Remember Where you Came From

When I got selected for the Meritorious Commissioning Program, I was at the rank of Sergeant and all my friends congratulated me and said “Ann, remember where you came from.” Remember life as an enlisted Marine…remember what it was like, so you will be the type of Officer the Corps needs the most. That’s what they were saying and it’s what I did.

Six years later, when I left the Marine Corps, as a Captain, my Marines wished me luck and said “Ma’am, remember where you came from and that we’re always here.” They meant that there was nothing in the civilian sector that could or would stop a Marine, and that the Corps and its ethos are always part of me and who I am.

There is no boot camp to forge someone into an entrepreneur, but there are rights of passage and it is one tough road to undertake. However, as I continue my research on finding Angel Investors and funding…I’ve come to wonder if some of them have forgotten where they came from. (This would be making the assumption that the majority are former entrepreneurs themselves.)

I’ve visited quite a few Angel Investor sites again, in the last two days, and been getting some emails from other types of organizations interested in learning more about us, so that we can present at their next conference. What gets me are the price tags attached to these “opportunities” to present. I’m going to compile a list and post it in the next couple of days, but I wanted to get this post out.

Obviously, some of these folks have forgotten what it’s like to be a start-up entrepreneur. If I had a couple thousand dollars to over $10,000 laying around for every presentation that struck my fancy…I obviously wouldn’t need YOU in the first place. The little money we have is better spent on the things that create progress and get us closer to launching our product. Why spend it on potential opportunities to present to a room full of supposedly investors, that come with no guarantees?? I mean, come on…what is this all about?!!? Being an entrepreneur is about taking risks and chances, but not about being flat out dumb and careless with the few assets you do have.

Remember where you came from…it seems that some of these investors out there have forgotten that at some point in time, someone came along and they cut them their break. And that someone who cut them a break…got wealthier off of them in the process.

I do want to say a BIG THANK YOU to the entrepreneurs following this blog, who have been in our shoes not long ago, and are going out of their ways to try to help us. Erik, Ed and Alain your interest in us and support is much appreciated.

Meanwhile, I’ll ponder the age old question…what came first, the chicken or the egg. I mean, what came first…the entrepreneur or the investor? One cannot go on without the other.

I’m going to see the movie premier of The Call of the Entrepreneur tonight. I’m really looking forward to it. Best part is going to be being in a theater filled with other entrepreneurs and like minded individuals. We’re going to the VIP after party afterwards, and I can’t wait to chat it up, I’m sure I’ll have much to blog about!!

Raising Money: A Headache and Motivation!?!?

Raising money is a seriously frustrating process and when I get frustrated I get a little “aggressive”. I’m at the point where I want to hit people over the head and slap some sense into them. Remember, I spent ten years in the Marine Corps; I have little tolerance for game playing, stupidity and ignorance.

Fund raising takes time and it’s definitely a pain staking process. Getting the introduction, getting past the red tape and working through all the scams and foolishness that’s out there is enough to drive you a little “postal”. Filling out online application after online application…you want me to describe the team, the concept, and the market in 250 words or less? Not, going to happen. We’ve submitted our business plan into so many different abyss, I’ve lost count. No one contacts you back, and most of the systems don’t even have confirmation emails that let you know your plan was received.

We’ve expanded and grown Why Go Solo so much now, that the business plan is actually completely outdated and I don’t have the slightest desire to update it. What’s the point. I’ve also grown paranoid about sharing Why Go Solo with investors…we’ve got too much to offer and by that I mean…actually having a business model. I need to worry as much about someone stealing our idea, as someone stealing our business model. Scratch that, I’m more worried about someone stealing the business model than the idea…not too many people could pull off the idea, without having a front man, that can bring a community together.

My Chief Technical Officer keeps reminding me that things will be very different once we have the beta…and I know that. It doesn’t hurt that we’re also planning on winning the Amazon Web Service Start-up Contest.

I guess I just need to let out some steam…

Bottom line is, I don’t understand investors and I hate it when I don’t understand something or someone. To understand them , I would have to talk to some, and to talk to some; they would need to show themselves. I realize I said I was ready to slap people around, but I promise to be nice. I’m particularly looking for Angel Investors. We need a couple hundred thousand dollars, to may be, a million. So VCs, are not who we’re looking for…and we’re definitely not looking for a six month due diligence period.

We’re on fire and we need some backing (btw, this isn’t an open solicitation, these are facts). We can move at a bootstrap pace…or we can turn up the heat a few notches. Anyone whose been reading this blog, should know I don’t mess around. This isn’t a start-up that might see the light of day…this is a start-up that’s going to turn into an Empire. We’re not just building a company here. Hence my frustrations…I read about all of these 'mom and pop' web 2.0 company getting funded, and it increases my WTF is up with investors factor. (I'm probably not helping my cause!!)

Someone basically came out and told me I need to move to NYC. I replied that we’re making being in DC work for us...However, I can’t help but have his comment feel like a thorn in my side. Is being in DC really holding us back? I know I never would have thought about or created Why Go Solo had I not been here, so who knows...

I need the right words and the right compelling way to get investors to give me 5 minutes of their time. I’ve always been turned off by cocky and arrogant claims. It used to really tick me off when I was in the Marine Corps, too. Some folks would make outrageous claims about what they (with their platoon) could do…and they never delivered. I never made claims and we always over delivered. I’ve never had anything to prove to anyone. We always did what we had to do for own gratification and to beat our own personal best. It’s about internal drive and motivation; vice outside sourced (fake) drive and motivation. It's about empowering people, and empowering an organization.

It’s the same with Why Go Solo. We have a kick ass team, that has nothing to prove…but everything to give to seeing what they’re made of and what they can accomplish. The drive is the vision and seeing it happen. The hunger and ambition is alive in each member of the team. Those who achieve greatness, are those who challenge, and push themselves, beyond who they are now, today. The gratification and satisfaction is about results and accomplishment, not praise or money. Don’t get me wrong…they’ll be plenty of that to go around at the end of the rainbow, but it’s that “We Did It” moment, that will be the ultimate moment of sweet success. That "We Did It" moment will only be truly known in those who have been there from the beginning...who took the risks, who bleed together, who wrote history.

Those who dream big, and embark on accomplishing things that are bigger than themselves, never wonder what life is all about.

When you have a team like that behind you…you know what you’ve got, and what you will achieve…there’s no need to get to the highest tree top to announce it. We’ll deliver. We’ll make it happen. Now, who is smart enough to take us on?!!?

My purpose in life this week is to get on the calendar of investors. November is our beta launch…I’m not waiting till then to get to talk to investors or get on their calendars. This is about being ahead of the game and keeping/building more momentum.

87 Million to May be Turn a Profit!?!?

Are you kidding me?? I’m about to rant and rave…this is hands down the worst stuff I can come across in the blogs I read. This post came courtesy of Venture Beat: Zillow gets $30M more for online real estate — despite credit crunch. That will be a grand total of 87 Million Dollars…and they are NOT a profitable company. To add insult to injury the article reports that Trulia and Terabitz both basically identical to Zillow.com pulled in 10 million dollars a piece in funding.

Someone, will you PLEASE explain the logic behind this insanity, to me?!? How can investors see a upcoming profit anytime soon!?!? Is another 30 million dollars really going to make a difference…they already have 100 programmers on staff and 155 employees. They’ve only been around for less than two years. What are they doing?? And why invest in identical companies?

The folks at Zillow.com have also proudly announced receiving a third round of funding on their blog. Personally, I would have kept it nice and quiet. I wouldn’t announce needing even more money and becoming “the most richly backed of the new era of “Web 2.0″ Internet companies.” I would rather become the Largest and Most Profitable Web 2.0 Internet company, Who Received the Least Funding in the History of Web 2.0 Companies…

Keep that headline handy…you’ll see it again, in less than two years.

I’m all fired up!!

Competitive Spirit: AWS Start-up Contest

We’ve decided to enter the Amazon Web Services (AWS) Start-up Contest. (Only thing that would stop us is an argument against it from our lawyer) One of our developer came across the contest and passed it along…of course, I got excited about it right away.

I play to win. I have a very competitive spirit and I love when it gets fired up. I also love the thought of having additional incentives that make me and the team work extra hard towards multiple solid tangibles.

Reap the rewards (Excerpt from Contest Page)

Prizes include $50,000 in cash, $50,000 credit toward Amazon Web Services, an investment offer from Amazon, and mentoring sessions from an Amazon Web Services Technical Expert. All five finalists will be included in various promotional activities and be featured at the invitation-only AWS Start-Up Challenge Awards Dinner.

This would be excellent exposure for Why Go Solo and it conveniently co-insides with our scheduled launch date. (Excerpt the Rules)

For each Finalist, Sponsor will produce, at its expense and at the Finalist's location, a professional video highlighting the Finalist's Business Proposition (the "Finalist Video"). The Finalist Videos will be posted online at http://aws.amazon.com/startupchallenge in November 2007. The public will be permitted to view and vote on the Finalist Videos online at the contest website, but the votes will not determine the winner.

Final Round. The final round will take place in December 2007 in Seattle, WA at the Amazon corporate headquarters. Each Finalist must be present in person at the final round and must prepare, at the Finalist's expense, a 30-minute presentation and demo of its Business Proposition. The presentation and demo will be presented to the Amazon Judging Panel. Each presentation and demo will be followed by up to 30 minutes of Q&A by the Amazon Judging Panel.

Amazon Web Services

We have been discussing and already considering Amazon EC2 and Amazon S3 for the hosting and storage solution for Why Go Solo…so the contest helps us make our decision and allows us take advantage of some serious perks.

I’ll make the announcement to everyone once our application is submitted!!

Some Answers to Real Questions

I was messing around yesterday in my last post; below are some real questions you could very well encounter when briefing VCs.

The excerpt comes from Guy Kawasaki's book, The Art of the Start. It's an excellent MUST read for anyone starting or thinking about starting a business, whether or not you will seek funding. It's filled with great tips, advice, information and what I considered to be Guy's sarcastic humor (which I absolutely love).

Can you guess who is the VC and who is the entrepreneur in the picture?!?!

Investor Trick Question	What you Want to Say	What You Should Say
“What makes you think you’re qualified to run this organization?”	“What makes you think you’re qualified to run this venture capital firm?”	“I’ve done OK so far, getting us to this point. But if becomes necessary, I’ll step aside”
Do you see yourself as the long-term CEO of the organization?”	“What did your limited partners see in you?”	“I’ve been getting focused on getting out stuff to market. I will do whatever is necessary to make this successful—including stepping aside if needed. Here are the logical milestones at which we can make this transition…
“Is ownership control of the organization a big issues for you?”	“I’m going to be putting in eighty hours a week to make this successful, and you’re asking me if I care how much of it I own?”	No, it’s not. I realize that to make this successful, we need great employees and great investors. They all need have a significant stake. I will focus on making the pie bigger, no on getting or keeping a big part of the pie.”
“What do you see as the liquidity path for the organization?”	“An IPO that sets a new record for valuation for NASDAQ!”	BUY THE BOOK FOR THE ANSWER!! Aren’t I mean…

Blessing the Investor Binders

Last night I finished the investor binders. We started them about two weeks ago in the hope they would already be well on their way and finding us investors.

A few things held us up:

1) A misunderstanding of what needed to be in the binders.
2) Getting the appropriate feedback back on the executive summary included in the binder (we finally decided to print it the way it is, although my good friend Alex did send me some feedback).
3) It took longer then anticipated to receive our business cards.

The binders include a 12 page extended executive summary, a 10 page power point presentation and one of mine and one of Martin's business cards. Nothing too fancy or complex. Enough to provide an overview of Why Go Solo, our product and services, mission statement, target markets, marketing plan, management team and projected earnings.

The binders will be mailed out on Monday, 35 will to go Florida and 31 (4 were already hand delivered) to Connecticut. Once they reach their destination CJ and Gregg, respectively, will then further distribute them to their joint partners they have identified as potential interested partners that are affiliated with accredited investors who seek out this particular type of investment.

The same documents included in the binders will also be posted on secure websites for other accredited investors, who can browse our project at their leisure, when they are seeking investment opportunities. Our goal in the first round is to find 25 investors who will make a minimum investment of $10,000 for a certain amount of shares.

While I was looking at the binders last night, I definitely said a quiet prayer. Getting the initial round of funding will allow us to implement Why Go Solo, prove the concept and then go for more money. Getting the initial round of funding means that I can take a sigh of relief (however short) and proceed with making Why Go Solo happen.

It's been over six months that Martin, Ruth and myself have been working at getting Why Go Solo ready for show time. The business plan has been reviewed, chopped, changed, and edited multiple times...with many more changes to come since that's the nature of the beast; we've talked to over a hundred people, continued to do research, and expanded the concept, but the core of what we are aiming to do hasn't changed, only grown and so has our passion.

This is our moment of truth. Yes, we've hit road bumps, dead ends, and many obstacles and we’ve persevered, adapted and we've kept on going which has gotten us here today. Why Go Solo will not appeal to all investors and we're ready for that however, we look forward to welcoming the investors who share our vision, who are ready to join our journey and who are ready to make a positive impact in people's lives.

Characteristics of the Ideal Investor

I’m big believer in the Laws of Attraction. In order for you to attract what it is that you want and desire…it makes perfect sense that you know, are clear about and able to visualize “it” (it being what you want/desire). So with that being said, and all the efforts we're putting into finding suitable investors for Why Go Solo; I figured it was time to publish and send out to the Universe our order for what characteristics we want our ideal investors to possess. Here goes:

1) Someone who is at least familiar, if not completely knowledgeable about online communities, to include: features, usage, widgets, income model, popularity, and technology.

2) Someone who has a desire to have a positive impact on our society and make a difference in people’s lives. Why Go Solo is being created to change people’s lives, to connect people together, to open lines of communication, to help people add fun, excitement and new adventures in their lives. We want investors who want to be part of delivering this joy to others.

3) Someone who is outgoing, an extrovert, and a networker with a large circle of connections and friends. Someone who enjoys meeting new people and expanding their horizons.

4) Someone who is part investor and part philanthropist. We have added to our business charter, that upon becoming profitable, we will make yearly charitable donations to non-profit organizations. We will only deal with investors who are excited about that.

5) Someone who is familiar with the pain of continuous traveling and time on the road, the hardship of making and maintaining friends because of constant relocating, and the aggravation of wanting to go out to eat and not having company.

6) Someone who admires passion, drive and the journey of following one’s dreams. Our ideal investors will recognize our strengths and potential…our hunger and zeal for success.

7) Someone who understands that when you meet someone new, you introduce a whole new world of possibilities into your life. We want investors who “GET” what Why Go Solo is all about, and realize that yes, it will give them a handsome return on investment, but more importantly, it will have a POSITIVE impact in people’s lives.

Let The Fund Raising Begin

We have finally taken a company on board to help us raise the funding we need. It was a nerve wrecking decision to make, but a decision Martin and I, both felt was necessary to make. We came across this particular company on the GoBigNetwork.com over two months ago. After I joined the website, I sent out my 20 maximum a day emails to investors and investment banking companies that met our criteria. I was contacted by CJ, the President of Millennium Capital Quest Corp,. either the same day I sent the email or the following day. With in the following days, we had quite a few phone exchanges and a 2 hour conference call between CJ, Millennium’s CFO (Gregg), Martin, myself and our lawyer. After the conference call, we were ready to start doing business with Millennium—that’s when my phone rang and it was an individual interested in funding Why Go Solo. That particular investor never came through, which is why, we went back to our original decision.

The really nerve wrecking portion of signing up with Millennium came after I spent some time reading the forums on GoBigNetwork.com. The many listings and comments pertaining to NEVER paying a fee to a company to raise funding were daunting, especially since we were about to pay…what I consider, a hefty fee up front. I emailed CJ right away. I needed to get some reassurance from him and also wanted to let him know, that if, they take us for “a ride”, I would come knocking at his door!! He promptly called me. He reminded me of their process, and also, that ultimately, closing the deal is entirely up to us (the Why Go Solo team). He promised he will put us in “front” of many investors and coach us through the process however, our performance and ability to sell Why Go Solo rests on our shoulders.

I want to insert a quick note, right here, about whether or not anyone should pay upfront fees to raise funds. I AM HARDLY AN EXPERT but the saying goes: You need money to make money…right?? Well, I would add: You need money to RAISE money. This realization hit me while I was working out. Going back to the forum, people were saying to never pay any fees upfront…well, the ironic thing is, in order to post your listing and email investors on GoBigNetwork.com, you have to pay a FEE!! So, to simply be exposed to potential investors, brokers and investment bankers…you have to PAY. (Same with the Grubstake Breakfast we attended two weeks ago) It would be great if you didn’t have to pay anything…but I think that’s very unlikely. There are many scams on the site and all sites that deal with raising money, so you do have to be cautious and careful.

Martin called GoBigNetwork.com customer service and spoke to Steve, who told him, Millennium has been listed on GoBigNetwork.com since last September and no one has ever reported any bad dealings or interactions with them. This confirmed the other research we had done and put our minds a ease a little more. I don't think you can ever be a 100% sure with these things.

We did the fund transfer on Wednesday to cover the required fees, and today, we received our marching orders from CJ and the due diligence package. We all have a lot of work ahead of us. Personally, I really have to review, update and improve the business plan. I also have to get more supporting material together.

I’m also going to start an investor’s series…the series will be about the various reasons to invest in Why Go Solo and will cover a little more about the research that validates our concept. We want to help our investors feel good and confident about their investments…we also want them to be ready to sign their checks very quickly!!

If you are an entrepreneur doing what we are doing...or about to do what we are doing, this blog is about to get very interesting for you.

Weekly Recap and All the Stuff I Missed

A/C is Fixed: Let me start with that, in case, any of you were really concerned about the nightmare that has been for me. I still have the holes in the wall and ceiling…but it’s nice and cool in the house. The new A/C system is much more quiet and efficient.

Mr. Boogey Boo: He’s still alive. I haven’t called any vets yet, but my roommate has agreed to take him to the vet once I’ve found one.

I failed to mention a few big things that happened this week. I guess my head was too much in blogging about my personal stuff!!

Web Designer: Last Monday, Martin and I met with a brilliant web designer who can get everything we need for a beta site for Why Go Solo in 6-8 weeks at an unbelievably reasonable price. We were flabbergasted by this guy, his abilities and his prices. We’re keeping him a secret for now!! We predict that he’ll be getting more business then he can possibly handle real soon.

A Call to My Dad: After meeting with Super Web Guy…we needed to come up with some money for the down payment so we could get the ball rolling. I did the one thing I never thought I would do, the one thing I had been avoiding, and the one thing I was scared to death to do. I asked my dad for money. He said “Yes”. I haven’t received the money yet, but will. I was so happy and relieved that he said yes. It would be way too long of a post to explain my relationship with my dad—jus want to point out that only following my dreams gave me to strength to overcome my “issues”.

Down Payment: On Friday the down payment was, well, put down, which means we’ll start working on the development of the beta site TOMORROW!!

Investors: We haven’t heard back from anyone that we’ve contacted, briefed and provided the business plan to. Next week, I’m going to make another round of calls to a few folks, but I also have a new plan for raising the money I want to implement next week. Like I mentioned, I’m tired of being jerked around when we have an option that would end all of that.

Finding the Super Web Guy was like hitting the jackpot…it brings us a lot closer to finally being in business, which is why getting the appropriate funds for the other pieces is absolutely critical.

Grubstake Breakfast

What a long day this has been…but, I don’t want to end it, without first, getting this post out. Today, Martin and I, were finally in a room with VCs!! We attended the Grubstake Breakfast this morning, which is hosted three times a year, by the Business Alliance of George Mason University at the McLean Hilton, in McLean, Virginia.

Our wonderful Banker Judy arranged for us to be there. The way it works, eligible companies seeking $250,000 to $2 million in investment capital apply for the opportunity to make a formal presentation to a panel of investors and to an audience of other investors, fellow entrepreneurs, potential strategic partners, and other interested parties. After each presentation, the panel and the audience provide feedback and ask questions.

The companies that presented this morning were:

And The Learning Accelerator—can’t find a website for them.

I won’t critique the presentations or presenters since, frankly, who am I do to so…however, I will state how surprisingly different each presenters were, although, they all used the same basic six slides. The companies ranged from different industries and each presenters had a style of his/her own. One of the presenters did break a few of the: “How to properly pitch VCs rules”, I have been reading about. Four out of the five companies had the CEO presenting and one did not, which I thought was odd.

The other thing I found rather annoying was when a presenter used to terms “our secret sauce”--be it in their presentation or while answering questions, I decided that, that is one expression I will stay away from using.

The panel of VCs consisted of: Hannah Clifford from InterSouth Partners, Mark Frantz from RedShift Ventures and S. Tien Wong from Opus8. Each member of the panel asked 1 to 2 questions to the presenters. None of the questions were tricky or difficult.

I walked away knowing that I could definitely, and with ease, do that type of presentation in this meduim and nail it. We will submit to present next quarter and will hopefully be selected, that is unless, we have raised the money by then.

We didn’t get to speak directly to any of the VCs, but we did meet a couple of interesting people and leads to potential funding.

As our first event of this nature, I feel it was a success and a good learning experience. I know, believe and am confident about what we have to offer, the potential of Why Go Solo and our abilities.

We will look for more of these type of events and will become regular attendees. That's really the way to do it. People, as in other entrepreneurs, investors, and supporting organizations have to see you at the events, get to know you, network with you and then, over time, more and more opportunities begin to present themselves.

We just have to remember...even taking baby steps, will eventually get you to the the top of Mt. Everest!

The Sky is the Limit

Back in late April, once we had the business plan done; we started sending out emails to people we knew, who might know people with money, who might be interested in investing in Why Go Solo. We basically began soliciting for investors.

Shortly after the email blast, our lawyer sent us an email to inform us of the blue sky law. I have a saying: “The sky is not the limit…there are no limits.” Well, turns out, when it comes to soliciting unaccredited investors there are some limits, 35 to be more exact, in the state on Virginia. We can legally solicit 35 unaccredited investors without first seeking the approval of our state or federal officials. Our lawyer recommended we start keeping track…

A blue sky law is a state law in the United States that regulates the offering and sale of securities to protect the public from fraud. Though the specific provisions of these laws vary between states, they all require the registration of all securities offerings and sales, as well as of stock brokers and brokerage firms. Each state's blue sky law is administered by its appropriate regulatory agency, and most also provide private causes of action for private investors who have been injured by securities fraud.

Great, I thought. There’s always a catch and there’s always something. When our lawyer sent out the email he did not mention that there is a difference between an unaccredited investor and an accredited investor.

Accredited investor is a term defined by U.S. securities laws that delineates investors permitted to invest in certain types of higher risk investments, limited partnerships, and angel investor networks. The term generally includes wealthy individuals and organizations such as a corporation, endowment or retirement plans.

For an individual to be considered an accredited investor, he must have a net worth of at least one million US dollars or have made at least $200,000 each year for the last two years ($300,000 with his or her spouse if married) and have the expectation to make the same amount this year. This rule came into effect in 1933 by way of the Securities Act of 1933.

Once I knew the difference between the type of investors, I realized that the law made sense. We also rapidly realized that an email blast isn’t going to result in finding investors. Also, accredited investors are obviously more knowledgeable, better equipped to invest, provide help and increase your chances of success. Plus, accredited investors are in the business of making investments—so it’s typically less of a hassle and risk for the entrepreneurs.

Update: Check out Ask the VC, turns out they posted on the same topic.