Tag Archives: james fallows

‘Good a time as any’ for startups

24 Oct

James Fallows is offering ongoing takes on how venture capital firms are reacting to the financial crisis — a writer always worth following.  He’s previously posted a much-talked-about slide show by Sequoia Capital, essentially advising a batten down the hatches approach to running a startup.  This generated a response from by one of his readers, Alan Patricof, the managing director of the New York VC firm Greycroft Partners, quoted in full at Fallows’ blog, and excerpted below:

This is surely a time for companies to pay meticulous attention to detail, particularly their cost structure. It is a time to be realistic in their near term assumptions for revenue growth and take nothing for granted.

Raising additional capital to support operations is of course critical, as it is at any time, but this is particularly a time for young companies to be extra cautious in developing pragmatic assumptions of their needs and in focusing on the amount and not necessarily the cost of that capital.

This is not a time to panic, cut off all investment in the future, and burrow into a dark hole. Take a page from the packaged goods industry that the time to gain market share is during tough times when your competitors are weaker in responding. And while this may feel more directly related to portfolio companies, we as a venture industry should not retreat either. It is our strong belief that we can and will continue to make sound investments in excellent opportunities. It is as good a time as ever to start a company with sound fundamentals.

An approach that makes sense. As a communications and marketing consultant, I’ve long enjoyed working with enthusiastic, optimistic entrepreneurs with loads of big-picture ideas who nonetheless took a measured approach.  They invest in defining and positioning their brand, have clear objectives, and focus their communications on advancing strategies toward those objectives.

More, I think there’s something to this idea of money moving from exotic financial instruments toward ideas that make things — good ol’ fashioned ‘progress’.

How to Consume Political Commentary – 5 rules

3 Oct

I’m a pretty even-keeled guy, but political commentary is about the only thing that consistently gets me throwing things at the television and shouting at my laptop. After absorbing all the spin I could stomach, I thought I’d try to contribute something positive to the discussion.  Herewith, five guidelines for analyzing political commentary.

  • Ignore focus groups. Repeat after me:  “You cannot draw broad conclusions based on focus groups.” Even focus groups equipped with cute little dials that draw pretty lines that go up and down as people talk.  Every marketer knows this.  Talk to an experienced marketer about focus groups, and they roll their eyes.  They know how easy it is for a focus group to steer you wrong.
  • Ignore all political operatives. To pick on CNN specifically, I don’t understand what Paul Begala, Donna Brazile, Ed Rollins and that Republican ad-guy are doing on a panel.  They will give you their party’s line no matter what. They are ideologically committed to their parties’ ideals, and they are tribally committed to supporting their team.  When they talk, don’t listen.
  • On surveys, question the questions. It was great to get results of CNN’s instant opinion polls. But as with any survey research, the questions asked, their context and the audience is vitally important to broader understanding.  For example, 84% said Palin did better than expected … a result that tells much about the low level of expectations, and little about the quality of the performance.   51% say Biden wins … but how many say that winning a debate is important to them.  Similarly, Palin was seen by 54% as more “likable” than Biden (36% felt the opposite), which compares the two, but tells us nothing about whether or not they find Biden or Palin likable at all.    On the other hand, the result that 87 percent of those polled said Biden is qualified to be president, while 42 percent said Palin is qualified seems telling.
  • If someone’s doing real analysis, pay attention. I like sites like RealClearPolitics and FiveThirtyEight, that aggregate polls (though they’re in a bit of a tiff with each other over perceived bias in their poll choices). I’m a big fan of James Fallows of The Atlantic, who has for many years been watching and analyzing debate performances with almost scientific rigor; he delivers great insights in the magazine and on his blog.
  • On blogs, click the links. Just because you tend to agree with your favorite blogger, it’s important to “trust but verify.” Know who they’re quoting.  Does that person have any authority, or is the blogger just amplifying someone else’s uninformed opinion?  I’ve been following Andrew Sullivan’s blog lately.  It’s taken awhile to get a feel for his unique take … what he gets worked up about, where I think he goes too far … mostly by following up on his sources, which he helpfully provides.

It’s the only way to come to your own conclusions.

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