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The guide is simplistic and wildly overly optimistic -- a founder raising a Series A could not expect such fast progress, e.g., weeks. Much more realistic and

The guide is simplistic and wildly overly optimistic -- a founder raising a Series A could not expect such fast progress, e.g., weeks. Much more realistic and prudent are the common advice and reports of reality that fund raising is difficult and challenging, a full time job, with effort so large it is a risk to the startup, contacting hundreds of VCs, straining to get warm introductions, taking dozens, maybe 100+, of in person meetings, for just one check, much less several, and months of time. The firm is asking way too much in time, effort, and expenses from the founder, e.g., flying to meetings with VCs. A founder would need a significant source of funds just to apply as described. There is the pitch deck with more advice that is challenging but obscure. Bluntly, there are NO good guidelines, many guidelines that vary wildly and no good guidelines, for what should be in a pitch deck. As a result, if the VCs need something other than just a good version, well organized, with the information clear, the spelling correct, of a business document, then they are looking for something founders have no way to supply. Many VCs seem to want and expect to be swept off their feet by some block buster summer popcorn movie, but any such production is way too expensive in time, money, and effort for a Series A and close to irrelevant for serious business and financial work. The firm is basically asking that the founder have a going business, at least traction and, to be realistic, likely earnings. Given the earnings, there is considerable question if the founder needs or should accept an equity check. E.g., in the past, a Web site startup needed big bucks for Sun servers, etc. No more: $2000 in parts will build a very powerful server and the cloud can supply a lot of pay as you go server computing right away. Given the traction of the startup, the firm thinks WAY to much of the importance of their check. The OP has the simplistic notion that the VC check will be the crucial enabler for future rapid growth; that view is in strong conflict with how successful businesses commonly grow. Net, the firm, for the whole process, is asking WAY too much and giving and doing WAY too little. Heavily that view of a Series A is from a dream version of the VC industry from 10+ years ago. That part of VC is gone with the wind. There is still lots of opportunity to make money in information technology startups, but ideas as simple and profitable as, e.g., Hotmail, are long gone. IMHO, computer science and VC funded startups are out of sufficiently good new ideas, out of gas, at the end of the road. For computer science, programming language syntax, parsing, compiling, linking, fundamental algorithms, database, TCP/IP, etc. are rock solidly done work, but computer science doesn't know what to do next. Similarly for VC -- projects as simple as Hotmail are done. There is more to do and very much worth doing, but computer science and the VCs need to find some new directions. Again, once again, over again, yet again, one more time, we find that VCs who desperately need very rare and very exceptional projects are proceeding with simplistic attitudes no more serious than a family shopping for a standard SUV. There is a lot of very serious work in our economy in research, engineering, law, medicine, national security, and parts of finance, but Sand Hill Road and the OP are not nearly serious enough. In the end, instead of the OP, a founder of a rapidly growing startup should consider the common advice that they should just wait until a VC notices the startup and contacts the founder. In the meanwhile, the founder should just keep working on the business.

askafriend 8y ago
I upvoted your comment because you make some good points, but I lost you towards the end there when you boldly proclaim that we're out of good, big, impactful ideas. There is so much great work being done if you just look around a little bit. The advances in computation photography this decade are incredible. AR will be ubiquitous soon enough. VR has a chance to change how we communicate. There's autonomous sailing drones scouring the seas and mapping them out, streaming data back. There's tiny low cost satellites being launched frequently to image the planet. There's rapid progress on electric transportation in full swing. There's a lot of these areas that are funded in part by VC. The very nature of VC ensures that the quality of firms also follows the power law so it's not surprise that a majority of funds lack imagination. But if you look at the really great firms, they're still investing in big ideas. Sure they may not be the lowest hanging fruit in the field as you mention, but they aren't precluded from being big, or impactful ideas driven by technology.
- graycat 8y ago
  Yes, some of the photography is amazing. Part of the success is from some optics math on depth of field -- better with small cameras, and the solid state sensors permit that. E.g., the old idea was just a pinhole camera that didn't have to focus at all. Then the electronics and software processing the signal from the sensor can make the new, really small cameras look really smart. And you may have still more advanced work in mind. For AR and VR, I see some markets but am reluctant to expect wide usage. The last really big idea was, what, Facebook? I know: There have been a lot of $1+ billion exits since the start of Facebook, but I haven't kept up on the small fry!!! I started my career near DC in applied math and computing and there saw a lot of fantastic national security projects from research. E.g., I was in the group that did the Navy's version of GPS, before the USAF did GPS. There was some really nice math, physics, and research, powerful stuff, in that group. E.g., how to design a satellite that will orbit the earth not very high up and have essentially no "drag" at all? Cute. Important. In an important sense, GPS, etc., are information technology (IT), but from all I can see the role of applied math, physics, and research so heavily used by US national security is missing from Sand Hill Road funded IT projects. E.g., if I were looking for some promising background at Stanford, I'd go to D. Luenberger, B. Efron, or P. Diaconis and not the computer science department. At Berkeley I would have gone to one of my favorite authors, L. Breiman, but of course eventually the computer science people did that to some significant extent. For Breiman's boosting and bagging, I suspect some important connections with resampling and some math in a paper I published. I suspect that there is a nice, more powerful, valuable way to explain such ideas, maybe with connections with sufficient statistics. E.g., order statistics are always sufficient. But such things are not relevant to my startup and, thus, on the back burner. Bluntly the US DoD, NSF, NIH, etc. eagerly support and exploit research with a batting average much higher than VCs, while as best as I can see Sand Hill Road, for IT projects, hearing research, soils their clothes and runs to the rest room. It appears that Sand Hill Road believes that the "technology" in IT is mostly just software with no connections with anything new, correct, and significant from research. Yes, they are pursuing AI and ML, but my view is that those are not very promising directions. The VCs need stuff that, among other things, is NEW, and we know where the "new, significant, and correct" stuff comes from -- research. So far Sand Hill Road for IT (but not for bio-medical technology) has with great determination refused to have anything to do with research, even if already done, rock solid, in production quality code. So the VCs just want to see traction, significant and growing quickly "up and to the right". But the research is a crucial part of estimating the future of the company, past current traction. IMHO, Sand Hill Road needs to get serious about "new, correct, significant", powerful and valuable in IT.

askafriend 8y ago

I upvoted your comment because you make some good points, but I lost you towards the end there when you boldly proclaim that we're out of good, big, impactful ideas. There is so much great work being done if you just look around a little bit. The advances in computation photography this decade are incredible. AR will be ubiquitous soon enough. VR has a chance to change how we communicate. There's autonomous sailing drones scouring the seas and mapping them out, streaming data back. There's tiny low cost satellites being launched frequently to image the planet. There's rapid progress on electric transportation in full swing. There's a lot of these areas that are funded in part by VC. The very nature of VC ensures that the quality of firms also follows the power law so it's not surprise that a majority of funds lack imagination. But if you look at the really great firms, they're still investing in big ideas. Sure they may not be the lowest hanging fruit in the field as you mention, but they aren't precluded from being big, or impactful ideas driven by technology.

graycat 8y ago
Yes, some of the photography is amazing. Part of the success is from some optics math on depth of field -- better with small cameras, and the solid state sensors permit that. E.g., the old idea was just a pinhole camera that didn't have to focus at all. Then the electronics and software processing the signal from the sensor can make the new, really small cameras look really smart. And you may have still more advanced work in mind. For AR and VR, I see some markets but am reluctant to expect wide usage. The last really big idea was, what, Facebook? I know: There have been a lot of $1+ billion exits since the start of Facebook, but I haven't kept up on the small fry!!! I started my career near DC in applied math and computing and there saw a lot of fantastic national security projects from research. E.g., I was in the group that did the Navy's version of GPS, before the USAF did GPS. There was some really nice math, physics, and research, powerful stuff, in that group. E.g., how to design a satellite that will orbit the earth not very high up and have essentially no "drag" at all? Cute. Important. In an important sense, GPS, etc., are information technology (IT), but from all I can see the role of applied math, physics, and research so heavily used by US national security is missing from Sand Hill Road funded IT projects. E.g., if I were looking for some promising background at Stanford, I'd go to D. Luenberger, B. Efron, or P. Diaconis and not the computer science department. At Berkeley I would have gone to one of my favorite authors, L. Breiman, but of course eventually the computer science people did that to some significant extent. For Breiman's boosting and bagging, I suspect some important connections with resampling and some math in a paper I published. I suspect that there is a nice, more powerful, valuable way to explain such ideas, maybe with connections with sufficient statistics. E.g., order statistics are always sufficient. But such things are not relevant to my startup and, thus, on the back burner. Bluntly the US DoD, NSF, NIH, etc. eagerly support and exploit research with a batting average much higher than VCs, while as best as I can see Sand Hill Road, for IT projects, hearing research, soils their clothes and runs to the rest room. It appears that Sand Hill Road believes that the "technology" in IT is mostly just software with no connections with anything new, correct, and significant from research. Yes, they are pursuing AI and ML, but my view is that those are not very promising directions. The VCs need stuff that, among other things, is NEW, and we know where the "new, significant, and correct" stuff comes from -- research. So far Sand Hill Road for IT (but not for bio-medical technology) has with great determination refused to have anything to do with research, even if already done, rock solid, in production quality code. So the VCs just want to see traction, significant and growing quickly "up and to the right". But the research is a crucial part of estimating the future of the company, past current traction. IMHO, Sand Hill Road needs to get serious about "new, correct, significant", powerful and valuable in IT.