Charles Ross Says Need More Capital Residing in Georgia Last week, TechDrawl featured Charles Ross, general manager of the ATDC, giving his take on the entrepreneur community in Georgia. After the video, the post goes on to describe the great location ATDC has in the center of the Atlanta tech community. The remainder of the post highlights the mission of the incubator and bio for Charles.
TechJournal South had a great article a few weeks ago about raising money in the current economy. Bill Warner, managing partner at business consulting firm, Paladin and Associates, reminds entrepreneurs that having discipline and focus is a top priority at all times, not only in tough economic times. Investors are calling for a conservation of cash, rethinking the revenue plan, justifying capital purchases and a positive cash flow. These greater efficiencies are a good target for successful business, investments and exits. Mr. Warner ends the article with an encouraging word to keep going, redouble efforts and make a positive return quickly.
Entrepreneurs at all stages can benefit from these reminders.
At the most recent version of Meet the VC, the entrepreneur community of Atlanta had the pleasure of meeting with Vimal Patel. Vimal talked a bit about his firm, Silicon Valley based Sierra Ventures, gave some helpful tips to our entrepreneurs, and put in a good word for the Atlanta community.
The Numbers Sierra Ventures sees 2,000 – 2,500 deals a year and they sit down with 50-75% of them. Most of the deals come to the firm through referrals. Due diligence is completed on about 75 deals and term sheets are given to approximately 20 companies a year. Twelve a year will close.
The Attitude During the economic slowdown, VC's are looking to extend the cash runway of their deals, cut costs, and streamline operations. For new investments, VC's are looking for recession-proof stories and if the case is good, they will keep spending. The VC's are paid to invest money that has already been committed and they are looking for good opportunities to do it.
Entrepreneurs: Tips
A successful management team is made up of a CEO who can hire well and open the right doors and a technology person who is passionate and knowledgeable about the industry
Effective product management is a key driver for success. Be sure to clearly define what the product is, understand the market, how your product fits and how you are going to sell it.
For your pitch, 12-15 slides {Sample presentation file} is plenty!
During due diligence, the VC will ask your customers three questions: Why did you buy the product? Why did you chose this particular product/company? How much money are you going to spend on this product in the next year?
The Good Word for Atlanta: The capital efficiency is great in Atlanta. The area is less flashy and not caught up in the buzz and that can prove to be very fruitful when cash is short. Vimal says that he has never seen anything like ATDC in the country! ATDC is a great resource and the executive talent in the region is also very good.
The last two days at the Omni Hotel in Downtown brought the who’s who of the wireless world to Atlanta. And, by who’s who, I mean a serious gathering of real global players at a conference that combined both big names and depth to an agenda.
Hosted by the GSM Association, this conference was the first of it’s kind in the America’s. The other two events organized by this group are in Barcelona and Mcau. The agenda included a plethora of executives from the likes of Yahoo!, MSFT, etc., to leading VC’s, to innovative start-ups (most having raised close to $100m or more in funding) and the largest global carriers on the planet.
These two days alone highlight the volume of activity in the mobile space and where the industry players see things moving. All this, in addition to some specific opportunities that lay ahead.
It’s a great thing for Atlanta to have this event in addition to having the GSMA’s US HQ right in our backyard.
ATDC graduate founder and ATDC Entrepreneur Advisory Council member Bird Blitch recently shared his thoughts on entrepreneurial coverage in Georgia:
"Time to jump on my PR soapbox. Our media exposure for Georgia technology companies is to be frank, way too limited. Did you know Firethorn recently was acquired by Qualcomm? Did you also hear about SPI Dynamics being acquired by H-P? HUGE wins for the community. Great stories about entrepreneurs and management teams who had a vision and then executed on it."
Why not more acknowledgement from the mainstream press? Not just an announcement, but an after-the-fact, in-depth analysis the way college football and basketball is dissected everyday in the papers. The day the Firethorn acquisition was made public, the headlines in the AJC Business Section focused on chicken. It’s time to change the way people see things in this state. Back in the old days, the economy used to be run by agricultural interests — cotton, soybeans, peaches, etc. This state was loaded with farmers. Then apparel manufacturing was the apple of everyone’s eye in the 50′s, 60′s and 70′s. Textile mills dotted every small town.
But now if you look at the two greatest economic engines in the state, it’s got to be the airport and Georgia Tech. Technology is the future. It’s where the jobs are. And when we get wins in our community, they need to be analyzed and discussed by the mainstream press.
TAG does a good job of evangelizing this PR battle, but in the end, big wins drive the entrepreneurial ecosystem. Without wins, the money dries up. New ideas don’t attract investors because the same investors have their money tied up in other deals. As a result and without cash on hand, it’s harder for these new businesses to attract scale and customers in a timely fashion. These entrepreneurs are forced to cash flow the business. Which, by the way, isn’t all bad if you can do it and still achieve scale.
"Scale" leads to revenue generation and exits. If the business is growing and can scale, then there’s a good chance for a strong exit. These exits are the ultimate complement for our community. Yet, when it happens, they seem to get mentioned and then forgotten.
So just don’t sit there and agree with me, how are you going to help change it?