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Startup & Venture Lessons

Law & Entrepreneurship Society at Duke

Jay Jamison

Partner, BlueRun Ventures

jjamison@brv.com | @jay_jamison | jayjamison.com

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Agenda

Introduction

Top 10 Lessons

Q&A

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Introduction

• Duke, BA, English, 1992

• Emory Law School, 1995-96

• MBA, Wharton,1998

• Microsoft, 1998-2007

• Founder, Moonshoot, 2007-10

• Partner, BlueRun Ventures, 2010-Present

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About BlueRun Ventures

• Over $1.0B under management

• Investing out of Fund IV ($240M)

• Focus: Mobile & consumer internet

• Seed & Series A

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Stuff that surprised me

• Having nearly 10 years at MSFT didn’t matter at all.

• Having an MBA from Wharton mattered even less.

• Having had a year of law school didn’t register.

• But, several of the skills from all this really helped.

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Top 10 Startup Lessons

1. Today’s Golden Age For Founders & Its Double-Edge Sword

2. What’s #1: Markets, Team, or Product?

3. Picking Co-Founders & How to Split the Equity Baby

4. Make It Happen

5. Get used to “No”

6. Hire Slow, Fire Fast

7. Distribution is Really Hard & Really Important

8. If You Stop Loving It, Make a Change

9. Values From Day 1

10. Pitching & Fund-Raising

11. Getting into Venture Capital

12. Thoughts on Legal

13. My go-to resources

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Lesson 1:It’s a Golden Age for Entrepreneurs….

Cheaper than ever to start a company.

Better resources

• Incubators: Y-Combinator, 500Startups, …

• Resources: Startup Digest, Lean Startup, TC, VB

Technology is easier to learn, access, &c.

• Codecademy

• RoR

• AWS

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… And Investors Understand This.

I see lots of great companies that are:

• Capital efficient

• High velocity in coding and releasing

• Product in market with traction

• Clear customer insight on what works

• Battle-tested founding teams

• Clear, concrete ask on what $$$ they need

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Implication

While we’re in a Golden Age for Entrepreneurs, it is raising the bar

for most very early stage companies…

You need to prove more on very little money, because so many other

start-ups are already doing so.

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Lesson 2: What’s #1: Markets, Team, or Product?

Which is most important?

A.Market

B.Product

C.Team

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Which is most important?

A.Market

B.Product

C.Team

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Analysis

• 75 pitches / quarter

• 0-2 get to term sheet

• Score each

• Multiple regressionProduct

Traction

Team

Market

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• World’s largest store

• Redefine social

• Organize & access information

• Reinvent money

• ????Your Company

How I think about Markets Choose Any 4 Companies, Stack Rank Vision

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Lesson #3:Finding a Technical Co-Founder

More important than fund-raising

Requires almost the same skills

• Pitching and salesmanship

• Capacity to speak enough geek

• Resourcefulness

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Default founder split: equal

50%50%33%

33%

33%

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Lesson 4:The Get It Done Principle

Lean Startup

Scrum

StealthCo

Never stealth!

Customer Development

If you’re not embarrassed with your first launch, you’re waiting too long. –

Reid Hoffman

Minimum Viable Product

Revenue from Day 1

Building for Scale

OffshoreEverything Inhouse

HTML5

Native Apps

You never get a second chance to make a first impression. – Anon.

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Just Get Stuff Done

Lean Startup

Scrum

StealthCo

Never stealth!

Customer Development

If you’re not embarrassed with your first launch, you’re waiting too long. –

Reid Hoffman

Minimum Viable Product

Revenue from Day 1

Building for Scale

OffshoreEverything Inhouse

HTML5

Native Apps

You never get a second chance to make a first impression. – Anon.

My Advice & Learning:

• Absorb all this stuff

• Listen to people you trust

• Use what works for you

• The key is work fast & economically

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Lesson 5:Get Used to No

As Founder: Heard “No” a lot, especially fund-raising

• At least 150 times

• From 5 different countries

As an Investor: I say “No” a lot, especially to fund-raisers

• Probably 1%

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What’s weird about this…

• These numbers are probably about average

• Generally “No” coming from smart, polite person

(Not always the case, so be careful)

• Under 10% of founders really follow-up and stay after it

• Lesson: build a plan to deal with “No”…

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Lesson 6:Hire Slow, Fire Fast

Hire Slow• Wait for real pain

• Everyone interviews

• Share feedback

• Do reference checks

• Dinner w/ SO

Fire Fast• When perf lags, speak up

• Set clear expectations

• Set a crisp timeline

• Fire

• Ensure lawyer is in loop

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Lesson 7: Distribution, distribution, distribution

This is by far the weakest part of your business at this point

And, it is also one of the most important…

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Love It or Leave It

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Lesson 9Values

Values are key from day 1

• Set them & talk about them constantly.

• No “right” way to do this, but doing it is important

• Make sure everyone knows them, everyone buys in

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Lesson 10 Thoughts on Fund-Raising

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Logistics : Pre-Meeting

• Arrive 15 minutes early every time

• Have back-ups (2nd PC, Dongles, USBs)

• Treat everyone you interact with politely

• Setup & preflight ppt & demo before meeting starts

• Bring ideally 2-3 people

Remember: You are SELLING

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Logistics: During Meeting

• Give everyone who attends a role

• Script which person handles which slide(s)

• Assign a scribe, every time

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Logistics: Q&A During Meeting

Often badly managed, and very important

Answer questions directly

Script answers on the obvious questions– How much are you raising?– How long does this last?– What beachhead markets do you think are most promising?– What holes exist in your team?– Why won’t Google, Facebook, Twitter, or someone else eat your

lunch?– What makes you the right team to do this?

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Logistics: Post Meeting

• Scribe: Write down all new QA for FAQ

• Follow-up in email that day w/ thanks, etc.

• Do what you need to handle rejection

• Keep positive & keep in touch

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Getting a Job in Venture

No clear career path into venture

Small, private partnership—bespoke cultures

Several routes in

My advice : Add Value

• Proprietary Deal Flow

• Earn Founders’ Trust and Respect

• Win the Right Business

• Showcase that you’re a great team player

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Thoughts on Legal

Michael Arrington Matthew Prince

David HornikChris Sacca

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Thoughts on Legal

Most important early stage needs

• Board composition

• All employee contracts & invention assignments handled

• Liquidation preferences & rights

Attracting clients

• Get out there and build presence

• Yokum Taku, e.g., Startupcompanylawyer.com

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Go To Resources

• TechCrunch, VentureBeat, TechMeme, etc.

• JoelonSoftware

• http://www.startuplessonslearned.com/

• Startup digest

• Netflix on Culture

• Compstudy.com

• Igor International Naming Guide

• Paul Graham’s blog.

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Thanks!