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Good read, with a better perspective

Really interesting and well written article by Joe Lindsey today.  I admit, I’ve been a bit callous about the recent doping admission from Tyler Hamilton.  Joe’s piece looks at the broader picture.  Not saying Tyler’s innocent by any stretch, but at least it gave me a bit of perspective I didn’t have before.

In honor of our snow day today

What kind of company are you?

There are (4) different types of companies:

1. Sales driven

2. Engineering driven

3. Finance driven

4. Market driven

The first 3 are by far and away the most common.  This often evolves over time with new leaders, manager, and macro economic shifts.  Mainly I think this stems from the personal biases of the leadership team.  People naturally gravitate to what they know and what has gotten them to where they are today – too often with no regard for the fact that what made them successful is not necessarily what will make them successful in the future.

The sales-driven organization:

Focus is on the customer.  What could be wrong with that?  Every customer demand is sacrosanct.  Problem with sales driven companies is that they end up building 42 different products for every customer corner-case that comes up.

The engineering-driven organization:

AKA: building cool shit.  You build what your developers think is the most kick-ass way to solve a problem even if the problem is something either no one cares about or worse, not enough people care about or even worse doesn’t fit in the real-world way your customers behave.  How many angels can dance on the head of a pin? Answer: no one cares..

The finance-driven organization:

You don’t actually build anything because it costs too freekin’ much.  kidding.. But seriously, the finance group rules the roost and everything has to pass through the ‘viability filter’ which by definition means you never go out on an innovation limb.  These companies save their way into irrelevance.

The obvious answer is the market-driven organization.  The trick here is that its easy to say, hard to do.  Most of us will always suffer from our own biases and past experiences.  The market-driven group has an uncommon ability to view a business holistically - sort of like keeping multiple competing ideas in your head at the same time.  Tons of optimism with a thick layer of realism baked in.

2 in a row down the drain

First it was the Koppenberg circuit race just out side Boulder.  Cancelled due to snow and mud.  Not that the course is that technical, its really that the cornerstone to the race is a short, steep (17% grade) rough dirt climb in the middle of a fast and smooth part paved – part dirt road race.

Next (my prediction) is the Haystack TT.  Set for tomorrow.  It will no doubt be cancelled due to snow and freezing rain.  This is a little slice of hell.  A 17 mile rolling course that I had my ass thoroughly kicked on last year.  My no-so-blazing time of 48 minutes was a full 14 minutes off the pro-level pace.  Of course that may have something to do with my pre-race ritual of Jack Daniels on the rocks, or perhaps just my heavy feet.

Chalk it up to a very odd start to 2009 in Colorado.  The weather for most of the past 9 months around Boulder has been unseasonably dry and warm.  Strange that during the first 2 major cycling events here we get hit with a freakish weather event that cancels each of them.  Is that Murphy’s law or what?

Venture Capital + Federal Government = Sucks

I wrote a quick blog post awhile back after Thomas Friedman’s op-ed in the Wall St. Journal.  Mr. Friedman essentially said that if government really wanted to spur innovation and progress, that we (the royal “we”) should be emulating the venture capital model of a small group of knowledgeable investors making strategic equity investments in promising new start-ups that are executing on innovative and disruptive ideas.  I still like the line of thinking.  I’m not passing judgment on the how or who, I just like the idea.

Today in the PEHub daily newsletter, Dan Primack takes a swing at a Federally backed VC fund-of-funds.  Take a minute to read the article (and the flow chart).

This is where I get sideways with the VC + Government idea.  My experience with the prior wave of SBA-backed VC funds is nearly universally bad.  To me, this was a way for fledgling VCs that couldn’t raise institutional capital, to lever up their individual investors commitments and get them a “big boy” fund.  This is bad on several levels and in nearly all cases I’m familiar with produced a flop for the individuals, the government, and the companies.

Mainly, I think the bar that VCs have to hurdle in order to raise an institutional fund is there for a reason.  It separates the wheat from the chaff in a way that no other model currently does.  It forces the team to have certain performance characteristics, have a sound strategy, and it gets them the kind of commitment that doesn’t balk when markets fluctuate as the always do.  Its a basic check and balance to ensure that only the best survive and that the rewards accrue to the consistent top performers.  Isn’t that what operating and executing in the high-velocity world of venture capital and disruptive innovation is all about?

The creation of a Federal fund-of-funds will obviously push a whole bunch of capital flows into alternative investments.  This will result in a spike of investment and startup activity some of which will be good – and of course some of which will be bad. The rule of unintended consequences suggests that most of this will flow to mediocre VCs and mediocre startups while at the same time hamstringing the companies and investment firms that truly have innovative and disruptive ideas.  A classic example of where the ideals and reality part ways.

We can has cheezburgers

Pet Holdings just launched the Lijit search across all their sites, including the flagship: ICanHasCheezburger.  To celebrate we ordered the whole company tasty cheeseburgers for a Friday lunch treat.  Todd snapped a quick video of me enjoying mine.. Check out Tara’s post at the Lijit blog for all the photos.