5 ms·

Open letter to a depressed VC (state of funding)

22 points by daleharvey 16y ago

daleharvey 16y ago
At the techrunch+engage event yesteday held in edinburgh, one of the investors bemoaned a lack of innovation in scottish startups. We have an excellent grassroots community growing and an abundance of engineering talent but still a relatively minor successes. The letter is from a local startup founder (who also started techmeetup) to the vc about the lack of bottom tier funding.
- timcederman 16y ago
  I wonder if it's a similar problem that is seen in Australia. Plenty of talented folks, but a real lack of innovation/big thinking. There are two main problems in Australia. 1. Lack of capital. Larger Australian companies and investors don't "get" the value and potential of startups, and there isn't a strong network of angels. I'm also shocked at some of the valuations I've seen in Australia for companies that end of raising a lot more overseas. A company that may be valued at 100k in Australia would be valued at 3 million in Silicon Valley. 2. Lack of gumption. There is this very odd cultural thing called "Tall Poppy Syndrome" in Australia, which is essentially that everyone should know there place - if you rise too high you'll get cut down. People aren't encouraged to think big.
  - starkfist 16y ago
    Tall Poppy Syndrome is not a cultural oddity. It's prevalent (but named differently) in Japan, Scandinavian countries, UK, Ireland, Germany, Canada, New Zealand, the Netherlands, economically depressed areas of the USA, most of the Midwest, and so on and so forth. I would wager that at least half of the world's cultures have the tendency to try to cut down the tall poppies...
    - gordonguthrie 16y ago
      Its a line from Livy's history of Rome. http://www.hup.harvard.edu/catalog.php?recid=24381 http://www.hup.harvard.edu/catalog.php?recid=24381 An early King of Rome sent his son out as a spy pretending to have run away from the tyranny of his father. Rome's enemies promoted him to a senior position. When their spys told him that his father was cutting down the tall poppies, this was the signal that he should mount a coup against the leadership of the enemy towns - which he did and they all fell under Rome's control.
    - timcederman 16y ago
      I wasn't saying that it was "odd" as in unique.
aditya 16y ago
I've heard this same story everywhere outside Silicon Valley; Not enough big exits, means not enough angels, means not enough seed capital, means too many service companies and almost no product companies. pg's talked a lot about being ramen profitable and as a decent engineer you should be able to put away $15k and take 3 months off to go build a startup. Except capital is only one piece of the puzzle. Building a real product company takes a lot more than just capital. I don't know what a good solution is, but atleast NYC seems to be solving it with pumping more early stage money into the system and slightly easier access to mentors. But even here we don't have a lot of people with the time, inclination and big exits behind them the mentor and nurture younger entrepreneurs...
- sachinag 16y ago
  You don't need mentors to have your company take off. You need a good idea, the ability (which includes runway, meaning cash) to execute, and the wisdom to learn from your mistakes. If you're a decent engineer with a little saved up, all you have to do is come up with (1) and recognize if you're capable of (3).
  - daleharvey 16y ago
    the only thing that is "needed" to succeed is a passionate and talented founder(s). everything else is about arbitrage and increasing the odds in which you can succeed, access to mentors and respected peers are undoubtedly a huge part of that, as the valley shows.
  - hga 16y ago
    You might not need mentors but I'll bet good ones help. There's a lot to learn in so many domains and good mentoring can speed up that learning substantially.

22 points by daleharvey 16y ago

At the techrunch+engage event yesteday held in edinburgh, one of the investors bemoaned a lack of innovation in scottish startups. We have an excellent grassroots community growing and an abundance of engineering talent but still a relatively minor successes. The letter is from a local startup founder (who also started techmeetup) to the vc about the lack of bottom tier funding.

timcederman 16y ago
I wonder if it's a similar problem that is seen in Australia. Plenty of talented folks, but a real lack of innovation/big thinking. There are two main problems in Australia. 1. Lack of capital. Larger Australian companies and investors don't "get" the value and potential of startups, and there isn't a strong network of angels. I'm also shocked at some of the valuations I've seen in Australia for companies that end of raising a lot more overseas. A company that may be valued at 100k in Australia would be valued at 3 million in Silicon Valley. 2. Lack of gumption. There is this very odd cultural thing called "Tall Poppy Syndrome" in Australia, which is essentially that everyone should know there place - if you rise too high you'll get cut down. People aren't encouraged to think big.
- starkfist 16y ago
  Tall Poppy Syndrome is not a cultural oddity. It's prevalent (but named differently) in Japan, Scandinavian countries, UK, Ireland, Germany, Canada, New Zealand, the Netherlands, economically depressed areas of the USA, most of the Midwest, and so on and so forth. I would wager that at least half of the world's cultures have the tendency to try to cut down the tall poppies...
  - gordonguthrie 16y ago
    Its a line from Livy's history of Rome. http://www.hup.harvard.edu/catalog.php?recid=24381 http://www.hup.harvard.edu/catalog.php?recid=24381 An early King of Rome sent his son out as a spy pretending to have run away from the tyranny of his father. Rome's enemies promoted him to a senior position. When their spys told him that his father was cutting down the tall poppies, this was the signal that he should mount a coup against the leadership of the enemy towns - which he did and they all fell under Rome's control.
  - timcederman 16y ago
    I wasn't saying that it was "odd" as in unique.

aditya 16y ago

I've heard this same story everywhere outside Silicon Valley; Not enough big exits, means not enough angels, means not enough seed capital, means too many service companies and almost no product companies. pg's talked a lot about being ramen profitable and as a decent engineer you should be able to put away $15k and take 3 months off to go build a startup. Except capital is only one piece of the puzzle. Building a real product company takes a lot more than just capital. I don't know what a good solution is, but atleast NYC seems to be solving it with pumping more early stage money into the system and slightly easier access to mentors. But even here we don't have a lot of people with the time, inclination and big exits behind them the mentor and nurture younger entrepreneurs...

sachinag 16y ago
You don't need mentors to have your company take off. You need a good idea, the ability (which includes runway, meaning cash) to execute, and the wisdom to learn from your mistakes. If you're a decent engineer with a little saved up, all you have to do is come up with (1) and recognize if you're capable of (3).
- daleharvey 16y ago
  the only thing that is "needed" to succeed is a passionate and talented founder(s). everything else is about arbitrage and increasing the odds in which you can succeed, access to mentors and respected peers are undoubtedly a huge part of that, as the valley shows.
- hga 16y ago
  You might not need mentors but I'll bet good ones help. There's a lot to learn in so many domains and good mentoring can speed up that learning substantially.