of cost to the cloud adopters. But it's also the delta of opportunity;in terms of 'room' to innovate.

The more capability procured from the cloud provider (i.e. higher up the stack as a whole), the less you have to do (and procure) yourself.  However the less procured from the cloud provider the more opportunity you have engineer a differentiating technology stack yourself.  This itself has it's disadvantages because the cloud adopters / developers could potentially not realise the true and best value of their cloud providers infrastructure.

I suspect that there is an optimum level, around the Platform Layer, which abstracts enough complexity away (i.e. you don't have to procure servers, networks, implementation or technology operations staff), but also leaves enough room to innovate and produce software engineered value.  Arguably the only current successful cloud provider, based upon market share, perception, revenue and customer take up, is Amazon Web Services (AWS) who provide a PaaS offering.

Summary

Hope you enjoyed the article, in summary if developing cloud services or even building out a cloud infrastructure I would recommend that you focus on your users and if your a cloud provider, your users' users; remembering that only a certain percentage of those users will be customers (I won't getting into discussing Chris Anderson's 5% recommended conversion rate for the long tail, however I would recommend understanding what some of those calculations might be).

If you're looking to develop services over the cloud, think carefully about where you and your teams skills lie, and where would you most want them focusing there efforts; working on installing and tuning operating systems and application platforms or writing business value focused applications and services, before choosing at which level to engage with your cloud provider(s).  

I haven't mentioned enterprise adoption of cloud based services, and that's because I'd like to post that in the near future in a different article.

Hope you enjoyed the article and all the best,

Wayne Horkan

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    Monday Jan 05, 2009

    i2m Research Snapshot: IP Protection


    1 in 3 entrepreneurs unlikely to legally protect their Intellectual Property


    Market research software providers i2m – Ideas to Market, have published research results into entrepreneurs, start-ups and small businesses. A special preview of these results shows that:


    29% do not intend to protect to protect their Intellectual Property at all


    The single most popular method of protection is an international patent


    Just 4% do not know which protection methods, if any, they intend to use


    i2m surveyed over 800 budding entrepreneurs and small business owners over the course of 2008, investigating their standing and attitudes in a number of key areas including: finance, market research, sales and marketing and business exploitation.
    Participants were asked how they intended to protect their Intellectual Property. The most popular response with 29% of respondents was “no protection at all”. In selecting this option, 29% participants are ignoring the numerous basic ways of protecting themselves such as claiming copyright and design rights for their work. These methods however were selected by 23% of participants with a further 18% selecting them in combination with other methods.

    24% of participants intended to seek an international patent, making it the single most popular method of protection in the study.  Only 4% did not know which protection methods, if any, they intend to use, suggesting that this is a business subject that most people are aware of and have an opinion on.

    David Thomas, managing director of i2m Software commented, “businesses, especially those looking to patent, should look at protecting their intellectual property as an economic decision, weighing up the costs of not protecting themselves against competitors, versus the legal cost associated with protection and the return on investment it may bring.

    Jane Lambert, intellectual property specialist counsel of NIPC, noted that these figures were consistent with many similar surveys and they are not in the least bit surprising. “The problem is that the cost of enforcement of intellectual property rights is prohibitive in England and Wales. According to the government’s own Intellectual Property Advisory Committee, the average cost of bringing an infringement claim to trial is £150,000 to £250,000 in the Patents County Court and £1 million plus in the High Court compared to around €50,000 in France, Germany or the Netherlands.   That no doubt explains why the UK (the country that started the industrial revolution) lags consistently behind not only the USA, Germany, Japan and France in the number of European patent applications but even the Netherlands and Switzerland which have a third and an eighth of our population respectively.  It is often said that businesspeople do not fully understand the intellectual property system. These results indicate that they understand it only too well.”



    A full set of i2m’s research results will be published early next year. For more details please contact David Thomas at d.thomas@inventya.com.

    1.About i2m Software
    i2m Software was created by UK based market research consultancy Inventya Limited. i2m is market research software for business planning, financial forecasting and professionally presenting an investment case. From entrepreneurs with new ideas to students with business projects to women seeking a return to work, i2m provides the guidance, support and resources to start a business and grow it.

    2.About NICP
    NIPC is the first and so far only specialist intellectual property chambers outside London and the only one anywhere to specialize in assisting small and medium enterprises.   For more information, visit our website at www.nipclaw.com and blog at http://nipclaw.blogspot.com .

    Wednesday Dec 17, 2008

    ZFS Discovery Days


    Featuring a live demonstration of the Sun Zettabyte File System (ZFS) working with Sun Open Storage hardware

    Understand how to take full advantage of ZFS features using Sun's World Leading Coolthreads servers, Sun X64 servers and Sun's Open Storage arrays.

    ZFS simplifies file and volume management whilst dramatically reducing operating costs and increasing data consistency

    • The massive growth and diversity of storage requirements means that it is becoming complex and expensive to manage your data using traditional file systems and volume managers
    • With traditional solutions, there is no guarantee that data has not been 'silently corrupted' somewhere in the system, however expensive your storage array
    • Many traditional solutions are inflexible when data requirements change leading to over-provisioning or downtime for re-builds
    • Storage software, to perform tasks such as Snapshots and Replication, can often be as expensive as the hardware and involve additional costs when hardware is upgraded
    • ZFS changes all of this...removing the need for volume managers and providing end to end checksums meaning that data integrity is maximised, regardless of the type of storage device used. ZFS is fully integrated at zero cost with Sun Solaris 10 on more than 1,000 multi-vendor Sparc and X86 platforms.
    • For the first time, it is feasible to deploy low cost Open Storage hardware, such as Sun's JBOD arrays or Sun's X4500 data server, but deliver the performance and data integrity of solutions costing 10 times more.

    Now you can see this in action and get detailed information on best practices and strategies

    Attend our ZFS Discovery Day. A Sun expert will explain the design concepts of ZFS and outline Sun's open storage strategy. Delegates will learn how to set up file systems using ZFS and how to employ in-built facilities such as copy on write snapshots and data replication, and all of this will be demonstrated using the latest Sun CMT and X64 servers, combined with the latest open storage hardware. Delegates will then take a look at how ZFS and Solid State Disks can be combined to accelerate application performance. Various usage scenarios will then be demonstrated, such as MySQL, replication and porting from a legacy volume manager in a 'live' application environment. The session will conclude by demonstrating the Common Array Manager and with an investigation into the savings in total cost of ownership.

    Sun and ZFS can help you dramatically reduce your acquisition and operating costs, whilst providing the performance and security that is delivered through this advanced file system. Stop using technology that was designed for 20th century systems....move into the 21st century with Sun and ZFS.

    REGISTER HERE NOW 

    Monday Dec 08, 2008

    Slap a CEO with a fish



    SLAP THIS MAN WITH A BIG WET FISH

    Web entrepreneur is either very brave or very stupid…

    Jay Nguyen is CEO of Sweemo.com, and in a blatant attempt to publicise his new auction website he has agreed to allow one lucky bidder the sheer satisfaction of slapping him around the face with a large wet fish. Jay said “Who hasn’t ever wanted to slap someone in the face with a fish? The irritating co-worker, the smug traffic warden. I am giving people the opportunity to take out some of life’s little injustices on me. If it helps publicise the site then I say fair dinkum!”

    Sweemo gets its name from a shortening of "Sweet Moments", and allows users to auction unique real-life experiences to the highest bidder.  From Wet and Wild Zorbing with Models' to learning a few chords on the guitar Sweemo truly offers everyone something that they can cherish. Like the chance to slap a Chief Executive with a fish.

    Today sees the opening of the live auction on Sweemo.com, in which users will bid for the chance to swing a 7kg Organic Scottish Salmon at the brave entrepreneur. This selection of aquatic weaponry was not taken lightly however. Jay consulted the Marine Conservation Society (who will be receiving the proceeds of the auction as a donation) in order to ensure the species of fish chosen was sourced in a sustainable manner. Jay commented “Violence to my person is only acceptable if undertaken with a sustainable fish. I feel very strongly about that”.

    Jay also carried out rigorous weighing and grip tests to ensure that the fish has the properties expected of a ‘slapping’ device.

    So determined is Jay to be slapped by one of his life-loving Sweemo users, that he is willing to fly the auction winner to London in order to take part in the unique experience. So no matter whether the winner is in New York or Bolton Jay will be waiting at arrivals armed with a salmon and a smile.

    The auction closes on Thurs 11th of December and the slapping will take place in central London on the Weds 17th. Video footage will be made available on the day. It is expected that a number of people will attend the public slapping including Jay’s ex-girlfriends and other adversaries.

    Jay commented “Sweemo is so much more than just an online auction. We are motivating and inspiring people to recognise the incredible experiences within their own lives and making them available to others. And there is no better way of celebrating this lust for life than being slapped with a 7kg fish… is there?”

    Check out the auction at Sweemo to see how high the expected bidding war has escalated

    Techfluff.tv sponsored by Startup Essentials - Episode Two


    Episode Two of Techfluff.tv brought to you by Startup Essentials, a round up of the UK Startup Scene.

    Check out the santa hats in Chinwag live and of course the Escalator pitch with the lovely Alicia from Skimlinks and to top the show,  Mike The Butcher and his knife answering the questions on ask the expert.

    December bargains for you, and you and you........

    Its nearly christmas, so lets get in the festive spirit and make some offers now.....are you looking to purchase some low cost servers ? Want some Enterprise ones ? Check these out now...pictures of beauty.

    X4150:

    2x Intel Xeon Quad Core (2.33GHz)

    8GB memory

    4 X146 gb SAS HDD

    DVD+/-RW drive  

    £1500


    X2200M2:

    2x AMD Dual Core (2.6 GHz)

    4GB memory

    250 SATA HDD

    DVD-ROM   

    £760


    Ultra 24:Workstation

    1x QX6850 Intel Core 2 Extreme Quad Core (3.0 GHz)

    2GB memory

    250GB SATA HD

    NVS290 graphics card

    DVD-Dual  

    £370

    These are all limited stock and available now.....call 01344 429218 now or email info@startupessentials.co.uk  for more information.

    Or GO HERE for the latest price list

    Guest Post - Jof Arnold - VCs will die MEME

    VC will not die. There, I’ve said it. Again. This post addresses a number of points raised in a TC.com article which I feel are misleading.

    [Edit 2: VC = Venture Capital or Venture Capitalist in this context.]

    First though, let me open by mentioning a few things which are important background information to this post (and will help you decide if you want to read it further):

    • My degree was in mechanical engineering, not economics.
    • I’ve only been in the web industry since July 2007.
    • I’ve tried, and failed, to raise VC money for a startup.
    • I had a startup until recently.
    • 99% of all the people I know, and drink with, are in startups.

    The only reason I think I’m qualified to write this post is that I count amongst my good friends a number of VCs who’ve taken time to explain the industry to me over numerous beers/breakfasts. [Eternally grateful, btw; you know who you are ;-)]

    So, on to the opinions:

    Successful web companies are expensive (features aren’t)

    Bedroom successes like HotOrNOt - and TC.com for that matter - tend to give the impression that anyone with wordpress and EC2 can make a multi-million dollar web company in minutes. There are some occasions where this can happen, but as witnessed by the endless stream of tiny web companies that come and go, this is a rarity and not the norm. The key reason is that margins in web apps tend to be quite small (eg ads), so to start making serious cash you need scale.

    Unfortunately, scaling isn’t just about having the latest elastic-cloud infrastructure; it’s much more about brand, design, advertising and marketing… and that is where things start to get seriously expensive. For example, Netflix is reputed to spend >$1m pcm on marketing alone!

    A web app is not a company. It’s a feature. Don’t forget that.

    “But I’ll grow it organically”. WRONG. WRONG WRONG!!!

    Or rather “Perhaps, but unlikely”. But I understand where you got that notion from and I admit I was duped at first also; it’s all this talk about things “going viral” isn’t it? Well, sorry to disappoint but it just isn’t true for most people. Build it and they probably won’t come.

    Let’s suppose you build a really awesome web service/app that could appeal to 1 in 100 people in the entire world - a huge potential market of 70m users. That means you need to speak to 100 people before you stand a chance of even one of them telling someone else about it. And they will have to tell another 100 and so on. The problem is, most people outside of the web community communicate with <50 people on a regular basis so the maths are against you.

    All the while you are doing this slow ramp-up, someone else is going to borrow $Xm VC money, get a serious campaign together and obliterate you by seeding their brand in front of millions of individuals.  They’ll also have the money to hire the staff necessary to support such success.

    And let’s not even consider the notion that by the time you’ve organically grown your startup to the point you can start making money, the world will have moved on.

    Other fish

    Sometimes I wonder if web tech people bury their heads in the sand a little too much when it comes to things outside their industry. If that’s you then I have a newsflash: early stage web tech is not - and hasn’t been for a long time - the pillar of many VC portfolios. I know the tech industry think it’s the be-all and end-all because they always seem surprised when big firms like 3i pull out of early-stage.

    VC is all about investing large sums of money at high risk (which means new markets usually) for ridiculously high returns.  The fact that the technology side of web tech has been commoditised and ubiquitous means that in the most part the web is no long as hot as it was 5-10 years ago. What’s hot now is greentech - and there VCs are like pigs in shit; high startup costs, high risk, massive returns.  VCs haven’t died - they’ve just moved on to pastures new.

    Ok, so I’ll build my startup without VCs

    Most people (I can list the exceptions - there aren’t many) shouldn’t build a business on the assumption of funding ANYWAY - in any market conditions. I admit I’ve made this mistake and it was the reason why we closed our first startup this year; the business wasn’t predicted to breakeven for a long time and required two rounds of VC money to be interesting. And let’s face it, how many VCs in the UK were going to fund something that risky when they didn’t understand the business and we were a bunch of first-timers.

    But never mind the scarcity of money - you all know you are going to be shafted if you get funding early-stage, right? Simple rule: don’t take money when you need it. If VCs are approaching YOU for a slice of the action, then it might be worth considering what they have to offer because you know you can refuse any bum deals.

    Sour grapes

    I lept from my previous job into the tech industry because I saw a lot of incredible startup exits and wanted a piece of the action. It helps to be honest about these things. I wanted to be rich. But right from the start I knew my experience, knowledge and plain odds were against me so I spent a long time getting to know the market and the people. I also joined/founded a startup fairly early in my web career so as to see what it was like on the frontline.

    As I see it, the audiences of many tech blogs consist of a lot of people like me, but where I think many of them differ is in the sour grapes department. I get the impression that many people feel it’s some sort of RIGHT that they sell their niche app to Google for billions. By virtue of being denied success they have an in-built desire to dismiss the opportunies/success of others… and what better symbol of success in the web industry is there - second to an exit - than raising VC money.

    By dissing VC’s, they are secretly saying “fuck you for not making me successful”. And probably a little bit of “but I’ll take your money if you have some, please”

    Finally, it’s entrepreneurship!

    Most of what’s above is my naive interpretation of the world around me. But there’s a powerful force behind all this which guarantees there will always be VC - and that, dear reader, is entrepreneurship… or perhaps it’s capitalism, to be more brutal about it.

    If I’ve branded and targetted this blog well enough you are probably a founder of a startup - or at least involved in one. So you’ll know all about how you saw an opportunity and invested in it with your intellectual (and possibly financial) capital. When dissing the VC model, consider: Why didn’t anyone else do it? Why did you choose that particular thing? Would you choose something else if only you had more money or more skills?

    The fact you are able to start a startup is because you have something that someone else doesn’t - and you are leveraging that gap. Angel investors work on a similar principle, only they also bring lots of money; they use the fact that they have money, when others don’t, to take opportunities that might not be available to them otherwise. They are, in effect, also entrepreneurs in the same way entrepreneurs are investors.

    But what of people or organizations with vast amounts of money? Well, they have another layer of resource; people. These groups/individuals split their large sums of money amongst smaller groups who can invest it for them - which in a crude sense is how VCs work.

    So as for VCs dying, I think that’s highly unlikely. Provided there are people with large sums of money to invest, there will also be experts who will step in and help them. What do you think? Comment me!

    [Edit: in case you skipped to the end, I do indirectly make the point that I don't expect web startups to find raising VC easy. The writing has been on the wall for early-stage VC for a long time]

    This is a guest post from Jof Arnold 

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