The smell of startups

The Queen thinks the world smells of wet paint. So it has been said, anyway. But the thing is, if it’s true, how would she know?

Thus wandered the mind during a talk by a senior honcho at one of the world’s leading tech companies at Shoreditch House recently. All these people worrying about technology and jobs and robots should just “check their cognitive bias”, he advised.
 
So should you, mate, I was going to say, but by then he’d sped off to Mars. 
 
We all slip into obliviousness about our environment because it is for each of us our own particular normal. And so, I wondered,  what might we come across so frequently in Silicon Roundabout that we forget that it is special? 
 
The author David Foster Wallace once gifted us a parable about the ease with which we lose our bearings and lose sight of our life and our world. He said: “There are these two young fish swimming along, and they happen to meet an older fish swimming the other way, who nods at them and says, “Morning, boys. How’s the water?” And the two young fish swim on for a bit, and then eventually one of them looks over at the other and goes, “What the hell is water?”
 
What, then, is the water like in Shoreditch? What does it smell like? I decided to find out and took a stroll of curiosity in the manner of Patrick Suskind’s  anti-hero Grenouille in his novel, Perfume. This is what I sniffed out:
 
Two Pizzas
The perfect sized development team can be fed by two pizzas. This was the lean heuristic created by Jeff Bezos as he built up Amazon. More than two Pizzas and the team is getting too big for optimum efficiency, much less and you may not be in growth mode. You smell two pizzas only and you’re near a startup. 
 
Roses
This is the fragrance of the spectacles worn by “n00b” startups as they pitch their first idea to accelerators, angels and friends and family. The whiff sours fast.
 
BS
This permeates the atmosphere almost every time angels or mentors explain to a n00b that they know just how to grow this decent little business into a unicorn …and can be persuaded to share the insight for rolled-up advisory fees and founder shares.
 
Coffee
Shoreditch is mostly a patchwork of coffeeshops separated by the need to stretch your legs. This smell is everywhere. It is the base.
 
Chinese Apples
Every flat surface in Silicon Roundabout supports a silver computer that once smelled of the the Chinese factory where it was manufactured and packed.
 
Red Bull
There is at least one hackathon going on every weekend and  usually many more. Jamie Oliver is judging a “food hackathon” as I write this. He might wish it to smell of fresh baking or lobster bisque but I guarantee that the overpowering pong will be that of all the energy drinks that have kept the hackers up through the night.
 
Sweaty yoga mats
There’s a moment just before morning rush hour when the pavements are overrun by a sub-species of Old Street inhabitant – the top-knotted yoginis. For a brief instant it is as if the northern lights have lost their direction as creatures wearing startling cosmic-patterned yoga pants and proudly bearing their rolled up mats briskly scuttle up and down the streets. An hour later they walk back much more slowly. 
 
Bicycle chain oil
This neighbourhood is the home of the fixed wheel bike brigade. They louche down the inside of buses, the other side of the road, and balance like a circus act at red lights (sometimes). Meanwhile Brompton bikers angrily show that just because their bikes fold in half and have small wheels it doesn’t mean their freakish gears won’t allow them to go just as fast. Rush hour is bedlam. Bicycle chain oil and burnt rubber give texture to the cursing and yelling, diesel and horn blasts.
 
Brick dust
Vast numbers of older buildings are being knocked down to make way for bigger, newer buildings. The dilapidated old warehouses and office buildings that used to sit in no-man’s land between the City and Islington were once so cheap that artists, designers and startups flocked to Old Street. Thus the scenius was born. Now these buildings are toppling like dominoes – though the low rents have disappeared faster. 
 
Steel and glass and cement dust
That tinny tang, that smell at the back of your throat, that’s from the brand new high-rises that are being built where the old brick buildings once stood. The Old Street gyratory itself is gradually being hemmed in by hugely expensive and vast office blocks. Who will occupy these? Bootstrapped startups? er…
 
Sulphur
Old Street is less than half a mile north of the City.
 
Cereals
Old Street is but a few flat whites away from Brick Lane which has many smells of its own to offer – not the least the  amazing curry shops. But today, readers, spare a sniff for the sugary smell of breakfast cereals. During the Autumn, protestors attacked a shop that sells all the varieties of cereals available in the entire Universe. With robots, artificial intelligence, multitudinous apps and revolutions being created in Old Street the protesters were alarmed by the wrong target. They couldn’t smell the wet paint.
This is my December 2015/ January 2016 column for BA Business Life…. which you should be sure to read every month because it was this column wot won columnist of the year. Did I mention that already?

 

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We are Galapagos Tortoises riding on the backs of Mayflies

We are the Galapagos Tortoises of lifespan. Our businesses, on the other hand, are mayflies. Nowhere is the contrast more apparent than in the start-up-birthing farm of Old Street Roundabout.

The thing about actual Galapagos tortoises is that they pace themselves. With 170 odd years or more to live you almost never see them in a hurry. Actual real Mayflies on the other hand, they are in a permanent rush. They have to cram an entire life into 24 hours. It’s a pretty exciting day but you wouldn’t want to rush around like that every day for 100 years.

We may conclude that the pace of life that these creatures adopt is appropriate to their time on the planet. Which brings me to the matter of a recent afternoon at Old Street during which I came across 9 startups, 2 gyms, 2 cemeteries and 1 accelerator-program-demo-day.
First, bear in mind that the first person to live to 1000 has already been born according to professors of senescence (which of course is the science of ageing). You may scoff at this, but the claim that with every year that passes scientists discover how to add another year to our lifespan seems less far-fetched. In any event the predictions are in our favour – we will go on almost forever. Like the Galapagos tortoises and beyond.

In the meantime our businesses are trending in the other direction. Big businesses crumble at the edges as technology-driven startups take away large chunks of their market and margins. Airbnb is worth more than Sheraton. Uber is worth more than Boeing. Auto giants bite their nails as Apple, Google and Tesla plot their demise.

The mid-tier suffers even more. The average lifespan of an S&P 500 company has fallen from 67 years in the 1920s to 15 years today.

But what about the Old Street birthing pool? Most startups barely learn to walk before they go bust. This isn’t new. Starting a business was always a risky way to invest your time and money. But now there’s more of them. Lots more. The company CB Insights finds that most startups meet their maker 20 months after raising finance.

According to Thomas Bayes’ famous statistical theorem it ought to be possible to mitigate the probability of startup death by filtering for quality of ideas, management, product-market fit and so on. This is one of the reasons that the Demo Days of Accelerator programs are so well attended by investors.

Which brings us to the demo day of a program called “Entrepreneur First” which was held not one minute’s walk from Old Street roundabout. One after another, nine companies that had not even existed six months previously presented their jaw-dropping innovations in lightning three minute pitches. Every decent accelerator claims a USP. For Entrepreneur First it is that they select not companies but stupidly bright candidates (I went through a different program – so I may write oxymorons). Over six months the bright people met other bright people, formed teams, had an idea, started a business, created prototypes, tested them in the market, and now yelled their world-takeover dreams at startled investors and press in a firehose of adrenalin.

How many of these will succeed? No matter how great the founders, the ideas and the knowhow, the odds are against them. Thus the well-worn adage recommends that if at first you don’t succeed then try, try and try again. But I wonder, how many times can a startup founder hurl themselves at entrepreneurship with the necessary intensity. The longer they live, the faster businesses fail, the more often they will have to do this. A tortoise cannot live like a mayfly.

What I wondered will happen to the thousands of serial entrepreneurs who never reach financial escape velocity? The roundabout at the epicentre of the European startup vortex is full of them. How will they adjust to a different pace of life? They can’t all become columnists for business magazines.

I went for a slow walk to ruminate. It took me past the two large Gyms near the roundabout. Five minutes westward along Old Street you’ll find the recently revamped Ironmonger’s Baths. This, I learned, is built on a site that used to be one of the largest cemeteries in East London. That was when lives were short and businesses were so long they were inherited. \_
The other gym is a few minutes minutes south of the roundabout. Curiously, this is also next to a graveyard. It’s called Bunhill Fields, a name that has been squeamishly softened from the original, Bone Hill. Some 123,000 bodies are interred there.

Among the famous bodies to lie there is that of the statistician Thomas Bayes. He died aged 59 which was a long lifetime in 1761. Both his gravestone and his theorem tell us one thing: Everything ends. The number of human years may be rising but the number of business years is falling.

In the meantime go to the gym and if you’re a startup go to an accelerator program and improve your odds.

 

This is my November column for British Airways Business Life

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…which was when the drone passed by the pub

If you’ve lived and worked around Silicon Roundabout long enough, then you’ve seen it all. Or you think you have. Enough, anyway, that very few things garner so much as a raised eyebrow or that ultimate triumph of making strangers speak to each other out loud. This is London x 10. Londoners suspect anyone who is acting in an overtly different way of trying too hard. It’s a city of bewildering individuality and yet if something about your bearing even whispers, “Look at me”, then no one will. The harder you try to get attention, the more invisible you become.

Silicon Roundabout amplifies this trend because it lies in the heart of so much creativity. Fashion, media, advertising, TV, films and the startup epicentre of Europe are clustered around an ugly little gyratory. No startups can afford rent — at least no startups that are actually starting up — so everyone is forced to clash and rub along together in coworking spaces and among the coffee shops that proliferate and multiply like bugs.

Given your close proximity to someone who is trying to be the biggest thing in fashion, music, art or the next Uber, you block out everything. Those who bray too loudly and showily at Skype about the wondrousness of their particular thing are rewarded by a yawn.

And then a drone flew by.

It was gloriously sunny so I had come to one of the latest independent cafés to have launched that day. And the drone buzzed by our heads. This — a drone flying along a major London street at head height — I concede I had never seen before. Instinctively this felt unusual enough to merit at least an eyebrow raise. Maybe a comment. Should I turn to my neighbour and say something. Would I lose my Shoreditch pro status?

Some other thoughts: “Can a drone try too hard?” “Can an inanimate object itself be the recipient of kudos?”  And the biggest question of all: “Why?”

I kicked myself for such ignorance. Was Amazon running delivery trials around Old Street? If I knew for sure I could turn to the bearded, tattooed, unicycling guy next to me and yawn, “Amazon trial”, which trumps just saying, “Drone”. But that was all I had. Maybe a teen planned to snoop into people’s bedrooms (shake of the head, “Peeping Tom”) or an investment bank intended to photograph sensitive information through a lawyer’s window (“Tsk, corporate espionage”). The clock ticked.

In Silicon Valley the air is thick with technology. The only conversation is tech startups. There, they actually do know all about the latest drone trials. But Shoreditch doesn’t have the same mono-focus. So there could be a drone trial going on and quite legitimately you haven’t heard about it. Or it could be performance art. Or a fashion accessory. Or fintech.

I went for broke. I coughed, turned and micro-raised an eyebrow. And before I could say it, the be-bearded one pre-empted me. “Drone,” he said. I smiled like my condescending piano teacher used to, ostentatiously slurped my drink and resumed my posture of indifference.

Sixty seconds later, someone walked by, head down, transfixed and staring intently at their controller. This was the drone pilot. He was taking the drone for a walk.

I didn’t turn to my neighbour. And he didn’t say anything. We both knew that we had been bested by someone who wasn’t trying too hard.

Not long after this, and not surprisingly, the beard left. Ten minutes later the drone controller shuffled back and, curiosity winning the day, I asked him what he was doing: Mapping the streets? Making a movie? Working for Amazon?

“I’m trying to have an idea,” he said.

“That’s what I thought,” I nodded and retreated to my cold coffee. Damn.

It’s hard to keep up and that’s the point. That’s why the neighbourhood is an innovation growbag. While the rest of us think that even owning a drone and taking it for a walk down the street is in itself an “idea”, the next wave of startup founders (or artists) have realised that inspiration will be built on top of that idea. So they walk around the neighbourhood to invite serendipity and see what, sometimes literally, comes out of the air.

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Walking the drone

 

 

Some observations from a sunlit pub bench, while being buzzed by a drone:

“…This is London x 10. Londoners suspect anyone who is acting overtly different of trying too hard. It’s a city of bewildering individuality and yet if something about your bearing even whispers “Look at me” then no-one will. The harder you try to get attention the more invisible you become.

Silicon Roundabout amplifies this trend because it lies in the heart of so much creativity. Fashion, media, advertising, TV, films and the start up epicentre of Europe are clustered around an ugly little gyratory. No startups can afford rent – at least no startups that are actually _starting up_- so everyone is forced to clash and rub along together in co-working spaces and among the coffee shops that proliferate and multiply like bugs.”

This, of course, is my BA Business Life column for October:
BA Business Life October 2015

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Q: How to raise billions? A: Loudly

Some thoughts on how to sell your startup dreams to customers, partners and investors. From my September column for BA Business Life.

BA Business Life September 2015

 

 

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The art of speaking American

Because I tried so hard to bury the memories, the exact words are hard to remember now. It went pretty much like this: “Urgh. Diabolical. Are you kidding me?!”

There were a few weeks to go before the ten startups in our accelerator cohort had to stand on stage and pitch our respective businesses to a theatre of press and investors. My co-founders and I were in front of a pitch coach who had flown in from New York to add some polish to the presentations. We weren’t 15 seconds in before hostilities had commenced.

“YOU’RE COMPETING WITH THIS!” he yelled, waving his smartphone at us. “TRY AGAIN!”

It’s customary for such talks to start with a short narrative. Ours began something like: “In only twelve months since the…”

“STOP. WHAT AM I DOING? SEE? I’M LOOKING AT MY PHONE. IT IS MORE INTERESTING THAN YOU. START AGAIN.”

“In only twelve months…”

“PHONE. BORING. Try again.”

“In…”

“PHONE. BORED, BORED, BORED.”

We pretty much ploughed our own furrow after that. The demo day went OK and the press liked it. So I figured that the underlying problem was that the pitch coach was crazy and then I forgot about it.

Recently, however, I had an experience that made me view the episode differently. Armed with this new information I see that the real problem was that the pitch coach was American. Or let me be more specific: the real problem was that we weren’t American. This became apparent when I spent a session with a public speaking coach. After incremental progress during the day, Esther Stanhope, ex-BBC and very British, pulled out her secret coaching weapon: “Now do the whole thing again but do it in an American accent.”

All of a sudden, my voice hit new decibel levels and the windows shook. And the equivocation, conditional statements and uncertainties vanished.

“It happens all the time”, said Esther. “People suddenly start talking in a new language where everything is global, prospects are golden, fortunes are giant, success is guaranteed and doubt has left the world.”

This reflects my experience of working with European and US startups. American startups need only to possess half an idea to become drenched in Obama levels of oratorial confidence. The rest of us hesitate as we anticipate the holes in our arguments. This may seem trivial, but the idea that simply by speaking American you suddenly become louder, more confident and persuasive may have more bearing on startup success than at first seems likely.

Take this example of a US startup, which had successfully resolved a fundraising deadlock to get its business up and running. Each time founders presented their deck, the investors probed the numbers as you’d expect. They duly updated their deck with more detailed forecasts, ratios and market analysis in order to be better prepared. The next set of investors dived into these new details and asked for yet more details… and yet more. Data begat data. But it didn’t beget investment. So they took out all the numbers. The new presentation deck was exclusively about the promise and the vision. The investors were sold on this pitch and shortly afterwards, the company raised the money it needed.

“We realised,” they explained, “that the strength of investors is their left brain analysis of numbers. They are better at it than we are so they kept asking questions that we couldn’t answer. When we switched exclusively to vision, we were speaking to the right brain. Here we could explain the world as we saw it and our opportunity within it.”

Even the smartest, most cold-blooded investors are swayed by vision, confidence, determination and all those qualities that are touchy-feely, hard to measure and become apparent in the first few seconds of opening your mouth. And this is why it might be reasonable for a US startup pitch coach to recoil in horror as a non-American merely begins to speak. They know that it’s the dream and the conviction that raise the money.

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Your secret super power

Can robots be creative? And if they were would it count?

I don’t think so. As Seinfeld once explained: “People wanna see someone sweat”.

Here’s my mid-Summer column for British Airways’ Business Life magazine.

BA Business Life JulyAugust2015

 

 

 

 

 

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The creative potential of robots

A few years ago, someone chucked a laptop into a dumpster full of rubbish. Not long afterwards a married couple, walking past the dumpster at the end of their road, noticed the laptop bag. They took it home, checked it out and discovered it was a perfectly functional working computer, which had been chucked out because it had been superseded by something a bit newer and shinier.

This observation led to a discussion about the nature of society’s relationship with technology and the growing ignorance of tech by the people who use it. It seemed that if the technology wasn’t mediated by a touchscreen surface then it would be abandoned.

Bethany Koby and Daniel Hirschmann went on to found a company that seeks to address this ignorance. Technology Will Save Us makes DIY gadget-building kits that encourage kids to play with underlying technology and make tools using soldering irons, batteries, speakers and LED light bulbs. The business is another of Silicon Roundabout’s success stories. Its DIY game-making kit has been acquired by New York’s Museum of Modern Art and plays a key part in the BBC’s 2015 ambition to make Britain a digitally creative society.

Needless to say, the building of such a business is itself highly creative. And tech hubs such as Silicon Roundabout are bursting with such creativity. But not for long, warn the increasingly numerous doomsayers. Creativity will soon become the measured output of robots and algorithms. Humans will be surplus to requirements.

“Did you notice the music?” one such doomsayer asked me with a look of triumph ready to wash over his face. He’d been showing me a video about how robots can do absolutely everything that humans can do. It’s peculiar that someone should look so gleeful about such a thing. But unlike robots, people are deeply, inexplicably strange.

“Not really,” I said. “Exactly!” He replied and grinned horribly. “The background music to that video was written by a computer. And you didn’t even notice. See? Robots can even be creative. They’ll do startups next.”

This is known as Solutionism. It’s the giddy dream of engineers that with enough data everything can be quantified, measured, known, done, solved and explained.

And no doubt they can do an awful lot of very clever things that might appear to come from the realm of creativity. But an algorithm that might be able to process knowledge into an idea cannot actually live a life and have an idea that stems from a unique life experience.

Companies such as Technology Will Save Us are the product of personal experience and know-how. Without the pre-existing concern about the gap between technology and human experience, the abandoned laptop doesn’t become woven into the life history of a founder and spark a resonant chord that begins a business that has meaning. And without meaning, a business has no passion. And without passion, you’ll never get past the hard times.

On the subject of striking chords, consider this startup business. Music Orbit connects the world’s leading classical musicians with students. Suppose you live in Cornwall and want to have a tuba lesson with one of the world’s greatest tuba players, then Music Orbit will connect you so that you can have an online video lesson.

The founder, Nicole Wilson, was the principal violinist at the London Symphony Orchestra. And she also loved to give lessons and help new talent come through the ranks. But being a professional musician is a peripatetic existence and lessons are hard to arrange. But now students anywhere in the world can connect with the best musicians who may also be anywhere in the world. And the reason she knew this would work was because she’d spent many years as a professional musician who played and taught and had a passion for music.

Every startup tale I’ve ever come across has at its root a personal story that is absolutely unique to its founder. The fizzing synapses that join the ideas up, convert them into a business idea that has sufficient meaning and passion to the individual who will then commit to making the dream real are far beyond the scope of algorithms.

And here’s the thing about the robot music. I didn’t notice it and nor would you. It was mere chewing gum for the ears. It was rubbish.

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The transient hegemony of coders and my sense of inadequacy

My June column for British Airways Business Life.

Come on coders – hurry up and make your self redundant!
BA Business LifeJune15

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Breaking the code

A friend flew in from South America the other day. He’d come to Shoreditch with entrepreneurial ambition and the first thing he did was to go on a three-month course to brush up his coding skills. He’s not a programmer by training but, as you do these days, he’s learnt a bit here and there in the process of tinkering, setting up, maintaining and enhancing websites and databases. He picked up this know-how in the same way most people learnt to work with Microsoft Office programs.

Working with spreadsheets, word processing and photo-editing programs are for most of us a classic illustration of Pareto’s 80:20 rule — understanding 20 per cent of MS-Excel’s functionality lets you do 80 per cent of what you want to do with it. And, just as one generation learnt to use such work tools of the personal computer age at a basic level with little or no formal training, so a younger generation has been learning basic level coding skills.

The question is whether today’s entrepreneurial population can get by without going the full hard disk (as it were) and enrolling on a full-time coding course or studying computer science during formal education. And, needless to say, most entrepreneurs want to do more than ‘get by’. They want to excel.

So can you excel as an entrepreneur without being a coding whizz? I have a vested interest in this question. Despite a longstanding intention to get to grips with computer programming, I haven’t done what my friend is doing. If my acquaintances are representative, then there’s a large number of us non-programmer folk on the loose, all of whom feel a similar sense of inadequacy.

My secret hope is that the usability of technology will evolve so fast that it will overtake the need to sharpen my Palaeolithic coding skills. But for this to happen, technology will have to become so sophisticated that it creates its own wormhole through which its own extreme cleverness makes it beguilingly intuitive to use. I’m not talking about the everyday simplicity of the end-user experience — something that was conquered a long time ago — but about the possibility that company founders will be able to use technology to create businesses without being a Navy SEALS-level programmer. To be straight up about it, I’m clawing the air forlornly for technology- building-blocks-for-dummies.

Except that it’s not forlorn. Happily, I see possibilities in various mega-growth areas. In data there’s the company Import.io. The data-scraping startup, based in San Francisco and London, enables anyone to convert a website into its raw data as easily as you use a Google search bar. Just type a URL into its website and it will convert the website into rows and columns. This makes it a breeze to build big data sets to produce insights, competitor information, lead generation forms, market research without writing a line of code.

The same trend can be seen in the Internet of Things. Almost endless permutations of businesses can be constructed from the concept. For example, you might wear a bracelet that communicates with your connected house and ensures that lights are turned on or off, heating on or off and doors unlocked, all based on your own proximity.

And a company called SAMlabs has created technology that enables such functionality to be implemented without writing code. SAMlabs, based about a mile from Silicon Roundabout, has created a set of intelligent blocks about the size of a Lego brick. Some are sensors (eg light, heat, pressure) and others do things (eg motors, lights, sounds). The critical thing for programming refuseniks like me is that the controlling interface for the technology is a drag-and-drop, screen-based solution.

Even in the ubiquitous world of smartphone apps there are moves to make things easier. Last year Apple introduced Swift, a new coding language that is designed to simplify learning how to program on iPhones and iPads. It also launched an app, Swifty, full of simple tutorials and videos to encourage curious would-be coders to take the plunge. These examples suggest that a growing number of businesses — young and established — are betting on lots of startups creating value by using their technology in a way that doesn’t require coding medals of bravery.

Meanwhile my friend from South America is, without doubt, right to be deepening his skill base. But there’s still a place for those entrepreneurs whose core flair may be something other than coding. Phew.

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