I gave an interview to Loïc Le Meur right after Webcom Montreal. I know it had been a long day, but still it doesn't explain why my eyeballs are largely missing from that video podcast. We talked about my experience as part of a distributed company. Listen and see how well you can handle spoken evil dead Canadian French!
Zero-Knowledge Systems is a Montreal-based company that went through the dotcom boom and bust, and rebounded as Radialpoint. ZKS cofounder Austin Hill (who just started blogging - welcome, Austin!!) gave a 15-minute presentation at BarCamp Montreal on Saturday. This is my impressionistic transcript of his talk.
This is normally a much longer talk. I was one of the cofounders of ZKS. I want to talk about entrepreneurialism.
On my title's meaning. Not "chasing while clueless". It's that you just don't know how it will end up. It's really about finding jobs you love.
People chase their dreams for various reasons. The guy who invented microfinance did not do it to get rich.
I've been doing startups since I was 13, (quickly enumerates) total.net....
Around 1997 I got into privacy. I had a passion for cryptography, info security, the internet was becoming very popular for normal people. My brother, father and I started this enterprise, ZKS. The vision was empowering people to control their information. It wasn't about attacking cookies. We had a vision for remaking the internet. In the Wayback machine you can see our old mission statements. Funny, I don't remember writing this.
We wanted to make it absolutely easy for people to go online and keep their privacy. There was a lot of very complicated stuff behind the scenes.
Now. You have a big dream. You may think VCs are living in treehouses, throwing money out the window. I have learned how VC works. I researched everything, and sent out all these faxes.
An important thing is to set your sights well. We were thinking very very big. Spreading our vision, with a lot of passion and evangelism, which helped drive our early success.
Fundraising. 1M seed from angels, 5M from California VCs in '98, including the cofounder of inktomi. Series A 25M Yorkton in '99, Series B (30?)M in '01.
The thing is, we did not need to raise money. But money was falling from the trees. People were desperately trying to give us money. We came up with a structure which was a coupon that said, you can give this to us now, you get money when we go IPO.
You want to stage your investments. You don't want to raise your money at a high valuation with a dumb investor early on.
We had an order for about 100M US, we only needed 10M. If you get money, you now have pressure to grow. We grew from 50 to 200 people. Has anybody heard of our hiring tactics.
(audience member): I remember a ZKS-branded "We're Hiring" truck that would go and park right in front of other software companies' offices.
There was a CEO in town, she tried to block email to ZKS. But her employees emailed us that night from home.
Then we raised 22M as a Series C. All told we raised 80M$. US dollars.
Thankfully we didn't put it all into stupid things. We diversified. We had this grand vision that we were to protect all the world's privacy.
There are lots of types of money men. The believers. They're enthusiastic. Finding the right ones is critical. They can bring a lot to your company. The people who bring underwriting. A company went public too quick. They should have raised the 1M$ privately. A team of good VCs can be an ally. Then the gangster types, who want to take control of your company.
Now. Rule #1 of startups. Bad Shit Happens. For us that was, the VC industry changed. [... ] You end up having to analyze your company to figure out what works. When you're big you can't iterate quickly. You talk about turning off entire business units. There's the edifice complex. When you walk into a new building, a lot of people feel like they've made it. There's the ghost effect when downsizing. For employees, this is bad for morale - the person they made come in all of a sudden has lost their jobs.
Check your motives. If you're in this for the money, then go find another industry. When the shit hits the fan, there are easier ways. Starting a company is because there's no other way to chase your dream.
Startups are a team sport. This is not swimming. Pick your team members very carefully. What really saved our company is we recruited really great people. Able to adapt and change.
Develop double vision. Some people are visionary, telescopic. You need microscopic vision, too, small steps.
Here's a common problem. Obvious things you don't see. For instance, watch this and count the number of times that a basketball is passed. How many? Now watch again. You're never sure what to focus on. As it turned out, we built an entire encryption infrastructure that could be bypassed by a couple lines of Javascript code.
More advice. Avoid undisciplined growth. Find mentors and coaches.
I'm very proud of the team we built at ZKS. My interests gradually went into community, venture philanthropy. Project Ojibwe is in stealth/ninja mode right now. It's about how we get people to aggregate with people... [short, fuzzy explanation]
