A very short note on an excellent presentation by Jean-David Chamboredon, partner with ISAI fund, entitled Funding Innovation in Europe. I particularly liked two slides that show the success rate of investment in a start-up, and the other one addressing a subject that is dear to me, the comparison of VC in Europe and the USA. Thank you to my colleague Marie-Laure for mentioning this study have me 🙂
My friend Jean-Jacques reminded me about this new study about entrepreneurship at Stanford University. Charles Eesley (who is also the co-author of the study on MIT impact) and William Miller have published it last October after surveying thousands of Stanford alumni. I was a little disappointed by the findings, but it might because I am biased (I work on the topic too, check my previous post on Stanford entrepreneurs) and also because I preferred the MIT study. But there is so much to say and analyze about Stanford! There are still very interesting data (see figures below), and it begins with the executive summary:
“The report […] estimates that 39,900 active companies can trace their roots to Stanford. If these companies collectively formed an independent nation, its estimated economy would be the world’s 10th largest. Extrapolating from survey results, those companies have created an estimated 5.4 million jobs and generate annual world revenues of $2.7 trillion.” [Page 6]
I also liked very much the small paragraph on risk-raking [Page 27]: When we asked Bechtolsheim whether taking on risks was part of the reason for his successes, he instead offered: “Risk is the wrong word. To me, Sun was a zero-risk startup because I knew there was a large market opportunity for this product. It was just about getting it out the door and selling it. Quite frankly, good startups don’t take on a lot of risk. They focus on making the right technology choices and product investments to go after significant market opportunitites. If you build the right product at the right time for the right market, success is much more predictable. That’s true even today.”
Now the figures I noticed, but there are many more: the initial capital raised by start-ups is high. It is consistent with my data on 190 public companies. The average value is $7.2M overall in my study and the median $3.0M (all fields included; the figures become $6.4M and $2.7M without biotech).
It is no news that many founders are immigrants. Here is a new illustration
Finally there is an interesting trend about how many years after graduation, alumni become entrepreneurs.
A major element of the Beylat-Tambourin report (about which I have already published an article) addresses the concept of innovative ecosystems. Before mentioning some passages, here are two interesting references on this concept:
– Josh Lerner in his book Boulevard of Broken Dreams shows how entrepreneurs and investors have benefited from each other in situations of tension and collaborations in the 60-70s. He also shows the importance of public support at least in the early years (funding for the Cold War and support to venture capital – SBIR, Erisa) so that it can be said that “the public sector played a key role in the evolution of Silicon Valley”. Then he tries to show some errors: incompetence in the allocation of public resources, inefficient use of subsidies, by “organizations whose mandate is to help entrepreneurs” (“Seven incubators provided under 50% of funds for companies”- an example in Australia) and the SBIR program has reached its limits. Also, his recommendations are:
– enhancing the entrepreneurial culture [through the right laws, the access to technologies, tax incentives and training],
– increasing the start-ups attractiveness [through allowing partnerships, creating local markets, accessing human capital abroad],
– avoiding common mistakes: timing [be patient], sizing [not too small, not too large], flexibility [learn by doing], create the right incentives [and here it is a complex situation as perverse effects from good ideas often occur] and evaluate [which does not happen often enough]. Already in his introduction he writes that you need rules, experience, time, incentives and assessment. But with all his experience and knowledge about high-tech entrepreneurship, Lerner is very humble with the lessons: the topic is really complicated, all these advice have to be implemented together and it is really their careful interconnections which will make an ecosystem lively or not. There must obviously be a lot of talent.
– Brad Feld gives the ingredients of start-up ecosystems:
 |
1. A Strong Pool of Tech Founders 2. Local Capital 3. Killer Events 4. Access to Great Universities 5. Motivated “Champions” 6. Local Press / Websites / Organizational Tools 7. Alumni Outreach 8. Wins 9. Recycled Capital 10. Second-Time Entrepreneurs 11. Ability To Attract a Pool of Engineers 12. Tent-pole Local Tech Companies |
Back to Beylat Tambourin report : “Everywhere in the world, innovation is stimulated within networks of actors uniting training, research, young & fast growing companies (start-ups), service companies, large groups engaged in a policy of “open innovation”, professional coaching and innovation funding, and sometimes the hospital.”
The most emblematic examples are of course Silicon Valley, the Boston area or Israel. […] In Europe, most states began a decade ago to implement a policy of clusters: poles of competence in France (in addition to existing clusters), with a focus on collaborative R&D; more recently a focus on a small number of world-class Spitzencluster in Germany, etc.. The effectiveness of these networks is based on the fluidity and speed of “assets” of innovation skills (persons), technology, infrastructure, services and financing. Innovation is primarily a matter of stimulation and confrontation of different points of view. The role of clusters and innovative ecosystems, in this aspect of their business and not as factories of R&D projects, is critical.
The success of clusters at international level is now relatively well analyzed and relies heavily on a few factors:
– World-class universities
– An industry of venture capital aggregating institutional and private investors,
– A range of sophisticated services (HR, legal, marketing) to support the growth of young innovative enterprises,
– Professionals of high techonology
– A critical but intangible ingredient: an entrepreneurial culture.
Transfer processes and innovation are “naturally” complex for several reasons:
– The transfer takes place at the interface of two worlds with different logics, which requires to achieve and maintain a significant level of trade, trust, understanding of the issues and objectives of each other…
– Innovation can not be deployed within an “established” entity: this statement is largely based on the concept of open innovation (open innovation).
– The complexity of the transfer process and innovation also increases with the depth of research and the nature of disruptive innovation.
– The processes involved are not “deterministic”: set goals and define interim milestones is of course necessary to construct a “nominal” trajectory, but we must accept that the “real” path will be different, and it is better to be able to adapt than trying to predict the future.
-> The policy must finely understand the ecosystem dynamics: centralized methods are not effective, we must have a Darwinian system and continually assess.
The challenges of ecosystems
– The impossibility of identifying a “construction plan” of an ecosystem, from scratch or from some already present features: an ecosystem is built over time and then one notices it. The time required for its construction (often several decades!) just proves that any search for the “first cause” behind the ecosystem is futile. This is a hard point for governments who want to create an innovation ecosystem for a particular “field” on this or that “territory”. Local governments, national and European are generally funders but they must have the patience of investors.
– The complexity of measuring the effectiveness of an ecosystem: assessment is central, but difficult to implement. The evaluation of each of the players in the ecosystem is of course possible, if indeed they have clearly defined tasks and ways to fill them. However, all of these individual assessments is not an assessment of the ecosystem, according to Pascal’s principle that it is “impossible to know the parts without knowing the whole, nor to know the whole without knowing the parts”.
– An effective ecosystem is based on the acceptance of their role by each of the actors: all are necessary for the operation, but none can claim to be the sole cause of success. However, the temptation to declare oneself essential is much stronger as most actors depend on government subsidies and can consider themselves in competition for access to these resources. Each player must avoid both “sufficient and insufficient” and remember that one’s effectiveness depends largely on that of the ecosystem (or ecosystems) to which one belongs.
– “Simplify” or “optimize” an ecosystem, let alone a complex of ecosystems, is irrelevant: we must accept “Darwinism”, think articulations, and continuously assess the dynamics to maintain and improve the efficiency of public investment. Proposals for simplification and optimization from some players and / or public authorities (local, national, European) actually consist of creating a new “object” that is supposed to respond to the noted deficiencies : it is the illusion of the “exceptional measure” that will change the situation of innovation, the creation of a device or structure, which explains to a large extent the accumulation of devices and structures in France. The challenge, however, is to define the positioning of any new “object” within the existing structure (for an ecosystem is built over time) and explain how it will improve the efficiency of the overall system.
I had the pleasure to be part of the group who contributed to the Beylat-Tambourin report, Innovation: High Stakes for France, which subtitle is also important: Dynamizing the Growth of Innovative Companies. It was a long process, we started working in September and the final document was presented to the Ministers on 5 April. You can download the report in pdf format or here, should the previous one not work..
The report is in French but as I saw the Wall Street journal mentioning it, I thought I would do a post in English too. However, if you read French, go to the sister blog post: L’innovation en France: le rapport Beylat Tambourin. My French is much better!
What should be noted before discussing the content is that 25 members of the mission come from different worlds (see end of article), which could have made it difficult to find agreement. This was not the case. There were debates, but this report summarizes the proposals without forgetting important points, or dilute the point, I think. I read (only) one satirical article in the media, but I’m not sure that the author had read the report (see end of the article as well)…
Click on the image to download the report in pdf format
I translate (again my apologies for my far from perfect English) here a quote from the introduction: “With the acceleration and the complexity of the issues, public policies sometimes seem poor, often messy. […] They have often been compared to a system of research transfer, itself too weak, and indeed not focusing enough on the creation of high-growth companies with an ability to create jobs. […] But there is no single model of innovation. […] However, invariants exist: research excellence; low barriers between public and private sectors; an entrepreneurial culture; cultural diversity, the ability to attract talent at an international level; a migration policy; and a successful combination of start-ups, large corporations, public research, higher education and investors.” [Pages 1-2]
The difficult definition of innovation
Here’s a great paragraph that I want to quote again: “There is no definition – uncontested and incontestable-of innovation but it is possible to bring out some characteristics of innovation:
– Innovation is a long, unpredictable and hard to control process.
– Innovation is not limited to the invention and innovation is not only technological.
– At the end of this process, are created products, services or new processes that demonstrate that they meet the needs (market or non-market) and create value for all stakeholders.
Another point worth noting: an innovation cannot be decreed, cannot be planned, but it is seen through the commercial (or societal) success it meets. This explains why it often comes at the margins of existing businesses and through interactions with many different actors: “The Internet is the product of a unique combination of military strategy, scientific cooperation and protest innovation” in the famous sentence by Manuel Castells.” [Page 5] ” Accordingly, a vision where the expenditure on R&D is the main concern should be changed in favor of a systemic vision for results, in terms of growth and competitiveness.” [Page 6] In other words, innovation is not the invention and certainly not R&D.
Here are the 19 recommendations, divided into four groups:
I. Developing a culture of innovation and entrepreneurship.
II. Increase the economic impact of public research by the transfer.
III. Support the growth of innovative companies.
IV. Develop instruments of public policy for innovation.
For the first group (Culture):
1. Revise teaching methods in primary and secondary schools to develop innovative initiatives.
2. Implement a large-scale program for entrepreneurship learning in higher education.
3. Promote the dissemination from large groups through spin-offs.
4. Develop a policy for attractiveness of talent around innovation.
For the second group (transfer):
5. Implement the operational monitoring of 15 measures for rebuilding the transfer of public research (see http://www.enseignementsup-recherche.gouv.fr/cid66110/une-nouvelle-politique-de-transfert-pour-la-recherche.html – in French)
6. Promote the mobility of researchers between the public and private sectors.
7. Develop a coherent program for the transfer through the creation of businesses.
8. Focus SATT on maturation [SATT are the new French structures for academic technology transfer].
9. Establish a consistent policy of public-private research partnerships, bringing together different policies (scattered today).
For the third group (growth):
10. Address the lack of equity financing for innovative companies (venture capital and later-stage growth equity) by mobilizing a small part of the French savings and improving the possible exit strategies for investors in these segments.
11. Launch “early stage” sector initiatives.
12. Implement the policy instruments of protection (IP, standardization) serving innovative companies.
13. Harmonize the different labels of innovative companies for better readability and link them to the growth of companies, consistently aligning all support tools available.
14. Encourage large groups and large public institutions to be involved in the emergence and growth of innovative enterprises, integrating new dimensions in their obligation for environmental and social responsibility.
Finally for the last group (public policy):
15. Recognize the role of metropolitan innovation ecosystems as the support for regional strategies as well as for the national innovation strategy.
16. Organize the transfer system to make it more readable and more efficient.
17. Provide the means to develop, pilot and evaluate a comprehensive and coherent strategy of French innovation.
18. Appoint a single operator for the operational consolidation of public finance policies of innovation: the BPI (the Investment Public Bank in its innovation component).
19. Making innovation a real political issue, organizing a broad public debate.
[Again sorry for the imperfect translation. I hope you got the points…]
As explained in the Wall Street Journal in Nineteen Ways to Make France More Innovative, “In the short-term, the government should move away from considering R&D spend as a metric of innovation recommended the authors, and look at jobs created. France outspent Germany on R&D in many areas, said Mr. Beylat and Mr. Tambourin, but the effect wasn’t felt in the economy.”
Another comment concerns the sub-title of the report: Dynamizing the Growth of Innovative Companies. This is a very important subtitle, but do not get me wrong, it is not about start-ups only here, but the message is that innovative companies should be a source of growth, whether large groups, SMEs or start-ups. It may not be a cultural revolution, or is it?
To push the envelope a little further, here is a short excerpt: “France is between the American dream of Silicon Valley, where disruptive innovations are supported by start-ups, the German dream of a well-established industrial Mittelstand, efficient in incremental innovation, and a French tradition of industrial planning in sovereign sectors. This oscillation blurs the representation that France has made of innovation because it mixes breakthrough innovation, incremental innovation and “strategic industrial policy.” We must cut short a myth: if innovation often requires an excellent R&D, it is not limited to R&D. It is not its natural extension. Innovation is above all the process that leads to the marketing of products or services, meeting a need, made by individuals engaged in an entrepreneurial approach. Innovation is thus at the crossroads of several areas, first and foremost research, entrepreneurship, industry and education. There is therefore no conceptual optimization or normative expected pattern.” [Page 6]
And on the cultural aspects: “Innovation is primarily a matter of individuals, state of mind and ambition for the company and for themselves. The dissemination of the culture of innovation and entrepreneurship is vital. These cultures are closely linked: vision, risk-taking, acceptance and learning from failure, capacity for initiative, project culture and commitment to completion are the main components. Finally, the ability to create companies with high growth potential (spin-offs and start-ups), some of which will become world leaders, sometimes in a few years, characterizes an effective innovation system.” [Page 7]
And finally I add a quote from President Obama, which perfectly symbolizes the problem: “We insist on personal responsibility and we celebrate individual initiative. We’re not entitled to success. We have to earn it. We honor the strivers, the dreamers, the risk-takers, the entrepreneurs who have always-been the driving forces behind our free enterprise system – the greatest engine of growth and prosperity the world has ever known.”
The report was presented to ministers on April 5, and to the French Prime Minister on April 8, for the appointment of Anne Lauvergeon as President of Innovation 2030. Genevieve Fioraso [the French minister for research and higher education] noted, however, in her introduction to the submission of this report, that President Obama was able to speak for about an hour on this one chapter of innovation. Where else would this be possible?
Finally, and this is a personal note, this report should be used more as a base for innovation than as a toolbox or a set of recipes. This is the big picture that matters and not the extraction of recommendations that would suit one or the other. “The issues of competitiveness show that innovation must be at the heart of public policy, as illustrated by our recommendations. While this is a technical issue that is inherently complex (because of all the dimensions that make up), where the “right” decisions are sometimes against-intuitive (eg, linear view of innovation seductive but wrong), it seems essential that innovation becomes a real political issue to ensure its adoption by policy makers and citizens.” [Page 121]
Finally I would like to add more quotes on innovative ecosystems. As it begins to be long, I’ll do it in a future article …
Facts and Figures
They show the challenges of innovation, particularly in France. I’ll let you judge for yourself.
R&D Intensity (compares France and Germany in their R&D efforts relatively to firm size)
An interesting typology of research using fundamental and applied research as well as experimental development
… and its evolution in France
A real issue: company growth – number of companies reaching €100M in R&D relatively to company year of foundation
The complexity of the financing situation – as a % of GDP
The complexity of the financing situation – seed, early, late & LBO
As mentioned above this is the origin of 27 members (two presidents, 25 experts).
A few references from the Press:
– Nineteen Ways to Make France More Innovative (Wall Street Journal)
– Une mission sur l’innovation après le rapport Gallois (les Echos)
– Cinq pistes pour favoriser l’innovation en France (L’Expansion)
– Le gouvernement va-t-il enfin mener une politique volontariste d’innovation ? (ZDnet)
– Un rapport sur l’innovation qui sent la naphtaline (The satirical article by L’Informaticien)
Criteo is the latest European story. Not yet, some may say, but its numbers are impressive. How do I know? Well in France the Register of Commerce provides a lot of data if you are prepared to pay a small fee (about €10 per document you download). It is possible to know about the rounds of financing, about the revenues, about the founders. It was not as easy as I imagined and maybe I should have bought more documents. (The revenues are not what I had read, stockholders’ shares is probably not accurate as things may be missing. But it looks good enough to me.)
I also know people involved do not always like such publications. Wealth, money is still a taboo, in France particularly. What is important is the message of value creation that entrepreneurs and their investors contribute to create for others. As I copied from the Slicing Pie recently: “Entrepreneurs give security to other people; they are the generators of social welfare. The country needs entrepreneurs, the world needs entrepreneurs. Without them not much would happen. In spite of the exciting life and important role of entrepreneurs, most people never become entrepreneurs. To most people, life is too risky. Most people can’t handle the ambiguity. Most people are afraid of failure. Every entrepreneur fails more often than they succeed.”
So I publish here again, one of my favorite tools, the capitalization table of Criteo with its rounds of financing (€47M raised), its revenues (at least €74M in 2011), its investors and its founders. But the wealth is virtual, it corresponds to a €15 price per share, more than 3 times the price paid by the series D investors…
I do not think Criteo’s journey was easy and simple. When I first heard of the company, it was developing recommendation systems, not ‘personalized retargeting’. It had Plan B related Pivot. So here it is and my apologies for inaccuracies / frustrations.
Here are some more references.
– Criteo Nabs $40 Million in Funding at $800 Million Valuation
– Criteo Hires Bank for Imminent IPO
This last article mentions the IPO of Marin, which I had followed too. The comparison is interesting…
Last week, I attended a workshop organized by Raphael Cohen. He explained his IpOp process. You can read again the post I wrote a few months ago: Proven Tools for Converting Your Projects into Success (without a Business Plan). It’s really a good tool if you need to develop your own project. Cohen mentioned the famous Business Model Generation by Alexander Osterwalder and Yves Pigneur; and he showed us again its 9 building blocks. It has become such a standard… I never mentioned it here. Better late than never!
You can download the pdf canvas here.
Very interesting presentation by the newspaper Le Temps and Xavier Comtesse about innovation in Switzerland (compared to the USA). (Thanks to Pascal for giving me the link :-)). The article is entitled The Swiss innovation model is it the best? (Same document on Prezi)
Before you view or read the content of the contribution by Comtesse, here is my reaction: it is indeed an excellent analysis, but the conclusion can be misleading! One could get the impression that the U.S. does not have large innovative companies like Switzerland has with Novartis, Roche or Nestlé. But I fear that it is a misleading view. The U.S. does not have that start-ups only and our are not growing. Not to forget, the topic of job creation, see Job creation: who’s right? Grove or Kauffman
Now here is a summary translated from Prezi: For several years, Switzerland has been at the top of the world rankings for innovation, this was not always the case especially during the 90s. So … Are we better than Silicon Valley?
Silicon Valley has developed a model in 8 strengths
– Excellent local university system
– Transfer of knowledge to the economy – technoloy parks, coaching, awards, etc..
– Powerful venture capital
– Start-ups that grow quickly and innovate in disruptive fields
– An effective IPO or M&A market (Exit Strategy)
– Large expenditures in R&D
– A high rate of patents per capita
– A strong entrepreneurial spirit per inhabitant
The 7 strong points of the Swiss model: Switzerland has a very different system of innovation from Silicon Valley but ultimately just as effective, especially for large companies.
– No federal masterplan for Innovation
– A concentration in life sciences
– A innovation driven by large companies
– Incremental innovation more than disruptive
– A quality education at all levels
– Framework conditions very favorable to the economy
– A high performance system of transfer of knowledge / technology
What are the strengths and weaknesses of Switzerland?
– Yes, our universities are excellent:
More than half of young Swiss university follow the one hundred best universities in the world, no country has such a result
– No, the Venture Capital industry is very low in Switzerland:
Switzerland underperformed largely in the area of venture capital (investment in Switzerland in 2011: 737 Million for USA 29,500 million).
– No, our start-ups do not grow fast enough:
The excellent survival rate is suspect, this means that start-ups are protected by the academic system or federal funding
– No, there is little IPO in Switzerland:
A small number of IPO (Initial Public Offering) shows weak growth start-ups or SMEs in Switzerland
– Yes, private R&D is very important but for large firms rather than in SMEs:
The share of the private sector is very important in Switzerland, particularly in the life sciences (pharma, biotech and medtech, etc.).
– Yes, we file a lot of patents:
but again it is primarily large enterprises, the proportion of patents is very important in Switzerland, this is partly due to the strong presence of very large firms
– No, the Swiss create firms twice less than the US:
the ntrepreneurial culture is very strong in the U.S., more than double that in Europe,
– Yes, the general conditions of business creation are very favorable:
Switzerland does better than innovative small countries such as Finland, Sweden and Israel
– Yes, technology transfer takes place in Switzerland:
Switzerland has fifty incubators, TechnoParks or other transfer centers Switzerland Silicon Valley
These two models as we have seen are very different. They work well both but the objective differences do not make possible to compare them as is done ll too often, especially in the field of start-ups …
Following my recent post (part 1), here is what I keep from the book without giving all details. Moyer probably needs to sell a few copies!
Moyer introduces the Grunt Fund as a mechanism to allocate equity between founders. He is using the classical metrics I have used in the past (again see Equity Splits in Start-ups) but he adds one interesting point: a dynamic allocation based on future contributions such as time and cash, weighted with your value (reputation, experience, etc). His process is simple:
– Appoint a Leader
– Assign a theoretical value to the ingredients provided by the various Grunts.
– Keep track of the contributions and calculate the possible equity whenever you need based on the relative contributions by each Grunt.
A Grunt Fund makes some people uneasy. They like to know what they’re getting into and they like the I’s dotted and the T’s crossed. That’s fine. If this is you, then don’t use a Grunt Fund – get a job instead. [Page 50] Then be careful about who and what you need. It’s up to you to decide what you need, but be fair!
Moyer mentions on the following page Noam Wasserman’s The Founder’s Dilemma (which I have not read) as a theoritical validation of his approach.
Without entering too much detail, Moyer gives value to time (2x what would a normal salary be) and cash (4x the actual amount). This is subjective. The critical element is that all Grunts agree with the rules. It can change from one company to the other… “Remember, you need to compensate them for not only the work they did, but also for the risk they take.” [Page 64]
When it comes to ideas or intellectual property, Moyer has principles I am quite close to: “Don’t get me wrong, ideas are critical to a business’ success. But turning the idea into a reality is where the value is built, not in coming up with the idea in the first place.” [Page 82]
Sometimes you will need to remove someone. There are 3 possibilities:
– he/she resigns without cause. You need to reduce his slice;
– you terminate him/her without cause. The slice should be kept;
– you terminate with cause. He/she may lose the slice.
[Chapter 5 + Pages 141-145]
The Grunt Fund is for the early days only. When do you stop using it? When you have a predictable business model, or when you have raised $1M. [Page 114]
As a conclusion (and Moyer mentions it many times), “a Grunt Fund is a moral contract, not a legal contract. It tells us how to treat each other fairly. […] A Grunt Fund is the foundation of a trusting relationship.” [Pages 121-122]
An EPFL entrepreneur had contacted me about equity split between founders, employees and investors in a start-up. I mentioned my experience and related blog post on the topic: Equity Splits in Start-ups. Then he came back to me with a book he advised me to read. I am half way through it and it has interesting (and new to me) lessons. So thanks Justin 🙂
The book is entitled Slicing Pie, and subtitled Funding Your Company Without Funds.
I will probably go back when I am finished with this book, but already, here are some examples of what I liked:
The Gap
Somewhere between the inception of your earth-changing idea and the investor presentation to Andreessen Horowitz there is a gap. During that gap, you are expected to have actually built something that resembles a business enough that the gentle and kind venture capitalist will decide that you have your act together and write you a fact check. I call it “the Gap” because it’s during this time that you either fill the gap with behaviors that create a business or let is consume you and your wonderful idea. Most fledging businesses experience the latter.
The days of back-of-the-envelope deals are over. (In fact, they may never have actually existed.) Few investors are willing to provide capital to a company that is little more than a rough idea.
Nowadays, you need to have something worth investing in which often means a management team, a business plan, and, if you’re smart, a working prototype. For bonus points get a few beta customers who are actually paying you. Now you have something worth discussing. [page 2]
The need for Entrepreneurs
“Entrepreneurs give security to other people; they are the generators of social welfare.” The country needs entrepreneurs, the world needs entrepreneurs. Without them not much would happen.
In spite of the exciting life and important role of entrepreneurs, most people never become entrepreneurs. To most people, life is too risky. Most people can’t handle the ambiguity. Most people are afraid of failure. Every entrepreneur fails more often than they succeed. [pages 9-10]
Good and Bad Lessons
Failure is how an entrepreneur learns. Good lessons improve an entrepreneur chances for future success. If you created a product that nobody wants, if your employee leaves you, if a competitor comes out, if your marketing did not work, if you run out of money, you will learn.
Being an entrepreneur requires a lot of trust and confidence.
But if they get burnt by partners, they learn bad lessons. They spend more time covering their own butts. They learn to move more slowly and take fewer risks. They learn to be less like entrepreneurs and more like everyone else. [pages 10-11]
Grunts
Grunts are people who are willing to forgo cash compensation in exchange for a piece of the pie. Grunts do the work necessary to turn an idea into a reality. They will do the fun work and the dirty work. They are as comfortable licking stamps as they are building a strategic plan. [page 28] (I love grunts probably because in some aspects I am one, even if not an entrepreneur!)
As a conclusion to his first chapter, author Mike Moyer claims that an entrepreneur needs a method for slicing the pie that is easy to understand and
– rewards participants for the relative value they provide,
– provides motivation for them to continue to provide more ingredients,
– allows founders to fairly add or subtract participants to or from the company,
– is flexible in the face of rapid change.
More in part 2!
In 2007, I had made the same exercise, i.e. extract from the Forbes billionaire list, the ones who had a link with technology. I found by accident the 2013 Forbes list, and did the same exercise. Again the USA dominates and the word is weak. Europe has 8 whereas the USA has 63…
What’s new from the 2007 Technology Billionaires is the new comers, the web2.0 winners from Facebook, LinkedIn, Twitter and Groupon, not to forget GoDaddy!
Top: the Facebook billionaires. Bottom: founders of Linkedin, Twitter, Groupon, GoDaddy and finally Laurene Powell Jobs.
Also, average age is 57 but Internet billionaires’ age is 46!
| # | Name | Origin | Company | Field | Wealth ($B) | Age |
| 2 | Bill Gates | USA | Microsoft | Software | 67 | 57 |
| 5 | Larry Ellison | USA | Oracle | Software | 43 | 68 |
| 19 | Jeff Bezos | USA | Amazon.com | Internet | 25.2 | 49 |
| 20 | Larry Page | USA | Internet | 23 | 39 | |
| 21 | Sergey Brin | USA | Internet | 22.8 | 39 | |
| 49 | Michael Dell | USA | Dell | Hardware | 15.3 | 48 |
| 51 | Steve Ballmer | USA | Microsoft | Software | 15.2 | 56 |
| 53 | Paul Allen | USA | Microsoft | Software | 15 | 60 |
| 66 | Mark Zuckerberg | USA | Internet | 13.3 | 28 | |
| 94 | Ernesto Bertarelli | CH | Merck Serono | Biotech | 11 | 47 |
| 98 | Laurene Powell Jobs | USA | Apple | Hardware | 10.7 | 49 |
| 122 | Hasso Plattner | D | SAP | Software | 8.9 | 69 |
| 123 | Hansjoerg Wyss | CH | Synthes | Medical devices | 8.7 | 78 |
| 123 | Pierre Omidyar | USA | Ebay | Internet | 8.7 | 45 |
| 138 | Eric Schmidt | USA | Internet | 8.2 | 57 | |
| 145 | Patrick Soon-Shiong | USA | Abraxis | Pharmaceuticals | 8 | 61 |
| 154 | James Goodnight | USA | SAS | Software | 7.7 | 70 |
| 156 | Klaus Tschira | D | SAP | Software | 7.5 | 72 |
| 179 | Xavier Niel | F | Free | Internet | 6.6 | 45 |
| 182 | Dietmar Hopp | D | SAP | Software | 6.5 | 72 |
| 262 | David Duffield | USA | Peoplesoft | Software | 4.8 | 72 |
| 316 | Gordon Moore | USA | Intel | Hardware | 4.1 | 84 |
| 353 | Dustin Moskovitz | USA | Internet | 3.8 | 28 | |
| 353 | John Sall | USA | SAS | Software | 3.8 | 64 |
| 363 | Jeffrey Skoll | USA | Ebay | Internet | 3.7 | 48 |
| 376 | Barbara P. Johnson | USA | Johnson & Johnson | Medical devices | 3.6 | 76 |
| 437 | Reid Hoffman | USA | Internet | 3.1 | 45 | |
| 437 | Alain Merieux | F | Biomerieux | Pharmaceuticals | 3.1 | 75 |
| 503 | Ronda Stryker | USA | Stryker Corp. | Medical devices | 2.8 | 58 |
| 503 | Andy v. Bechtolsheim | USA/D | Internet | 2.8 | 57 | |
| 527 | John Doerr | USA | KPCB | Venture capital | 2.7 | 61 |
| 527 | Elon Musk | USA | Tesla Motors | Hardware | 2.7 | 41 |
| 554 | Marc Benioff | USA | Salesforce.com | Software | 2.6 | 48 |
| 554 | Jack Dangermond | USA | ESRI | Software | 2.6 | 67 |
| 554 | Phillip Frost | USA | Key Pharma, Ivax | Pharmaceuticals | 2.6 | 76 |
| 554 | David Sun | USA | Kingston Technology | Hardware | 2.6 | 61 |
| 554 | John Tu | USA | Kingston Technology | Hardware | 2.6 | 72 |
| 613 | Mark Cuban | USA | Broadcast.com | Internet | 2.4 | 54 |
| 641 | Ray Dolby | USA | Dolby Laboratories | Hardware | 2.3 | 80 |
| 641 | Ralph Dommermuth | D | United Internet | Internet | 2.3 | 49 |
| 670 | Michael Moritz | USA | Sequoia | Venture capital | 2.2 | 58 |
| 670 | Eduardo Saverin | USA/Bra | Internet | 2.2 | 30 | |
| 736 | Sean Parker | USA | Internet | 2 | 33 | |
| 785 | Romesh T. Wadhwani | USA | Aspect | Software | 1.95 | 65 |
| 792 | Meg Whitman | USA | Ebay | Internet | 1.9 | 56 |
| 831 | Hans-Werner Hector | D | SAP | Software | 1.8 | 73 |
| 831 | Thomas Siebel | USA | Siebel | Software | 1.8 | 60 |
| 882 | David Filo | USA | Yahoo | Internet | 1.7 | 46 |
| 882 | Henry Samueli | USA | Broadcom | Hardware | 1.7 | 58 |
| 882 | David Cheriton | USA/Can | Internet | 1.7 | 61 | |
| 922 | Kavitark Ram Shriram | USA | Venture capital | 1.65 | 56 | |
| 931 | Craig McCaw | USA | McCaw Telecom | Telecom | 1.6 | 63 |
| 931 | Pat Stryker | USA | Stryker Corp. | Medical devices | 1.6 | 56 |
| 931 | Peter Thiel | USA | Paypal, Facebook | Internet | 1.6 | 45 |
| 965 | Irwin Jacobs | USA | Qualcomm | Hardware | 1.55 | 79 |
| 974 | Vinod Khosla | USA | KPCB, Khosla | Venture capital | 1.5 | 58 |
| 974 | Bob Parsons | USA | Go Daddy | Internet | 1.5 | 62 |
| 974 | Jerry Yang | USA | Yahoo | Internet | 1.5 | 44 |
| 1031 | John Brown | USA | Stryker Corp. | Medical devices | 1.4 | 78 |
| 1031 | Steve Case | USA | AOL | Internet | 1.4 | 54 |
| 1031 | Henry Nicholas, III. | USA | Broadcom | Hardware | 1.4 | 53 |
| 1107 | Mark Stevens | USA | Sequoia | Venture capital | 1.3 | 53 |
| 1107 | Jon Stryker | USA | Stryker Corp. | Medical devices | 1.3 | 54 |
| 1107 | Nicholas Woodman | USA | GoPro | Hardware | 1.3 | 37 |
| 1161 | Graham Weston | USA | Rackspace | Internet | 1.25 | 49 |
| 1175 | Jim Breyer | USA | Accel | Venture capital | 1.2 | 51 |
| 1175 | Robert Duggan | USA | Computer Motion | Medical devices | 1.2 | 68 |
| 1268 | James Clark | USA | Netscape | Internet | 1.1 | 68 |
| 1268 | Jack Dorsey | USA | Twitter, Square | Internet | 1.1 | 36 |
| 1268 | Eric Lefkofsky | USA | Groupon | Internet | 1.1 | 43 |
| 1342 | John Morgridge | USA | Cisco | Hardware | 1 | 79 |