Writing is a fun but time-consuming task, but I want to commit to publishing one article per week. There are hundreds of topics I can cover to help you understand how Silicon Valley startups work.
So, please help me choose which ones you are more interested in posting to this thread.
Sure. There are many different advantages to move your startup to Silicon Valley. First off, you need to understand if Silicon Valley is a good fit for your company. Are your early adopters in that area? Do SV investors understand your business? That's not always the case—a fashion company should not move to San Francisco, for example.
On the other hand, any startups need a consistent about of money to scale quickly. San Francisco 🌉 is the best place in the world for that. But it's not an easy one. It's expensive, and you better know how things work there before moving your business. That's part of the goal with this newsletter.
Most important of all, it helps if moving to the area is your dream. It will keep you working hard even when things become tough.
If you need some feedback, just book a slot with us on our website and tell us your product and dreams.
Hi Massimo, why do you think some technologies become almost a must have (or a fast lane ticket) for investors in order to invest in a startup?
Example: blockchain. We do know it's a great technology for something, while not so efficient for other applications. Why the "built on blockchain" phrase is (maybe was, now the hype has redimensioned) often enough to get investors or raise an IPO?
I have a specific example in mind: Storj raised $35M, Filecoin $257M. Distributed cloud storage is a great idea and a must in the future of the web, where (I suppose) privacy issues will gain major attention.
But is blockchain the right technology to build it?
The blockchain is designed to be a bulky database, in order to prevent double-spending and attacks. But imho it’s not so good when you need a reactive and user friendly cloud storage, with a simple (AWS like) usage. After all ICOs and investment there’s still a few enjoyable things on the platforms I took as an example.
Blockchain has been a phase that ended with the crypto crash at the end of 2018. Crypto still is a big thing, though, and some VCs are betting big on that with vertical funds—like a16z. Things changed since then, and now everything is back to ”normal.” If you want to get funded, you need traction and at least some promising revenue experiments in your pocket. I think that customer care is the buzzword today: see what Superhuman is teaching with its approach. Journal has a similar onboarding style—I spent 30 minutes a few days ago on Zoom with their customer onboarding team to get a full introduction to the platform. I don't see many blockchain startups In the Valley. In the next 12 months, revenues will be king.
Thanks for the reply. As I wrote, crypto isn't an updated example as you highlight. But it is an example. So back to the general question: why some buzzwords often become the main thing (more than revenue itself, often)?
Silicon Valley's most notable ability is to adapt itself moving from technology to technology from trend to trend before it becomes mainstream. That is the quality you look for to create highly scalable companies. Sometimes a buzzword comes out when people start thinking that a specific technology has such a condition. Create companies like Apple or Google that requires technologies or trends with the potential to change the market landscape in a few years. VCs invest in companies that have the potential to make huge revenues, not in buzzwords.
Be sure that if a San Francisco startup is making (recurring) money fast, then it doesn't need to go looking for investors.
Hi Massimo, I would like to know if there are examples of startups that have reached shares in a market without having substantial initial funding.
In I.T., unlike more traditional sectors, it seems that with a PC you can "climb the world". Is this vision utopian or in your experience do you know examples of startups that have implemented something without having initial funding?
I firmly believe that having a computer and the skills to code or design, you can always create something great. Hundreds of startups became billion-dollar companies raising from friends and family. I wrote about this in the past here https://medium.com/lombardstreet-io/remember-that-even-unicorns-started-with-200k-13a968c83f84 . If you can build things, you can create a company—there are many examples of companies that designed a sustainable growing business without being startups. See Balsamiq (Italia), Basecamp, or Bears(Italians).
You ask: "How does a guy with no money who has an idea to create a team of qualified people and find funding?". Hey Alessio, I'm sorry, but I need to use English so everyone can understand what you asked. Here we talk about VC and investors' money, I guess. Investors need to know that you can deliver what you have in mind, so the best thing is to start creating your product by yourself with a few friends. Once the early version of your product is online, people seem to like it, and then you can search for capital to build a team and expand. Sometimes VCs invest in ideas—before the product exists, but it's rare. I believe in the power of ideas because there are game-changing ideas. Your ability to execute and create is more important, though. If you want my 2-cents, use this time to learn what you need to build your plan. Learn to code usually is the first step.
Ideas matters. When you build a startup, you're committing not just to starting a company, but to starting a fast-growing one. Search for one of the rare ideas of that type.
Shall I move my startup to the Bay or not? Are there general rules you can share about?
Sure. There are many different advantages to move your startup to Silicon Valley. First off, you need to understand if Silicon Valley is a good fit for your company. Are your early adopters in that area? Do SV investors understand your business? That's not always the case—a fashion company should not move to San Francisco, for example.
On the other hand, any startups need a consistent about of money to scale quickly. San Francisco 🌉 is the best place in the world for that. But it's not an easy one. It's expensive, and you better know how things work there before moving your business. That's part of the goal with this newsletter.
Most important of all, it helps if moving to the area is your dream. It will keep you working hard even when things become tough.
If you need some feedback, just book a slot with us on our website and tell us your product and dreams.
Thanks Massimo. I booked a slot and I'm curious to discuss if SV is the right place for my startup Bloovery. See you soon.
Hi Massimo, why do you think some technologies become almost a must have (or a fast lane ticket) for investors in order to invest in a startup?
Example: blockchain. We do know it's a great technology for something, while not so efficient for other applications. Why the "built on blockchain" phrase is (maybe was, now the hype has redimensioned) often enough to get investors or raise an IPO?
I have a specific example in mind: Storj raised $35M, Filecoin $257M. Distributed cloud storage is a great idea and a must in the future of the web, where (I suppose) privacy issues will gain major attention.
But is blockchain the right technology to build it?
The blockchain is designed to be a bulky database, in order to prevent double-spending and attacks. But imho it’s not so good when you need a reactive and user friendly cloud storage, with a simple (AWS like) usage. After all ICOs and investment there’s still a few enjoyable things on the platforms I took as an example.
Blockchain has been a phase that ended with the crypto crash at the end of 2018. Crypto still is a big thing, though, and some VCs are betting big on that with vertical funds—like a16z. Things changed since then, and now everything is back to ”normal.” If you want to get funded, you need traction and at least some promising revenue experiments in your pocket. I think that customer care is the buzzword today: see what Superhuman is teaching with its approach. Journal has a similar onboarding style—I spent 30 minutes a few days ago on Zoom with their customer onboarding team to get a full introduction to the platform. I don't see many blockchain startups In the Valley. In the next 12 months, revenues will be king.
Thanks for the reply. As I wrote, crypto isn't an updated example as you highlight. But it is an example. So back to the general question: why some buzzwords often become the main thing (more than revenue itself, often)?
Silicon Valley's most notable ability is to adapt itself moving from technology to technology from trend to trend before it becomes mainstream. That is the quality you look for to create highly scalable companies. Sometimes a buzzword comes out when people start thinking that a specific technology has such a condition. Create companies like Apple or Google that requires technologies or trends with the potential to change the market landscape in a few years. VCs invest in companies that have the potential to make huge revenues, not in buzzwords.
Be sure that if a San Francisco startup is making (recurring) money fast, then it doesn't need to go looking for investors.
I mean, investors come to you 💰... A lot of investors
Hi Massimo, I would like to know if there are examples of startups that have reached shares in a market without having substantial initial funding.
In I.T., unlike more traditional sectors, it seems that with a PC you can "climb the world". Is this vision utopian or in your experience do you know examples of startups that have implemented something without having initial funding?
I firmly believe that having a computer and the skills to code or design, you can always create something great. Hundreds of startups became billion-dollar companies raising from friends and family. I wrote about this in the past here https://medium.com/lombardstreet-io/remember-that-even-unicorns-started-with-200k-13a968c83f84 . If you can build things, you can create a company—there are many examples of companies that designed a sustainable growing business without being startups. See Balsamiq (Italia), Basecamp, or Bears(Italians).
Come fa un ragazzo senza soldi che ha un idea da realizzare a creare un team di persone qualificate e trovare finanziamenti?
You ask: "How does a guy with no money who has an idea to create a team of qualified people and find funding?". Hey Alessio, I'm sorry, but I need to use English so everyone can understand what you asked. Here we talk about VC and investors' money, I guess. Investors need to know that you can deliver what you have in mind, so the best thing is to start creating your product by yourself with a few friends. Once the early version of your product is online, people seem to like it, and then you can search for capital to build a team and expand. Sometimes VCs invest in ideas—before the product exists, but it's rare. I believe in the power of ideas because there are game-changing ideas. Your ability to execute and create is more important, though. If you want my 2-cents, use this time to learn what you need to build your plan. Learn to code usually is the first step.
Sembra che la sola idea conti poco
Ideas matters. When you build a startup, you're committing not just to starting a company, but to starting a fast-growing one. Search for one of the rare ideas of that type.