Infrastructure, capital, etc. – don’t forget the human element needed to build a startup ecosystem
Tech startups whose ‘business guy’ has an understanding of technology have better survival chance
IN all the talks and discussion on technology entrepreneurship and how to nurture startup ecosystems, a critical part that is often neglected is the human element.
It’s not just about developing soft skills or making sure your human resource assets have the right talents. It’s about people interacting with people, whether it is between the business guy and the techie; between the entrepreneur and a possible investor; or just between peers.
“People often talk about the infrastructure and the ecosystem – including venture capital and mentorship – that must be present for startups to be successful, but nobody talks about the peer support; the emotional support that is required for a vibrant startup ecosystem,” said David E. Weekly.
This emotional support is in fact one of Silicon Valley’s strengths, he told the DNA-TeAM Disrupt panel discussion on ‘Hacker lessons from the Valley’ held on Sept 19 at The Canvas in Petaling Jaya.
“Odds are, your startup is not going to last very long and will probably end up in abject failure. That is a pretty difficult thing to swallow, yet people are brave enough to do that. The highs are incredible highs, and the lows are so crushingly low that it is an emotional journey,” he said.
“Behind every success story, there is a series of failures,” he added.
Being surrounded by like-minded people who can empathise with you and give you advice can also help, argued Weekly, infrastructure product manager at internet.org, the initiative kicked off by Facebook Inc and others to bring Internet access to ‘the next five billion people.’ He is also founding director of the Hacker Dojo and founder/chairman of PBworks, both in California.
It was a point that his fellow panellist Ngeow Wu Han, chief designer at Mindvalley and founder of WebCamp KL, a community of web technology developers, designers and enthusiasts, concurred with.
“When you put like-minded people together – they interact on Facebook and on social media – and then you take them out of there and get them to interact in real life, you get the whole picture,” he said.
“And when that happens, I’ve seen amazing things happening,” Ngeow said in the panel discussion moderated by Digital News Asia (DNA) founder and chief executive officer Karamjit Singh. Disrupt is a monthly discussion and gathering organised by DNA and the Technopreneurs Association of Malaysia (TeAM).
The other part where the human element comes in is in investor relationships. Weekly said that the most successful investors and venture capitalists in Silicon Valley are those who try and understand an entrepreneur’s personality and motivations, rather than those who just crunch numbers.
Such investors would ask questions about your background and the reasons why you are building this startup, before going on to look at market opportunities.
Ngeow, recounting his experience at last year’s Asian Business Angels Forum in Kuala Lumpur, said that he came across many investors who had made it big in other industries or came from ‘old money,’ asking entrepreneurs questions such as, “If your startup fails, what’s my exit going to be?”
“Nothing,” noted Weekly, adding that technology startups were not like investing in a restaurant where there were physical assets that could be sold off. “But the payoffs are much bigger in technology.”
Business vs tech
The other human element is the interaction between the ‘business guy,’ who often sees himself as the ‘ideas guy,’ and the ‘technology guy.’
DNA’s Karamjit noted that the topic for this Disrupt session was actually triggered by his meeting someone who had gone to a hackathon to “look for his CTO (chief technology officer) for an idea he had,” as well as hearing about how a Malaysian startup had faltered because of disagreements between the CEO and CTO over who was more critical to the company.
“The point at which the business guy sees himself as the ‘ideas guy’ and is looking for a technical co-founder, they’ve already screwed up,” said Weekly.
“Speaking from my background as a coder; someone who thinks he has a great idea and thinks it’s just a matter of implementation; who comes at it without an understanding of the underlying technology and is yet trying to build a technology company – [such a person] won’t realise what is possible to do, and therefore, what is more helpful to do,” he said.
Without that technical understanding, such a person “may not realise that some of the things he is asking for is not technically feasible.
“Making a technical product is a very iterative experience, because you sit down and build part of it to see which parts work and which don’t, which can be hard to predict sometimes,” he said, adding that they next step would be to improve the product. Again, and again.
“The ‘ideas guy’ needs to see that it is iterative, and that he is going to need to co-develop it, along with the market and not just the technology – oftentimes, this ends up being something very different from what was originally envisioned,” said Weekly.
“A lot of the risk a startups face is that they spend a lot of time building something that turns out to be something nobody wants,” he added.
Ngeow agreed, saying that this was pretty much the experience at WebCamp when they started about four years ago, with a lot of ‘ideas’ people coming to the gatherings to look for technical cofounders.
“They would say things like ‘We want to build the next Facebook; you know, it’s like Facebook, but …’ – we got a lot of that,” he said, adding that it got so bad that some technical people started dropping out of the gatherings because they found they did not share a common language with these ‘ideas people.’
“It works out better if the ‘ideas guy’ has some technical background,” said Ngeow, offering as examples Mindvalley’s own founder/ CEO Vishen Lakhiani, and Catcha Group founder/ CEO Patrick Grove.
“In the Malaysian ecosystem, we’ve got too many people who think they have a cool idea, but when they talk to a technical person, and if that person asks a few questions, they go, ‘Oh, I didn’t think about that’.
“But what is happening now – and I’m hoping that WebCamp is helping accelerate that – is that we’re bringing these technical people out of their technical shells, and have them start interacting with other people,” he added.
This is why events such as startup weekends can be so helpful, said Weekly. “You can’t just go for one hackathon and choose a CTO – it’s like walking into a bar, seeing someone you like, and asking her to marry you!” he said.
However, in an event like a startup weekend, “you’re working with someone over [a period] 72 hours to build up something,” he said, adding this is a great starting point for seeing how you can interact and get along with that person.
“It can’t be ‘I have the idea already – I just need somebody to code it’,” said Weekly. “It’s not that simple.”
Find your weirdness
Finally, the human element also includes the people all around you, which is what Silicon Valley has in abundance: Like-minded people.
Weekly said that he was brought up in Boston where he would never have thought about starting his own business, but within a month after moving to Silicon Valley for his studies, he was brainstorming on all the different companies he was going to start.
“There is a certain something in the water,” he said. It’s kinda infectious because you see all kinds of people, all around, doing all sorts of stuff around this ecosystem, and you think that you should be really doing something too.
There are even the people who have failed many times, but are happy doing what they’re doing,” he added.
Weekly noted that other industries have such meccas too: With film, it’s Hollywood or Bollywood; in the world of finance, it’s New York or London.
“There’s a certain magic being surrounded by people who are great at what they do, and realising that they’re all in in together,” Weekly said.
“It’s the kind of concentration that is extremely exciting in Silicon Valley,” he said. “Silicon Valley is halfway in the future, halfway a delusion, and it is only with retrospective that you can tell which part is which.”
Which is why he doesn’t believe other countries should try and re-create Silicon Valley. “I think it very important for every place to be its own self,” he said.
It’s the same whether you’re talking about individuals or places. Don’t try to be another Bill Gates or Mark Zuckerberg.
“Figure out how to be yourself, figure out your own weirdness,” said Weekly. “This is the incredible part about the 21st century economy.
“The point of the 20th century economy was to churn out systematically valuable workers who could consistently do the right thing, be managed well, and go and create output. The 20th century was very great at this.
“The 21st century has a very different set of demands; in terms of its educational system, it is for everybody to find their weirdness and embrace it. Leverage on it. Your own unique perspective is what you bring to the world, and you need to put it out there.
“In the same way that this is critical for an individual for competing in the 21st century, it is critical for a locale as well. You shouldn’t look to be Silicon Valley; instead, you should ask, ‘What is really weird about Kuala Lumpur that no other place already has?’ and work on that,” he added.
Ngeow believes that this is what Mindvalley and WebCamp are trying to do, in terms of evoking the type of magic that Silicon Valley enjoys.
“I think you need to take much more pragmatic and hyper-local approach – see what kind of variables you’re working with, and from there, build up and see what comes out,” he said. “WebCamp is kind of an experiment in that sense.”
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