Does the idea of interviewing for a new job put you on edge or scare the living daylights out of you? Does it make you want to stay under the duvet and hide?
You’re not alone. There’s a lot riding on landing that job whether you’re currently unemployed or not, particularly in the current climate. Here are 9 ways to give a naturally confident interview that really allows you to shine.
1. Don’t Over-Prepare
You certainly need to know your stuff before heading into that interview room, but whatever you do, don’t over-prepare. You need to know your onions (so to speak) as well as having some knowledge about the company’s products, services, market position, opportunities, etc, but preparing answers for every possible question and memorising every fact will drive you crazy and make you ultra-nervous.
Knowing your subject isn’t a case of simply repeating information verbatim, and if you go to an interview planning on spouting facts and figures there’s a risk that you’ll sound too rehearsed or stilted.
Interviewers want to see how well you think on your feet as well as how knowledgeable you are, so leave room to move. You don’t have to be word perfect, you don’t need to know everything or have a slick answer for every question. Trust yourself to shoot from the hip.
2. Don’t sweat it
Focusing on the things that make you nervous will only ever give you more drama, and that’s exactly what you don’t need.
Yes, interviews can be nerve-wracking, but it’s okay to be nervous. If you weren’t nervous it would mean you didn’t care, so how about finding a better way for you to care about this? How about directing that energy in a more useful way to up your game? How about using that nervous energy to demonstrate your enthusiasm and energy?
Remember, the simple fact that you’ve been invited to interview means that they’re interested in talking to you and think you might be right for the job. That’s a good thing, right?
What difference would it make if you knew that whatever decision they make is just fine, that no matter what happens it’s no reflection on you or your ability? Shifting how you perceive the risks of the interview can feel pretty liberating, allowing you to shine.
3. Blow Your Own Trumpet
You have to blow your own trumpet to show how much you can add to an organization. Fail to do that effectively and it’s game over.
So get clear on what your strengths are – the skills, talents and experience you’ve applied in the past to get great results. Get clear on what you’ve achieved and your role in those achievements. Get clear on how capable you are, and how you want to continue to develop your capability.
That’s the information and evidence they’re looking for.
4. Don’t jump into the first chair you see.
Don’t rush into the room and grab the first chair you see – it’s not a competition. Let the interviewer find their place first. If you’re in a meeting room don’t sit next to them on the same side of the table, and don’t automatically sit directly opposite them. If you can, try to sit diagonally from them – it provides a good space between you but doesn’t act like a wall.
5. Don’t go in just 1 direction
Go down a single track during your interview and talk about one area of skill or experience and it could easily leave a big enough gap in the interviewers’ mind to wonder if you’re the best candidate. Show a range of skills and experience, and show that you can get on with people as well as tasks.
But going in 1 direction isn’t only about what skills and experience you choose to show and tell, it’s about what you need from the interviewer.
An interview has to be a 2-way street to avoid miscalculations of culture and fit. It’s a process to see how well you fit in the role and the organization, and if the role and organisation is a good fit for you. It’s not simply about the interviewer pulling out the information they need to make their decisions, you need to get the information you need to make your decision.
6. Smile
I’ve interviewed a good number of people in my past, and there was always one thing that made a candidate stand out head and shoulders above the rest – the fact that they were enjoying themselves, not just in the interview but generally in their life.
An interviewer doesn’t want a one-dimensional person, and often the personality of the candidate can override any weakness in skill or experience.
So don’t think that you can’t enjoy an interview. If you look like the interview is torture or if you’re just generally down-beat, you won’t get hired. Simple as. If you’re enjoying and engaging with what you’re doing and where you are, it speaks volumes.
Smile. (Just not too much that you look like a grinning maniac).
7. Leave your stuff outside
Carrying any uncertainty, doubt or problems into the interview with you will limit your ability to interview well, so put that all to one side before you start. Picture the interview room as a safe place with people who want you to get the job, and remember that the interviewer wants to see the best of you, not the worst. They’re on your side.
8. Don’t let your body talk for you
If your shoulders are hunched, you’re slouched in your seat, you’re wringing your hands, continually scratching your head or if your eyes are darting around the room then your body language will be screaming “Danger!” loud and clear.
Having a relaxed but confident body language communicates a relaxed and confident individual. You’re free to move in your seat and use your hands to demonstrate key points, just watch you’re not waving your arms around like you’re swiping away fruit flies.
Remember eye contact too – it’s about building rapport and connecting with people. Without eye contact there’s no connection, so be sure to look your interviewers in the eye as the interview progresses. Like everything, there’s a balance to be struck, so don’t stare fixedly at your interviewer like a wired Will Ferrell, this isn’t a Saturday Night Live skit.
9. Embellish and polish
There’s a saying that suggests that an interview is 2 people in a room lying to each other. Some interviews might be like that, but not the ones that end up with a great deal for everyone. Don’t lie. It’s like dressing a cow in a duck costume and asking it to quack – it’s not going to fool anyone.
But while you shouldn’t lie there’s nothing wrong with a little polish or embellishment. Tell them how proud you were of a team achievement. Don’t cover up a weakness or failing but spin it into an important lesson learned. Show them how darn excited you were to get involved in a particular project.
This doesn’t mean that you’re misrepresenting yourself, it simply means that you’re selling yourself and giving a great interview.
Steve Errey almost died at age 5 as he choked on a grape. Today, Steve is a leading confidence coach for entrepreneurs and intrapreneurs, with a reputation for talking sense and getting results. Read more at The Confidence Guy and follow him on Twitter. He still loves grapes, despite the risks.
Just over a month ago, I ran into a friend at a CES event. While I see this friend around town once in a while, this was the first time I’d seen him in a non-casual setting since Blogworld 4 months earlier. After exchanging the usual pleasantries, he asked me an odd question: “Is this like your conference party outfit?”
Indeed, I was wearing the exact same clothes I’d worn to the event four months earlier. Since he doesn’t usually see me dressed up, it stood out enough for him to remember. But that’s not the real point, here; the real point is that I have few clothes suitable for “adult” gatherings.
I have a suit, of course, for weddings and funerals. (I haven’t had a job interview in 9 years, but if I did, it would be suitable for that, too.) And I have my day-to-day clothes, which aren’t awful but which aren’t anything to brag about, either. Functional casual, basically: jeans and khakis, an assortment of button-front shirts, some cotton sweaters.
As a college professor, there’s not a lot of pressure on me to dress up. If anything, it’s just the opposite. For one thing, I interact regularly with younger people, mostly teenagers (I teach 100-level courses), and being too formal creates a barrier between my students and me. That might be ok in business or law (think John Houseman in Paper Chase) but for my classes and my teaching style, some level of rapport is crucial. For another thing, my fellow professors don’t exactly set the sartorial bar very high – and there’s a certain sense of bohemian “me-against-The-Machine” attitude expressed by violating “corporate” standards of dress.
But mostly I dress the way I do because I’ve never really learned how to dress otherwise. Like a lot of my fellow geeks, fashion just wasn’t on the radar for me. Fortunately I have a brother who has always been very fashion-conscious, and he’d take me in hand every few years when my fashion sense got too out of touch with reason and social acceptability.
Well, my friend’s off-hand comment was a wake-up call for me. I mean, I’m a grown man – I should have more than one pair of slacks and one shirt nice enough to wear to an industry event without embarrassing myself! So I set out to educate myself on some fashion basics – what shoes go with what kind of trousers, how to distinguish various sorts of dress shirts, and so on.
I did what any true-blooded geek does when he or she wants to find out about a new topic: I googled it. But what I found was scattered, often contradictory, and for a newbie like me, downright confusing. A lot of the information out there is tied to specific social contexts: the workplace, the nightclub, and dating, mainly. And a lot of it’s quite vague – the answer to most questions is “it depends on your personal style” which I’m sure it does, but what if you don’t know your personal style yet?!
With some perseverance, a few trips to department stores, and the help of friends on Twitter, I managed to assemble the following rules. As with all rules, they’re meant to be broken – but only by people who know how to break them. For the rest of us, this is a pretty good primer on basic men’s fashion.
Dress Suits
1. You eventually want to own three suits. Your first suit should be either navy blue or gray, possibly with a light chalk stripe (like a pinstripe, but softer), and in an all-season, medium weight. Either of these colors will fit into most social settings. Your second suit should be the one you didn’t get the first time around. Your third should be black – not for funerals, but for black tie affairs. If you work in a field where suits are the norm, you’ll probably want more than three; once you’ve covered the basics, you can move on to more distinctive suits (pinstripes, different weights, unconventional colors, etc.).
2. Suits are made of wool or cotton. Higher thread counts signify higher quality, but are ironically not as durable, so stick with something mid-range. Ask the salesperson to help you with this. (Yes, ask the salesperson. Suits are not self-serve.) Synthetic fibers need not apply.
3. You never button the bottom button. Apparently, Edward VII got fat and couldn’t button his vest over his belly, so now nobody does. On a three-button jacket, you button the middle; the top button is optional. If you have a jacket with 4 or more button, you obviously know what you’re doing already.
4. A gentleman carries a handkerchief in his front breast pocket. You don’t have to get fancy, just fold it square to fit and have 1/4” to 1/2” sticking out the top. Then proffer it as needed. And wash it after.
Shirts
1. Don’t wear your sleeves too short or too long. 1/4” to 1/2” of cuff should show beyond your jacket sleeve.
2. Shirts with button-down collars are not dress shirts. They’re sports shirts, so wear them with a sports coat. Polo players used to button their collars down so they wouldn’t flap up in their face while they played. (Are you beginning to sense a theme here? Fashion rules are largely dictated by what English gentleman and nobility did generations or even centuries ago. Sports coats? You wore them during sport, i.e. hunting. Regimental stripes on ties? They indicated your regiment in the British military. And so on.)
3. If you unbutton your collar, remove your tie. You can wear a suit or sports coat without a tie – just ask Obama – but wearing a tie with an unbuttoned shirt looks sloppy.
4. You can unbutton the top button always (provided you’re not wearing a tie), the second button usually, the third button only on disco night at the Rollerama.
Trousers
1. Wear your pants at your natural waist. Too high and you look like Grampa, too low and you look like a high school kid. Your waistband should sit 2-3 inches below your belly button.
2. Pants should almost touch the ground without your shoes on. Jeans can be a little longer, since they shrink a bit when you wash them.
3. One pleat, maximum. If you’re a big guy, like I am, you learned somewhere along the line that pleats are slimming. They’re not. At best, they look like you’re a big guy trying to look slimmer; at worst, they actually make you look heavier because they pull out across you, broadening your appearance. In any case, the job of a pleat is to maintain that crease sown the front of your pants. For pants without that crease (and many with it), pleats are unnecessary; for pants that need the pleat, they only need one.
4. 1” to 1 1/2” cuffs. Or not. There’s nothing wrong with cuffs, there’s nothing wrong with no cuffs. They are understood, however, to be an older man’s style – not in a bad way, think sophisticated, experienced, distinguished, and conservative. For younger men, a cleaner line is generally preferred.
5. A useful piece of trivia for the American abroad: in British English, “pants” are underwear. So if, for instance, you are in London and get invited out and maybe your trousers are dirty from work, don’t say “I’d love to go out, I just need to go home and change my pants first.” And if someone should ask, “Why, are your pants dirty?”, don’t say, “Yeah, I always get my pants dirty at work.” You will be laughed at. Er, I assume.
Shoes
1. Pay attention to your shoes. Everyone else does. It’s hard for the non-fashion-maven to tell a more expensive suit from a less expensive one, a high-quality shirt from a medium-quality one, and so on. But everyone can tell cheap or poorly cared-for shoes. Buy the best ones you can afford, and take care of them. Polish them regularly (a few swipes with a wax-infused polishing cloth is often all it takes) and store them covered if you won’t be wearing them for a long time. Shoe trees, it turns out, are important: they not only hold the shape of the shoe but the cedar ones absorb moisture (and thus odors) which helps preserve the leather. (Aside: women tend to pay a lot of attention to men’s shoes. Keep that in mind when a) dating, and b) interviewing for a job.)
2. Shoes are made of leather (besides sneakers). Anything not made of leather you can consider a non-shoe. Leather breathes and adapts to the shape of your foot. The soles don’t have to be leather, but the uppers do. (True story: as a young man, my brother was a car salesman here in Vegas. In the summer, the tarmac could get well over 150 degrees F. Standing out there with leather-soled shoes could give you second-degree burns! So they wore rubber soles, which melted after a month or two and had to be replaced.)
3. You need more than one pair of shoes, but not too much more. Black oxfords (lace-up dress shoes), black loafers (slip-on shoes), brown oxfords or loafers, and you’re set (not counting your athletic shoes, of course). A pair of ankle-high boots in black or brown can substitute for the loafers. Ox-blood (burgundy) shoes are harder to find but in theory go with everything. You can pretty safely ignore white shoes.
4. The shinier the shoe, the dressier. Matte-finish shoes – nubuck (that pebbly leather), suede, and distressed leather shoes are automatically compatible with jeans or khakis; shinier shoes might still go with jeans but it depends on the rest of your outfit, the dressier you are the shinier your shoes can be. If you can wear them with a suit, you probably can’t wear them with jeans, and vice versa.
5. Shoes should be the same tone or darker than your pants. This is all the rule you need to know when trying to figure out what shoes to wear. This is why you never wear brown shoes with black trousers, but you can usually wear black shoes with brown trousers. When in doubt, wear black.
Accessories
1. Match your belt to your shoes. It doesn’t have to be a perfect match, as long as you wear a black belt with black shoes and a brown belt with brown shoes.
2. Match your socks to your pants. Again, it doesn’t have to be a perfect match – a little lighter or darker is fine. If you don’t have socks to match your pants, you can match your shoes, or just wear black socks.
3. White socks are for sports. Only. Unless you are a) wearing sneakers, and b) doing something athletic in them, avoid white socks.
4. Your tie should reach your belt. Anything short of your belt makes you look like a rube.
5. Try a front-pocket wallet or money clip. This will save wear-and-tear on your back pocket (helping to avoid the heartbreak of “buttsquare”), help avoid pickpockets (a little – the good ones know…), and save your back. Plus: classy!
6. You’re allowed one affectation. A fedora. A pocket watch. A bracelet or class ring. A vest (if you’re not wearing a three-piece suit). An expensive wristwatch. Pick one, but no more – give your whatever-it-is space to say whatever-it-says.
If it feels like these rules are arbitrary and stifling, they are. Think of it like learning how to paint: first, you do a still-life (arbitrary) using just one color (stifling). Eventually you move up to two and three colors, then maybe a warm or cool palette, and your subjects might expand to include figures or landscapes. Once you’ve mastered the basics, you can begin to press against the rules, juxtaposing non-complementary colors or painting unconventional subjects.
In fashion as in art – style emerges not from a lack of rules but from a mastery of them, from making them serve you instead of the other way around. If you’re a geek like me, you need to dial a fresh start – clear your closets of all those conference freebie t-shirts, put a shine on your shoes, and burn your butt-crack pants. Ultimately, these rules are not at all about tamping down your personality but about learning how to express it. And unfair as it is, people will take you more seriously when you dress with a modicum of style.
Anyone else have tips for the newcomer to the world of style? Give us your best advice in the comments.
QUICK UPDATE: Comments are coming on this post faster than I can get them modded in. If your comment was sent but doesn’t show up, don’t send it again – it’s in my moderation queue and I’ll get to it as soon as I can. Thanks – loving all the great comments on this post!
About 18 months ago, we wrote about an obscure search startup from Germany called FAROO. We believed that its radical alternative, using peer-to-peer (P2P) technology, had a shot at being a real disruptive force. Today, it has made some progress, has raised some money and is getting out into the market. (Disclosure: FAROO is currently a ReadWriteWeb sponsor).
FAROO is wisely underplaying P2P in its marketing, preferring more fashionable terms such as "real-time search" and "social discovery." But the P2P technology drives it.
Sponsor
So, we decided to invite someone who understands P2P at a technical level to interview Wolf Garbe, FAROO's founder. Our tech expert, Kiril Pertsev, of Agily Networks, has already written about P2P for us in the past.
Kiril: Why .NET? Did you already have development resources or did you make this choice because you consider it a better option for networked desktop applications? Would you make this choice again? And if you're not satisfied with .NET, what would your platform of choice be, given all of your experience over the past few years?
Wolf: I come from Delphi (Object Pascal). So, the choice of C#/.NET was a dedicated decision for a new platform, not driven by legacy. When I started to work on the first prototype in 2004, Delphi moved towards .NET. I preferred to go with the original, especially because the development of C# was led by Anders Hejlsberg, the designer of Borland's Turbo Pascal (which Delphi derived from).
Of course, I also looked into Java, which I found quite similar, both from the language perspective (C# vs. Java) and the JIT Runtime environment (Java Virtual Machine vs. .NET Runtime). The decision for C# was based on the dominating desktop market share of Windows and the assumption that embedding the .NET framework into the OS would ensure fast penetration of .NET. This only partially came true, partly due to the limited success of Vista, which was the first Windows version with .NET pre-installed.
Kiril: Doesn't this choice hinder your ability to move to Mac and Linux platforms.
Wolf: We were betting on Mono for platform compatibility. Unfortunately, Mac OS X still has no Mono application launcher, other than starting with the terminal, which is not feasible for a mass market. With the increasing importance of the Mac OS X platform, I expect this to change. Silverlight today is already natively available for Mac.
For the ultimate platform independence, we are also continually observing the diverse RIA developments (AJAX, AIR, Silverlight, Mozilla Prism, HTML 5 persistent web storage, Mozilla's DOM storage, Google Gears and Flash persistent storage), which could one day allow us to remove the download and installation step for P2P. But so far, no solution meets all of the requirements: out-of-browser capability, permanent background operation, auto-start option, tray icon support, cross-domain connection support, persistent storage, accepting an incoming connection and receiving data and NAT traversal.
Kiril: If you become dissatisfied with .NET, what would be your next platform of choice.
Wolf: Although not everything went as expected, I still believe that .NET is a very powerful platform, and C# as a language is evolving at a much faster and broader pace than Java.
Today, we have a good .NET penetration rate in the US and Europe. With Windows 7, I expect that to increase in Asia as well.
Kiril: I see that you're using a pretty simple P2P communication technology instead of sophisticated Hamachi-like NAT traversal using UDP hole punching.
Wolf: I suppose you are referring to the transport layer, which is HTTP over TCP/IP. The real P2P overlay protocol on top of that is not that simple anymore.
Because our distributed search engine system architecture breaks with almost all legacy paradigms, we thought it would be a good idea that it be at least based on proven and widely used standards wherever possible. There are several reasons for this:
It reduces complexity and development time.
It improves compatibility (there is probably no protocol more widely used than HTTP over Port 80).
It's unlikely that this connectivity will break anytime soon by changes in protocols, OS, drivers or hardware.
Behaving like a standard browser from the protocol view makes the application less vulnerable to filtering, blocking or traffic shaping and ensures that it even works in most corporate environments.
NAT traversal is the most critical issue for every P2P application. It's really a shame that although the Internet is built on a distributed foundation, end-to-end connectivity between users in a decentralized way is completely broken. We are using several NAT traversal techniques: Manual Port Forwarding, Automatic Port Forwarding via UPnP and Teredo. Teredo is a IPv6 Tunneling technology, standardized according to RFC4380.
Teredo is part of Windows XP, Vista, and Windows 7; with Miredo, there is also an open-source implementation for Linux and Mac OS X available. Microsoft reports that with Teredo, the chance of a connection between two peers increases from 15% to 84% (PDF link). Our observations are somewhere between 60% and 70%.
Teredo is quite sophisticated technology and is a more universal approach. It provides connectivity at the OS level, in contrast to having several applications in use, where each uses its own proprietary traversal technology.
Kiril: Could you please elaborate on choosing network technology, having achieved a substantial number of users and collecting usage statistics. Do you know how many active and passive peers you have at any given time? What is the ratio?
Wolf: We have solid insight into the state of our P2P network. We know the number of active and passive peers on any given day (using the log from our update server). The active peer ratio is between 60 and 70%.
We are also currently working on an improved distributed intraday statistic. (The distributed statistic currently built into the P2P client is not valid anymore for the increased network size. For scalability, every peer has only a limited view of the whole network, which requires more advanced methods for calculating the actual network size.)
Creathor Venture is a 25-year-old venture capital firm based in Germany and Switzerland. That makes it unusual. In 1984, when it started, not a lot of VC funds were in Europe. So, we decided to speak with Cédric Köhler in Creathor's Zurich office. As innovation accelerates and globalizes, we wanted to find out how a smaller regional fund like Creathor can compete with much larger Valley-based firms that have a global footprint. And of course, we wanted to find out what's hot on the European tech scene. Read on to find out.
Sponsor
Aka Aki: European Play in the Web's Golden Triangle
First, what's hot? In short: mobile + social + real time. That sounds like it was created by a random buzzword generator. But the combination can be very powerful. This is what Fred Wilson calls the Web's golden triangle.
This area is hot for a reason. Mobile devices reach more people and occupy more of their time than desktops or laptops could ever do. But to reach people effectively on mobile, you need mobile-native services, built for the limitations and advantages of the small screen. (Standard HTML apps retro-fitted to mobile are like the talking heads in early television.)
Mobile is inherently social: you use it to communicate with people. It has to be real time (or "just in time" if we want to be accurate), because the small screen demands a filter that shows only what is relevant right now. (Yes, that does pre-suppose great filtering capabilities.)
The way Cedric puts it, Aka Aki "adds the dimension of time" to location-based services. This addresses the question, "Which of my friends is within shouting distance right now."
FourSquare is from New York, and Aka Aki is from Berlin. With location-based services, location matters. Specifically, density matters. People will use the service if it connects them to people they know locally. If I am in Rhinebeck, New York, discovering that I have friends in Manhattan, Zurich and San Francisco who are online right now does not help me. I am only interested in the friends in Rhinebeck.
This is an argument for a territory-based expansion model. You become dominant in one area, and then expand to neighboring areas. This is the way business worked for centuries before the Internet. Then the Internet heralded the death of distance. You could create a site and get readers from all over the world.
With mobile location-based services that connect you to people in the real world, the old territory-based expansion is returning - with a twist, of course.
German, Then French, Then English?
Aka Aki started in Berlin. As this blog from March 2007 shows, it was early to the game of mobile + social + real time. It got its first round of funding from Creathor in December 2007.
Then, in October of this year, it got a second round from INNOVACOM, the leading French VC (with Creathor joining in that round as well).
That is a natural expansion model. Aka Aki did well enough in Germany to raise a second round and then uses that to grow geographically. In this context, bringing on a French VC made a lot of sense.
Insta-Site: The No-Barrier-to-Copying World
Cédric gave us a good perspective on the early-stage investing scene in Europe. Like other European VCs, he pointed to the rash of copy-cat ventures in the Web 2.0 era. These have been referred to, more politely, as "concept arbitrage": someone sees a service doing well in one location and creates a version for their location.
While "copy cat" is a derogatory term, Cedric was keen to point out that it has been a valid strategy in the past. As he puts it, "If I have a successful pizza shop in one location, I could probably create a successful one in another location". In the Internet business, many successful exits have been based on this model.
But VCs around the world who we have spoken with tell us that this game is pretty well over. The reason? Well, it's all our fault. Bloggers and tweeters spread ideas so fast that the time needed to exploit a concept arbitrage has shrunk to nothing. The tools for building and deploying a website have also dramatically shrunk the time and cost to market. 1. Get idea on Monday, 2. Launch on Friday, 3. Move out of dorm room on Sunday.
In the world of close-to-$0 insta-sites, the copy-cat model is being challenged. This is just like the arbitrage strategies on Wall Street. When friction goes, profits eventually wither as well.
But Don't Underestimate Local Nuance
We can still see big wealthy countries where the US Internet giants have not become dominance for one reason or another. For example, Google does not dominate search in Korea or China.
What looks like a tiny bump from 30,000 foot can be a massive obstacle when you are in the war on the ground.
This is even more true in the world of social media. By definition, social involves cultural norms, and they differ around the world (thank goodness for that, homogeneity is terribly boring). When social + mobile + real time connects people in the real world, the differences can be even more striking. We are all humans with similar basic needs, but the cultural differences between, say, Germans, the French, Americans, Brits, Chinese, Indians and Koreans (to name just a few) are significant.
The Globalization Challenge for VCs
The top-tier VCs on Sand Hill Road know that innovation is going global and that the biggest markets and best ventures may no longer reside within a few miles of their office.
So, the big VC funds are setting up branch offices around the world. This is the traditional multi-national model. The problem is that it might not work as well in the VC world, where personal relationships matter so much and yet you have to make decisions very fast. The multi-national model does not easily square that circle. Venture capital is not a naturally scalable business.
VC funds have to decide between staying local (i.e. being a small firm of partners who can meet face to face every Monday in their office) and going global. The business does not scale well. If you bring in more partners, you won't be able to maintain the situation in which all partners agree on every deal. That would create way too much overhead and friction. Fast decision-making overrides the standard layers of corporate management approval.
On the other hand, if local partners are making the investment decisions, what value would they get from being part of a big global fund (one in which the folks way over at head office take a big chunk of their profit)? Is branding really that important? Smart entrepreneurs know that a fund's name (i.e. its brand) is much less important than the individual partner who they deal with.
This is a strategic dilemma for big funds.
Federated Best-of-Breed VC
Creathor, along with other smaller regional funds, is moving towards a federated model.
As Cedric puts it, "We are partnering more with other funds." In one sense, this is nothing new. VCs have always worked together on deals. But in the past, this usually meant two VCs on Sand Hill Road meeting at a Palo Alto coffee shop. Now, it means a Swiss fund working with a French fund (or a New York or Indian or Chinese fund).
European VCs have to innovate in this way. They cannot win on the multi-national model: their funds are not big enough for that.
As the markets move East - to China and India, for example - VCs have to "be there." Similarly, a VC in Asia needs to work with VCs in Europe and America.
It will be interesting to see how the globalization of innovation plays out and what new models emerge.
At the IBM Information on Demand conference, we asked Robert Ashe to sketch how he sees integration between the company's business intelligence and collaboration technologies. What he shows is how business intelligence applications and Lotus products could connect business users through mashups and social interactions.
Ashe is a general manager at IBM who leads the company's Business Intelligence and Performance Management efforts. He was CEO at Cognos before the company was acquired by IBM in 2007.
Sponsor
[Disclosure: IBM paid for a plane ticket and hotel room for Alex Williams to attend the IBM Information On Demand Conference.]
IBM is developing analytics platforms to help companies better understand how multiple pieces of information fit together to create rich forms of business intelligence.
Morpheus describes itself as "a gang of serial entrepreneurs and around 40 startup founders" who are "trying to make a small contribution towards India's startup revolution." The venture aims to fill the gap in early-stage financing with a decidedly hands-on approach. Is it a fund, an angel network, or an incubator? Are these labels even still relevant? What segments does it focus on? What is early-stage innovation in India like? We spoke recently with Indus Kaitan, a Valley entrepreneur who returned to India as a Morpheus partner. Read on and listen to find out more about the early-stage scene in India.
How much equity do you take in each company?
"We take an equity stake of 4 to 8% in each of the companies we engage with as part of the business acceleration program."
Do you invest money in companies?
"No. Currently, we do not make any capital investment. We work alongside you as a co-founder, and we invest sweat capital and intellectual capital in the portfolio."
In other words, Morpheus is an incubator (the team calls it an "accelerator"), not a fund. If you need cash, find it elsewhere. Morpheus is okay with the label "Like Y Combinator, but without the cash." That makes sense, because cash is not what makes Y Combinator interesting. Also, as Indus explains, very few people in India are willing to work purely for equity, without cash. Morpheus is willing to do that. It invests time and experience for equity.
Our Questions and MP3 Guide
Question: How is early-stage financing doing during this downturn compared to the last one in 2001/2002?
Skip to 2:24 in MP3 Summary: Investment during the last six months is down 58% from a year ago. VCs have moved to later-stage, leaving a real gap in early-stage financing.
Question: How is the VC model changing, if at all, and how does the global financial crisis impact this change?
Skip to 5:30 in MP3 Summary: VCs in India are investing in profitable businesses, even in publicly traded companies, because they need to juice short-term returns, leaving early-stage financing in trouble.
Question: What percentage of your investments targets a local or regional market as opposed to a global market?
Skip to 11:00 in MP3 Summary: Morpheus does local plays in India. It had tried global plays from India, but unless management and marketing were in the US, you missed that critical local nuance.
Question: If costs are lower in India than in the US, how is this reflected in the amount of funding required?
Skip to 14:48 in MP3 Summary: Funding is not lower and may even be higher because people won't work for equity as they do in the Valley.
Question: What market segments excite you today?
Skip to 19:30 in MP3 Summary: Health care for the mass market in India.
Interesting Portfolio Companies
Vericar does used-car certification and appraisal, catering to the used-car market in India, which is at a million units every year.
Robots Alive is the second company in India to have manufactured a robotics arm from the ground up. Costs were around $15,000, compared to an imported version that cost around three times as much.
Peter Shankman knows a bit about startups and PR. Ever since launching his own venture, Help A Reporter Out (HARO), last year, he's been living at the crossroads of journalists who need stories and companies that need exposure.
And in connecting expert sources with harried journos, Shankman has gleaned a wealth of tips, tricks, and common-sense dicta, many of which he shared with us in a phone interview this morning. Read on, and find out what this entrepreneur/skydiver/damn smart PR guy thinks about your pitch - and why we, the press, agree with him.
Sponsor
Get to the Point
To start things off, Shankman gives a word of advice that makes remarkable sense: "Journalists respond to sources who know how to write.
"They're doing six times as much work with six times fewer resources, and brevity has never been more important. Give them one paragraph - short, to the point, tell them exactly what you have to say - and help them write their story in a clear and concise way."
He also noted that it's important be sensitive to the fact that most journos operate on a deadline (or, in bloggers' case, race to break news at strange hours of the day and night).
Be in the World and of the World
If Shankman is to be believed, the sun has set on the day of the three-page PDF press release complete with company boilerplate, CEO biography, and a rash of pre-fab quotations. What makes press folks notice and cover startups these days, he said, is a mindfulness of the world around us.
"You get so wrapped up in what you're doing when you're starting a company. You sit there and think, 'We just created a widget we worked on for 7 months.' Well, it's not as important as Kanye West interrrupting a country singer. But because you launched a widget, the world revolves around you?
"What works better is working your widget into the news, make it part of what's going on in the world." Relating your startup to a hot news item is also a good way to catch a reporter's eye in a sea of sameness.
Offer Real Value
Is your startup's goal to get media attention, or to be seen as an expert, a go-to source of information? Are you trying to be a perennial fount of knowledge about your vertical or a one-off novelty for blog fodder?
"One of the best things a startup can do," Shankman said, "is to be aware of what's going on in your industry, and offer that information to the reporter from the perspective of an industry expert."
By tracking and giving insight on trends that others might now know about, your startup story might allow a journalist to "break" something new while giving you exposure, a win-win situation for both parties.
For the Love of Mike, Ditch the Jargon
Is your startup a real-time, semantic, social media solution in the cloud? You might want to reconsider the necessity of including those terms before sending your pitch email.
"Oh, I hate buzzwords," Shankman said, echoing the sentiment of every journalist we've ever met.
"People use them as a crutch. If you give me an interesting message -"Peter, you'll like this" or "I saw this and thought of you" - you might actually know what I'm looking for. Don't give me a buzzword."
Then again, he warns pitching companies to use familiarity with care. "If you don't know me, and it's a blanket pitch, you're not on the level. Then it's one keystroke, you're marked as spam, and I'll never see your emails again."
The Bottom Line: It's About Longevity and Love
Ultimately, said Shankman, the startups that are successful in the press are those who position themselves as sources, bringing journalists carefully crafted stories that are well-written and relate to the bigger picture, be that industry or world news. More than a simple review of a new site or app, a smart opinion can ensure more coverage in better publications and prompt more widespread user adoption.
And to any new tech company, he advises, "Don't go into a startup with the sole goal of making money. Those companies generally do not succeed. Go into it because you believe you have something that will solve a problem, and the money will follow."
We recently spoke with Bruce Cleveland at InterWest Partners. Bruce has been part of InterWest's IT team since 2006, focusing on investments in the software and services sector, with an emphasis on software as a service (SaaS) and analytical applications. He is a board member of Cloud9 Analytics, Marketo, Right90, and Signal Demand. Prior to joining InterWest, Bruce was one of the original members of the Siebel executive team. So, he knows enterprise software. Having just returned from the Enterprise 2.0 conference, we wanted to get the investor's view of this market.
This interview will be valuable to any entrepreneur who is looking for funding for a SaaS venture targeted at enterprise and SMB markets. InterWest has a fairly new $650 million fund (which closed, in good timing, in October 2008) that is split about 50/50 between IT and life sciences. InterWest invests at all stages from seed through Series A and beyond. It is Valley-based, so you would probably need to be based there or plan to move there.
Bruce specifically is a guy who understands how large enterprises purchase. He is an operational guy in a VC role. He is particularly good at anything related to the revenue cycle, from marketing to sales.
Questions and MP3 Guide
Question: Enterprise software has been out of fashion with investors for a few years as everyone focuses on the consumer. Do you think enterprise software is still a good place to be and why?
Skip to 4:02 in MP3 Summary: Bruce gives a good description of what he calls the "pas de deux" between buyers at large enterprises and sellers at large software vendors, both of whom have wanted to keep the vendor eco-system limited for different reasons. This is why VCs have not liked this space for a while. SaaS does change that, making it easier for startups to get some traction.
Question: Do you care whether a venture is pure-play SaaS or is it okay to cater to clients that want to deploy behind the firewall?
Skip to 12:06 in MP3 Summary: Bruce explains why SaaS is so much superior to the release and version problems that have plagued the enterprise software business for decades. Thus, he is wary of any venture that deploys behind the firewall. He makes an exception for using appliances to deploy behind the firewall while avoiding the release and version problems.
Question: Reducing the cost of sale is one key success driver. What techniques have you seen that work well these days?
Skip to 18:45 in MP3 Summary: He describes the shift from the old model, in which business planning was driven by a sales headcount, to the new SaaS model, in which the revenue cycle is driven by the generation of leads. First you ask, How many leads, and of what type, can marketing generate? Then you hire sales people to convert that lead flow.
Marketo: Turning Marketing into a Revenue Center
Clearly, one company in InterWest's portfolio that Bruce is very keen on is Marketo. InterWest funded it from the concept and seed stage, and Marketo's space (marketing automation) is clearly one that Bruce knows from his operational experience.
John Hagel, perhaps best known for his book The Only Sustainable Edge, has been one of the leading strategic thinkers for decades. Recently, as Co-Chair of the Deloitte Center for the Edge, he unveiled the Shift Index. This is a fascinating way to look at the economy and goes well beyond the traditional GDP and employment measures. Have a strong cup of coffee before reading or listening to this interview. This is important for enterprises as they think about the big picture related to social media, changing demographics, and increased global competition. It is also valuable for enterprise software vendors as they seek to articulate the value of their products to these clients.
Sponsor
The Interview and PDF
The interview is about 20 minutes, a good listen. If you want to do justice to this subject, read the PDF first as background, and then listen to the MP3. For the super-busy skimmer, we attempt to distill the essence below.
This is what caught our attention in the email -- and is the reason we wanted to do this interview:
"U.S. companies' return-on-assets (ROA) have progressively dropped 75 percent from their 1965 levels despite rising labor productivity."
That is dramatic. If you had to select a single measure by which to judge the value delivered by a CEO, board, or management team, it would be return on assets. To quote from the Wikipedia entry:
"The return on assets (ROA) percentage shows how profitable a company's assets are in generating revenue. This number tells you what the company can do with what it has, i.e. how many dollars of earnings they derive from each dollar of assets they control."
And here is the bit that matters:
"Return on assets is an indicator of how profitable a company is before leverage."
If you want to understand the financial meltdown that happened at the end of 2008, just think leverage, i.e. debt. Companies juiced up their earnings using leverage. They have been doing this more and more in the last 30 years.
What happens when you take that away? You get the return on asset bombshell that the Shift Index reveals. It is like taking steroids away from an athlete and then saying, "Now, how fast can you run 100 meters?"
Only a US and BigCo Problem?
The massive ROA drop was measured across all public companies in the US since 1965.
It would be very interesting to see the results for Europe and Asia. Would they be different? Has anyone run those numbers?
Public companies tend to be large. We were interested in knowing whether this was simply a BigCo problem. Here at ReadWriteWeb, we report on startups and small companies. Our assumption for some time has been that an historic shift in power is taking place from BigCo to SmallCo, which can be explained by Coase's Theorem.
Now that we've seen huge companies, household names such as Lehman and GM, crumble before our eyes, thinking that BigCos are in serious trouble is no longer a radical idea. And as nature and economies abhor a vacuum, this must create opportunities for others. The question is whether this shift will be simply from some BigCos to others, as they out-compete each other, or a more fundamental shift from BigCos to SmallCos.
We asked John Hagel about this, and he told us his view that the shift in power to smaller companies, even to free-agent individuals, is a short-term trend and that bigger companies will return to dominance once they figure out how to operate in this new environment. He told us that BigCos face a great challenge in part because:
"They grew up and became successful in a different environment, where scalable efficiency was the way to generate and sustain economic value."
He goes on to explain that money follows talent and that large companies are having a hard time articulating to the most talented and creative individuals why they would be able to grow and prosper more within large institutions than as free agents or in small ventures. He believes that large companies will be able to make that transition. Clearly, given his role with Deloitte, which provides management consulting to large companies, he has to take that view. But he has also voted with his feet on this issue, by even joining a large company like Deloitte in the first place, when he was already a successful free-agent author and consultant.
His fundamental message is that BigCos need to offer a rationale other than just scalable efficiency. This is consistent with Coase's Theorem. His view is that this rationale will be "scalable learning." Scalable learning sounds like it could become an over-used buzzword, but when you listen to him describe how companies build networks of partnerships that learn from each other, it comes alive.
It certainly will resonate with anyone who has worked at a startup.
The question is whether BigCos can learn to work like agile startups again. In other words, is it possible to teach elephants to dance?
How Can Enterprise 2.0 Vendors Articulate Their Value in This Context?
I asked John if he saw a day when more CTOs and CIOs would become CEOs, because really understanding systems and technology has become so essential for leaders. He was skeptical. In fact, John views the risk-averse nature of most CIOs as a big stumbling block.
John pointed out that most companies have "only skimmed the surface" of opportunities to use social media to build richer knowledge networks that cross the firewall and connect with partners and customers. Indeed, he talked about the problem of how "most CIOs are tending to become extremely risk-averse." He pointed out that CIO turn-over is increasing, and that the reason CIOs get fired is often because of some big operational blow-up. So, they avoid anything that puts current operations at risk. In doing so, they may be creating even bigger issues, as large companies miss opportunities to leverage social media to create new value.
John's advice to Enterprise 2.0 vendors is to become a lot better at articulating how their technology can build value and competitive advantage at scale. That is obviously easier said than done. But doing it is essential. The CIO will be motivated to look at operational risks only if the CEO tells him or her that the risks of ignoring them are greater.
Does the idea of interviewing for a new job put you on edge or scare the living daylights out of you? Does it make you want to stay under the duvet and hide?
About 18 months ago, 
At the 
IBM is developing analytics platforms to help companies better understand how multiple pieces of information fit together to create rich forms of business intelligence.
We recently spoke with 