Agile Racecar: Software, Magic, and Life

... continued from "Milk Money for Meebo.com" I’d put the percentage equity that the VCs took for their $3.5 million at Meebo at a lot closer to 20% pre-money given how hot Meebo was (again, based on all the buzz about them on Sand Hill Road). Still, let’s assume 25% pre-money . That makes the pre-money valuation of the company 3.5 * 4 = $14M. In other words, Sequoia put in $3.5 million and got 25% of Meebo, putting the company’s value at $14M pre-money. After the investment, Meebo’s post-money valuation is $17.5M (i.e. 14 + 3.5, the value of the company + the cash). That means, Sequoia now owns 20% of Meebo, post-money. Like I said, that’s about the minimum any self-respecting VC firm in the Valley would like to hold in a startup after Series-A financing. And Sequoia is right up there with Kleiner-Perkins at the top of the VC hierarchy in the Valley. --- Note that at the other extreme of 40% post-money, Meebo’s post-money valuation $8.75M. That puts the pre-money ...

The Agile entrepreneur has a choice all too common these days. Implement it yourself. Or hire smart people for equity only- easier to do in the Silicon Valley than anywhere else (it's amazing what a single ad in Craigslist can do). Or pay young, super-smart programmers in India for a fraction of your monthly salary- you may not be able to afford it for a whole year, but we're talking about 3 weeks (i.e. iterations) here at a time. Regardless of the approach, practically every software entrepreneur in the US now has the ability to incrementally implement the features defined by the customer(s) , one iteration at a time. And get valuable feedback. And sooner or later, you'll have a paying customer as long as you stay true to the principles of Agile- "The Customer Is Always Right At The Beginning Of Each Iteration" (apologies to Sam Walton and Kent Beck:). Alternately, the customer(s) might realize soon enough and declare that the product doesn't have as mu...

Ok, so you've all heard zillions of quotes on success- and how to achieve it. Here's my take on it- that takes all extraneous factors and mind-games out of it, and puts the responsibility for success squarely on *your* shoulders: You can Choose to have an Excellent Reason for Failure; or You can Choose to Succeed It all depends on how much you want to succeed!