Johnson Cook

Atlanta tech investor. Entrepreneur.

Johnson Cook - Atlanta tech investor. Entrepreneur.

Editorial Comment- About Startup CEO References

In many of my posts when I talk about the energy it takes to build a startup, I specifically mention the “Startup CEO.”  I do this intentionally, because I work hard to only speak from experience.  My own experience is based on being the CEO, and I have little experience-based credibility in sharing advice and ideas otherwise.

However, as it has been pointed out to me several times (especially at the Atlanta Tech Village water cooler), many times my thoughts and ideas are valid for anyone building a startup. Whether you are employee #2 or employee #20, the work is still hard, the energy still needs to be positive, and the ideas are still valid. 

I will continue to speak from experience, because I believe this is the only credibility I have. If you do follow my writing, I hope that you will see yourself as “CEO of yourself” and have no issues with the reference to actual job titles in your startup.

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Long Distance [Professional] Relationships

One of my best decisions in 2014 was to start building my network in the Bay Area and as such it is also a 2015 “resolution” (even though I hate that word) to continue that effort. Building a tight network from 2000 miles away can be challenging.

Here are some ideas on how I am trying to be more involved in the tech capital of the universe:

  • Schedule 4-6 standing trips per year and just go. This is useful for me. Even if I go out for one day and back, I can always fill up a day with coffee meetings and lunches. There are potential clients in every city you will visit. Investors, especially in the Bay Area.
  • Give extra effort to provide introductions. I work hard to be sure that my friends and contacts in the Bay Area see me as a valuable connection to Atlanta.
  • Curate the outbound introductions carefully. Double opt in as the minimum standard. This one is unique: many times entrepreneurs in Atlanta see that I’m connected on LinkedIn to some well known Valley VC’s and ask for direct introductions. I normally just will politely decline unless I really believe there is potential value to be created. And even then, I always ask the VC first if they are ok with an intro by giving them a quick one liner about the entrepreneur.

Yes, the world is small and flat nowadays, but face-to-face meetings and serendipitous meetings still rule for building deep relationships. Getting on a plane is the only way to really make it happen long distance.

Inside the Mind of B2C VCs – What B2B Startups can Learn from B2C Investors

 

b2b_b2cThere is an interesting dialog in Atlanta right now around the lack of B2C startups and successful tech companies. My only comment on the dialog itself is that I wish it could stay positive and not come across so negative from a few folks. It’s really great topic with powerful ideas around how to make change.

In parallel to those Atlanta conversations, as follow-up to the Bay Area trip with Kasim Reed, I’ve had the opportunity to chat at length with VCs who do very well investing in consumer startups. Also, I’ve learned a great deal by helping our Atlanta Ventures Accelerator company, YikYak negotiate investments from B2C focused VC’s from Silicon Valley.  I’ve learned that the way the B2C crowd thinks about growing startups is completely foreign to me, and learning how they think has opened my eyes to some valuable points for my own B2B startup, Voxa, and can help others as well.

It’s easy to sit atop the imagined ivory tour of Enterprise SaaS startups that can generate substantial revenue very early and proclaim that businesses without revenue models don’t make any logical sense and aren’t sustainable… but… B2C startups benefit from a clear, undeniable, singular focus that often times it is hard for B2B folks to achieve. B2C startups must be 10000% completely focused on building the best product, period.

Build the best product, or die.

One of the investors in SnapChat, Facebook, and Twitter told me that they tell their portfolio entrepreneurs over and over to stop thinking about monetization. They tell them that monetization will be figured out in 3-5 years at the earliest. Instead, focus on the user experience. Focus on building a product that has tremendous value. Live inside the head of your users. Be a user!  Use the app yourself constantly. Always be thinking what you can do to make it more useful for yourself.  It’s very simple what to do.

In the B2B world (and I can already see this happening in Voxa), it can be easy to get distracted with the other challenges of building a sales oriented business.   You have to put a ton of effort and energy into your customer acquisition machine. If you do this before the product is fully ready, you will have issues.   If you have success with your sales efforts, but have a product that hasn’t been fully proven to add sustainable value, you can be falling into traps you set for yourself. While it’s important to find the balance between sales and product, remember that when you put your “product hat” on to think like a B2C startup.

Think about what features and improvements make the product the best to *use*. 

In any startup, you will always be prioritizing your product roadmap. As you get users, you will add more desired features. Some of these features make the product easier to use, while others may be growth hack features. Features that are intended to make the product more far reaching perhaps shouldn’t be prioritized over features that make the product 10x more valuable to the current user base.

It’s all a balancing act. Everything is a compromise.  Remember to give both sides of the equation intense and intentional attention.

I look forward to learning more from B2C startups as Michael Tavani becomes successful in bringing a boat load of energy towards more B2C in Atlanta. Way to go Michael!

 

 

Takeaways and Trends from Silicon Valley – Trip with Mayor Kasim Reed

 

Johnson Cook and Kasim Reed

Mayor Kasim Reed

Last week was awesome. I had the honor of traveling with a delegation of community leaders, including Mayor Kasim Reed, John Yates of Morris Manning & Martin, Bernie Dixon of Atlanta Tech Angels, and the Invest Atlanta executives to Silicon Valley to meet with the top investors (both venture and private equity) about Atlanta.

The purpose of the trip was information gathering, first and foremost. We went to hear their impressions of Atlanta. What do they think of Atlanta from a deal perspective? What do they know about Atlanta? What deals have they done here and what deals have they missed here?

Ted Schlein, Kliener Perkins Caufield & Byers

Ted Schlein, Kliener Perkins Caufield & Byers

Overall, the feedback was very positive about Atlanta. West Coast investors love the town. Georgia Tech was always mentioned in the first breath.   The talent wars for engineers is a major challenge for West Coast companies and the fact that we have GT right here is a huge asset, and they know it.

What I was most excited about was the consistency of feedback. There was little variation in the opinions and even less variation in the advice and recommendations.   When asked “How do we engage your firm to invest in more Atlanta companies?”  The responses were consistent.  I will share the top six areas of advice here.

Mayor Kasim Reed, Bernie Dixon, Johnson Cook, Bruce Cleveland

Mayor Kasim Reed, Bernie Dixon, Johnson Cook, Bruce Cleveland

1. Focussing on connecting Atlanta investor community to the SV investor community is a more scalable bridge than connecting individual deals.   When investors have close relationships with other investors, things move faster. When a VC receives a call from another VC saying “this is a good one, you need to see this” — it is so much more efficient than the typical ratio of seeing 200 deals to make on investment.

Bernie Dixon, Brook Byers,  Johnson Cook

Bernie Dixon, Brook Byers, Johnson Cook

2. Facilitation of visits really does help.    12 to 20. That’s the number of companies that an investor needs to see (in their specific area of investment) to justify getting on an airplane.  If the community can help facilitate these pitch days and tours, it is a meaningful needle mover.

3. When investors look at startups, having Fortune 500 customers matters a lot.  Investors said it in every single meeting. If Atlanta can connect our large corporations to our startups for the purpose of making the customers, investors will get really excited.  Having Home Depot, Coke, Cox, Georgia Pacific, UPS, Turner, NCR, Delta, and their peers on your “current customer” slide deck is a giant deal.

Interwest Partners Visit

Interwest Partners Visit

4. Focus on supporting entrepreneurs.  This was one of those that is almost so simple it’s obvious.   Creating an environment that is super entrepreneur friendly, really does matter. Help the entrepreneur. Make things easy. Help them avoid distractions, help them find each other, help them find money. Make the focus on helping the entrepreneur build great companies and the investors will find them.    Venture Capital is a very efficient industry. Money travels with ease.

5. Infrastructure for growing startups matters.  I was delighted to hear this direct feedback from Brook Byers and Ted Schlein at Kleiner Perkins.   Building community centers like Atlanta Tech Village and ATDC is far from trivial. When they put money into a company they just want to say “GO and GROW LIKE HELL” … they don’t want their portfolio entrepreneurs having to go out and shop for furniture, look at office space, negotiate with internet providers… they just want them to get their ass in gear and go.   Incubators and community centers with flexible growth oriented work spaces make a huge difference.

6. Our engineering talent pool, mainly Georgia Tech, is our top advantage. Given that the biggest challenge of Valley startups is finding and retaining solid engineering talent, it is no surprise that the big VC’s see Georgia Tech as a key advantage of Atlanta startups.   Bruce Cleveland at Interwest Partners, for example, shared with us his model for offering engineering students who intern with a portfolio company then join full-time after graduation a major signing bonus. It’s the same money you would pay to a recruiter, so just give it to the student instead.

This trip energized me and everyone else on the trip. It was an awesome confidence builder and the great start to many new relationships between the West Coast and Atlanta.

My last takeaway is that we need more trips like this. Startups should get on the plane as often as they can afford and get out there to soak it in, shake hands, get business cards and start to build the bridges.   The more surface area that touches the West Coast ecosystem, the stronger our own ecosystem will be.   Plus, it’s beautiful out there.

SandHill Road

Thoughts for Students Thinking About the Startups

 

Another critical group in the startup community are students. For today, let’s stick to college students, but we are seeing some great programs that are bringing high achieving high-school students into the startup world.

Students: Why should you care about startups.

The first one is pretty obvious: you need a job.   On the other hand, you may have the itch to start your own company. If you can’t stop thinking about it, have a great team, and can get in a program like Startup Semester or Flashpoint, then you should definitely go full throttle. If you are on the edge and have a feeling that one day you may start a company, but you don’t have the idea just yet… no problem. Just go hang out in the community. Being in the right place, surrounding yourself with the right people, will only make it easier when the time comes.

Students: How you can get involved most effectively in startups.

First, start reading your ass off. You need to subscribe to a few great VC blogs (Feld and AVC to start) and of course follow the top bloggers in the community (DavidCummings.org).

Second, get a job with a startup or tech teen company (aka large and well funded startup like AirWatch or Mailchimp). Plain and simple.  If you are an engineer, just get in and start helping build things. Learn how teams work to build things in the real world. Learn how to balance quality with GSD.   If you aren’t an engineer, the absolute best thing you can do for yourself is to get a job in sales. Learning how to sell stuff is the most valuable and widely applicable skill you can acquire.  You may absolutely hate it as some new grads do… if that’s the case, then try to commit at least 10 months to selling. At the 10 month point, if you are going to be successful, you should see the light at the end of the ramp-up tunnel.     Just remember that taking a job in sales doesn’t mean you’re committing your life to selling used cars or telemarketing. You are committing to learn.  When you do go start a company, you will look back and realize that any amount of time you spend in a sales job is the most valuable thing you can do for your chances of success learning a startup. Sales solves all problems.

Students: What you should expect to gain.

The most important thing you need in your early career is a strong network of deep relationships.  Getting involved in the startup community is an adult thing to do.  It requires follow-up and discipline. When you go to events, get business cards, ask to have lunch follow-up meetings with people you meet.  Ask entrepreneurs to mentor you.   If you do these things right, you will start to form an impressive network. Once you have a network, you will find that next steps in your life journey will come easier for you than your peers.

Career services will be the last place you will look to find a job if you know the right people.

 

 

Thoughts for Startup Service Providers

 

I couldn't resist at least one lawyer joke in this post...

I couldn’t resist at least one lawyer joke in this post… I promise, I’ll be serious after this photo. Ok, I’m done. Seriously.

My first post in a series about Players in the Startup Ecosystem.

Service providers have an interesting relationship with the startup ecosystem. They play a critical role, however and many startups don’t appreciate the true value in the right providers.   I for one certainly did not appreciate early in my entrepreneurial journey the importance of having the right lawyer, banker, accountant, HR people, and real-estate brokers.  It’s not that my service providers did anything wrong, it’s just that I didn’t intentionally select providers that were active in the community and could add value to my company beyond their scope of work.

Some service providers don’t get startups and don’t ever have any intention of building deep relationships to add value beyond their invoice.    As a community grows and entrepreneurs become more aware of the value of tight relationship networks, they will continue to place value on an informed, connected, and proven service provider.   Providers on the outside of the ecosystem may find it hard to get in. Here are some thoughts.

Service Providers: Why you should care about startups.

First of all, it’s not because you can make a ton of money. Working with startups is going to be an expensive pain in the neck. They will be low margin for you. They will negotiate every chance they get, and they will demand the highest level of service you can or can’t provide.

The thing is: startups don’t stay startups forever. If they do, dump them as a client. If they don’t, they will become your best success stories. Helping them grow is rewarding and powerful for your business. They also are typically led by entrepreneurs who will become involved in future businesses and community leadership organizations. Those long term relationships are not forgotten.   The ones who help us when we need it most are the ones we feel closest to when we are the ones offering the help.

How you can get involved most effectively in startups.

1. Make a lot of bets.  Unless you can magically see the future, it is unlikely you can pick one or two startups to work with and have a giant success story. You need to place a lot of little bets. If it takes creating a standardized services package that startups can afford, then try to do that. If it takes giving away time, maybe that’s worth a try as well.  No VC has ever made money in early stage companies by picking only a couple of investments.

2. Help them with the things they need most.  In my experience, the things startups need the most that service providers can help with are: customers and talent.  Refer customers as often as possible. Perhaps your other clients are potential beta users of a startup’s product. If so, get involved and make it happen.   Talent is easy as well. Never hesitate to send good people to a startup. Even if they aren’t hiring, entrepreneurs love meeting with smart people.   Good entrepreneurs are always looking to build new relationships.

3. Manage your expectations.   It’s hard work building startups, and it takes a lot of time. Remember that most will fail. Remember that many times failure is not spectacular crash, but it’s rather stagnation after a certain point.  Be ready for this and work through it with your clients.

What you should expect to gain.

Service providers who figure out the startup formula have a world to gain by being involved in such a fast paced, constantly changing ecosystem of innovation.  Aside from the benefits discussed above, you will also very likely be considered cutting edge in your own profession.  I’ve seen lawyers, accountants, and marketers become “startup experts” in their field and start to win over their colleagues and entire industries.

Cracking this code isn’t easy, but once you get involved, there is great satisfaction from helping create companies from thin air as a service provider.

 

The Surprising Diversity of Organizations that Play In the Startup Ecosystem

 

Village Atrium @ 1 yr Anniversary. In Full Construction Mode.

We just passed the one year mark of the Atlanta Tech Village inception. What a great year!

Looking back, there are two big surprises that neither David or I expected.   The first surprise: the soil is rich and the demand for community, connection, and density is far greater than we expected.

The second surprise: the startup ecosystem as we perhaps inappropriately label it, is far more diverse than we expected.   What we are doing touches many organizations and people, much more than just the startups. The system is not closed: many people that are not in startups are impacted and involved.

In thinking ahead, I’ve enjoyed doing an exercise for myself, that I will share over a few posts. I’m taking a look at each of the main categories of organizations and people we’ve encountered in the Atlanta Startup Rainforest and evaluate why they care about startups, how they can help the ecosystem, and what they should expect to gain from the ecosystem.

Here is a list of some of the types of organizations who are playing in the startup ecosystem:

- Students.  (Not just technical, but MBA’s, liberal arts, and more)

- Universities.   (From research teams, economic development, and career services.)

- Community Organizations. (Chambers of Commerce, Entrepreneurs Organization.)

- Startup Service Providers (Lawyers, Recruiters, Accountants, Insurance providers)

- Investors (Angels, VCs, Private Equity, Institutions)

- Local Government (Municipalities, County, State organizations)

- Large Enterprise (Home Depot, Turner, Cox, Georgia Pacific, Georgia Power)

- Tech Enterprise (Google, IBM, Amazon, Salesforce.com, Facebook, Yahoo, Twitter)

- Teenage Startups (AirWatch, Mailchimp)

- Tech Startups (duh)

- Non-Tech Startups (an interesting delineation I will discuss later)

 I look forward to sharing thoughts and observations on each in the coming month.

Facilities Matter – First Reno Opens this Month

 

World Gym Fayette - New Lexington Location

World Gym Fayette – New Lexington Location

Last week my local gym opened a brand new beautiful building. I only use it for the pool, but I have to admit the old one was pretty uninspiring as far as facilities go. The new one is amazing.  My first swim was awesome. I won’t disclose my embarrassingly weak workout, but I will say that I did 50% more laps than my normal swim. Something about the brand new pool, super tall ceilings, glass everywhere, clean water, new locker room, and awesome showers just pumped me up.

As I drove away, I was thinking about how in January, we will open the first renovated floor of the Atlanta Tech Village.  Exactly 1 year after we started this project (and 10 months after we naively thought we would open renovated space), the 4th floor, featuring Private Suites and coworking will be finally open.  Just like my new gym, it will feature a ton of glass, an intentional modular layout, all new Knoll furniture, super tall ceilings, fancy-shmancy light fixtures, IdeaPaint everywhere, and large LED screens everywhere.

Thinking back on the office space we rented in my last companies, it never made me excited. We always got the cheapest space we could find and kept it as minimal as possible. We were never in anything better than Class C, and never bought furniture that didn’t come from Ikea or Office Depot.

This isn’t a sales pitch– trust me– but it always was an annoyingly persistent energy drain to be reminded that we were in crappy offices.  It didn’t help for recruiting, and when myself or my team would visit companies that we thought were similar to us but made their home in awesome Class A space, we  went back to our home feeling a little down.  We didn’t admit it, of course, but it’s human nature and unavoidable.

Being a little bit older and wiser, I’m ready to admit that I missed the mark on this. I should have acknowledged sooner that the facilities matter more than we think… and more than we like to admit. The energy of the team can be affected by the pride in the physical facilities of the company.   I cannot wait to start using the renovated space in the Village… and look forward to those long, hard workouts at my new gym too.

 

 

Thoughts on Community Conversations in Atlanta – How they Happen

 

nucleus_actinLast week when a few of us did the How I Work posts, Allen Nance made the comment that it makes him laugh that us in the entrepreneurial tech community are “blogging at each other.” All in good fun, and yes, I’m giggle at how cute we are, but I’ve also been stewing on this for a while and have some thoughts.

The Atlanta Startup Community, like every other community/ecosystem has layers of participants. There is the inner circle leaders and outspoken proponents. Then there are the participants who love the community but aren’t leaders, then there are varying fringe layers of participation. Some layers include folks who drift in and out of the community and some are there always but silent.

For a community to thrive, the inner circle needs to be tight. It needs to be active and it needs to be dense.  Similar to an atom structure: the nucleus determines a lot of what happens around it.

I’m a daily reader of Fred Wilson’s blog at AVC.com.  The most impressive thing about AVC is the community of commenters.  I have no idea what the average number of comments is, but I suspect it’s at least 50-100 per post.  The site is really more of a community site than a blog, acting like a Forum, with Fred’s post teeing up the topic of conversation for the day. The names become familiar and it really does feel like an online community.

I love our Atlanta community of bloggers. I love that conversations happen via blogs.  We don’t have a single site like AVC where all these conversations are happen (Hint, hint for some great journalistic entrepreneur out there…), but the blogging community is healthy and vibrant and that’s just what we need.

I also love these things about it, and you should to:

- It’s completely open. Anyone can start writing, commenting, and participating.

- There are tons of resources to make a difference if you step and decide to become a leader.

- If you have an opinion and are willing to share, it’s easy to stand out. The vast majority of people keep their opinions to themselves and don’t have the courage to step up and write publicly.

- We have a friendly community.  Even our disagreements with Urvaksh are handled with Southern courtesy.

2013 was a great year for Startups in Atlanta. I have a feeling though, that it will look tiny compared to the startup successes we will see in 2014-2018. Many new things were set in motion this year… now is the time to get involved.

 

Peachtree City and the Atlanta Tech Village

 

Peachtree CityI mention regularly that my family lives way out in the south side burbs of Atlanta, in Peachtree City, GA. We love it here. People ask me: “When are you moving in town?” And my answer, at least for the next few years is “We can’t imagine living anywhere else.”

Peachtree City (PTC) is also known as the bubble. Some say it reminds them of Stepford, Connecticut.   It’s because PTC is a planned community.  Back in the 60’s and 70’s, some ambitious entrepreneurs recognized that there was a need for a great community south of Atlanta, primarily to support the growing airline community (execs and pilots), since the rest of the booming family-friendly communities in Atlanta were headed north, but Hartsfield Airport was staying firmly located on the south side of town. They made a big bet. The planning is impressive. There are distinctly defined “villages” in Peachtree City. The industrial needs were planned. The parks, lakes, libraries, pools, neighborhoods, streets, recreation centers, and trails were planned. We now have hundreds of miles of recreational trails (fantastic for RUNNING), an amazing amphitheater, 3 fantastic lakes, parks and pools everywhere, and…. well, you get the picture… I’ll get to the point.

At the other end of my daily commute stands the Atlanta Tech Village.  Again, people ask me regularly: “Why don’t you just get an office closer to home?”   And again, my answer is: “I can’t imagine spending my days anywhere else.”    Why?

It’s not the coffee. Not the comfy chairs, fast internet, convenient burritos for lunch, or even Jeff Hilimire.  It’s the community.    The Village is a planned community, just like Peachtree City.  It’s intentional.  Who comes, why they come, how they fit the core values are all intentional.   Other than the other startup incubators, there aren’t any other office communities that are planned like the Village.   The Village is a planned community for businesses.

It’s inspiring to think that 30-40 years after some forward thinking guys started Peachtree City, it still brings so much value to so many people. I hope that in 50 years, the Atlanta Tech Village will still be as strong (whether it’s in the same building or not) and that entrepreneurs and their teams will see value from the work we are doing today.

Read more facts about PTC on the Wikipedia page.

 

 

These 8 Talking Points Could Save Your Life at Holiday Parties

 

It’s December and that means it’s party season.  Time to see friends, neighbors, and colleagues that you often only see once a year. Time to reconnect with extended family galore.

Many of these people will be far removed from the tech scene that we live and breathe. However, if you are in any way affiliated with a tech company, or have brought up anything related to the Atlanta Tech Village in conversation, you should be prepared for these unavoidable party topics.  Don’t be caught off guard!

8 Topics you will be forced to discuss because of this affiliation:

TOPIC 1: New in 2013. Bitcoin.
What is it? How does it work? Isn’t this illegal? Should I buy some? Do you have any? I don’t understand why it exists.
Best answer: I don’t know.

TOPIC 2: The NSA.
Best answer: Just be careful what you say in your e-mail, granddad.

TOPIC 3: Healthcare.gov Debacle…
Why didn’t it work? What happened?
Best answer: I need more wine.

TOPIC 4: Traditional favorite: Can you fix my printer?
Best answer: You know, I hear cousin Johnny (who just started college) is taking a computer class. He can probably fix it better than I can.

TOPIC 5: The One that won’t Die: My Windows 98 computer just started popping up an error message on startup?  It takes too long to load Outlook Express, do I have a virus?
Best Answer: This turkey is delicious. Is this homemade dressing or stove top stuffing?

TOPIC 6: Should I get an iPhone?
Best answer: Yes.

TOPIC 7: I don’t “get” the Atlanta Technical Village. What exactly is it?
Best answer: It’s hard to explain. You have to come see it.
Alternative answer:  We aren’t allowed to talk about it. We’re working with the government.

TOPIC 8: Tell me again, what does your new company do?
Best answer: Computer stuff, mom.

It’s a jungle out there. Best of luck to you all.
See you on the other side!

 

Setting External Goals – EO, YPO, Village Verified and the 83.3 Club

 

When I started my first business, I discovered the Young Entrepreneurs Organization early. It was just for me… until I realized that it had a revenue threshold of $1mm in annual gross revenue.  I was equally bummed and motivated. I realized that I needed to set $1mm as a target for my business because I wanted to be in that group.    For my next business, I have the YPO target in mind already. $12mm in annual revenue, be the CEO or President, and join before your 45th birthday. (And a few other requirements, here.) I’m not there yet, but 11 years to go!

There is something valuable in goals that are external to you and your company.

If you set an internal only goal like one of these, it would be easy to make excuses and say things like “we decided that revenue isn’t important, and we want to focus on user growth.”  If you set the goal to Join EO or Join YPO, then there are metrics outside of your control. Giving up is not an option.

See Seth’s post on Owning It. This one made it to my “classics” folder.

In the Atlanta Tech Village, we are hoping to provide some stepping stone goals for all companies in the Village.    The first one is our Village Verified program.    This is our six-figure club: meaning that a startup has reached $100,000 in either funding or annual revenue.   Once in Village Verified, serious new perks and meetups will be unlocked to a startup founding team.   Villagers reading this- members can apply to become Village Verified here on F6S.

Next up for us in the Village is to create the 83.3 Club.   This is the equivalent of the EO membership target. $83,333 in monthly recurring revenue (MRR) is a giant accomplishment for tech startups. This means you are at the $1mm annual recurring revenue (ARR) mark and have proven serious traction.

Don’t shy away from big goals like this. Put it out there. Put a timeline out there, and go for it.