The Foundry: A Word on Resources

I am fully aware of my bias and propensity to brag about The Foundry's accomplishments. Over the last 10 months, there have been some very interesting results generated from the peer-mentorship model and our unorthodox use of resources (which I'll get to in a second).

To this point, some agencies and sophisticated investors are taking note and want to give resources to the program which I think is great. The only advice that I give to any "adult" (whatever that means) is simple: slow down and listen.

My experience in the Foundry taught me that entrepreneurs don't have a resource problem but a RESOURCEFULNESS problem. When I first started Dash & Cooper, I thought that a substantial round of funding would help me solve all my problems. But thanks to the forced scarcity of the Foundry model and culture, I learned that there were a number of smaller, cheaper steps that I could take to incrementally move from the place I was (high ambiguity, anxiety, fear) to the place where most of my business classes start with (defined product perfectly matched with a defined market).

If I had been given a 5-figure investment at the beginning of the program in exchange for equity like most other accelerator/incubator programs do, my inevitable failure would have been amplified, not solved. I was (and still am) a diaper-baby and had no idea what I was doing. Forced to solve the problem with little more than $500, I broke through all the commonplace barriers that people use to explain why starting a company is hard. Being resource starved forced me to be resourceful and in the process I learned something new about myself.

Every person within every Foundry cohort faces this gauntlet. It also helps explain why the participants emerge unstoppable because we have seen (and created) what the world looks like when creative willpower combined with a social system committed to you (not just your company) gets applied to any "problem".

Of all the things that an entrepreneur can receive from the Foundry, the distinction of Resourcefulness (with a capital R) is the most valuable mainly because it costs you the person you thought you were. Which might help to explain why the underlying connection each cohort has with each other is the respect for this process - and why we, the participants, vehemently defend against thoughtless application of outside financing or other resources. Resources rob participants of the precious and painful opportunity to awaken something in yourself that wasn't there before.

They also attract the wrong crowd.

Now I'm not saying that we shouldn't have resources. There are some world class executives circling the Foundry and I would be delighted if the money showed up to bring these people in full-time. I'm sure Matt would appreciate better filming and editing equipment for his videos. Paid subscription to various software-as-a-service products, used laptops, computers, projectors and whiteboard pens have been the most useful for participants and administrators.

And food. Foundry has been known (allegedly) to run up monstrous tabs at Eva's, The Wild Grape and Dick n Dixie's - so I know that this would consume a large line item in any budget ;-)

These are the high leverage items in which resources would make a difference. And that's about it.

Now to address the issue of equity financing and attracting the wrong crowd.

Anyone that want to ports a seed fund on top of the program simply has no idea how a Foundry participant gets imprinted and this becomes the type of entrepreneur investors want to give resources to. Programs that offer resources attract people that want resources. Notice that Foundry doesn't offer resources...

The reason why Foundry participants show up, start companies, and help manage 80% of administrative tasks despite a schedule that juggles full-time school, full-time work, and family life is because they want to get what no other program offers (hint: not resources). Foundry's lightweight and methodical process of repeatedly bathing participants into the nit-and-grit of discovering businesses from scratch is the reason why it exists. It was born of unmet demand not fulfilled by other programs. Not that the other programs are wrong or not valuable - it's just that a year ago 20 of us wanted to start companies, looked around at what was available, voted with our feet and with the gracious help of Rob Wuebker, Matt Hoffman, Ken Krull, Todd Dauphinaus, Brent Thompson and Adam Slovik we invented the Foundry.

There are plenty of places for entrepreneurs to get resources, they are called business plan competitions. And we actually have a business that can help win any competition at will - CupAd. The Light brothers are happy to coach you to win competitions because we, the children, know that those things are not real life, just another variant of class - and thus don't treat them seriously.

There's nothing wrong with investing in strong teams progressing fundable ideas - Foundry is full of these types of teams and there's nothing wrong with being interested in and having financing discussions with a team or company that you want to invest in. There's also nothing wrong with getting a return on one's portfolio, it is the point of a seed fund and the fiduciary responsibility of its managers.

But if your motive is to profit from a bunch of 20-somthings or be a guy that "has a say" without regard to the process that produces the results that got you interested in the first place, then it is a signal to the *participants* that you are "Not Foundry". One earns this scarlet letter by clearly demonstrating that they don't understand (and not interested in understanding) what is involved in the 'forge' part when we say that "Foundry exists to forge entrepreneurs for life."

Focusing on the entrepreneur creates a fundable company as a catalytic byproduct. Fundable companies are the means, not the end.

How to Get Good at Making Money

Hear them haters talk

but there ain't nothin you can tell em

just made a million..

got another million on my schedule.

-Wiz Khalifa, Black and Yellow

I just finished reading a really, REALLY good article from Jason Fried, CEO of 37Signals. His article on Inc.com titled How to Get Good at Making Money follows his innocent and curious exploration of sales and enterprise during his childhood. Here's some of my favorite quotes:

...people are happy to pay for things that work well. Never be afraid to put a price on something. If you pour your heart into something and make it great, sell it. For real money. Even if there are free options, even if the market is flooded with free. People will pay for things they love.

.. charging for something makes you want to make it better... after all, paying for something is one of the most intimate things that can occur between two people. One person is offering something for sale, and the other person is spending hard-earned cash to buy it. Both have worked hard to be able to offer the other something he or she wants. That's trust-and, dare I say, intimacy. For customers, paying for something sets a high expectation.

When you put a price on something, you get really honest feedback from customers. When entrepreneurs ask me how to get customers to tell us what they really think, I respond with two words: charge them. They'll tell you what they think, demand excellence, and take the product seriously in a way they never would if they were just using it for free.

This article was very insightful and endearing to me as it helped crystallize some "forgotten" lessons from my childhood. As a youngster, I loved making money and was always knocking on doors to shovel people's walk or rake their leaves. The feeling of money in my pocket was great - especially because it signified that I had earned something.

Later on, I had moved into trading cards - first with Pokemon and later on with Star Wars, as the franchise reboot happened when I was in fifth grade. I liked the competition of playing the games (yes there were games to be played) and acquired a large enough collection to let people borrow the minimum required deck size to play and would teach them.

I remember going to Scout summer camp and teaching other boys in my troop (we had about 100 enrolled any given time) and other kids from out of state at the commons area. I picked them because everyone in my neighborhood was already playing Star Wars and the likelihood that they would be interested in buying from me was low. Plus, when you are camping somewhere in Idaho or Wyoming, scout camp provides very little non-scout-related entertainment, thus there was little to do but play card games.

As kids learned the game, I started selling them at a premium since there wasn't any trading card shops immediately available. I could also upsell "foil cards" that were strategic game-makers at multiples of the price of a pack of 10 cards (each pack contained at least one *surprise* foil card).

My parents would marvel at the fact that I would come home with more money after camp than they gave me.

I echo Jason's insight that you have to sell the things that you love yourself - because otherwise nothing gets sold. Even then, you aren't even having a sales conversation as it is traditionally known.

Here are entrepreneurial lessons from my childhood that still show up today:

1. Go where the ground is fertile. - I knew I couldn't sell in my neighborhood because everyone was doing it and there was a card shop nearby so there was little that I could offer them. I had to go someplace where people would be open to a new kind of card game and could easily catch the fever. Scout camp was great because card games were a great way to pass the time when you decided to skip out of your merit badge classes.

2. Enroll, entertain, teach. - I think it's important to find way to get people's attention for just long enough and then you have to do everything possible to make sure that they enjoyed their time with you. You've got to give them the dopamine charge - the "happy-feel-good" experience that leaves them wanting more. When you get permission to have more of their time - that's the perfect opportunity a great opportunity to introduce some of the dry "learning" that is necessary for them to be pleasantly hooked on what you are up to. It's important to love what you are selling because your natural passion is what people are playing off of when you are teaching them about your product.

3. Let the value proposition present itself. - After playing the game a few times, I would typically offer a "premade" deck for sale - mentioning it would take more time and money to construct themselves. By allowing them to participate for free, they could easily see the benefit of having their own deck to curate - rather than some fixed deck that I constructed.

4. Let the users interact. - After I had sold about 8 decks of cards, I organized tournaments with a "heavily stacked" deck as the prize for the winner. This would usually draw small crowd of curious boys who would watch, ask questions and then would want to purchase a deck from me. Because I removed myself from the equation and let kids from different troops battle it out, the players would have their friends show up and I could easily offer the same access to the fun to those who showed up - this saved me a lot of time and effort by letting my customers do most of the work for me.

All in all, I agree with Jason Fried that the skills we build can start at anytime but that we are always practicing them. This has certainly been the case for me. I think that our childhood lessons should be taken at face value simply because they capture the essence of doing business and human interaction. As adults we have a nasty habit of over-complicating things - which can be detrimental when you are leading an early-stage startup with limited resources to use in the quest to find product-market fit.

Thanks Jason for the article. I recommend that you all go check it out and see what shows up for you.

Foundry Company: Coverstruck

He has not learned the lesson of life who does not every day surmount a fear.

~Ralph Waldo Emerson

With this new batch of Foundry miscreants halfway through their cohort, F2 tends to be more tech-oriented than the F1 guys that preceded them. Which means that they are smarter and spend their time mulling their baggy eyes through lines of code at weird times during the night - eating $5 pizza and "liberated" Rockstar Cola that mysteriously showed up on Foundry's footsteps last July.

CoverStruck, an audio/video startup founded by Foundry F2 member, Garrett Smith is like Youtube for the musically talented to showcase their artesian recreations of popular songs and support each other. I was surprised to note that Garrett has somehow locked down performance licenses from the three biggest music rights management companies so that users can upload their "interpretations" without fearing The Man.

While I can definitely see the benefit to "yet-to-be-discovered" musicians and their desire to not be sued, I found the user experience for non-musical norms like myself to be very intuitive. The front page has a rolling feed of videos that are on the site, it's addictive (kinda like Facebook's newsfeed) and I found myself returning to it to see what else was going to pop up.

What also cool is the way that the site is designed to encourage exploration. While the video is playing you can see who else has covered the song, who has covered other songs by the same mainstream artist and how many covers the particular musician has covered.

To give an example, I found a piano cover of "Use Somebody" by Kings of Leon and while I was watching the video, I noticed a tab that showed there were three other covers of that particular song. So once the first video finished, I checked out who else had done the song and then moved on to other Kings of Leon covers.

Surprisingly, I spent much more time than I planned to on the site and I think that speaks to the way Garrett is thinking about the user experience on both sides of the spectrum: the musicians and the music lovers.

CoverStruck is now saved in my favorites and I plan to use as I do work on my laptop - sort of like a Pandora for song covers (it's that good).

I recommend that you check them out and encourage your musician friends to be soothed by their ability to legally express themselves online.

The Art of Living

A person

Who is a master

In the art of living

Makes little distinction

Between their work and their play,

Their labor and their leisure,

Their mind and their body,

Their education and their recreation,

Their love and their religion.

They hardly know which is which

And simply pursue their vision of excellence and grace, whatever they do,

Leaving others to decide whether they are working or playing..

To them they are always doing both.

-A Zen Poet

Living into the Person You Want to Be.

A few weeks ago, I was asked to help Drs. Robert Wuebker and Bill Schulze prepare a discussion on what we know about CVC literature at the Winter Strategy Conference, jointly hosted by the University of Utah and BYU.

It was an intense few weeks - we were attempting to prepare a gargantuan data set of over 500,000 transactions from 1980-2010 and for me, it was an academic baptism by fire. To date, it was the most substantial challenge (opportunity) that I've been lucky enough to encounter. I've never done research, I didn't know anything about the world of academia and had to pick it up on the fly while simultaneously attempting to give the team a data set worth presenting on.

At times I struggled to simply keep up with the cognitive horsepower of the team, compromised of Rob, Bill, Jaime Grant (PhD Candidate) and Ken Krull (Operating Partner, Mercato). It was a whirlwind two weeks and I certainly made forays into new areas of personal cognitive and physiological possibility that I didn't know existed. Even a week later, my body is still craving for more sleep than I anticipate.

Rob, despite sleep-deprivation, gave the most balanced presentation I've seen from him yet and Bill was nice enough to give me a shout out for my contributions at the end of the presentation.

Those who attended the post-presentation dinner at the Canyons were gracious enough to engage with me personally about the data and the presentation (thanks Bill) and I got to meet a lot of really interesting people who were very welcoming for a visiting undergrad diaper-baby like myself.

It was novel, overwhelming, euphoric, entrepreneurial, terrifying and exciting and fun.

The big thing for me was not simply that I was asked to be a data monkey - I would have been satisfied with just that - but that I was treated as a team member. I was up against a nearly vertical learning curve trying to understand the nature of academia, the form and function of excel's functionality and grasping the data set such that we could produce something of merit. In spite of this (or maybe because of it), Rob, Bill, Ken and Jaime were generous enough to help me feel like I actually had something to contribute to the team's thought process and strategy for putting the presentation together. When I spoke, they listened, took me seriously and responded as such. They were patient with my constant blunderings and I always felt like they saw me as a competent value-add to the team.

Going forward it looks like I'll be doing more of the same work for the team on other research projects as it appears that I do a good enough job to be kept around - and it turns out that I actually like doing research.

It's one thing to be handed the opportunity of a lifetime - it's whole other thing entirely when the team chooses to see you as the person that you could become and creates a space for you to live into. This experience, the overwhelming feeling of belonging and confidence is huge gift that I simply cannot put into words.

Thanks to everyone for their encouragement and patience as I slogged through the ups and downs in an attempt to 'get it done.'

Someday.

I hear a lot of kids in my age cohort talk about someday.

Someday they'll be on time to meetings. Someday they'll care. Someday they'll do things differently... when it matters someday.

I believe that they are right. Someday you will care. Someday.. when things matter you'll try to do things differently.

But none of that will matter because you won't have the capacity to survive when that opportunity comes. When you have been spending years practicing the art of 'just getting by', you get crushed by opportunities that require everything you have.

Not that there is anything wrong with mastering the art of getting by, in fact, I think that it speaks to the potential of human beings to get whatever it is they are committed to getting. It takes a highly optimized machine to get exactly the outcomes they are striving for. The implied heuristic here is that humans aren't broken - they are actually finely tuned. Aristotle makes this point best when he says,

"Excellence is an art won by training and habituation. We do not act rightly because we have virtue or excellence, but we rather have those because we have acted rightly. We are what we repeatedly do. Excellence, then, is not an act but a habit."

I love how eloquently Aristotle states that we don't do things excellently because we are born with an excellence gene - we become excellent (at anything) simply by repetition.

This is good news and bad news.

The good news is that over time (some people say 10,000 hours/625 days/1.71 years) you can become excellent at anything. The bad news is that you can be excellent at anything.

You can be excellent at avoiding conflict. seeking conflict, just getting by, keeping emotional distance from risky endeavors of the heart. Fill in the blank.

So what? What's the next step?

The next step is doing. Simply doing. Again, Aristotle ('cos he's smart) weighs in:

"We become just by performing just actions. Temperate by performing actions. Brave by performing brave actions."

Someday is NOT some state of being that you wake up to one morning somewhere in the future. Someday does not announce itself with you walking in slow motion through smoke. Someday does not arrive after a montage with the latest Kanye West song playing in the background.

Someday is right now. The choice you make every morning to play for keeps or 'do what you can with what you have'. There is a huge difference between playing to win and playing to not lose.

Because when that once-in-a-lifetime opportunities arrives - when you see that wave forming on the horizon- your ability to simply get on and ride is a product of how you chose to ride every other wave in your life prior to that.

And in that moment, when you are put to the ultimate test of doing something you've never done before when it really counts - getting married, building a company, offering forgiveness - how you decided to live your life 'when it didn't matter' is going to be the difference between getting smashed into the rocks or making history in the narrative of your life.

Mark All As Read.

Turn up the lights in here, baby.

Extra bright I want y'all to see this,

Turn up the lights in here, baby.

You know what I need,

Want you to see everything,

Want you to see all of the lights.

- Kanye West + Rihanna

I just logged into my Google Reader account for the last two weeks. The Google informed me that I had 1000+ unread items. After skimming some articles about startup launch announcements on VentureBeat, I hit the 'Mark All as Read' button at the top.

"Yes Google, I am sure that I want to do this."

"No Google, do not ask me again. I'm an adult."

Clean slate. Sometimes it's just better to get a new sheet of paper than dig yourself out of a hole.

To be fair, the hole is self-induced and totally worth the dividends I received by focusing solely on a research project for the U. It was a hard effort. It was terrifying. It stretched me and introduced me to new possibilities cognitively and physiologically. Most importantly it was fun and satisfying.

It's been said that construction workers have the greatest job satisfaction of any profession. I would say that entrepreneurship and academic research are the same. Just like my friends who find satisfaction in pointing to tangible evidence of something they have produced - like driving down a road they paved or past a building they built - I have the same satisfaction in seeing a startup start to find its place in the market or watching someone present some findings that I helped contribute to.

I love the long hours. I love mulling over the floating puzzle pieces to see if they'll come together. I love the uncertainty, the ambiguity, the fear, the failure. I love the fascination, the possibility, the wonder of it all.

I love the act of producing.

Everything else - the accolades, the potential for wealth, the reputation (or something) - they are "nice-to-haves"; catalytic byproducts of doing the work I love and wish to excel at.

But sometimes, I let things go unmaintained for too long. My Google Reader and Gmail Account are certainly lightposts to indicate how well I am managing other areas of my life.

If I have made a commitment to you that I didn't follow through on - a promise to call, or meet or further a task - I appreciate your patience and I ask that we 'Mark All As Read' anything that's incomplete between us a result of my lack of focus. I recommit to complete what I originally said I would do. And I as I work through my email and other communication channels, expect to find a message from me about getting done what needs to get done.

Thanks for your love and patience.

-T