startup – my passion for startup and my experience in Poland vs USA

In September 2011 I started the first talks with investors who, for various reasons, were interested in iTraff Technology (in Poland and abroad). I had 32 meetings, 21 Skype, I mentioned a lot of emails, I made a valuation of the company, prepared to negotiate and so on and so forth (in the margin: nothing much I could not know what this whole process). Now I’m at the stage near the closing round of funding talks with the comfort with several potential investors in advanced negotiations.

Apart from foreign funds, I visited most of the Polish, spoke with their boards. Taking an overview of virtually all, or the vast majority of Polish investment funds (technology), I unfortunately (sorry, with a sad mouth) subjectively say:

Polish VC is not able in the near future to build a global exitu (I’m not talking here about seedowych fund whose purpose are generally not large (millions) exity, or the Business Angels’ach)

and in the field of mega utterly pregrywa of Western funds, below I will try to say why this is (based on my experiences and observations):

First Most ordinary anxiety.

Polish VC afraid of failure, to the extent of their fear that paralyzes their imagination. Their imagination is somehow shackled stress before failure, a failed investment. They try to predict the future, and freeze it, but not giving the chance of alternative thinking. On the one hand is stressful (understandable), but they can not attempt to predict the future except to find alternative thinking in which stimulation would lie to some imaginative, risk-saturated naive, bet poker return events.Fear tells them to choose from already proven business models, or models like the best. This hampers their imagination.

Second So you really do not believe that manages to build a multi-million dollar business.

Subjectively – I think that the Polish VC does not believe in big, multi-million dollar success and otherwise does not believe that he can build it. He would like to, but not around each other’s examples, stimulation, which utwierdziałyby him in the belief that it can build the next Google, Skype and Spotify. This is mental. If you have something big happens in its surroundings is rather Polish VC explains this fluke of that company, or specific conditions under which the company operated. Thus confirming the belief that building a big business is damn hard (he is) and I have a rather slim chances (I VC) to do so. Do not give God the VC is already on the account fail, it cedzi your chances even more. In addition, I have not found among the Polish investor faith in the 10,000% growth, we discussed many Polish startup’ach (not just iTraff) and the VC was very often in his opinion on the head startupie which ordered thinking “this and this startup has potential, but it and not allow him to be a multi-million, billionth success. ”

Third Excite the slogan gobalne, but global needs of global money and here begins with weakness.

Every VC wants to have a global startup, with people thinking globally, acting globally. The global success of the global money – gong! Polish VC live in ext. contradictions – I would like globally, but for local budgets. zonk! From what the thinking is clear – do not know 

4th Lack of time

Polish VC has developed the process (in the sense it is very rarely) the analysis of new investments or do not have the resources for such activities. Managers of businesses are busy and do not have time for lunch, coffee, meeting, do not have a team of analysts who have the time to study because they are busy with ongoing activity. In other words, most of the Polish VC live in the chaos of everyday life, which make it impossible for them to actively and systematically to analyze the emerging investment opportunities on the horizon. A new opportunity is a way to analyze a problem because this chance is like a chisel, you should stick to the daily earning.

5th What the hell is round the corner boy and not the end of the road?

A short investment time horizon that is today, I’ll give you money, but as soon as possible show me the profits. This thinking is not a precise implementation, but Excel with forecasts based business is watching. So far for the month, year, and why so little. How much is probably przestrzeliłeś uuuu?Generally, there is nothing wrong with that, but in most cases, apart from this short analysis overlooked, does not analyze the long-term impact that a startup can do. In my opinion this is due to a lack of knowledge, which nienagromadziła still in Polish ecosystemie startup’owym. It’s still not enough to be able to clearly, with confidence the VC he could look at the long-term period of time and it is not an extension of the planning period in excellu.

Summary:

First A little VCs understand such behavior, it helps me in the knowledge that communism in Poland was that the market and ecosystem for young technology companies is cosmically young, etc., but do not share this thinking.

Second As long as someone’s comments are motivating, I think they are super important, but if someone with your anxiety, fear, etc. pressure down, it makes no sense to stay with him.

Third Sorry for the negative tone of this material (it comes hard for me because I prefer the positive actions), but I felt that this could be useful for someone through what I experienced in the head enrolled.

I can give advice that is simplistic and two:

First Do not let himself lose to those things that you mentioned. Remember that VC is thinking and can not be your thinking (if you demotivate).

Second Search for funding outside of the Polish and the VC funds in Poland treat as an addition to your actions.

Council for Polish VC:

First Rise, and sing the song “I need a dollar,” and popłyńcie wyluzjcie in your dreams. Do not limit a!

Second It depends on you whether we will provide you an entrepreneur 100000% rate of return, you can give us a kick or shot wgniatający the ground.

I think that every startup man can learn something from Smith – last week I had the pleasure to become an expert in Adam Smith Center.

It is an interesting place, full of free market thinking on the border of disruptive thinking, so close to startups. Together with Andrzej Sadowski, having a cake and coffee we discussed the entrepreneurship in Poland, taxes, the European crisis, and Angela Merkel. I must admit that knowledge contained in such discussion allows me to open some areas of the brain, hitherto unknown to me.

We also talked about new investments in the innovation sector which have a chance to happen in Poland thanks to the American capital (keeping my fingers crossed).

I am worried about the EU, I think we’re witnessing something incredible, a breakthrough in the formation of Europe. We are looking at a certain process, which, as it is over, will take the form of a new order. I have the irresistible impression that no one knows this order. No one can define it.

What is the conclusion for me? One concrete – the future belongs to entrepreneurs because they are always doing great. The EU is the EU and I’m keeping my fingers crossed for it not to split. Let it last and get stronger. However, diving in the entrepreneurship is what protects us from the crises, bureaucrats and stagnation. More companies gentlemen!

On these gloomy autumn days someone sent me a link with a sentence underneath “He who fears, he is a slave” – Seneca. Let me add to the above what Marek Kondrat said once: We cannot be afraid because we lose too much. Therefore to all the startup people building their companies struggling with their visions and hallucinations:

„He who fears, he is a slave”
A friend of mine wrote to me yesterday that he would like to set up a company, but he is not ready yet and he will still wait. Damn, I was never ready and I’m not even ready today. There are so many guys smarter than me that it makes my hair stand on end when I think how much this one or the other one knows comparing to me. I think you cannot get yourself ready for chaos, risk and failure. One can think about them and try to accustom oneself while they bite your hand. However if the only reason holding us from entering the game is fear (not health, family situations etc.) we have to jump in, because:
„He who fears, he is a slave”

Several silly thoughts which I think I worth sharing.

a) only customers can decide if product is ok or not ok

Angry Birds simplicity could be a failure and is big success. Facebook founders didn’t want it to be a company. So…. can we realy decide what is good product. It looks like not, stupid ideas can be golden mountains, golden mountains (perceive) could be stupid ideas. The key is customers (with accent on “s”). MVP could not be developed under the startup office roof, it must be put on a market. I believe

b) lean startup methodology support customers centric approach, this is why it is interesting approach.

c) simplicity looks like key feature. I think it is a feature because it must be featured inside products. Corel Studio is worse than iLife not because it is expensive, more developed, better in options – is worse because of fuzziness. iLife is better because of its transparency. Better for me, simple user, not graphic man, a mass population.

d) churn rate is something important but it exists anyway. If somebody understand what is churn rate and how to calculate it using web/mobile analytic (I didn’t for a long time, what a shame) it looks like he / she pays attention and lean startup can grow.

e) Seth says cool words: “Inherent in the process of minimal viable product, then, is a trusting, large permission base that will eagerly listen to you, try your new work and let you know what they think. And you don’t have the option of building that audience once the product is ready–that’s too late.”

Hope it was worth your morning coffee. Have a cool week.

Arek

Yesterday I was watching Merchant of Venice movie, great example of Al Pacino’s work. Cool story, cool art wrote by great man! I was astonished by the story about merchant of venice who was stubborn man with material goods orientation. He was good at what he was doing. On the other side, there was a salesman, a man who was counting on his own venture, entrepreneur, startup man!

Finally he lost. Startup man lost and according to a contract with Jewish Merchant contract, startup had to give 1 pound of his body = death! He was scared. But he was ready to do it.

But life smiled to him and whole situation turned upside down. He won because he was ready to give everything away.

That made me think that life is sometimes like that, you need to be ready to give everything you love away so life will smile to your face and afterwards you will be rewarded!

It was great time recently. Our photo recognition technology found some attention in peoples minds. I must say as being pride that we were chosen to top 10 startups during startupweek2011 in Vienna. We were showing up our photo recognition technology in San Francisco and some really cool Polish newspapers and web pages mentioned us.

Sometimes you feel that things are really cool. Technology got traction, VCs pay attention, people write about your staff. This is such a great feeling which takes you up to the sky. Gives energy.

Startup life is great, it opens a box o surprises (probably the same forest gump had) and it shows that so many things are possible when you in enterprenuership mode.

So sometimes it is hard to wait for the surprise but it will come !

I am watching crisis around us, watchin’ Polish politicans fighting for their next 4 years life. I am looking at Polish flag waving. I can see so many great startups around me, so many smart people, smarter than I am, than I can even imagine. I can see investors watching pitches but admitting that not having time for insight. All of these surround me. In spite of all that stuff around me I must say I am so lucky to be inside entrepreneurship world.

I need to admit that startups showed me what I love. Being in this chaos world I realized what is best for me as a human-being. Entrepreneurship shows what are my strengths and where my weaknesses are rooted. This is so obvious that I can’t cheat myself. So much self development insight from my life.

I feel in love in sales and marketing. This year I realized what is it. How it works. After all these years, startups gave me the best advice how to love sales and marketing. Startup should sell. This is healthy money.

There are no boring days when you entrepreneur, no back scratching and beer drinking with remote control in your hands.

I must say, I don’t know why I wrote all of this but I feel I have to….

Once a week I spend 30 minutes with SaveUp user. We launch Skype or Googles Hangouts, have coffee and talk. BTW if you are SaveUp user let me know, let’s talk.

These conversation gave me a picture of SaveUp usage. Where, in what situations, SaveUp users buy books:

- in friends’ house – they see a interesting product, take picture and buy this item straight from smartphone

- reading magazines they see products recommendations and they realize they like it and they want the book, they grab smartphone, and buy what they want

- in restroom – they use simple text search option and put several books into basket. They buy many items but pay only one delivery fee

- finally they buy things sitting in the car, in the traffic jam  - how? they listen to the radio and get to know that someting new is on the market. They use SaveUp to search for it…….

The day we were preparing for during the whole year has finally come – money collection for the next periods of operation. iTraff Technology Ltd, the producer and the owner of the image recognition technology and at the same time the owner of application SaveUp, has started its journey to acquire capital. Sounds pompous, but it is a very big challenge for us. We combine our brains in the company and focus them towards this direction.

We started this concentration on establishing relations with investors and acquiring capital with departure for TechCrunch. I am (sitting on a plane at the moment) heading to Amsterdam for CapitalOnStage.com . We will also attend startupweek2011.com and InvestorsDay . We were picked to participate in all these events by chapters which found our product interesting and of great business potential.
Then we set out on a journey into the unknown, onto the path of questions and answers, discussions and conversations, negotiations and poker faces. We depart to convince the potential investors we are worth to invest in. Like Christopher Columbus (first startup man in the world) we set sail …

iTraff Technology team, outstanding and amazing:
- image processing engineers,
- account managers, people taking care of the relationships with our 50 partners
- PR, Marketing and SEO people
…. has developed technology of image recognition for over a year.

SaveUp is mobile application for spontaneous shopping. Buy your favorite products whenever you are! We believe that people want to buy products right here, right now. Spontaneous decisions rocks the world. We want people to buy what they see right here, right now. Because of image recognition technology you may purchase products displayed on printed ads, billboards etc.. Every printed or displayed product information can lead directly to a purchase. You can make shopping everywhere now!

At the same time, for months we have been receiving inquiries from advertising agencies, manufacturing companies pharmaceutical companies, companies which produce and distribute alcohols and also internet stores – these companies want to use our technology in their applications. There are also talks with those companies which would like to replace QR codes with image recognition. This is our strength – demand has found us.

Analyzing queries from abovementioned companies, as the SaveUp owner after analyzing opinions of hundreds of users we want to give the investors possibility to acquire shares in the company, which:
- is the owner of the image recognition technology;
- owns the application SaveUp, which we will introduce into German and UK markets (localized applications);
- will be installing build-up image recognition technology in applications of other companies/developers/mobile applications producers. We want to give the others possibility to use our technology.

Today, like never before, we need you to keep your fingers crossed. We dream about becoming a global company, we want to show to the world the project conceived and developed in Poland. We want to attract the eyes of the biggest companies in the world to Poland. We want to visit these companies wearing white and red t-shirt with SaveUp logo on it.
Please keep your fingers crossed and have a drink or beer for good luck. Your feedback and support is priceless.