Always New Mistakes

December 13, 2010

Beware of those who say they help entrepreneurs

Filed under: Conference, entrepreneur — Tags: , , , , — Alex Barrera @ 3:00 pm

I recently attended one of the most shameful events I’ve been to in a long time. Being and entrepreneur myself and collaborating in so many ways (Tetuan Valley, Okuri Ventures, Sandbox, Startup Digest) with other entrepreneurs around the world, I was excited to attend the opening of the MIT Enterprise Forum chapter in Spain. Nothing could have prepared me to the disastrous event I was about to attend. So many people share my views, but no one wants to write them down, so here there are:

I got to the event just in time, just to realize that something was extremely wrong, the president of the MIT Spanish chapter was reading the presentation speech. Having been to so many events and talks, I can tell you, that’s never a good sign. As it happens, it wasn’t, things got much worse as time went by. A round table of “experts” talking about how Spain should help entrepreneurs just made my day. The amount of incoherent ideas, half truths, PR bullshit and just plain ignorant talk was overwealming. I just have to feel sorry for one of the speakers which is a friend and by the look of his face you could see he was as shamed as we were.

Anyhow, one of they things I realized is how dangerous these people can be. There we were, a room packed with people, everyone listening. The problem was, except for our friend, none of the speakers had real entrepreneur experience. Maybe it’s me, being an engineer turns you into a meritocratic person by default, nevertheless, I’ve always thought that if you want to fix a something, first you need to know where the problem is. In my eyes, that was the biggest problem, none of them knew anything about where that laid. Now, it wouldn’t be a problem if these people were regular folks, but they weren’t. They were smart and powerful people. They run big VCs (or so they call themselves in Spain), entrepreneur programs, consulting firms, etc.

What baffled me was that they hadn’t a clue about entrepreneurship, startups or their suffering. Even among them, they couldn’t agree as to what was best for entrepreneurs. The amazing thing was that, from the amount of suits I counted in the room, the percentage of entrepreneurs attending the talk was below 1%. So, in the end, you had, a packed room of non entrepreneurs, listening to a bunch of people talking about a topic that they had absolutely no idea.

This is the thing, a banker that creates a startup competition thinks that gives him uber knowledge on their problems. Truth is, the banker never gets to talk with the entrepreneurs. Not the ones attending his program, not the ones elsewhere. An MBA person, with expertise in finance and buyout operations, that has being doing buyouts and M&A for large (> 100) corporations during the past 6 years thinks he knows entrepreneurs. But I wonder if he’s ever seen a startup with less than 3 people or even talks with entrepreneurs. I’m sorry but working with a corporation has absolutely nothing to do with bootstraping a company in the turmoil of a worldwide economic recession. A doctor working at a hospital has even less idea of what’s in an entrepreneur’s mind. Yes, he opened several new facilities within the hospital, but excuse me if that’s even remotely similar to trying to raise capital for a crazy risky idea. Then we have the typical VC profile. X years in a consulting firm doing private equity and M&A operations. Yes, you meet so many entrepreneurs doing that… and of course, regular VC has so many real interactions with entrepreneurs I just can’t imagine why I’m even writing this (for the record, there is sarcasm here). An finally, but not least, you have the MIT Enterprise Forum chairman. First of all, how can you even speak of funding in Spain when you’ve never started a company in Spain. It just amazes me how easy it is for him to repeat what others say with absolutely a complete ignorance of a countries specific problems. But most importantly, how is it possible that being an entrepreneurs himself, he allows this mummers farce to go on. Shame on him and shame on the MIT.

If MIT thinks that having such a sorry lot talk shit about how to help entrepreneurs, giving a talk with NO Q&A and call it “Forum” and most interestingly, stressing the importance of doing networking, but kicking everyone out to the street after the talk is done, then that’s the reason why most real entrepreneurs end up in California an desert Massachusets.

So, people, please, be critic, and be careful with those that preach that they are champions of the entrepreneur cause when in reality they’re far detached from their real day to day world.

Oh, by the way, I would link to their webpage but they’ve run out of quota: “This account has been suspended. Either the domain has been overused, or the reseller ran out of resources.”

December 5, 2010

Localization Wars: Facebook vs Foursquare

Filed under: Technology — Tags: , , , , , , , — Alex Barrera @ 7:17 pm

Some months ago, Facebook unveiled their location strategy aka Facebook Places. It comes as now surprise that the next move from them was getting into location. After buying Friendfeed, copying Twitter, it’s the turn of Foursquare and Gowalla.

Most of the discussion going around is centered around the struggle between Facebook and Foursquare. Even though Facebook has been saying they’ve been working with them, it’s crystal clear, the new announcement has hurt them in a really bad way.

So, the big question, will Facebook outflank Foursquare? I’m afraid the odds of Foursquare winning this battle are rather thin. The key driver in the location space is the user base of these systems. The more people checking in and leaving geotags the more useful the system becomes. In that aspect, Facebook just dwarfs Foursquare.

Not only that, but to use those systems you need a specific app. Problem is that most people already have the Facebook app, getting into Foursquare would mean going through the extra hassle of downloading and configuring a new app, while the Facebook app not only has a much larger audience, but it comes preconfigured in most new smartphones.

Now, what could Foursquare do to fight back? It’s clear they really need to differentiate themselves from Facebook. They need something that you can only get on Foursquare and not from Facebook. I’m not sure if that’s something they’re going to be capable of doing if Facebook plays their cards correctly. Any new feature that gets any traction can be easily replicated by Facebook. They only possible way is to make something so different from the Facebook genoma that they won’t be able to replicate it because it goes against the Facebook strategy.

For example, even though they tried to transform the news feed into the Twitter feed, the Twitter audience kept using Twitter. The main reason is in how different the follow/followers dynamics are from the friend/no friend dynamics of Facebook. That simple thing is what really prevents Facebook from collapsing Twitter. The thing is that Facebook can’t change the way the deal with social relations in an easy was because that would mean changing the core dynamics of the company. Something like that is what Foursquare should pull out of their sleeve if they want to stay alive.

Many people have been saying that what the location space needs is a shared geolocation database, maintained by several companies so that each company could focus on developing cool things on top of it. With Facebook on the loose, they’re saying that Facebook could become the maintainer of that database. The problem is that, while the original hypothesis made sense, the Facebook one is extremely dangerous. The first one assumed several guardians, the second one just one, Facebook. Needless to say that having Facebook control the whole location data is like handing the keys of your kingdom. Information and data is key here, even though it’s a tedious task, it’s critical to build features that allow you to differentiate from Facebook.

Let the geowars begin!! Any comments? Insights? Should have Foursquare planned for this attack before hand? What do you think?

Images: cnet, jamesnorquay.

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