E.C. - Burn Rate

In the words of Tony Robbins, “The only limit to your impact is the is your imagination and commitment.” And this book really sucked me into another world! A burn rate is Burn Rate is the cash drain of a startup company. The book mentioned his own dot.com to dot.bomb experience back in 1997. It was funny how his lack of interest in the stock market suddenly took a 180 degree turn once startups and even ‘Wired’, a famous magazine with operations company took a hit. As mentioned in the book, “This was a revolution, because now computing would involve everybody, not just scientists, engineers, and accountants.” It was an extensive process for the Wolff to change his way of thinking.  Even living in New York City, the center of all these new technologies, he found the metropolis was lacking individuals proficient with how to use the internet for proper business purposes without losing everything.

Throughout the book he explains what he recalls people told him AOL, AT&T, Sports Illustrated, Time Warner, and IBM. He even goes over how he tried getting in deals with AOL, Magellan, and Washington Post and the only conclusion to everything was how he had to go back to his roots of being a journalist. From what I read, it seems like anyone who was an entrepreneur saw incredible aspects and application for internet while other usually whined over it. Sometimes while reading I felt a disconnection from the main character since he tends to make me see and hear him as the author instead of a writer.  He seems like a wondering soul just trying to find his place in the world and I feel it parallels how most of us feel when we deem ourselves lost. I really enjoyed this book since the way he words his speech and description give me an eerie feeling that opens up a door to the distant past, much further than the 80s or 90s of course.

E.C. - Startup.com Documentary

The documentary for Startup.com was a movie we watched near the beginning of the quarter. It featured 3 guys who were high school buddies and entered the business world together to try to make a new company during the explosive growth of the first years of the WWW. Very early on in the film the 3^rd high school friend, Ki, got his cut of the profits ($700,000) after doing his part of the work and cut loose from the company since he had qualms about taking it further on. The two remaining friends, Tom and Kaleil, stayed in the company and continued to build it. The company purpose was that anything done through the government can be done online. Such things like paying parking tickets.

The two friends had a lot of difficulty finding companies willing to invest their confidence and money in their efforts and it started to take effect in their friendship. Unfortunately, Tom and Kaleil’s personal values were very different and became relevant over the course of the year. Tom valued family, while Kaleil seemed to value success more. Kaleil’s girlfriend left him because of this.

The main competition for their company, ezgov.com, showed no worry after taking a look at Tom and Kaleil’s company, and the reason became very heart wrenching later on. Website testing unveiled glitches as the due date for the site was vast approaching and this was freaking out Kaleil. Around that time someone also broke into his office and stole his computer, which had important company data on it. On Friday the 14^th the stock market crashed and one immediate concern was that the number of employees for their company dwindled. This was an issue since back in January they had 120 employees, which rose to 200 in April after the crash. Increasing the number of employees under the current circumstances was probably the wrong move at this point.

Tom and Kaleil were having greater difficulties with Tom ending up being terminated from the company in May 28^th of 2000. They friendship had taken a damaging blow, though Kaleil stayed with the company. Six months later the company had a mere 50 employees and not long after it completely failed in comparison to ezgov.com which had a superior website. This company of theirs was only one of the many companies to rise and fall during these years taking into consideration the economy change. Watching the change in the two’s relationship over a course of months really cemented the concept to me that life can bring you down and ruin friendships no matter how close they may be. Friendships can be tight, but business can be unforgiving.

Dot.com to Dot.Bomb

This is a breakdown of the Dot.com to Dot.Bomb years. According to our professor it can be separated into 5 stages – An innocent beginning, Boom!!, Insanity!!!, Bust!, and the crawl back to sanity. Before the world wide web, Tim Burnes laid out 2 uses for the web. HTML had to be created and standards had to be developed such as HTTP. Apple computers came out in 1984 which in turn led to computers becoming ubiquitous and people wanted to connect them. Big systems were coming out of the woodwork and at the time were heavy hitters all their own. Prodigy, a private network, had 1.1 million users and was owned by Sears and IBM, Compuserve, which was owned by H&R Block, had 1 million users, Genie, which was owned by General Electric, has 200,000 users, AOL, which was using a CD distribution strategy, gained a large user base, and Delphi, another service, had 100,000 users. This was not to last though.

It began in 1994 when Microsoft used Compuserve to localize programs to other regions. Free range media was allowed use by corporations. DealerNet was one such example of an extremely successful website. At the International Web Conference that year, Tim Burnes delivered a paper describing the potential of the WWW. There was also another individual who proposed that there should be 2 different versions of the WWW – one for businesses and one for science. Cole and Weber were 2 individuals at the time who worked together on web advertising and Mosaic was an alternative to using Internet Explorer.

During the years of 1995 to 1997 the Boom!! Stage occurred. Netscape became the browser leader worth $1 billion, the web became a market, and PathFinder was going to be a compilation of online magazines. Burnes was contacted by Advertising Age magazine about free range media’s advertising strategy. Prodigy rose and fell in the course of that time, Compuserve purchased Spry for $120 million, Yahoo launched and became big, Amazon aimed to be the largest bookstore (causing Barnes and Noble to throw a fit), and the USWeb became a large web development company.

In 1997 the Insanity!! Stage occurred. AOL bought Compuserve, InfoSpace went public, Burn Rate was written, and the InterNet Bubble was published. This led to the next stage, which was Bust. Many .com companies advertised on the SuperBowl, Pets.com went bust, the stock market made a downturn, layoffs occurred in many .com companies, and many more companies fell alongside them.

Over the course of the following years the businesses have crawled back from the ashes of defeat and new ones have formed, but the introduction of the WWW has changed business forever. The big change was going from an Industrial Age economy to a computer age economy. Some could shoulder the pain, but most were unable to bear the burden. In essence, the strong consume the weak, though that is just what happens when a large upheaval of change takes place. I didn’t honestly notice these changes that easily even though this occurred during my childhood years, but some of the ramifications that came from this and some of the technologies used back then that aren’t used now were things I was familiar with. 

Guest Speaker - Shadrach White

Being revenue hawk involves many objectives. You need to understand what selling means since your business won’t go anywhere otherwise, you need to smile to create a welcoming culture that becomes infectious, you need to be able to make quiet time to let your mind relax, and you need to read other subjects other than matters relating to business so you can connect to others by being well-rounded. Those were the first points made to us by the Speaker of the day… Shadrach White.

He briefly went over some of the startup companies that led to his eventual 4^th company. One of these was called Sportswear and its purpose was to sell vintage basketball jerseys. His angel investor gave him $700,000 to get rolling, though he didn’t manage his finances well and it ended up with him owing a lot of money and paying it back for 6 to 7 years. He also built up a business called Olympia, though he didn’t have much to say about it.

Cloud PWR was his 4^th company and the purpose was to build it up to a $1 million company then make use of an exit event to make a large profit. He made it a point that you should never underestimate the power of a good attorney and not to cut corners since it may be expensive earlier on though pay off in the long-term. His company was responsible for Air Lift. It involved building applications for government institutions and services as well as making them simpler.

Lastly, he made sure to go over 4 ways to protect intellectual property – trade secret, copyright, trademark, and patents, 4 directions a company can go – close it, continue operations, sell/merge, or openly trade, and ways to fund a company – equity, debt, or other options such as grants, business plans, etc. The details behind these were all covered earlier on, though he organized them into a simpler format than the first time we saw them. He basically told us he was in entrepreneurship for the purpose of making money and it was alright if that was what we were aiming for. Creating companies for the purpose of exit events is just another form of business and some individuals just don’t want to spend their entire lives doing one thing or running one company and he assured us all that entrepreneurship didn’t mean dedicating your everything to one option, but dedicating your everything to any option.

Mission Statement

To create lower costing, yet higher quality computer parts customized just for you!

The reason for the mission statement is just as it sounds. Its purpose is to give the market what they want at a lower cost, though this is preferably aimed at individuals who for whatever purpose want a custom made computer or laptop. This doesn’t necessarily mean it will lower the cost of computers in general since these computers would be made for the specific purpose the customer needs it for. This could range from high paid CEOs to gamers. The company values should include expanding to a certain point and then keeping the company stable without sacrificing from the employees in the best case scenario, though the largest goal would be to make the selling of the previously mentioned computer parts cheap and at a higher quality than you’d find elsewhere, though this part of the company goal could prove a bit difficult if the personal contractor isn’t doing a proper job.

Guest Speaker - John Dimmer

Funding; one of the driving forces to taking a business to new heights. John Dimmer opened my eyes to the importance of gaining enough capital for your company to take it where you want it to go. Special attention should be taken in this since it can help in expanding your company or causing you to lose your part in it. This is because too little can lead to running out of funds before achieving key milestones, while too much can lead to selling yourself out of an ownership interest in the company at too low a price. It all depends on the financing source you make use of since they each have their own benefits and drawbacks.

Debt doesn’t dilute ownership percentage, but it is often difficult for start-up businesses to obtain. Equity is the largest pool of funding for start-up businesses, but by taking on equity investment, you give up partial ownership and, in turn, some level of decision-making authority over your business. Other financing sources include prize money from business plan competitions (since it is non-taxable free money), governments grant known as SBIRs, money available under veteran’s programs, crowd sourcing, and a few other methods. Benefits of these are that there’s no repayment obligation like debt and no ownership dilution like equity, though these methods can prove to be time consuming and only nominal funds are available.

Gaining investors in a company through shares is a very common thing. Generally, though, they never want anything to do with Sub-Chapter S Companies since they eliminate many Angel investors and VC’s who use LLC’s as their investment entity. The corporation’s investors prefer are “C” Corporations and LLC’s since they provide liability shields for the investors. It is important to note though that once your ownership drops below 50% you lose control of the company so it is necessary to plan out how many times you plan to raise and where you want to make use of your exit strategy if that’s your reason for building up the company.

Protecting Intellectual Properties

In the words of Richard Branson, “Business opportunities are like buses, there’s always another one coming.” And since there is no shortage of new ideas coming out of the woodwork it is quite necessary to have the proper channels set in place to protect what’s yours. The four methods for protecting your intellectual properties include trade secrets, copyright, trademark, and patents. My idea is nothing new and there’s no actual secret ingredient to making it work so there’s no trade secret involved. I guess the secret sauce in the case of my business would be the computer code involved but that oversteps the bounds of a trade secret and sounds more like copyright. That method as well as the other two methods may very well be viable in achieving their intended use.

I can use trademarking to protect an image that I use to identify the company logo. I can also use copyright to protect the computer code involved in the creation of the app service part of my business plan or the code for transferring computer blue prints to personal contractors that are partnered with my business. Patents on the other hand, may generally be the first option that comes to mind when talking about intellectual property, but the idea behind my business isn’t especially innovative when compared to Uber, DoorDash, or any other type of app job service. One the other hand, the method in which I use my app business is quite different from how other businesses use theirs so it may be possible. I am after all crowd sourcing the manufacturing of computer parts through the use of 3D printers.

Service Cost

In the words of Colin Powell, “There are no secrets to success. It is the result of preparation, hard work, and learning from failure.” And boy is he right on the money. As he should be of course. The preparation involved in finding out the cost of running my service the cost is very difficult for me to calculate at the moment. I have to take into consideration the cost of running the app service, the cost of paying each personal contractor signed up with the app service, and the cost of patents for the blue prints involved for the parts of the computers that are 3D printed. There also could be other costs I am unaware of at the moment as well which could play a role in the matter.

At this time the only specifics I am aware of consist of the prices of mobile app maintenance costs as listed online. To quote one website on the matter, “A good rule of thumb is to budget 20% of the cost of initial development when calculating how much it will cost to maintain software. If your initial development costs are $100,000, you can reasonably expect to spend about $20,000 per year to maintain your app.” Another website that listed a 2016 enterprise survey showed that annual cost of maintaining an app service consisted of 25.3% of companies spending more than $1.5 million, 5.7% spending $1 million to $1.5 million, 7% spending half a million to $1 million, 29.1% spending a quarter of a million to half a million, 24.7% spending nothing to a quarter of a million, and 8.2% spending different than that amount. This means that $250,000 to $500,000 is the most common budget for that part of the service alone.

Guest Speaker - Brian

           With humble beginnings as an elementary school teacher, Brian Forth ventured into the unrelenting and unforgiving world of entrepreneurship. That introduction sounds kind of like an underdog fighting against the odds to achieve greatness like in Rocky. Truth be told, fancy wording aside that isn’t too far from the truth. The journey can be long and hard but the gains are worth the struggle.

            A past experience he had took place in the San Francisco Bay Area. Him along with others from Microsoft, Sega, and Atari (among others) were working together on a project, though were axed not long after. He didn’t want his company, SiteCrafting, to be the type of company that cared only for profits. His goal was to build a company with the type of culture that values its employees. It was to be the kind of workplace they could retire from and not need to worry over being fired from. It is a web application development company based in Tacoma that also creates training kits on how to code and builds websites. Gear Lab is a stemmed off company on the other hand that does product offering (with a separate LLC). He has run other projects like the Mobile Wine Tour App, which died off because they couldn’t keep up with new wine locations opening up.

            He 3 C’s he offered to us during his session: Core, Company, and Community. Core is being true to oneself, Company relates to the culture he wanted to build in his enterprise, and Community means to actively participate and give back to Tacoma. I think his model of a company is probably one of the safest working environments I have ever heard of. Usually you would hear of the negatives aspects of larger corporations, though his company puts value in the employee and the willingness to work with them instead of having them work like a grunt under him. It isn’t something I hear of often so I am glad to know there exist a few out there.

Guest Speaker - Eric

In the words of Joseph Campbell, “We must let go of the life we have planned, so as to accept the one that is waiting for us.” That pretty much defines entrepreneurship for me and that may also be true for the guest speaker, Eric, who attended our class to tell us a bit about his life went in that direction. It all began for him with writing a novel in 8^th grade, then really took off when he was brought on as the director of the grand cinema for the purpose of running it, increasing fundraising, and increasing special programming. Basically he gave it a face lift. He also went into how he was involved in a joke website and a few other prospects he tried out, but I lesson I took from his stories was as he mentioned halfway through his talk. In his own words he said, “Each job is time for money.”

His words really spoke to me. Though it wasn’t because it was a magnificent unveiling that awoke anything in me or anything like that. I also have a few mentors who live in such a way and show me the in-and-outs of entrepreneurship. Hearing it from someone else’s mouth just cements it more in my mind that it really is what I want to achieve greater freedom in the future. I also greatly agree with his comment on how, “The skill of running a business isn’t the same as what business is.” The biggest change is in the mindset of how it all works and most of us are programmed earlier on that you either win or lose, but it should be that you either win or learn. That is what I believe anyways.

What I Hope to Gain from the Class

            Waking up at the same time each morning, going to work every day on a set schedule, working for someone else’s dream, coming home, going to bed, and doing the same thing again and again until I retire is not something I look forward to. In fact, it is something I dread with a passion. Finding hobbies or searching for the little things in life to keep me occupied while I am not working sounds like it is just meant to fill in the gaps. Defining myself to someone else by my occupation isn’t something I wish to grow accustomed to. I don’t want to tell someone something like that when they ask me, “What do you do?” I want to be able to reply with, “I am a guy who loves going out with friends, snowboarding, traveling around the world, collecting interesting souvenirs, helping others find what they want in life, working out at the gym, buying my dream cars, building my next home, hanging out with my wife and kids, taking on new experiences, and so much more.”

            What I want to gain from this class is a way to accomplish this kind of lifestyle or even accomplish these kinds of goals. I don’t want to be limited by a boss and helping them with ‘their dream’. I want to find my own and work to making it a reality. I want to live day to day not as something to fill in the gaps, but to fulfill my purpose in this life. I want to mean something. I want to be something, not just another cog in the system all my life. I believe entrepreneurship is the way to achieving that.

3 Business Ideas

            3 business ideas I thought of include 2 having to do with apps and one other idea. My first app idea is similar to the app known as Doordash where people who apply can become personal contractors who deliver food from restaurants to customers. They are then rated on their performance and are paid upon delivery completion through the app. My app would have to do with computers. Doordash requires each personal contractor to have a car to deliver with, but my app would require personal contractors to have a 3D printer. Through orders sent by customers in a specific area near the personal contractor, such as in a specific city, they would process the blue prints of the order that is sent over through the app from the company, build the computer with a 3D printer, assemble it, then ship it off to the customer. They would only receive orders during the schedule times they signed up for to take care of orders so they could literally only work when they want to and the price of buying a computer would be cheaper in the long run since it doesn’t have to go through so many different hands before reaching the customer. The business running the app would get their cut and the personal contractor would gain from it. Of course this requires computer assembling that is made simple so most people could do it within an hour or two so getting in more orders could be possible in a day.

            My second app idea is similar where people work as independent contractors for an app, but in the case of doing 3D printing for cheaper items instead of customers needing to purchase them. Items could range from anything the contracted app company has copyrights over. My third idea is for personal heated clothing. This could pertain to jeans, jackets, or anything similar. It could have built in heating or cooling depending on the setting.

            I have a bit of a better grasp on the first idea and the second and third ones were things I considered as alright ideas that I may expand upon later.