Tag Archives: Founder

The Rise and Fall of BlackBerry

Very interesting article in the very good ParisTech Review: The Rise and Fall of BlackBerry. The article shows how disruption is more and more threatening not only for established companies but also fast growing start-ups.

Blackberry was founded in 1984 as Research in Motion by two young engineering students from the University of Waterloo – Mike Lazaridis – and the University of Windsor – Douglas Fregin. They were about 23 years-old. Eight years later, an experienced business man, James Balsillie, would join, invest some of his money ($250k) and become Co-CEO with Lazaridis. RIM funded a lot of its initial activity with partners (Ontario New Ventures – $15k; General Motors – $600k, Ericsson, – $300k, University of Waterloo – $100k, Ontario local development – $300k) so that it raised investor money in 1995 only, including Intel in 1997. The company went public on the Toronto Stock Exchange in October 1997 and then on Nasdaq in 1999.


As the authors notice, “though BlackBerry has less than 1% of the smartphone market share today, it once had more than 50%. […] In this era of disruption, the mother of disruption stories is the BlackBerry story. A company that introduced the BlackBerry in 1998 became a $20 billion company from nothing in less than a decade. Then four or five years later, it was back down to a $3 billion company, gasping for breath. It’s not only a disruption story; it is a story of the speed of the technology race today.”

They explain how Lazaridis was a visionary when mobile phones had to be simple devices and how he failed a few years later: “The pivotal moment is January 2007 when Steve Jobs walks onto the stage in San Francisco and holds up that shiny glass object that we all [now] know and love so much, and says, “This is an iPhone.” […] The really compelling part of the BlackBerry story is how they reacted that day. Over in Mountain View, California, you had the folks at Google under a secret project. One was for a new keyboard phone and the other was for a touch screen phone that was going to be run on Android. The minute they watched that live, streaming on the internet, they realized that their project keyboard was dead, and they immediately shifted everything to the touch screen phone…. Mike Lazaridis looked at this announcement, looked at what Steve Jobs was offering, and said, “This is an impossibility.” Again, the conservative engineer brought up on conservation said, “The networks won’t be able to carry this. It’s an impossibility. It’s illogical that anyone would even propose this.” He was right for the first two years. Remember all the dropped calls, all the frustrations, all the lawsuits against Apple and the carriers. It didn’t work…. But then it did, and RIM got it wrong. Two years is a lifetime at a technology rate, and by the time they realized what a serious threat it was, they were at that point followers.”

Blackberry was (still is) the success story of the University of Waterloo and Wikipedia mentions how much Lazaridis has given back to his alma mater: in 2000, Lazaridis founded the Perimeter Institute for Theoretical Physics. He has donated more than $170 million to the institute. In 2002, Lazaridis founded the Institute for Quantum Computing (IQC) at the University of Waterloo. He, with wife Ophelia, has donated more than $100 million to IQC since 2002. This looks very similar to what Logitech and Daniel Borel are to EPFL (where I work). You should read the full article and I conclude here with my usual cap. table…

Blackberry CapTable

3 things all first time entrepreneurs should know from the founder of Housetrip

An amazing article I had totally missed and read yesterday thank to a colleague from IFJ/venturelab, thanks! Arnaud Bertrand does not give the usual lessons about money, product, market, blablabla. It is much more profound and painful…:

1- Succeeding at building a good business is first and foremost succeeding in the art of hiring and managing people
2- Having a differentiated product or service is far from being enough to capture your market
3- Founding a company and seeing it to success is winning a whole lot of fights against yourself


You must read it all: https://www.hottopics.ht/stories/how-to/3-things-all-first-time-entrepreneurs-should-know/

Startup Land : the Zendesk adventure from Denmark to Silicon Valley to IPO

Many of my friends and colleagues tell me that video and movies are nowadays better than books for documenting real life. I still feel there is in books a depth I do not find anywhere else. A question of generations, probably. HBO’s Silicon Valley may be a funny and close-to-reality account of what high-tech entrepreneurship is but Startup Land is a great example of why I still prefer books. I did not find everything I was looking for – and I will give one example below – but I could feel the authenticity and even the emotion from Mikkel Svane’s account of what building a start-up and a product means. So let me share with you a few lessons from Startup Land.


The motivation to start

“We felt that we needed to make a change before it was too late. We all know that people grow more risk-averse over time. As we start to have houses and mortgages, and kids and cars, and schools and institutions, we start to settle. We invest a lot of time in relationships with friends and neighbors, and making big moves becomes harder. We become less and less willing to just flush everything down the drain and start all over.” [Page 1]

No recipe

“Along the way, I’ll share the unconventional advice you learn only in the trenches. I am allergic to pat business advice that aims to give some formula for success. I’ve learned there is no formula for success; the world moves too fast for any formula to last, and people are far too creative—always iterating and finding a better way.” [Page 6]

About failure

In Silicon Valley there’s a lot of talk about failure—there’s almost a celebration of failure. People recite mantras about “failing fast,” and successful people are always ready to tell you what they learned from their failures, claiming they wouldn’t be where they are today without their previous spectacular mess-ups. To me, having experienced the disappointment that comes with failure, all this cheer is a little odd. The truth is, in my experience, failure is a terrible thing. Not being able to pay your bills is a terrible thing. Letting people go and disappointing them and their families is a terrible thing. Not delivering on your promises to customers who believed in you is a terrible thing. Sure, you learn from these ordeals, but there is nothing positive about the failure that led you there. I learned there is an important distinction between promoting a culture that doesn’t make people afraid of making and admitting mistakes, and having a culture that says failure is great. Failure is not something to be proud of. But failure is something you can recover from. [Pages 15-16]

There are other nice thoughts about “boring is beautiful” [page 23], “working from home” [page 34], “money isn’t only in your bank account, it’s also in your head” [page 35], and an “unconventional (possibly illegal) hiring checklist” [page 127]

I will quote Svane about investors [page 61]: “I learned an important lesson in this experience – one that influenced all of the investor decision we’ve made since then. There is a vast spectrum of investors. Professional investors are extremely aware of the fact that they will be successful only if everyone else is successful. Great investors have unique relationships with founders, and they are dedicated to growing the company the right way. Mediocre and bad investors work around founders, and the company end in disaster. The problem is, early on many startups have few options, and they have to deal with amateur investors who are shortsighted and concerned with optimizing their own position.” [and page 93]: “Good investors understand that the founding team often is what carries the spirit of a company and makes it what it is.”

And about growth [page 74]: “Even after the seed round with Christoph Janz, we were still looking for investors. If you’ve never been in a startup this may seem odd, but when you’re a startup founder you’re basically always fund-raising. Building a company costs money, and the faster you grow, the more cash it requires. Of course, that’s not the case for all startups – there are definitely examples of companies that have come a long way on their own positive cash flow – but the general rule is that if you optimize for profitability, you sacrifice growth. And for a startup, it’s all about growth.”

In May 2014, Zendesk went public and the team was so extatic, many pictures were tweeted! The company raised $100M at $8 per share. They had a secondary offering at $22.75 raising more than $160M for the company. In 2014, Zendesk revenue was $127M!… and its loss $67M.


There was one piece of information I never found neither in Startup Land nor in the IPO filings: Zendesk has three founders, Mikkel Svane, CEO and author of the book. Alexander Aghassipour, Chief Product Officer and Morten Primdahl, CTO. I am a fan of cap. tables (as you may know or can see here in Equity split in 305 high-tech start-ups with founders, employees and investors shares) and in particular studying how founders share equity at company foundation. But there is no information about Primdahl ‘s stock. I only have one explanation: On page 37, Svane writes: “the thing about money is, it’s happening in your head. Everyone processes it differently. Aghassipour adnSvane could live with no salary in the early days of Zendesk, but Primdahl could not. It’s possibly he had a salary against less stock. I would love to learn from Savne if I am right or wrong!

Click on picture to enlarge

FT’s Top European Tech. Entrepreneurs

Following my article posted on June 25, entitled Europe and Start-ups : should we worry? Or is there hope? Here is a more detailed analysis of the FT’s Top 50 tech. entrepreneurs. First, you may want to do a quiz: do you know them from their pictures?

FT Top 50 Europe

Before I give you the full list (ranking is from left to right and top to bottom), here are some interesting statistics (I think).

FT Top 50 Europe Stats

The countries are not really surprising whereas the huge presence of Index Ventures, compared to Atomico or even Accel was. American funds, including the best ones, are all around. Interesting too. So how many entrepreneurs did you know…

FT Top 50 Europe List
(click on picture to enlarge – additional sources : Crunchbase and SEC)

Biocartis, the (could have been) Swiss success story

Biocartis might have been a Swiss success story but most of the company is now based in Belgium. Probably not a decision of investors (as people think when company move) but from management! One of the founders is from Belgium and an impressive serial entrepreneur: Rudi Pauwels. Here is what you could read in the IPO document:


Still the numbers are interesting. The company has raised more than €200M before its €100M IPO this week. Despite such huge amounts the founders have kept about 5% of the company. Its IPO prospectus is available on the company web site. It has signed deals with Philips, Hitachi, Biomérieux, Abbott, Janssen and Johnson & Johnson and counts Swiss-based Debiopharm among its mains shareholders. Here is my usual cap. table:

(click on image to enlarge)

Another billion dollar start-up founded by young people? Except they are out of Etsy

Etsy is the most recent IPO filing to date. It’s a well-known ecommerce start-up, based in New-York, seed funded by Caterina Fake, Stewart Butterfield, Joshua Schachter & Union Square Ventures (Albert Wenger and Fred Wilson), further funded by Accel Partners, Index Ventures and Tiger Global, with a total of at least $100M raised before the IPO.

The three founders (Robert Kalin, Chris Maguire, Haim Schoppik) graduated from NYU around 2005 just before founding their start-up, then in their early to mid-twenties. But there is no info on them in the S-1 document. Kalin was CEO until July 2008 (came back between Dec. 2009 and July 2011). many employees and co-founders Maguire (Software development) & Schoppikleft in August 2008.

Founders: Robert Kalin, Chris Maguire, Haim Schoppik

and here is the usual cap. table. Interesting to check what the value at IPO will be…
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Celebrating a (too rare) Swiss IPO: Molecular Partners

I could have said: Celebrating a (too rare) European IPO. Molecular Partners is a spin-off from the University of Zurich, founded by Professeur Andreas Plückthun, Christian Zahnd, Michael Stumpp, Patrik Forrer, Kaspar Binz and Martin Kawe in 2004. It was funded by private investors: a first round of CHF18.5M in 2007 and a second round of CHF38M in 2009. Molecular has also signed a number of agreements with pharmaceutical companies, which explains the high income for a biotech start-up. The University of Zurich is also a shareholder thanks to a license agreement signed in 2004, through which it also receives royalties.

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I think it is interesting to illustrate the evolution of its ownership trhough the financing rounds, including the IPO that has brought about a hundred million to Molecular.

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I also like to mention the age of the founders. The IPO document provides data and I “guesses” the others from the academic career (based on a age of 18 at university entrance…) It gives an average of 33 with a range of 20 years between the extremes. I know that money is a taboo; Europeans do not like to disclose their wealth, which remains highly theoretical, because one does not sell shares in a biotech as easyly as a Facebook employee… But it seems to me important to celebrate the success of founders and their investors … Congratulations to all!


Should entrepreneurs have start-up skills? Two counterintuitive answers

I teach entrepreneurship and I often wonder. What should be taught? I am not sure. In the class How to Start a Startup, both Paul Graham and Peter Thiel did provide feedback on some examples. First Paul Graham. Just click here or go to time 5:26 below or read after the video frame.

“The second counterintuitive point, this might come as a little bit of a disappointment, but what you need to succeed in a startup is not expertise in startups. That makes this class different from most other classes you take. You take a French class, at the end of it you’ve learned how to speech French. You do the work, you may not sound exactly like a French person, but pretty close, right? This class can teach you about startups, but that is not what you need to know. What you need to know to succeed in a startup is not expertise in startups, what you need is expertise in your own users.

Mark Zuckerberg did not succeed at Facebook because he was an expert in startups, he succeeded despite being a complete noob at startups; I mean Facebook was first incorporated as a Florida LLC. Even you guys know better than that. He succeeded despite being a complete noob at startups because he understood his users very well. Most of you don’t know the mechanics of raising an angel round, right? If you feel bad about that, don’t, because I can tell you Mark Zuckerberg probably doesn’t know the mechanics of raising an angel round either; if he was even paying attention when Ron Conway wrote him the big check, he probably has forgotten about it by now.

In fact, I worry it’s not merely unnecessary for people to learn in detail about the mechanics of starting a startup, but possibly somewhat dangerous because another characteristic mistake of young founders starting startups is to go through the motions of starting a startup. They come up with some plausible sounding idea, they raise funding to get a nice valuation, then the next step is they rent a nice office in SoMa and hire a bunch of their friends, until they gradually realize how completely fucked they are because while imitating all the outward forms of starting a startup, they have neglected the one thing that is actually essential, which is to make something people want.”

Second Peter Thiel about the Lean Startup movement. Again just click here or go to time 44:55 below or read after it.

“What do I think about lean startups and iterative thinking where you get feedback from people versus complexity that may not work. I’m personally quite skeptical of all the lean startup methodology. I think the really great companies did something that was somewhat more of a quantum improvement that really differentiated them from everybody else. They typically did not do massive customer surveys, the people who ran these companies sometimes, not always, suffered from mild forms of Aspergers, so they were not actually that influenced, not that easily deterred, by what other people told them to do. I do think we’re way too focused on iteration as a modality and not enough on trying to have a virtual ESP link with the public and figuring it out ourselves.”

(NB: I assume ESP is Extra-Sensory Perception)

Zalando files to go public

Zalando, one of the very visible European start-up should become a public company on October 1st in Germany. It’s not so much the numbers which I found of interest, but how difficult it was to get them. As usual, Europe is showing less transparency. Finding the prospectus was not easy, and I am not sure I could have found it without claiming I live in Berlin. And still, I have no clue how much the company has raised, at which price and when. This is not in the prospectus – I just have all capital increases dates and shares number, it does not help much.

Rubin Ritter, David Schneider and Robert Gentz

I could still build my usual cap. table and here is what it gives. Revenues are impressive, as well as losses. Founders have been diluted, btu given the capital increases and losses it is not so surprising…