Every so often I am asked what I did in Silicon Valley. While it is a nice way to get into innovation ecosystem, entrepreneurship and high-tech talk with people at events, I think it might interest others as well, hence this blog post.
Some of the lessons learned are very specific to Silicon Valley but others are relevant as well for Switzerland and Europe.
Update: could not work on this post for a while due to work and travel. So let me give you the quick list of lessons learned right away 🙂
- timing is the most important criteria for success in high-risk startups. you must have an organisation that can execute focused, fast and still with high quality.
- stock grants are not an option but a MUST. Let me be very clear here. Without this there will never ever be a culture of ownership and why should you then have a startup and not simply do it in a big company? Big company execs don’t understand that cos they have no experience.
- pivoting is essential. when I see how an army of consultants is paid to write over 6 and more months business plans for Swiss startups and those consultants often never ever worked in a startup themselves then I ask myself what a waste and how can anyone expect this to work? you must be ready to change your plans all the time when it is clear it does not work. business plans are needed but they must be done in a short amount of time knowing they will change anyway. and it is good if they do.
- failing is part of the game. it is not easy but accept it and move on. noone should be treated badly if he/she tried and it did not work. show respect and encourage them to try again applying the lessons learned.
- go for the world domination. noone should ever get any VC funding without wanting to become the next big thing after the current internet powerhouses. If your plans are modest and niche-focused, then don’t ask for VC money. do it as a Swiss only project but don’t ask for VC funding ever cos it is not for you. and any VC who still gives you money will for sure fail as well.
- be crazy in a positive way. there is no problem that cannot be solved. of course timing might come in the way. if you cannot solve it then someone else will before you or noone.
- don’t ask for the government to help you. maybe for seed funding and prototyping you can accept but then you must be able top raise money competing against others, why? it is not the governments job to subsidise companies. If they do they should act as a VC as well and expect return. and you will compete against others and test your plans with critical VCs. this is an essential part of the game and far more important than business plans. learn to sell yourself cos that is needed as well for success.
- go to the markets where you find the biggest clients. if needed move your headquarters there. But keep R&D and other functions also here. It is a Swiss venture and should keep it roots here. and this in fact could be the winning differentiator.
- never ever think that a Big 4 company would be able to consult startups. they will not. never ever. just believe me. it is an entirely different business they are in. they have zero expertise in running startups. its like hiring a coach for a soccer team that only knows how to play and train for golf. the ball and skills required are VERY different. 🙂
Also, as the high-tech startup scene in Switzerland and Europe is developing rapidly, there is hope and the expectation to come closer and closer over time to SV.
First of all it is some time ago, but many of the things that happened to me there are still highly valid albeit in other hightech areas.
Time: 1997 – 2001
Hightech trends: next-gen data communications, giga and terabit routers, optical communications, tuneable lasers, semiconductors, search technology
Success stories: many trade sales in the billions USD to Nortel, Alcatel, Lucent; IPOs: Foundry Networks, Extreme Networks, Broadcom
Apple, Google and Facebook did not yet have the success as we know today or did not yet exist.
What was crucial at the time: due to this huge exits lots of money was around and many VCs were looking for startups to invest into. As it turned out there was too much money which lead to partly crazy investments. One of these areas was Metro-DWDM… let me explain why.
stay tuned… will continue this post shortly.