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I’m Holding Out For A Startup Pioneer

Another Saturday morning Twitter conversation got me thinking about big-idea startups. For me, it all comes down to the quality of the entrepreneurs – both in ideas and execution. Paul Freet cut out a couple tweets that went like this:

“The best markets are zero-billion dollar markets. $0 today. Your innovation makes it $1B+. Tough to prove. Need visionary investors.”

“If market must pre-exist, Zynga never gets funded. Social gaming was $0 in 2007. $1B this year.”

After a momentary concern that some anti-bootstrapping activist had hacked Paul’s Twitter account, it occurred to me that true rock stars are made this way.

I’ll use my own partner Ben Dyer as an example. It was 1977 and the guys inside a computer hardware dealer had just written themselves some non-mainframe software. Peachtree Software was spun out of The Computer SystemCenter in 1978, and Peachtree Accounting was bundled with the first IBM PC. And yes, that was the first business software ever for microcomputers. Rock star made.

And Paul’s point about Zynga is spot-on, which makes them the modern-day equivalent. In this case ‘social networking’ sites were the IBM PC, and social-enabled gaming was the category created in 2007. Talk about a first-mover advantage in a Facebook ecosystem that would grow into a 500M member web destination. Again, Mark Pincus delivered perfect timing into an exploding market. Rock star made.

And make no mistake; the same phenomenon repeated itself through the ‘80s and ‘90s with companies like Adobe and Amazon respectively. So if this can happen as easily in 2007 as it did 30 years earlier, then who’s working on harnessing the next seismic shift? Realistically, this isn’t the type of company building that fits in a nice little box. It’s the kind of effort where people – friends, family, investors, analysts, media, etc. – look at you like you’re nuts when you outline your plan for world domination of something they can’t see or understand. Hell, if you’re really genius, you might not even be able to explain it sufficiently.

So I ask this simple question of entrepreneurs: Does your startup idea baffle people? If so, you’re on to something and now it’s time to figure out if it’s pure genius or your own delusion. Seek out 10 of the smartest, hardest-working folks in a related category (I’m assuming your idea is so big it doesn’t fit into an existing one) and find a way to get 30 minutes face-to-face. If more than one meeting turns into a two-hour session including whiteboards and peer introductions, you’ve got a winner. Batten down the hatches and prepare for a long, hard run at changing the world.

On the other hand, if all 10 glaze over within 5 minutes then be real with yourself and move on. In most towns you’ve not burned all the bridges, but it might have earned you a 'maverick' reputation you’re probably better off with anyway. ‘Cause that’s probably how you roll…

So how does a startup town find these pioneers? Or can they be found? I certainly don’t have all the answers, but I know an ecosystem needs big wins – and this is who delivers. Maybe most importantly, how do we get the hell out of their way?

My final question is who’s the next Ben Dyer or Mark Pincus? Nominations?

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0 # Lance Weatherby 2010-08-03 03:27
If the startup idea baffles people it is likely the entrepreneur is ineffective or delusional. The most common reaction is something along the line that "they don't get it." If they don't get it one of two things is happening. 1. You can't pitch. 2. It's a bad concept. Good concepts, based on potential market need are immediately apparent when properly explained.
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0 # GFRRTDEFF 2010-08-03 05:17
Really? It's always at the foot of the entrepreneur? The 'establishment' really knows everything? At various points (and to various degrees) I fully believe the Emperor has no clothes...

I've spent the last 3-4 days consuming a ton of thinking from Ron Conway, Dave McClure, Brad Feld and Fred Wilson on the topic of entrepreneurshi p and there's a major shift happening that I think changes the whole game. Post coming soon...
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0 # Lance Weatherby 2010-08-03 12:05
I did not say the establishment knows everything. I said a good idea is apparent.
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0 # Heath Wilkes 2010-08-05 10:51
A Catch-22, the advice above is statistically true except when it's not. Follow me here... We've all seen entrepreneurs who find any criticism, even constructive, to be a false attack on their brilliant idea. Yes, some of these aspirational founders are feverishly unwavering to market forces. And to be fair, the vast majority of startups do need to hone their pitch or pivot their business model. The problem is history proves the biggest game-changers also swim in this same exact water. The startups that redefine our world, creating new $1B+ markets in the process, are often met with huge resistance during their seed stage. Most 'Startup Pioneers' (the context of this post) have war stories of how certain investors and/or advisors were "baffled" by their idea, and how they had to shop hard until they found a visionary (or three...) to support them. It's only in retrospect these crazy entrepreneurs are labeled genius.

Repeating variations of this same basic theme suggest many of the best concepts were initially misunderstood by the very markets they soon changed. In fact, plenty of folks smarter than me will argue if an idea is "immediately apparent" the entrepreneur is simply not aiming high enough. Which is to say, all that baffles is not bad:

"Don’t worry if the idea seems crazy. If it didn’t seem crazy, it would be too late to invest as an angel." - Paul Graham

"I don't know what a dipshit company is. I haven't seen one. If you listen to the chatter on the Techcrunch comment threads, you will see that people think Twitter and Foursquare are dipshit companies. Fine. Many great companies have been built on a wall of derision and I personally think those two are going to join that list of laughed at great companies (and maybe already have). My point is you just don't know what is a crazy idea and what is a brilliant idea. And you don't know what is a great team and what is a weak team. Of course, we have our opinions on that. We make those judgment calls every day. But we are often wrong. VCs are wrong more often than they are right." - Fred Wilson

For a startup community to thrive, you need a few big wins. Yet, big wins rarely come from playing safe bets. And that's my fear when people follow practical advice to the letter of the law. New entrepreneurs with uncomfortable, uncommon, baffling, big ideas will too quickly be labeled as either "ineffective or delusional" before they can blossom. We end up discouraging the very thing we seek. Or worse yet, we coddle a generation of incremental companies in the wake of monumental shifts in technology and entrepreneurshi p. Said simply, we get left behind. That's why I challenge everyone to consider the possibility of a third option: 1) You can't pitch. 2) It's a bad concept. 3) Your company will be worth billions. And if we can admit the last option exists, the next logical question is clear: How does our community protect, nurture and execute on such a wonderful-for-all possibility?

So yes, good ideas are immediately apparent, but that same timestamp rarely applies to the great ones. And every town sure could use a few more of those...
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