My Votes My Friends

Posted on October 8, 2008 · 13 Comments

After watching three debates my biggest response to them is a simple yuck. McCain merely supplies old solutions that no one wants to hear about. Obama has merely proven much more skilled then Palin in bridging (the PR not networking type) by turning questions on the need to cut back to solve the financial crisis into spending manifestos to give just one example. Personal highlight for me was when Obama used the term "Force of Good" vs. McCain’s "Force for Good" (I will have to explain the back story one day).

I am in the midst of deciding who I am going to vote for this year. Seems to be turning into another battle of the less of two evils. I consider myself a moderate independent. For a little perspective here are the USA presidential election results since I have been old enough to go to the polls.

1980	Ronald Reagan Jimmy Carter John B. Anderson	Republican Democratic Independent	489 49 0	43,899,248 36,481,435 5,719,437	George Bush—R Walter F. Mondale—D Patrick J. Lucey—I
1984	Ronald Reagan Walter F. Mondale	Republican Democratic	525 13	54,455,075 37,577,185	George Bush—R Geraldine A. Ferraro—D
1988	George H. Bush Michael S. Dukakis	Republican Democratic	426 111²⁶	48,886,097 41,809,074	J. Danforth Quayle—R Lloyd Bentsen—D
1992	William J. Clinton George H. Bush H. Ross Perot	Democratic Republican Independent	370 168 0	44,909,889 39,104,545 19,742,267	Albert A. Gore, J.—D J. Danforth Quayle—R James B. Stockdale—I
1996	William J. Clinton Robert J. Dole H. Ross Perot	Democratic Republican Reform Party²⁷	379 159 0	47,402,357 39,198,755 8,085,402	Albert A. Gore, Jr.—D Jack F. Kemp—R Pat Choate—RP²⁷
2000	George W. Bush Albert A. Gore Ralph Nader	Republican Democratic Green Party	271 266²⁸ 0	50,456,002 50,999,897 2,882,955	Richard B. Cheney—R Joseph I. Lieberman—D Winona LaDuke—GP
2004	George W. Bush John F. Kerry	Republican Democratic	286 251²⁹	62,028,285 59,028,109	Richard B. Cheney—R John Edwards—D

For a little more perspective it may be interesting to see my voting history. So here it goes in a semi sentence. Anderson, Reagan, H. Bush, H. Bush, Dole, W. Bush, Kerry. So five Republicans sandwiched by an Independent and Democrat make up my presidential vote choices over the past 28 years.

In seven days my mind will be made up on who I will vote for in 2008. I would like to think my history shows that it is not the party but the issues that influence me when I go to the polls.

I currently have a lean. One more debate. Then I choose.

In the meantime it would be interesting to see the voting history of FoG readers if any of you care to share.

October 8, 2008 | Comments | Tweet | Posted in Politics

Register

Posted on October 5, 2008 · 1 Comment

Was riding bikes in Piedmont Park when I came across two guys registering people to vote. If you want to vote you have to register and registration closes on Monday.

October 5, 2008 | Comments | Tweet | Posted in Politics

Quote of the Week

Posted on October 3, 2008 · 7 Comments

"So what should the government do? Eliminate those policies that generated the current mess. This means, at a general level, abandoning the goal of home ownership independent of ability to pay. This means, in particular, getting rid of Fannie Mae and Freddie Mac, along with policies like the Community Reinvestment Act that pressure banks into subprime lending.

The right view of the financial mess is that an enormous fraction of subprime lending should never have occurred in the first place. Someone has to pay for that. That someone should not be, and does not need to be, the U.S. taxpayer."

Jeffrey A. Miron

October 3, 2008 | Comments | Tweet | Posted in Quotes

My Main Lens

Posted on October 2, 2008 · 5 Comments

I don’t talk about it much on FoG, but I take pictures. Lots and lots of pictures. And I have been doing it for a long time. Paul Stamatiou outed me over the weekend when he posted on Flickr this shot I took of him at Octane.

It was taken was his Nikon D90, which in program mode (I am typically a manual mode shooter) seems to overexpose things to me, and my personal favorite lens. Paul has a nice review of the D90 if you are in the market for a new camera.

Which I am not. But I recently was in the market for a new lens when my wife bought me a D80 as a present. The D80 upgrade made the autofocus on my Nikkor 28-105mm f/3.5-4.5AF inoperable so I decided it was time for an upgrade. And somewhere along the way I learned, or was taught, that the lens that you use is more important then the camera body.

So I reached out to Josh Hallet who suggested the Nikon 17-55mm f/2.8. That lens was not quite tight enough for me so I ended up with the Nikkor 28-70mm f/2.8 which is one spectacular lens. It is generally considered to be Nikon’s best professional no-compromise normal zoom from 1999 to 2008. It was discontinued this spring shortly after I purchased it and replaced with the Nikkor 24-70 f/2.8 (picture below shot with Nikkor 18-35mm f/3.5-4.5).

It cost about twice as much as the D80 body but it’s been worth it. The f/2.8 is a step function better then the f/3.5 min on my old lens and that in and of itself is worth the price. Perfect for low light no flash situations which I tend to be in a lot. On top of that it comes with a nice hood to keep the lens safe and a case for when I have another of my three lenses on the body. Biggest downside is that it weighs in at nearly two pounds, so it is a bit heavy, but it is the main lens I use when I am out and about.

I love photography and I don’t know why I have been hesitant to talk about it much on FoG. This is the start. I am in the process of making a decision on the best online photo sharing service to use so that I can bring more of my pictures online. I have conflicting needs around this. I want to be able to share them on this blog and want to be able to distribute them to distant relatives that are not as Web proficient as readers of FoG. I would welcome any direction that you can provide. Until I get that figured out I will leave you with a parting shot of Buzz, taken outside my office yesterday morning with the 28-70.

October 2, 2008 | Comments | Tweet | Posted in Photography

Startup Depression Suppression

Posted on October 1, 2008 · 10 Comments

Back in July Jason Calacanis said he was retiring from blogging and starting a private mailing list. Well the retirement turns out to be a bit Bret Favre style. Over the weekend he sent out an email entitled “(The) Startup Depression” which drew a great deal of attention and led to him posting the content on his blog.

It’s both a rambling and greathearted article. A worthy read. And one that I can best supplement by book ending the beginning and end.

Jason started out by stating:

“It’s my believe that the economic downturn will be much worse than it
is today, and that 50-80% of the venture-backed startups currently
operating will shut down or go on life-support (i.e. 3-4 folks working
on them) within the next 18 months.

Make a list of every Web 2.0 startup to raise an A or B round and
cross 80% of them off the list, because they will not make it to their
next round of funding or profitability.”

HE ended with a must read top ten list of specific things that an entrepreneur should do in trying times closing with:

“Raise money: I know I said above most folks won’t be able to raise
money in the down market, but that’s not because the money isn’t out
there–clearly it is. The issue is that the big money out there
doesn’t want to fund small ideas that are in the death spiral. Build a
plan based on revenue and taking market share and folks will consider
funding you.”

I completely disagree with Jason’s first assertion and agree totally with the last.

My take on the startup funding marketplace is that you are going to see the same things in this asset class that you see in all asset classes during cyclical downturns. A flight to quality.

If you are an entrepreneur running a venture backed startup you are going to have to prepare your team to weather the storm. Cut costs. Find customers. Tightly execute. Do this and do it well and your VCs will have funds in reserve to see you through the rough seas. VCs are going to batten down the hatches and start playing things more conservatively when it comes to new deals so that they have the dry powder they need to keep their current good deals going (assuming that their limited partners are willing to make their capital calls and that may or may not be a safe assumption at this
point).

If you have yet to make it to the venture stage of life things might be a bit tougher. Individual angels are hurting.

To explain via an example let’s say that angel Jill Rich had investable assets of $10 million entering 2008. Of that Jill had set aside 5% of her portfolio or $500k. Over the past four years she had invested $200k with $200k reserved for follow on and was looking to put another $50k to work this year. But Jill has a problem. That $10 million is now only worth $8 million. So Jill has gone from being under allocated in her angel investing asset class by 20% to being fully allocated in the asset class. She has no room for new investments. Repeat this over and over again with angels and all of a sudden you have them not making any new investments.

Angel funds are a bit of a different situation. They behave like VC funds. The ones that I have talked to are merely looking at a exit time horizon in the 7 – 9 year range versus the 5 – 7 year range they were thinking about in early September. Like VCs they are going to get a little more conservative too. But they will keep investing.

So things are going to get tough. New technology startups will be able to get seed. But only the those with truly superior concepts and management. Big ideas will continue to garner venture funding, there is too much money out there for that not to happen.

The next two years are going to require focus, something that I preach in both good times and bad. They are going to require the courage and honesty that Jason reflected in his post. And the resiliency that he and countless other entrepreneurs have demonstrated over the years.

Perhaps the biggest issue that I have with Jason’s musings is this; there’s nothing to be depressed about. I can’t predict or control what is going to happen in the broader economy. To win in a down market all I can do is get up, go to work, and move things forward in a way that attracts interest. Interest from employees. Interest from customers. Interest from investors. Big interest.

For entrepreneurs there is never time to be depressed. There is always time for realistic optimism, good business thought, and execution. And that is now you win in any market be it up or down.

October 1, 2008 | Comments | Tweet | Posted in Angels, Entrepreneurship, Startups, Venture Capital

Amazon Startup Challenge

Posted on September 29, 2008 · 1 Comment

Just read over on Feld Thoughts about the AWS Startup Challenge. If you are building a web app utilizing Amazon Web Services you should check this out. The grand prize includes $50,000 in cash, $50,000 in AWS service credits, and a potential investment offer from Amazon. The application is short and straightforward. Deadline for entry is October 3.

September 29, 2008 | Comments | Tweet | Posted in Entrepreneurship, Startups, Web/Tech

Quote of the Week

Posted on September 26, 2008 · 1 Comment

"You can do a lot of damage on Wall Street with a pen and a piece of paper."

Warren Buffett

"What Buffett has done is provide the government a roadmap to how to invest in struggling banks."

Aaron Task paraphrasing Larry White

"If I were Bush, McCain, or Obama (all three of them ideally) I’d send
Paulson and Bernake to their cubicile and tell them to do the numbers
and come back with the return projections before voting on this."

Fred Wilson

This is a special triple quote of the week but we are experiencing special times.

What Buffett did with his Goldman investment was get a 10% yield on preferred stock with 100% warrant coverage to buy common stock at an 8% discount on the stock price the day before the deal closed with some corporate oversight. Sounds like a good structure to me and one our government should follow going forward on any bailout.

What Fred is suggesting in his post are two things that any venture capitalist does in practice. Before doing the deal running the numbers establishing an expected value to determine if the deal should be done and if so tranche the payments.

Combine these together and I think you have we have a winner. Do you?

September 26, 2008 | Comments | Tweet | Posted in Quotes

Dueling Taxes

Posted on September 25, 2008 · 17 Comments

I have written from time to time about the differing taxes plans of Senator McCain and Senator Obama which often leads to comments from the Obama faithful deriding the credibility of The Wall Street Journal and other such things. Well another interesting little table appeared in the Journal yesterday.

Interesting, because using information from an analysis by Deloitte it shows that unless you make over $400,000 your taxes are not going up under either candidates proposals. The only folks that full a lot of pain in the Obama plan are those making over a $1,000,000 annually. If you like you can download a pdf of the full Deloitte report here.

As an entrepreneurial kid of guy of more interest to me is capital gains tax treatment. A year ago I made the statement that I would not vote for anyone that wanted to raise capital gains tax. Perhaps I am not alone as Mr. Obama has changed is position of wanting to raise capital gains tax from 15% to 28%. He currently states that he would raise capital gains and dividend rates to 20% for families earning more than $250,000 ($200,000 for singles), and eliminate all capital gains taxes on start-ups and small businesses to encourage innovation. As an undecided centrist I can live with that.

More broadly, given the current state of economic turmoil I have to halfway agree with Marc Cuban. Talk of tax cuts for anyone is no longer economically viable. But increasing taxes on the uber rich is another story. Taxing the heck out of that dude from Goldman that wants a USG bailout and personally makes about $70,000,000 a year. Now that's interesting. Populist or not, taxing ordinary income above, say $10,000,000 annually, at an 80% tax rate might be a way to reel in excessive corporate executive compensation and provide the fortunate more reason to give back to society voluntarily.

September 25, 2008 | Comments | Tweet | Posted in Business

Divvs’ Pitch Sucks Less

Posted on September 24, 2008 · 5 Comments

Don Brown of Divvs was voted best presentation at the first Startup Gauntlet. Great time was had by a brave pack or early stage entrepreneurs looking to perfect their investor presentations. We are doing this again next month.

Update: After reading this post this morning I decided that it deserved much more prose. The above was created using the iPhone TypePad app which is not great for creating new articles.

Startup Gauntlet was a great little event that I think helped move all the participating entrepreneurs along. The title of the post was taken from the certificate Don won for having the best presentation. Truth be told, his presentation was darn good, along with those given by several other entrepreneurs. To give you some idea of the high quality, Stephen Fleming (who has funded a few things in his day), made the comment to me that he thought several of the companies were ready for their first round of funding. I agree.

With that said, the quality was uneven. A few forgot their pitches entirely or only made it about a third of
the way through their presentations. That’s OK. The purpose of Startup Gauntlet is to help entrepreneurs practice, refine, and get better so that when they get out their in the real world, in front of real investors they can succeed. And the most magical thing is that the participating entrepreneurs starting learning from each other. Seeing what others were doing so that they can understand where they need to go. Providing feedback to each other (and to the Dungeonmasters).

Photos courtesy of Mike Schinkel.

September 24, 2008 | Comments | Tweet | Posted in Entrepreneurship

Yankee Stadium Memories

Posted on September 21, 2008 · 2 Comments

Tonight the New York Yankees will play their final game in 85 year old Yankee Stadium before moving across the street to the "New" Yankee Stadium.

I am sure that mainstream media will be reporting on the most famous moments at Yankee Stadium. Gehrig’s "Luckest main alive" speech, Larsen’s perfect game, too many Reggie Jackson heroics to mention, and "The Greatest Game Ever Played", the 1958 NFL championship game between the New York Football Giants and the Baltimore Colts.

Yankee Stadium is one of my favorite sports venues. Walking into the place one cannot help feeling a sense of reverence. Truth be told I am a bit of a Yankees fan. I spent quite a few days and nights there during my time in metro New York between 1990 and 1992. Here are my top personal memories.

The beautiful summer afternoon when Bo Jackson broke his bat over his knee in 1990 after, I believe, striking out for the third time. I was sitting in the box of Rick Balter, who later was sent to prison for having a contract taken out on an individual that owed him some money.

The evening in June in of 1991 when the Yankees were playing the A’s. I was in the Mobil box. Jose Canseco had been seen either earlier that day or the day before leaving Madonna’s apartment. When he came on deck he had an exchange of words with a fan who was ejected. Shortly thereafter when he took his position in right field someone from the bleachers tossed an inflatable doll onto the field. Canseco ignored it and it was removed by security. Only in NYC.

Seeing the Braves play the Yankees in the 1999 World Series. I forget if it was game 3 or 4 (the Yankees won both). What I do remember is that Danny and Stephen Baldwin were in the box next to us and played a very spirited game of mound ball with Nikki Nickerson and me.

And oh yeah, on more than one occasion Yankees fans throwing D batteries at Boston fans that were foolish enough to cheer the Sox.

Like many Cathedrals, Yankee Stadium can be a bit cold and dark. But I have great memories there. And I am going to miss her. Not many more important places in all of sport.

September 21, 2008 | Comments | Tweet | Posted in Sports