RooneyRyan.com

The Startup Cooperative - Sean Blanchfield

liamryan — Fri, 30 Dec 2011 19:38:09 +0000

I read this post by Sean Blanchfield and here is what I posted as a comment:

Great reading Sean, and a topic I believe will be of interest to all entrepreneurs out there.

I can’t help think upon reading your post that this co-op follows a structure similar to an “accelerator” or “incubator” such as YCombinator, 500startups, TechStars or Startup Bootcamp.

This co-op needs to be defined as an organization set up by it’s members for it’s members. The members are active entrepreneurs who seek to act on opportunities in their markets of experience.

But let’s face it, ideas are only ideas unless acted upon. Everyone with a flare in business or entrepreneurship has ideas, and lots of them. We talk with colleagues and do a bit of research around an idea and then we write short descriptions of them and imagine a route to market…but that’s all we do. We save them in a lonely folder fooling ourselves in the belief that we will someday have the balls to act upon them.

It’s been considered that 9/10 ideas (or startups) fail. They fail because perhaps the market was not yet matured for it, the route to market was wrong, or the team behind the idea was wrong or they couldn’t get the product together in time. Now imagine a co-op like this that would make the difference between creating a successful business or creating a worthless product.

To add to what you mentioned above, I see the co-op providing the following:

1. An opportunity to weed out the crap ideas. They say it’s best to fail fast when you’re a startup. Instead, I say it’s best to not even start if there is no real business in your idea. Ideas can be actively discussed and challenged by the members.

2. An opportunity to build a great team. When an idea is perceived to be a valuable opportunity for the market, members with an interest in the particular space can then put their name forward to continue with the opportunity and form a team with set targets and milestones. It is also important to realise that the team can and should change during the process of the startup venture. For example, a team of developers can move between the co-ops businesses once the market has been qualified and a sales pipeline has been identified. A business student loves researching new markets and finding routes to market (but lacks the experience of knowing what to do next) so they work with the team on the early stages of new startups. This is a way we can draw from the experience the members have at the right time.

3. An opportunity to pool resources to provide assistance to the teams. At the end of the day, the members will want the startup to succeed as all members will benefit.

At the end of the day, I believe that all members acknowledge that owning 100% of that idea in that lonely folder is worth nothing, and always will if they decide not to act on them. This co-op is a great opportunity to churn out great ideas and great businesses.

Chris and Liam bring getHealth to America: Part 1

liamryan — Mon, 05 Dec 2011 22:08:00 +0000

On Wednesday 12^th October, Chris was doing a Google search on the US wellness industry and he came across the Annual Corporate Wellness Conference which was being held in Chicago in two weeks time from the 26^th to the 28^th of October.

The conference was the largest corporate wellness conference in the world bringing together 1500 attendees from all over the world as well as many of the experts in the industry to share their knowledge. We quickly realized that if we were going to try and validate our business idea we needed to attend this conference. Also, because we were applying to a number of accelerator programmes in San Francisco we thought, “sure, if we’re going to Chicago we may as well pop down the road to San Francisco.” So our plan was that that would become the second part of our trip (see “getHealth does America: Part 2”)

Things started to happen very quickly with flights and hotels being booked, business cards being printed and meetings being set up, and despite Chris frantically trying to renew my passport we got everything organized very quickly. On Tuesday 25^th we headed off for the morning flight to Chicago O’Hare International.

After the 8 hour flight and getting to the hotel in Schaumburg, Illinois, we quickly assessed our surroundings and our itinerary. Our first engagement was a networking cocktail party in the hotel where the conference was being help. Armed with business cards, a few flyers and pure adrenaline we headed off to the cocktail reception to commence our networking barrage of the US wellness industry. With palpable enthusiasm for our new idea and our Irish accents in full swing, we got a lot of positive feedback from attendees at the conference.

Following a few glasses of wine and some business card collecting, we headed off to dinner with Marcia Reid, a Healthcare Consultant (with quite a large following of her personal blog on healthcare), whom Liam had connected with via Twitter. It was good to relax and chat about our idea with them and talk about our strategy for launching this service in the US market. Amidst the food and chatting, we quickly realized that our jetlag was catching up on us and we headed on back to our hotel to rest up for the next day.

Wednesday

Not adjusting to the jetlag meant we had an unexpected early start to the morning. However, this allowed us to get some good research done on some of the individuals we were due to meet later in the day.

Throughout the morning we spoke to HR managers, health insurance providers and wellness coordinators about our business concept and, like the previous day, the response back was extremely positive and a number of the companies expressed an interest in piloting the service for whenever it launches.

As well as speaking to individuals about our concept, the conference was also a fantastic opportunity to learn about the corporate wellness industry and to see what challenges companies faced. Particularly notable speakers included Dr. Cecil Wilson, President of the American Medical Association, who spoke a lot about various legislation which are either in effect or coming into effect in the next couple of years. Also of note was Pani Tademeti who talked about the ‘Return on Investment for Web Based Enrollment System Implementation’. This session was interesting from our point of view, as it let us hear from other experts how they can create a culture of change for wellness coordinators through the use of software and online technology.

Our meetings went very well throughout the day and perhaps the most productive time was spent going round the stands chatting to people, finding out what they do and also identifying any potential competitors.

With the day coming to a close we were able to relax and reflect on what had been a great day of networking for us with new friends and a delicious steak.

Thursday

Up early again to finish off our demo. Some of the attendees we had met the previous day had expressed an interest in being able to view it and so we spent a bit of time adding the final touches to it before heading off to the conference.

The first talk this morning was Donald Trump’s first apprentice, Bill Rancic. The talk had very little to do about wellness but it was interesting to hear about his experience of the show and about his business life in general. After he spoke there was a Q&A session, where Liam went up to the mic got up to ask a question in front of this room of 1500 people.

He started off, “Hi, my name is Liam Ryan. I am from Ireland and I’m working on a new online solution for the wellness sector. What impact do you think technology will have in healthcare moving forward? “Bill didn’t hear the question properly. So Liam repeated the entire question, “Hi, my name is….” The answer to the question didn’t matter. What was important was that we just advertised ourselves to the entire conference, and boy did it work. People were coming up to us after saying, “Oh, you’re the Irish guy who asked the question. I’d love to hear more about what you’re working on.” Result!

Bill’s talk was a nice way to ease into the day but it was followed up with a fascinating talk from John Casey who is director of international benefits at Google. John is Irish and a graduate of UCD, and he gave an insightful account of Google’s approach on wellness. It was very clear to see that innovation touches all aspects of their organization.

Thursday proved to be even better than Wednesday with some great contacts acquired and a lot of interest generated in getHealth. We also got the opportunity to attend a couple of sessions which allowed us to get a Corporate Wellness Certified Accreditation which we know will be extremely useful to us as we develop the business.

The end of conference event held on Thursday evening was a truly strange affair; dinner at the world famous Medieval Times. If anyone has seen Jim Carey in The Cable Guy you’ll know exactly what I mean. In this “magical” place you sit around a medieval arena watching as horse men perform tricks and fight each other, while we all sit there and eat half a chicken with our hands. The food was pretty awful but the show was entertaining. I wouldn’t bother going again though!

Friday

The conference finished at 12pm on Friday and, in my opinion they saved the best session for last; Peter Saravis, CEO of Evive Health, talking about new tools for increasing employee engagement in health and wellness programs. This was extremely relevant and helpful to us as it explained how even a smallest of changes can improve employee engagement in wellness. For examples, Peter explained how changing the image used on your wellness promotional materials can improve employee engagement if it makes people feel that they can relate to it more. This session was very well attended and I think it underlined the problem wellness managers have in trying to improve employee engagement.

The conference drew to a close shortly after this session and after our fond farewells to our new friends (and hopefully new clients) we headed back to the hotel to gather our things and prepare for the next part of our trip.

See ‘getHealth does America: Part 2’

Chris and Liam bring getHealth to America: Part 2

liamryan — Mon, 05 Dec 2011 20:49:00 +0000

Following a relaxing weekend with a visit to friends in Miluakee, Illinois, we travelled to San Francisco on the Saturday evening. Arriving in the city, we were greeted by locals taking full advantage of the Halloween season and at our hotel we marked our arrival in the city with a pint of the familiar black gold.

After an all American breakfast the next morning and casually breaking the shower flooding the entire bathroom, we went on our merry way tearing up San Fran. After taking in the sites and getting lost in Macy’s several times, we made our way to Eric’s house and to our first experience of AirBnB.

Eric was a fencing champion and start-up advisor living on Mason street, who was incredibly blazay about his stunning view from the roof of his down-town apartment.

The next day was an early start for getHealth filled with presentation practicing. After this, we travelled down to Berkley to have lunch with Chris Bruce, local serial tech entrepreneur. Along with working on his own ventures, Chris also provided office space for start-ups in and around the Berkley area. Following a couple of coffees and some great advice from Chris we were on our way again and headed for Palo Alto.

The tree lined streets and packed out coffee shops, fulfilled all expectations from our watching of ‘the social network’. Here, it was great to meet up with a couple of Irish based out there. Enterprise Ireland’s David Smith and Stripe co-founder, Patrick Collison. Both gave us a good insight into the life out there and were able to make some great recommendations as to how we should approach developing our company out there.

On to the second night with AirBnB and a group of young entrepreneurs living close Stanford were our hosts for the evening. There were three companies in the house all working on a variety of different tech solutions and it was nice to sit and chat over a beer about our different experiences of the start-up world. It’s clear that WePay.com, Stypi (a Y-Combinator Startup) and Predictive Edge will be ones to watch in the future.

Tuesday was the big day for us. The meeting with Rock Health in the morning was what we had been looking forward to for the past week.

Rock health is a new start-up accelerator program based in Chinatown in San Francisco. The program is exclusively aimed at helping start-ups based in the health space and the next session commences in January 2012.

We met with creative director Lesley Ziegler whom we presented our concept to. After showing our demo and some Q&A we got some good feedback from Lesley on getHealth which we helped us in resubmitting our application.

After the relief that the interview went well, we took ourselves off down the Golden Gate Bridge. We got stunning weather and were lucky to be able to get some great snaps.

After soaking up San Francisco one more time we headed back down to Palo Alto to meet with Joshua Merril, CEO of Tap Canvas and currently based in 500 Startups. Josh showed us around and pointed out Jawed Karim, the co-Founder of YouTube, sitting by the window mentoring one of of his colleagues’ companies. Josh gave us some good advice on how we should approach setting up a company over in the Bay area. We also meet Dave McClure who was just recently back from Ireland as a judge at the Dublin Web Summit.

There was an amazing buzz about the place. Some teams brainstorming, others on sales calls and a lot of them building the next million dollar company. The atmosphere and vibe was infectious and we could see why the programme is held in such high regard.

After this we headed off to our third and final experience of Air BnB. This time we were staying with Iddo Tal and his family, an entrepreneur trying to make it like the rest of us. Their house was still decked out with Halloween paraphernalia from the night before and they were very welcoming to us both.

As soon as we left our stuff off with them we headed back into town for Silicon Valley NewTech meetup event. Liam had found out about this prior to heading out to the States and had secured us two seats at it. The event was attended by people from all sorts of backgrounds and essentially it was an opportunity for the tech start-up community to come together and to talk about their business ideas. Joshua who we met earlier was attending and the three of us sat and listened intently to some fascinating concepts people come up with for the online space.

Following the pitches, we got a chance to network over some pizza and beer and it was really nice to feel welcomed to this community having only come over from Ireland.

After this event our trip was drawing to a close and all that remained was to get a snap at 5am outside Facebook HQ:

Learn about Product Development at Facebook

liamryan — Sun, 20 Nov 2011 10:01:06 +0000

I just found a free course you should take time to watch. It’s a 9 lecture course (2/3 minutes each) taken from an interview with Mark Zuckerberg discussing product development and how the product has evolved with the growth of this company.

The interview is chaired by Jim Breyer from Accel Partners: the first investors in Facebook with a $13Million fund back in 2005!

You can find the course at Udemy here: http://www.udemy.com/product-development-at-facebook/

Growing a Company - Iain Mac Donald, Skillpages.com

liamryan — Fri, 18 Nov 2011 09:44:49 +0000

Last night I attended the 2011 Campus Company Development Programme Awards Evening in Nova UCD, the Innovation and Technology Transfer Centre for spinout companies from college research.

While the judges were deliberating on the final presentations, the audience was treated to a presentation my Iain Mac Donald, the founder of Skillpages.com (Iain was the founder and CEO of Perlico that was acquired by Vodafone Ireland for €80M back in 2007).

Iain’s presentation described, in his opinion, the 10 key elements to growing a company, and I’m going to attempt to paraphrase the best I can.

1. Choose Your Market Carefully

Iain pointed out that you must choose a market that is available to you right now. Ask yourself, is it easy to get a customer? Is there an existing engagement in the sector already? It could take two/three, even ten years before you engage them. That’s just too long!

If your market is already educated, your company can capitalize on the benefits of not having to waste valuable money on educating them about your sector.

2. Vision

Have you asked yourself what your personal ambition is? What do you want to achieve out of the company you’ve just started, the company you get up out of bed early every morning for, the company you work long long hours for…it has to be a passion of yours from the beginning!

Think big. Big vision! Take over the world vision! You’ll know what goals you can achieve and when you’ll be able to achieve them.

Your company may pivot from time to time but your vision will kind of stay the same.

3. Do One Thing Brilliantly

Iain describes this as how you and your company will succeed. What is that one thing your company does amazingly? Well conquer it and be the market leaders!

4. Beware of “Experts”

Now this was really interesting point, and one that I have tried to learn fast as a young entrepreneur: You have to be aware of who your talking to and what opinions they give about what you’re working on.

Are they feeding you an expert opinion or are they absolute wafflers?

You’re intelligent: so listen as much as you can and then form your own opinions. Who were the people that influenced you correctly over time?…they are the experts, be nice to them.

Find those experts that believe in you and most importantly, that they have your personal best interests at heart.

5. Hire The Right People

This is a common theme that all CEO’s will talk to you about.

How do you actually hire the right people? Iain simply says you have to sell them on your vision. If you don’t know what’s going on, how do you expect to get people on board.

Hire the people who have “been there, haven’t done that”. The people who have been number 2, who worked for their boss and always thought they could do it better or differently, the people who’d love to take on the responsibility.

These are the people who will make your company.

Don’t be fooled, building a team is difficult and hard. I’m trying to do it with our latest startup and I believe it is the most important thing to get right.

6. Expect Uncertainty

I kinda missed out on this one, distracted by the twitter stream no doubt but here’s a picture of a sign post:

7. Integrity

Plain and simple, but you have to treat your staff, advisors, investors with the upmost respect (you know “Do onto others..” etc).

Pay your bills on time including your taxes and wages. It’s hard to do but Iain recommends doing it right because it will pay off in the end.

8. Work, Very, Very Hard

When you make the choice of starting a company, you have made the decision that requires sacrifices.

Iain stressed that you must prepare yourself mentally. The long days and nights behind your desk, 4hr sleeps, lunches on the go, meetings and meetings, elevator pitches to everyone you speak to…it all takes it’s tole on you. By preparing for it you can pace yourself so you don’t burn out.

Iain also notes that the sacrifices will delivers huge personal gratification, and from a personal point of view, I would not be doing anything different that what I’m doing right now.

9. Get a Good Wife/Husband/Partner

In the life of an entreprenuer, Iain comments that you really need the support of your partner. They need to understand what you are doing and what you trying to achieve with your company. Yes it will be tough and strenuous at times, but try to make it up by simply being in charge of cooking sometime during the week, or by promising that you will make it up after a certain project has ended.

I’ll go as far as saying that you also need to have the support of your family and friends.

Iain’s final point was one that he spent the most time talking about. He says it is the fundamental and absolutely important decision that can be made for your new company…

10. Start!

Get yourself your business cards. Put the logo on it. It’s official - this is my company and this is what I’m doing. Once you put yourself out there and do that, everything changes.

People will respect you for it and you have made a decision that will change your life, for the good.

Another few points worth mentioning during the Q/A, Iain made a differentiation between investors and backers: noting that backers are primarily those who support your long term vision.

When asked how Skillpages get their users, Iain highlight 4 key steps: SEO, PR, Paid Activity (such as advertising in a new city etc) but most importantly, viral activity. Ask yourself, in particular if you are an online company, what are the viral points within your site, and why would someone share this content with a friend. By enabling this feature, you will be able to increase traffic and sales.

Iain added that the way they primarily get new users, is that they’ve created a value for the customer. Just think about that for a moment…are you creating real value for your customer? If so, then of course they would suggest it to a friend. Now harness that within your own site.

Finally, Chris asked a question on how Skillpages differentiated themselves to competition in the market place including the likes of LinkedIn. Iain responded to say that the competition is not the problem, you just have to be better that the competition!

You can find Iain on Skillpages here: http://www.skillpages.com/imd

Getting your writing done, fast!

liamryan — Fri, 18 Nov 2011 01:31:06 +0000

A couple of months ago, I discovered the website, Copyblogger Media. The site is all focused on how to generate more traffic, inbound links, subscribers, paid customers, and how to grow your profile through the content you have on your site.

Without thinking, I signed up for their free 20-part internet marketing course focused on the above that is delivered one by one via email each week. It was free and of course I subscribed cause I was on the learning curve.

They send me different posts each week on different topics but I have to admit, I do not get time to read them often. They’re marked unread in my inbox with the greatest intentions of someday getting to read them. But tonight (it’s funny how these things happen) I managed to open the most recent mail…it was all about being focused when writing and churning out content like blog posts: my biggest problem!

I wasn’t a great student in English class at secondary school, I was more of a sports guy with a tendency to be outdoors as much as I could. In fact, my teacher told me I’d probably fail the honors level course, and that I would be lucky to pass the exam. (I’m happy to report that I not only got my honor, but I wasn’t far down the pack. Take that Sir!)

I really would like to get into writing more. Having working on two internet startup companies, I have learnt so much that I have so much to write about to put down all those lessons I’ve learnt on paper. That was the reason myself and Chris launched this site, we want to get into the habit of actively writing more and more to help inspire others or at least help them learn the key building block as an entrepreneur.

I have todo lists of topics I want to write about the length of my arm, I just find it difficult to just do it! It’s hard after a long day working on your startup to then go ahead and write about lessons learnt that day or from the previous week. But I’m trying!

So: here it is. Read it! Because if it can help you as much as I feel it has opened my eyes or simply helped me focus when I write, you will hopefully get it too!!

By now, you know that content marketing is the new advertising.

Your readers - and those beloved search engines - highly reward those sites that consistently deliver authoritative content that is focused on a topic, industry, niche, or idea.

What does this *really* mean? You’ve got to write. A lot.

Sure, there’s other ways to deliver the goods - audio, video, infographic design, etc. But ultimately, the writer runs this show. And, writing - whether in outline, script, or long form - is what underpins all other categories of media.

Writing is the cornerstone skill of all great content creation. So, when it comes to building your business on the Internet, you’re going to be spending a good amount of your time at the keyboard.

Here’s a stripped-down system for getting your writing done, fast:

1. Know what you’re talking about

Obvious, right? If you’re going to write authoritatively about anything, you’ve got to put in your time. You’ve got to read relentlessly on your subject.

Study, research, painstakingly try to understand the movements and theories and motivations *behind* your product, service, and industry.

Stay current on, or ahead of, the news. Get to know the players involved.

This step (which, by the way, is an ongoing process) eliminates the dreaded moments of staring out the window for ideas. Research *is* writing.

2. Outline every time

If you don’t know where you’re going, how will you ever get there? Don’t ever start blindly typing your essay, article, or blog post without a map.

First, think through what it is you actually want to communicate. Then, write down the skeleton of the thing. Major points, subheads, title.

A simple outline takes the guesswork - and in many ways, the *actual* work - out of the picture.

Give yourself a paved road to walk down, and then walk down that road, simply putting one foot in front of the other.

3. The secret lies in 30 minutes

I stole this technique from Eugene Schwartz, and it is the single most powerful practice for getting words on a page I’ve ever used.

Get a kitchen timer. Or, use the one on your smartphone. Sit down at your desk with your notes, research, outline, and coffee. Set that timer for 30 minutes and punch the “start” button.

*DO NOT* get up from your desk until 30 minutes passes and the buzzer goes off.

Here’s the trick: don’t try to write. Don’t stress about it.

After a few minutes of sitting there, staring at the page, your cat, out the window, whatever, you’ll get so *bored* that you’ll begin to write.

When the 30 minutes is up, go do something else for a while. Then, come back for another 30 minutes of not trying. If you get six or seven of these sessions in during a day, you’ll be so far ahead of the game, you’ll wonder why you ever struggled to write in the first place.

4. Write a lot

It is an immutable law of the universe. The more you do it, the more you’ll do it. It may not get easier, but eventually you will become a writer. And that, my friends, can change your life and your business.

Robert Bruce and his team at CopyBlogger have three great products on offer for everyone to use. They are StudioPress for design, Scribe for SEO (made awesomely simple) and Premise for conversion. Check them out now!

The Colours of the Web

liamryan — Sun, 06 Nov 2011 17:51:16 +0000

I think it’s fair to say that colours are fascinating. Colours can change how we think, how we feel, how we interact with others. They can be described as light or dark, busy or calming. On the mention of a colour, it will strike a feeling and thought for you. Red!….you’re thinking about a stop sign yea? Or perhaps the feeling of caution, yea?

I don’t know much about colours really. I mean, if you were to show me a design, I can tell you if it looks good or not. I can tell you how it makes me feel or what emotions it would cause me to feel. I wouldn’t be able to tell you what colours could potentially match together though, or what colours would fit to a certain industry.

Recently, I’ve been thinking a lot about the use of colour online. For instance, have you ever thought about how some of the most dominant leaders in a market have an associated blue colour branding. For social media, it’s Facebook and Twitter. For blogging platforms, it’s Wordpress and Tumblr. For communication, it’s Sykpe. For search, it’s Google (blue appears in two letters). For financial services, it’s PayPal.

(Take offline markets too like the airline industry and we take note of the leaders such as American Airlines and Ryanair. I’m actually sitting on an American Airlines flight to Chicago as I write this and the staff are dressed in blue, the seats, walls, floors…it’s all blue.)

Something has to be said to the use of certain colours, and in particular the colour blue for successful companies.

Did you know that Google invested in the research of A/B testing the most effective use of their colour blue? It’s clear that Google value their brand and they looked for the right tone quality, border shading width etc that would support their brand and one that was going to appeal to everyone all over the world.

If you’re starting a company and you’re beginning to think about the design of your logo and how your company looks to your audience, have a think about these things:

What is the colour of your industry?
What emotions do you want your audience to feel?
What colours are used in your competitors branding, and do you think it works?
Do you personally like the colours?

Then once you’ve answered these, talk to a designer about it. Designers will know exactly what works and…be prepared to listen.

What do you think of the colour blue? Are successful companies blue orientated?

UPDATE: just spotted this read and infographic http://www.colourlovers.com/business/blog/2010/09/15/the-most-powerful-colors-in-the-world, probably where Google found me the image!

Earlier this week, myself and Chris had to put together an...

liamryan — Fri, 21 Oct 2011 17:46:57 +0100

Earlier this week, myself and Chris had to put together an informal 1 minute video for an application to one of the most famous startup incubators in the world. Although we did manage to get there in the end, we captured some bloopers along the way.

Sometimes you can’t fight the giggles :)

Cash Flow can win you the Champions League

chrisrooney — Tue, 11 Oct 2011 16:15:00 +0100

In life, money isn’t everything, but in a start-up, it is. Many entrepreneurs, investors and business analysts have written and talked extensively about this topic and, having developed our first business to the point it is now, only now can I truly appreciate why.

Tracy Eden, National Marketing Director for Commercial Finance Group recently summed up the importance of cash flow in a blog post back in May. She said “One of the biggest financial mistakes many small business owners make is focusing too heavily on profitability at the expense of cash flow. There’s an old saying that sums it up well: ‘Profit is Queen, but cash is King’.”

Trying to run a start-up without cash flow is a bit like trying to play the final of the Champion’s League when you aren’t fit enough. It is so integral to the success of a venture, that even if you have the best product or best employees, if you can’t keep the show on the road, there’ll be no show.

Perhaps one of the most exciting things about knock-out competitions like the Champion’s League is the fact that it can go to extra-time or even penalties! When the latter happens, often the winner, who comes out, is simply the team that was physically able to keep going the longest.

Let’s say for example the ball in this football match is your product and that if you use the ball/product well enough to score more than you’re opponents, you’ll win the match. For the purpose of this analogy let’s associate winning the match to selling your company or landing that huge customer.

Now your team all has to work together to score enough goals so that you beat your competitors and ensure you achieve the ultimate goal. One of the problems however, is that this is a final, and you don’t know how long it’s going to take to win this match. It could be 90 minutes it could be 120 minutes or it could even be 120 minutes plus a penalty shoot-out.

As a result of this ambiguity, the management team’s job is to ensure their players have the fitness levels to be able to get to the end of the match whatever the outcome. If they don’t have the fitness then they’ll start to get injured and the team could crumple and miss out on the end goal by the narrowest of margins.

Let’s think of the manager, in this case, as the CFO of the company and, the fitness of the players, as the company’s cash flow. As players and whether you play in attack (sales), midfield (marketing) or in defense (product development), you will be relying on the management team to have given you the adequate training to ensure you have the necessary physical reserves to achieve the goal for the team.

The team that has the reserves to keep going will be in a much better chance to win the match than the team who doesn’t. It’s really as simple as that.

So, if you keep cash flow as your number one priority, it’ll keep your dreams of success still alive.

Trademarks for Startups, what you need to know!

liamryan — Mon, 22 Aug 2011 13:46:00 +0100

Understanding the area of Intellectual Property (IP) is very important for any new startup. You must understand what IP means, how it can be beneficial to you as a new company, and in particular for the purpose of this post - what a trademark is.

It took me a long while to really get my head around it when I applied for my first trademark, and to be honest I’m still not fully certain. But, I can assure you, if you start to engage with trademark attorneys, they have a huge fee, and they won’t educate you on this topic, so I recommend trying to figure it out on your own first.

So a very obvious start, but what is a trademark? - in short: a legal entity to identify a product/service.

Businesses, groups and individuals use trademarks, logos and symbols to generate brand awareness in public forums, in order to make it easier for people to recognise a product, business or individual by simply associating them with their trademark.

The most successful logos are best described as being ones where the actual sign doesn’t even need to be specifically noticed, because when people see a product they will instantly associate that product with their trademark or symbol within their own minds.

Trademarks have in fact made life a bit easier to live as they can be used to crossover language barriers, just by simply showing the trademark and/or symbol to an individual in order to locate a place, group or business in different countries.

http://bizcovering.com/marketing-and-advertising/the-worlds-most-recognizable-symbols-and-trademarks/

I’m sure you can relate to some of the world’s most recognizable trademarks above…right?

There are loads of different forms of trademarks, from logos to text, and from shapes to slogans. I’ll throw in an interesting fact here sure: the roar of a Harley Davidson engine is trademarked (See article from the Wall Street Journal 1995)! No other engine can sound like a Harvey as it is a identifiable asset to the brand. Impressive and legal!

“Identical or confusingly similar”

One fundamental aspect to grasp, is that this form of IP is only granted if your text/logo/etc is in no way identical or confusingly similar to other trademarks in the market (i.e. if I wanted to trademark Macs Fastfood with a big yellow ‘M’ as the branding logo, and “You’ll love it” as the slogan - I don’t think I would have much success!!).

Applying for a trademark - the filing date is so important!

When you apply for a trademark, the legal reference date is the date of filing, and you receive 6 months of international rights based on that filing date. This is confusing, but for example - if I file for a new trademark today, I may not hear any word back from the patents office for say 7 months (generally it’s 3 months), and I won’t know if it’s positive or negative news. But in the meantime I can apply for international trademarks (UK etc) up to 6 months, and base it on that initial filing date for the Irish application. It’s a chance you’ll just have to take. There is a legal play going on here I believe, whereby I can ‘trump’ another companies filing date in another market as long as there application doesn’t trump mine from a previous application in another international recognised state.

What is the difference between a trademark (™) and a registered mark (®)?

When you submit your trademark (and following the initial approval of fees paid etc) you can officially start using the ™ symbol. This states that you have applied for the trademark, and your name will be associated with the papers. It does not mean that you have been granted the legal mark.

A registered mark is the officially stamp of approval to say that the mark is in fact a legally identifiable association with your brand. You own the rights to this and if anyone begins to use that mark, within the state(s) defined on the application, they can be fined and face legal prosecution.

The process from trademark to registered mark can last anywhere from 4 to 6 months, and possibly more depending on any objections to the mark.

Where do I start?

Here’s where you should look you want to get trademark for Ireland (http://www.patentsoffice.ie/) or UK (http://www.ipo.gov.uk/).

but…have you heard of the Madrid Protocol?!

You should also familiarise yourself with the Madrid Protocol (http://www.patentsoffice.ie/en/trademark_madrid.aspx). Basically, instead of paying for two trademarks, one in IRE and one in UK for example - you can get a trademark in all 86+ recognised states via one application form and at one price (it may be more expensive but could work out a lot cheaper in the end). Again, if you just file for an IRE trademark, you have 6 months preference on the Madrid Protocol too.

Remember: a startup can trademark a sound, text, logo etc…and it all adds your company’s assets…and I’m talking about the investable type. This is what investors will look for when inspecting your company. It is the arsenal of your startup; protect it, build it up and use it to further your success!

Let me know and if you have a question about trademarks that wasn’t answered here, let me know and I can try to help, or find someone who can.

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Coffee: Strategically Speaking

liamryan — Sun, 21 Aug 2011 15:00:00 +0100

I found this really interesting read from Kevin Purdy. I have to admit that I am a sucker for a cup of joe when I feel like I’m hitting a slump, but I still haven’t figured out if it helps to boost my energies…apparently not!

So whether you’re a coffee connoisseur or an absolute novice like me, perhaps this post will be of useful insight.

Caffeine is a trickier substance than we generally acknowledge. Here’s what you need to know to get more out of caffeine—starting with a suggestion to go cold turkey.

Caffeine seems so simple, even if you’re a veteran user. You drink it, you get amped up for a short period, and you inevitably come down a bit when it wears off—or so you think. But caffeine is a more subtle substance than we give it credit for. Knowing how it works on your body and brain, and how it is most effective, can give you an edge at concentrating, while still keeping the jittery edge off.

The best way to get the most from caffeine is to start from scratch. There are a lot of factors that play into how a dose of caffeine affects you, but there’s no stronger factor than the tolerance you’ve developed, morning after morning. Give yourself a week to 10 days to recover, scaling back slowly if necessary, then start fresh with coffee as an occasional, smart pick-me-up.

Note: Biological and genetic factors also play into your caffeine interaction, and it may not be for everybody. This is just a starter’s guide for those who want to stop feeling like one cup isn’t enough.

Yes, you probably have a caffeine tolerance. Learn to adjust it.

Patients waking up from surgery in which they went under anesthesia often wake up with a killer headache. Doctors used to blame their own knock-out juice, until research showed how effective a post-surgery cup of coffee could be. Most of us are used to having our regular coffee or tea, occasional sodas, and bits of chocolate, but when asked by doctors not to eat or drink anything for long stretches before surgery, then sleeping off the drugs, your body wakes up to a system without any caffeine, and it’s a mite unhappy.

Knowing this, and having days or weeks where you know you’re going to need reliable energy boosts, try to keep yourself caffeine-neutral and wean yourself from dependency. It takes between a week and 12 days to build up a tolerance and dependency on caffeine (even at just one cup a day), and an average of 10 days to work it off. Once you’re past the rough mornings and headaches, you’re able to strategically deploy the stuff when you’ve got a big day ahead and need better attention and memory performance. But keep in mind …

Caffeine unlocks your potential energy, it doesn’t create energy

Stephen R. Braun, author of the excellent explanatory tome Buzz: The Science and Lore of Alcohol and Caffeine, told me in an interview at Lifehacker that caffeine’s effects were best described as “taking the chaperones out of a high school dance.” Caffeine does its magic not by directly stimulating your cells, but by being extremely similar to adenosine, a cell by-product that your body monitors as a kind of gauge for exhaustion. Caffeine’s molecules plug up your receptors for adenosine, so your body stops getting signals that it’s tired.

But if you’re running on just a few hours sleep and living off pizza and Clif bars for hours, caffeine will only tweak your behavior a bit, not reinvigorate you. So, it’s best to set up an optimal deployment scheme for caffeine. It can’t hurt after that near-all-nighter, but it won’t be as helpful, either.

Combine naps and caffeine for ultimate midday refreshers

Got 15 minutes and a cup of coffee or tea handy? You’ll be glad you do, and that you’re keeping yourself from developing that daily tolerance. Because then you’ll have access to the “caffeine nap” discovered by U.K. researchers. Drink some coffee fairly quickly (assuming you aren’t already buzzing on the stuff), then take a 15-minute nap. That gives your body just enough sleep to feel slightly refreshed, and the caffeine enough time to start taking effect the minute you wake up.

Drink good, seriously de-caffeinated coffee at non-critical times

Now that you’re good and caffeine-free, what happens when everybody at the table wants a cup after dinner? What happens when you just want a cup of good coffee, regardless of brain impact? Go with decaf, but go with a “Swiss water” blend that’s 99.9 percent free of caffeine.

It might seem a bit severe, but read up on proper decaf making, and realize that other coffee compounds, like GABA, are also impacting your alertness and energy levels, and you’ll see the importance of keeping unplanned caffeine away from your fine-tuned system. Spend the time shopping around for good decaf roasts that you’d spend on standard beans. The Swiss Water logo is a good starting point, but not the only conveyor of serious decaffeinated intent.

"Imagination is more important than knowledge"

chrisrooney — Sat, 20 Aug 2011 12:56:00 +0100

“Imagination is more important than knowledge”

- Albert Einstein

Getting the legals right

chrisrooney — Sat, 20 Aug 2011 07:50:00 +0100

If I have learnt anything in my 18 months in business, it’s to make sure you get the legal’s right! One only has to watch the Facebook movie to realize how sticky an amicable relationship can become. A metaphor immediately springs to mind as to how I would describe the importance of it:

Between the ages of 8 and 12, all I wanted to do was play football. Everyone remembers the days of throwing down two jumpers 6 feet apart, picking teams and shouting ‘begsy not doin’ goals!’ As soon as we would kick off, all 10 boys would proceed to chase a worn Mitre ball round the not-so-Wembley back garden. Each player as determined as the next to achieve their aspiration of scoring that wonderful individual effort just like everyone’s hero, Eric Cantona. I usually tried to stay out of doing any of the really hard work like chasing after the ball. Instead I would opt to loiter around the opposition’s penalty area in the hope that the ball would be passed through to me, and I could then toe-poke it into the top corner.

Alas, it tended not to be the most productive of tactics but you can bet your life, that when the plan came good, I’d be the first to throw the t-shirt over my head and slide belly first across the grass in celebration of my success.

Those were the days where the outcome of a friendly football match held serious importance. But if we rewind back before those happy memories, let’s remind ourselves of what the logistics were in playing football with your friends. Here’s an example of a conversation prior to the football

Me: “I’m going out to play football with the lads…ok see ya….bye”

Mother: “Wait wait wait, make sure you have a jumper on, it’ll be cold when you’re coming back”

“I don’t need a jumper, I got to go,” says I, as I start to move closer towards the door.

“WAIT! Go upstairs and put a jumper on this instant, or you’re not leaving this house!”

“OK fiiiiiiiine,” I say as I trudge back up the stairs to get an old hoodie.

When you start a business all you want to do is get out there and play. Everyone wants to go and do the really fun things involved in the start-up environment like building a cool website or trying to get your first customer. But behind all of those fun activities, is our forgotten friend – the legals.

To bring it back to the football analogy, I never wanted to hear about having to stick on a jumper. As far as I was concerned, those conversations were just wasting valuable goal scoring time. Looking back on it, the parent telling the child to wear a jumper, before they go out to football, is simply making sure they don’t end up with a cold the next day. Similarly, by spending the time on the legals before you enter into a contract for example, you’ll make sure you don’t run yourself into trouble in the future. For the sake of spending a bit of extra time, getting the correct advice and putting in place good structures, it will ensure all parties are adequately protected. You’ll be especially glad of it, if and when a legal arrangement ends up not going quite to plan.

So, to sum up my advice, make sure you get the legals right before you go running out to play because if you do, I guarantee you won’t catch a cold further down the line.

Two of the Worst Elevator-pitch Mistakes!

liamryan — Thu, 18 Aug 2011 13:50:00 +0100

Here are the first two of the worst elevator-pitch mistakes entrepreneurs make — and how to avoid them. (Entrepreneur.com) - these are very cool lessons to learn in my opinion!

Mistake No. 1: You don’t explain what the problem your business solves.

Some entrepreneurs spend too much time talking about how his or her product or service works and not enough time explaining what problem it solves, says William C. De Temple, founder of investor group Maximize Angel Investments Orlando Inc. “People buy solutions to problems,” he says. “Don’t tell me about how your lawn fertilizer works. Tell me about my lawn.”

The Fix: Share why customers will buy your product or service.

“If you don’t understand or can’t explain what problem you’re solving and why customers want to give you money, then we’re probably never going to want to invest in your company,” says Kyle Harris, a managing director at New York City-based angel fund Liquidity Works. Harris poses three questions to startups that you should be able to answer in your business: Who’s your best customer? How much money do they make from buying your product? And, how much money will you make from selling it?

Mistake No. 2: You offer too many facts and numbers.
Entrepreneurs often use statistics to help explain their business. While some figures — such as your sales and revenue — are important to establish a track record, don’t go overboard, Silva warns. Leave out the “step-by-step numerical proof of your market size,” he says. “Be compelling. Save the reams of facts for later.”

The Fix: Tell a story.
To capture an investor’s full attention, explain your business by telling a story. Silva suggests using personal examples about how your service or product has solved a problem in your own life. Or, put the investor into your story. “If you’re selling a product for people who are blind, don’t start off talking about the difficulties blind people face. Instead, say something like, ‘Imagine if you or a loved one were to go blind tomorrow…’” Silva says.

(I spotted this post on Entrepreneur.com, and there’s another 3 mistakes to learn there)

The Co-Founder Mythology

liamryan — Tue, 16 Aug 2011 13:35:00 +0100

I discovered a great post by Mark Suster over at his website tonight, there’s even a video summary too that the boys in Stanford spliced together.

Mark speaks about the real early stages of new startups delving into the business responsibilities of shareholdings for founders/partners/tech co-founders.

Interesting read!

I spoke at Stanford last year about starting a tech company. I covered what I call “the co-founder mythology.”

Here is a quick summary of my POV:

When you start a company a 50/50 partnership seems obvious. Either you’re not technical and you think you need a technical co-founder or vice-versa.

Conventional wisdom says that you gain far more in working as a team than you lose by diluting by half before you start.

Conventional wisdom doesn’t account for all of the things that go wrong in partnerships over time; especially ones that are formed quickly and without a long gestation period.

It is increasingly popular to have “founder dating” or “startup weekend hackathons” of some variety or the other. We get cast together with a team of people we barely know and if we win we gleefully announce we’re going to do a company together. We don’t even know whether they snore.

You often have very limited perspective on whether this person will continue to be a great partner 2 years down the line, 4 years down the line, 8 years down the line.

Even if you *think* you know them, people change. One person gets more risk averse, the other has more risk appetite. One person gets married or has kids and starts to de-prioritize the business. One person loses the passion for what you do. Or you have disagreements about strategy, recruiting, funding, etc.

50/50 partnerships can be hugely unstable – even if you’ve been friends since high school.

And all of the hard work is ahead of you. You’re only going to find out whether they’re TRULY a great partner after you’ve put in years of money, blood, sweat & tears.

I think most people do 50/50 partnerships because they’re afraid to start alone. It’s scarier because if you fail it was only you and all your fault. Somehow it feels easier to leap together. I know. It’s what I did the first time.

I say, “go ahead & take the leap” if you want to start a company (many people don’t want to – that’s OK, too.). Hire your co-founder. Give them a large sum of equity. 20%. 30%. Even 40%. Vested over 4 years. If you ever fall out of love you have a pre-nuptial agreement. I talk about that in more detail here.

Truly treat them like a co-founder. Give them access to all confidential information. Involve them in fund raising, hiring, strategy, etc. Publicly call them a co-founder. Don’t rule like a dictator. But … if you have very big disagreements about funding, risk levels (e.g. like how much burn rate), whether to sell the company, etc. you won’t be backed into a corner or unable to make tough decisions.

Here’s the reality: most people don’t want to start a business. They don’t have an idea. They don’t want to come up with one from scratch. They don’t want the risk of the first 3-6 months with no salary and having to walk around with a tin-cup for funding. So most people join companies. That’s OK. It’s the more sane thing to do. Startups have high failure rates.

Most senior employees who join are given 2% if they join early. Maybe they get up to 10% if they joined REALLY early and were senior. Who gets 30%? Nobody. That’s who. So trust me when I tell you that you can hire incredibly talented people for 30% of your company. Or 20%. Let’s be honest – even 10%.

And here’s the thing – given that all of the hard work is IN FRONT of you (as in the next 8 years of your life) – why would you start out with an unstable position if you don’t have to?

I know many people reading this will violently disagree. And some of them will be from startups that are already very successful. If it’s working – no problem. I’m not saying it will never work. But many of the cases where it goes well are when the company hasn’t struggled. We’re all friends when things are moving up and to the right.

If you do decide to go down the 50/50 route, please at least consider:

Make sure you have founder vesting for both of you. It is not uncommon to see startup founders walk before raising capital and take large pieces of equity with no vesting. That means that the people who stay get to work their arses off to try and make money for the person that walked. Why risk it?

Make sure you have a very clearly established governance structure. None of this, “we’re co-founders, we just work well together. So we’re co-CEO’s” BS. Pick a leader. Have a clear path to resolving conflicts if they arise.

Discuss up front how you’re going to resolve any conflicts. Discuss topics such as funding, risk orientation, how long each of you wants to be doing this business, what happens when one partner wants to leave or one isn’t performing?

OK. Now feel free to shoot the messenger.

Just please read one more message first: I promise you for as great as you feel about your current partnership agreement – I meet far more people who had problems with theirs than founders who didn’t have problems. People just don’t talk about it publicly or in blogs. I meet far more second or third time entrepreneurs who wouldn’t do a 50/50 (or 33/33/33) partnership ever again than you would image.

I am one of them.

Really interesting video to watch from the Google IO conference...

liamryan — Tue, 16 Aug 2011 06:14:00 +0100

Really interesting video to watch from the Google IO conference last May 2010. The first question asks the panel if they would invest in non-technically founders of a startup - and if not, why not!! Dick then goes on to ask about what are the key features of an investable team.

Paul? - http://liamhq.com/post/7629268485/i-just-discovered-the-cofounder-of-ycombinator :)

Tech Talks - Albert Wenger, Chris Dixon, Dave McClure, Brad Feld, Paul Graham, Dick Costolo (moderator)

What do notable tech-minded VCs think about big trends happening today? In this session, you’ll get to hear from and ask questions to a panel of well-respected investors, all of whom are programmers by trade. Albert Wenger, Chris Dixon, Dave McClure, Paul Graham, and Brad Feld will duke it out on a number of hot tech topics with Dick Costolo moderating.

Advice from Paul Graham, Y-Combinator

liamryan — Mon, 15 Aug 2011 13:50:00 +0100

I just discovered a great post by Paul Graham, a founder of Y-Combinator in Silicon Valley, from October 2006. Paul talks about the 18 Mistakes That Kill Startups but one in particular stands out for me:

In a sense there’s just one mistake that kills startups: not making something users want. If you make something users want, you’ll probably be fine, whatever else you do or don’t do. And if you don’t make something users want, then you’re dead, whatever else you do or don’t do.

With every idea and concept I’m working on, I’m trying to learn fast and more importantly learning from the hard lessons entrepreneurs and business people have had to suffer from in the past.

This is a great synopsis by Paul and I fully recommend you read it.

An earlier post to note, and I’m still working hard and hoping: http://liamhq.com/post/7629268485/i-just-discovered-the-cofounder-of-ycombinator

Born before technology was invented!

liamryan — Fri, 29 Jul 2011 07:53:00 +0100

While conducting some research for a new product I’m working on, I came across this quote by Ian Calvert of Instant Grass and I blind posted it on Twitter last night:

“We only call it technology when we were born before it was invented”

This particular quote caught my eye within the MobileYouth.org presentations as it stood out, in my opinion, as a true and striking statement. I was surprised of the comments that came back to me, saying it was ‘complete tosh’ and ‘profound’.

Let me explain why I understand this to mean something quite simple.

When I grew up in the ’90s, there was no such thing as a DVD player or a HD TV, an iPhone or tablet devices that gave you the opportunity to check-in on your social graph, video chat and voip call. There was no such think as Foursquare, Skype, Google, Facebook or Twitter…

I was aged 10 before we had dial-up internet (we used to spend 10 minutes to see a page fully load with crappy Web 0.1 graphics) and it wasn’t till I was 12 that I got my first mobile phone, a Nokia 3210 (one of the first in my class too may I add). We even had the famous snake game, and we were addicted to the craze.

As I grew older, with technology growing so fast around me, I decided to learn and interact with this new technology, adapting to it as quick as I could.

People all over the world engage with this new technology every day, but it is the new generation that are now starting to grow up in, what is considered our ‘new technology’. They will grow up with an iPad in the house as if it was normal. They will grow up up broadband speeds reaching speeds of 1GB per second bandwidth…

Imagine a young person starting off with today’s ‘new technology’ - they will interact with it as if it is normal and common place, in the search for “newer technology”, newer technology that is even better than what we currently have, just because they can afford to think bigger, better and faster!

Some of my peers still have a Nokia 3210 today!! Perhaps I should tell them what they are missing out on!

I'm heading to Google HQ! [Update]

liamryan — Mon, 18 Jul 2011 19:07:00 +0100

UPDATE - It was great to attend the event last night and a big thank you to Jane Murphy and her team.

I thought it would be good to share some insights into what I learned at Google:

Google are one of the founding partners of the Undergraduate Awards.
Google purchased the Montevetro Building, the tallest building in Dublin (15 floors), for ~$136M back in early February of this year - and they currently only occupy the first 2 floors!
50% of Googlers hold a Master degrees.
46 languages are spoken daily and “if you were to climb the stairs 10 times a day, you are nor guaranteed to hear English”.
John Herlihy is based in Dublin and holds the position of vice-president of Google‘s global ad operations. Herlihy drives Google’s online advertising operations and support globally by providing small business solutions to advertisers.
The Story of the Lava Lamps: during the presentation, we were given an inside overview as to what happens when a new Googler joins the growing team. In the very beginning, Larry Page and Sergey Brin literarily worked out of a friends shed. With no furniture and all expenditure going on the likes of servers and equipment, friends offered lava lamps to add some colour to the place. Today, it is offered as a gift to new recruits to symbolise the humble beginnings.

You can grab one here, that is, if you really want to!
Did I mentioned the free food? They’ve even pool tables and bean bag areas on every floor. Look’s like they don’t want these Googlers to ever leave work!

PS: I suppose you know you’ve made it when you can offer your company’s branding in a sweet on the way out :)

—

A couple of weeks ago, I entered my engineering thesis into the Undergraduate Awards for Ireland and Northern Ireland. As my entry was explicitly for the engineering categories [non tech], I was delighted to receive a invitation to submit an application to attend Goggle’s Wrap Party in conjunction with the awards.

As I have always been keen to experience the Google culture first-hand, meet Google interns and employees etc, I jumped at the opportunity to let them know why I thought I would be a good fit with their team.

To celebrate the end of submissions to the 2011 programme, the Undergraduate Awards are inviting a small number of entrants to an exclusive wrap party at the EMEA headquarters of Google in Dublin on July 18th. This unique opportunity will give students the chance to meet Googlers, learn about current openings and experience the Google culture first-hand. As Ireland’s top graduate employer, Google receives thousands of applications every day and are currently hiring. Students will find out about opportunities at Google – for all grads, be it Arts, Business, Science or Technology – and learn how their CV can stand out from the crowd at this event arranged exclusively for Undergraduate Awards entrants.

I was lucky enough to get the reply a few days later:

Congratulations! Thank you for applying to Google’s Wrap Party in conjunction with The Undergraduate Awards. It was amazing to see such great interest in this event and we were overwhelmed by the quality of the answers we received. We are delighted to inform you that you have been selected as one of the 50 guests.

Boom [the sound of sucess that my good friend @c_j_rooney would make!]

You can find out more about the Undergraduate Awards here.

Freemium Is Dead

liamryan — Sat, 16 Jul 2011 20:32:00 +0100

I discovered Jason Tryfon the last night, the CEO of @vital_insights. He had a number of really cool and intersting posts on his website, but one in particular post from June 2010 stood out in my mind.

Jason explores the link between the venture capital market and new emerging companies with a freemium model gathering users. Is it sustainable, is it investable and is it the right way to build a company? Read on…

The venture capital market in the past two years has been interesting, to say the least. On a whole, transactions are way down, and what intrigues me the most – from a preliminary perspective – is that the valuations for intellectual property are reaching its tipping point, or an emerging bubble. My fear is that when this bubble bursts – and it will – there will be lots of collateral damage.

I see the problem in these stratospheric valuations, being served up as venture capitalists clamber and climb over each other to lead deals, typically revolving around a social media-esque company. Has anyone learned anything over the last 24 months?

Few, if any of these companies have monetized, let alone exit. Most of the start-ups recently launched are yielding mega-million dollar valuations with no revenue.

Here’s what I don’t understand: millions of dollars for NO revenue, NO earnings, NO EBITDA, NO cash flow and most importantly, NO assets? Software code, which seems to be the foundation of these valuations, holds no monetary value, at least in the financial sector. A concept or idea being sold certainly warrants some blue sky, and a patent or two definitely helps. However, the actual investment into the company is being made on something without a tangible net worth and worst of all, it isn’t making any money.

Business 101 clearly stipulates that in order to make money, you need to spend less than you made.

The rules have changed, at least in the Silicon Valley, where the less one makes, the more it maintains its SUBSTANTIAL value. It becomes an interesting market where anactual business with income, revenue, and a strong EBITDA are constantly passed over by venture capitalists, private equity and angels.

They continue to wait for the next big social media winner. Case in point: Foursquare and we can’t ever forget Facebook and Twitter.

Foursquare has recently turned down a $100 million acquisition offer. Personally, I’m still struggling to find any value in this company, even with its shiny new “geo-location” technology. The whole concept of Foresquare is annoying and I have yet to meet a person that cares if their friends “checked- in” to a Walmart, Dairy Queen, or McDonalds. And it’s not just me. Critics abound, with TIME magazine touting the social media company one of the WORSTinventions ever.

Yet, after all the indifference and lack of widespread acceptance, where did this valuation come from? What exactly was worth $100M? The data? Geo-location data? To be honest, that data isn’t worth much. Advertising agencies aren’t paying the premiums like they were 2 to 4 years ago for this kind of data. It’s strictly a commodity. Even bigger questions surround both the Facebook and Twitter valuations at $15B and $1B, respectively. These two have had years to monetize and develop a profitable business plan and neither has accomplished a thing. Sure, there have been hints and even an executive hire for a “VP of Monetization”, but nothing has come to fruition. Want to know why? Freemium is dead.

Long gone is the business model of inducing users with a free membership to one day (hopefully) converting them to paying subscribers – that is so 2008 and so done. For example, Facebook launches an insignificant user interface change and thousands of Facebook pages emerge containing a ton of users protesting the Poke removal feature. Good luck charging these folks to post pictures.

I can easily point to hundreds of overinflated deals in the Silicon Valley that will continue to bring false hopes for their investors, their funds and themselves, but I won’t. The bubble is about to break open and big names are going to fall and like the subprime mortgage crisis, there will be damage. Will this problem ever get fixed? I’m not sure. One suggestion for the capital community: release your addiction to social media. While the concept and business models are important, it’s the value of nothing that needs to be considered and changed.

Follow Jason on Twitter at @jasontryfon and you can find his post on his own website here.