at tech crunch 50, the entrepreneurs that win/or want to be included cant pitch for weeks heading up to the event...is that not a cost.
the cost of exclusivity ?
it's an ok discussion, but pretty flawed arguments and ambigous
fredwilson
· 2 months ago
good critique on the exclusivity thing howard. i don't think that is a good policy either but just because Jason isn't perfect, it doesn't mean his point is wrong
Charlie Crystle
· 2 months ago
Jason isn't perfect, his overall point is right, but like anything it's nuanced. There should be no ban on pitching before ANY event. That restriction is about TechCrunch owning exclusivity on the media attention, not about the startups.
fredwilson
· 2 months ago
I'll call him on that. You are right
kidmercury
· 2 months ago
i agree howard, excellent point
fredwilson
· 2 months ago
You guys are jasin hatin' on this blog. I'm tempted to block you for that :)
kidmercury
· 2 months ago
well boss howard's insightful comment has been liked three times, sending it to the top of the comments....meanwhile jdawg remains silent and defenseless in response to howard's lethal blows.....you can call the TKO whenever you want boss, your blog so you are the ref, but i think it's safe to say howard won yet another round in this beef....damn
Mark Essel
· 2 months ago
All our bases are belong to Howard? (it's the old video menes that get stuck in my craw).
There is most certainly a shift in the way we judge businesses. No longer is it good enough to give terms and have a mutual agreement. Now we're condemning Jason for taking advantage of startups (even though appears to be defending them)
I'm on the open market side even though I lean heavily toward favoring startup founders if there is some leeway though.
I paid 2 bucks to Mahalo to have Jason respond why startups were paying an sizable entry fee to TC 50. Isn't that the same thing as paying to pitch?
Mark Essel
· 2 months ago
This is an area that has been market reviewed but becomes stronger by info spread (known scammers can't survive long under public light).
The finer aspects of cost and value need to be reviewed, especially when it pertains to a startups potential survival.
We're still a culture dominated by the motto, let the buyer beware. But at least we are quick to share info about folks that lie.
Depending on the situation, I might even pay for the opportunity to pitch. Certainly if I knew with confidence that the concept needed more than a minute or two to describe and "sell" to a reputable agency. I should be penalized with some cost if my pitch is a total waste of time. I think picking up a lunch tab is fair punishment :)
awaterman8
· 2 months ago
Much love to Stocktwits Howard, but as a TechCrunch 50 presenter in 2008 (www.emerginvest.com), I have to disagree!
Waiting an extra month or two to launch our product in front of tens of thousands of interested people was well worth it. We could've launched on our own schedule and fought to get anyone to notice. Instead we had 10,000+ hits in a few days plus interest from VCs, the press, Angels, firms in our space, etc..
Plus each team had two hours of pitching coaching from Jason Calacanis and Michael Arrington personally before TC50. Invaluable for first-time CEOs like me and really improved the quality of our pitches during the real thing on stage.... and FREE to us mind you.
The "cost" of giving exclusivity to Arrington and Jason on our launch was well worthwhile, and it was our choice beforehand to "pay." Many other TC50 companies I know agree with me here.
ShanaC
· 2 months ago
Look, one of the reasons you probably should not pay to play is really obvious-
You are hindering obvious connections from happening. One of the great things about stuff like the NYTech meetup, ect, is that people meet each otherm and start doing the stuff mentioned here naturally, and companies start pulling together naturally.
Pay to play prevents those sorts of refinements from happening. It laso means that the psychological growth from people pushing themselves for putting themselves out there is much higher. It's already hard to be an entrepreneur. It's harder if your barrier of entry is to pay, when it could be the random person whop is willing to read something. Paying could put ideas out of reach, when people are willing already to do this stuff. I don't get it...
fredwilson
· 2 months ago
great point Shana
ShanaC
· 2 months ago
Why can't I edit this one, but I can edit my other one on the page? So strange...
Mark Essel
· 2 months ago
It appears to be over punishment for fast typing. I pay dearly in grammar to phone comment, but it's a price that needs to be paid.
Keenan
· 2 months ago
This is interesting. This entire argument is based on perceived value OR/AND supply and demand. It makes "access" a market. VC's feel they can charge because they can provide access. Too many start-ups, not enough VC's drives this market.
The problem is this argument could be flipped upside down? In-demand properties could conceivably charge VC's to pitch them for the opportunity to invest. How much in fees could Twitter or Facebook have generated if they charged VC's for an opportunity to be considered as one of the firms with an opportunity to invest? Creating a market around access to investment on either side takes everyone's eyes off the ball.
The market shouldn't be the access. It should be the perception of the start-ups business.
JohnSharp
· 2 months ago
I think when it comes to "pay to pitch", there are some additional subtleties that need to be discussed.
Sometimes, the entrepreneur is not really serious about his stated intentions: he has no intention of taking on the fight he is proposing. Yes, not every entrepreneur pitching wants the money, or the advice. We are all aware, I'm sure, of examples of this - there are some people out there that, when pushed, will stop short of taking the final step. These "weekend rock stars" just want to be able to tell their friends they "gave it a shot."
I'm sure the same is sometimes true with investors as well - lack of sincere intent. How can an entrepreneur even know if the angel in front of them truly has the ability to invest? They may be out of investment dollars, but still want to appear to be in the game. There is no way for the entrepreneur to know.
If the investor does have money to invest, why the need for the fee? Any decent-sized investment outfit has a team of analysts in place (or at least one) for the purpose of protecting their principals from time-wasting business plans - and moving plans forward through due diligence. Investor has zero support staff? Don't waste your money on pitch fees.
The test for both sides is sincerity of purpose. If the entrepreneur is truly ready to take the risk and is willing to take investment and advice in support of building his enterprise, he should not have to pay to have his story heard. If an investor is truly in the business of investing, and has the capital and staff to support that activity, there should be no need to charge fees.
Note re coaching: I disagree with some of the comments re coaching. I think this can be money well-spent. There are some really, really smart people out there that are incapable of writing a business plan or setting pricing for their services - because their smarts lie more in the area of storage array design or protease inhibitor innovation. For these folks, paying an Excel jockey or a business coach may be the difference between being able to articulate a business and floundering in obscurity.
fredwilson
· 2 months ago
I'm with you on coaching. But there should be a 'rate the coach' website so entrepreneurs know who is good and who is not
Charlie Crystle
· 2 months ago
I agree there should be a public systematic way of rating coaches.
I've coached 7 founders this year, most for free. I can say I've done a good job with some, not as well with others. Some I didn't take on because they wanted me to run their companies or raise money for them. The ones I've charged get a great deal, and they continue to engage me to help guide them. Notably, they don't have boards, advisory boards, or partners...
JohnSharp
· 2 months ago
Agreed.
But what to do if some do are not able to judge the quality of the advice they are receiving,because of lack of experience... it may be the right advice but not what they want to hear.
Mark MacLeod
· 2 months ago
There is a rate the coach (or anyone else site). Linkedin. People with many, credible, referencable connections and recommendations are the ones you should go with.
fredwilson
· 2 months ago
Nice tip. Thanks!!
ShanaC
· 2 months ago
For the record- this kind of drama makes someone young (IE me) want to shy away. Most things in life should not be this complicated or heated. Think about it. You are having a discussion about how to sort out annoying people from not annoying people, and in the end it just comes down to shades of gray and nuance, with some really dark gray/black and some very light gray/white, and practically nothing in between.
Just lets all sit down, and say -we will not do business with asses. That's it.
mranon
· 2 months ago
Self-billed as ‘#1 European Internet event’, LeWeb, is charging the startups 1500 Euros to enter their startup competition and there is no explicit prize / promise of investment. This is no different that angels charging for their time... Surely by charging the startups they will be excluding the very ones that they should want to encourage- i.e. those that are good enough not to need to pay to pitch. For evidence of this, just look though the past winners- cant see any BIG names. This is really shortsighted because surely many of the attendees will be there to see the ‘20 best applicants’ and the eventual winner. This seems a great shame because otherwise the conference looks fab, the speakers list (below) is a veritable 'who's who' of the digital good and the great. I hope the organisers will right this wrong... and if they don't, perhaps the speakers and attendees will boycott or maybe Jason C will organise a competing event?
Speakers list:
Christopher J. Alden SixApart Ltd. Eric Archambeau Wellington Partners Michael Arrington TechCrunch AJ Asver Osama Bedier Gina Bianchini Ning Richard Binhammer Dell Violet Blue Lars Buttler Trion Jeff Clavier SoftTech VC Jennifer Corriero TakingITGlobal Thomas Crampton Jack Dorsey Twitter Timothy Ferriss Author Andrew Fisher Shazam Laura Fitton Steve Gillmor TechCrunchIT Louis Gray Baroness Susan Greenfield CBE Nick Halstead TweetMeme John Ham Ustream Brent Hoberman Mydeco Tony Hsieh Zappos.com Chad Hurley YouTube, Inc. Joi Ito Creative Commons Justin Kan Andrew Keen Dan’l Lewin Microsoft Marissa Mayer Google Ben Metcalfe Jack Moffitt Dave Morin Facebook Kimbal Musk Ouriel Ohayon Jeremiah Owyang Sean Percival Tsavo Media Chris Pirillo Shervin Pishevar SGN Steve Rubel Edelman Digital Christopher Sacca Robert Scoble Yossi Vardi Investor & Entrepreneur Martin Varsavsky FON Founder & CEO Gary Vaynerchuk
Loic Lemeur
· 2 months ago
this is inaccurate. LeWeb does not charge to "enter" the startup competition, we received hundreds of applications and they are all entered for free. The LeWeb ticket at normal price is 1,500 euros and we ask the companies selected to buy two passes at HALF price.
They get the entire event at half price as a participant and can demo their startups at no cost.
LeWeb costs more than a million euros to produce, barely breaks even and setting up a stage, a/v, wifi(! when it works ok) and a room for 2,000 people in Paris is a big deal, we believe we give a very fair deal. The startups benefit from the entire event and setup as a normal participant at half price, they get on stage for free.
I really don't see what's wrong with that, there is value in just participating at the event which we let them go to at a discount.
Some people won't understand that and will always want everything for free, that's fine, we could simply not put an event like this together with them.
Thousands of entrepreneurs come back every year and consider they get enough value for their money... Most US events cost twice as much to participate, do your research.
Loic Lemeur
· 2 months ago
having said that you just gave me one idea. We will offer the startups to pitch for free if the like, access LeWeb just for their presentation, or also buy a half price tickets for two full days.
Mr Anon
· 2 months ago
definitely a step in the right direction but consider that many participating startups would already be making a sizeable investment just by coming to paris...
i think at the very least the finalists should get their 1,500 eur back if they take up the half-price tickets.
should they be treated any differently from the regular speakers?
Aniq Rahman
· 2 months ago
You're being unfair to Loic. He came up with a pretty amicable solution in offering free passes to startups that are only pitching -- nobody is forcing any startup to come to Paris and you can't expect a conference to compensate a vacation (LeWeb is very much a startup itself - albeit very successful to date).
AlwaysON and DEMO, etc. charge startups and founders to pitch at their events -- they even call you many times and nag you with emails. I think that you should be more concerned with them. Loic/LeWeb is helping startups and provides a tremendous platform of visibility.
Mark Essel
· 2 months ago
Ah thanks for that outside perspective Aniq. I'm surprised a startup is forming around connecting investors with founders. Would have expected investors to host this type of "trade show" or conference.
Cost and value are such personally relevant measures it's a wonder we can agree on the price of anything. $10 to me is different than $10 to Fred, which is different than $10 to Bill Gates, yet regardless it still buys a movie ticket (almost).
jerome camblain
· 2 months ago
This debate on start-ups at Leweb is an interesting one and attacking the promoter is always easy. Although in my opinion LeWeb could even be split into two separate events: 1) the fund raising contest (Europe's got talent), that a small percentage of visitors join, mainly the smaller VCs who did not do their job around the presenting firms; and 2) the event itself which I enjoy, with various speakers, where most networking take place.
Loic Lemeur
· 2 months ago
it is not a fund raising contest. It is a startup competition which we had for years and which provides exposure to the startups to a very broad public, not pitching angels or VCs. There is a very large press coverage for example, many startups last year and the winners for sure got even featured on our "french CNN" LCI TV channel. LeWeb is much broader than pitching vcs and angels.
Tom Allason
· 2 months ago
quite a debate going on here and sounds reached a good compromise solution. if you are thinking about doing it for this year you might want to consider opening up the application for another few days to accommodate those start-ups that might not have applied due to the cost. i shouldn't be saying that since my start-up completed the application before the deadline! i do believe the whole conference will benefit from a higher caliber of applicants. hope to see you in paris!
Loic Lemeur
· 2 months ago
we received hundreds of applications, sorry for the startups who could not make the deadline, we have given plenty of advance notice.... we also need to organize everything
fredwilson
· 2 months ago
That's a great idea loic. A win/win for everyone
DaveinHackensack
· 2 months ago
"Some people won't understand that and will always want everything for free..."
The limits of Freeconomics/Freemium in action. There's something to be said for time-honored business practice of charging money for a product or a service.
csertoglu
· 2 months ago
This is going into interesting territory: the industry event. The events fulfill a purpose. I have never thought of them as paying-to-pitch, but it's certain that a startup that can budget for more events to attend would have a higher likelihood to have their pitch heard by investors they meet at the event.
Unlike LeWeb, European Tech Tour's selected companies are not required to pay to attend. However, if a company is not selected, then the only way they could attend would be to buy regular tickets.
I have to think a bit more about this... :)
Loic Lemeur
· 2 months ago
I don't think you're comparing events that can be compared in terms of costs...
Mr Anon
· 2 months ago
I am not questioning the greatness of the event or your commitment to it.
Having said that... no matter how you slice/dice, the fact remains that the cost for any startup that wants to enter your startup competition is 1,500 euros.
If the event costs 1m to put on, the 30k you get from the startups is relatively insignificant. they are providing you with the content for your conference... it seems like you are nickle and diming to charge these startups.
why not charge everyone else an extra 3%? you will not have scared off any of the cash-poor startups and will as a result end up with much better content...
out of curiousity... what do you charge the not so cash-poor speakers who are also providing the content that your conference is benefiting from?
Loic Lemeur
· 2 months ago
we are not charging any speaker and on the contrary some of them who don't have the means we fly them from around the world and take care of hotels etc. Unfortunately we can't do it for all. But as I said, your comment gave me an idea, we will make it free if startups just want to pitch and are not interested in the two day conference.
I am sorry but you are talking here about an event that takes a full year for @geraldine to put together and we finance it in person. For example we have put out of pocket 200 000 euros in advance to pay for the huge room in Paris, we are also entrepreneurs and we take a big risk with this. So while I agree in principle, I am tired of people that want everything for free. An event like LeWeb can simply not happen for free, I wish it could. We're doing a lot already, like very low tickets for students, which is a first this year. We're losing money on every single of them.
Mr Anon
· 2 months ago
i dont understand the rationale behind not charging speakers for tickets and indeed paying (expenses) for some... whilst at the same time you will charge your chosen startups for tickets. both groups are providing you with content. one is getting paid to provide (in kind) and the other is having to pay to provide. it just seems like a real double standard.
Loic Lemeur
· 2 months ago
Too bad you don't understand, I tried my best to explain.
Nigel Eccles
· 2 months ago
I back Loic up on this.
There is a difference between paying a fee to pitch a group of investors and paying to launch at a stage managed event like LeWeb, TechCrunch or DEMO. Those events have huge costs to consider.
In launching our first product, Hubdub, we spent $20,000 on DEMO. On both a PR and even a CPA basis it was well spent money. I'm glad we did it. Le Web at EUR 1.5k is a steal.
The issue isn't these events. It is so-called angel groups and consultants preying on desparate entrepreneurs.
Loic Lemeur
· 2 months ago
thank you Nigel, appreciate some support here!
aaronklein
· 2 months ago
most conferences have to pay the speaker to come, for crying out loud. to be honest, I've never heard of a conference that didn't pay every speaker's travel expenses.
the "Mr. Anon" name doesn't help the credibility of that complaint.
Tom Allason
· 2 months ago
I maybe wrong but I don't think Mr Anon's issue is around paying speakers...
I believe the salient point is that the speakers and selected startups together form the content for the event.
If you are paying speakers (entrance / travel expenses)- which it is undisputed you need to do to get them- then shouldn't you do the same for the 20 startups?
Keep in mind these are not arbitrary start-ups that want to pitch but they are the 20 that have been selected from the hundreds of applicants by Loic and his team before the event.
This argument's underlying assumption is that by not charging start-ups you would get better content (the same way that by not charging speakers gets you better speakers). i.e. you would not put off the start-ups that couldn't afford or wouldn't pay to pitch.
It also assumes that there is parity among the content i.e. that the visitors are there for the start-ups as well as for the speakers (and community). I have not yet attended le web and so cannot comment on this. Although perhaps the two are linked... i.e. if top start-ups applied then people would come for them. This also assumes that top-startups aren't already applying.
I am not in a position to determine whether these assumptions are valid. It sounds like Loic has plenty of startups willing to pay (mine included) due to the added value (exposure) that comes with presenting at le web. The proof will clearly be in the pudding.
Either way this is a hypothetical- it is clearly too late for this year and it sounds like Loic has come up with an excellent solution for next year. I think it is a credit to him that he showed this flexibility and pragmatism- and demonstrates the success of the medium he is supporting... Vive le web!
Mr Anon
· 2 months ago
Sorry to clarify, it does not cost you 1,500 euro to enter the event... it will cost you 1,500 to take up your spot if you are selected in the final 20.
Jeff Pester
· 2 months ago
Yes, the answer is to A) Increase the conference fee by 50-100 euros for all but the startups chosen to present (and I guess the speakers that you're comping) and/or B) Find a "we covered the costs for the presenting startups" sponsor, if that's what it takes to put on the event. It's too late to increase the fee for this year but maybe someone like Union Square would be willing to be the White Knight sponsor for the presenting startups :) That's a cherry sponsorship!
I like Loic very much and have heard very good things about the event, but the argument that begins "The startups benefit from the entire event and ....." is the same justification that all the events that charge startups to present use.
This seems like a problem that can be fixed tout de suite.
Loic Lemeur
· 2 months ago
Jeff, I would love your help to find a sponsor that cover all the startup participation costs and would be happy to talk to anyone you have in mind, indeed it is a great solution, we have not found anyone for that.
Jeff Pester
· 2 months ago
Loic, I don't have any ideas for you for this year's event given the late date - I think Fred probably has as good a suggestion list for this year as anyone state-side. I really do think it's a great opportunity for some smart sponsor(s), especially given the growing attention/momentum the subject is getting. Best of luck!
fredwilson
· 2 months ago
Let me jump in here and defend Loic. He and his wife have funded LeWeb every year and are taking huge personal financial risk largely to bring silicon valley style networking to europe. I think we should be celebrating what they are doing not critiquing it. That said, this thread has given Loic an idea about how to give startups a better deal and that's a good thing too
Jeff Pester
· 2 months ago
Fred, hope neither you nor Loic interpreted my comment as critique. Agree that what he's doing is important (and often under-appreciated) work.
Was simply offering a thoughtful suggestion re the sponsorship, etc. Sounded like Loic found it an interesting/worthwhile idea. Full steam ahead :)
Mark Essel
· 2 months ago
That all makes sense, but it leads me to believe solid startups are better served by building a great core business, and doing it transparently so that investors can find them. There are plenty of avenues to connect with potential investors, why pay to be in a lower signal to noise auditorium full if other presenters and funders who may not even listen to your pitch (burst processing of listening to pitches has to cost venture partners valuable attention span).
Charging a reasonable fee to cover costs of any event is more than fair though. I'm sorta torn on this issue. Do we need the conferences to get good pitches? If we do then it's part of the solution (it may push presenters psychologically to produce something more appealing to investors).
fredwilson
· 2 months ago
i'll talk to Loic about this and get to the bottom of this. LeWeb is a great event and I attended last year and will be there this year.
The Angel groups in the UK are getting to wise to the coming backlash and have now began to re-lable their Pitch Fees, as Pitch Training Fees. (doing the 'training' is obviously made mandatory).
On the pro-side at least new entrepreneurs can use the pitching fees as a quick litmus test to see whether the angel group is bona-fide and worth the effort of pitching. - If they have any kind of upfront fees - dont even bother.
Really, somebody must have blogged about this years ago. Here's something from my post:
"As I've suspected for a long time, he and a lot of VCs don't think very highly of companies that use agents or brokers. It says to them you don't have the drive, ambition, and curiosity to find and pitch VC yourself. And that likely means you don't have the drive, ambition, and curiosity to push you company the way it needs to be pushed to get from seed stage to exit."
The VC I'm referring to is top tier early stage (not Fred).
Fred--on success fees: I've consulted to a number of startups, a few of which wanted to pay success fees. I don't sell myself as an agent or someone who can raise money for them--they have to raise the money them selves. I can coach them, shape their pitches, provide a list of VCs to call, but I won't raise the money for them because 1) it's not my company and 2) getting a term sheet and closing a deal is too dependent on them. I could develop and work a deal that tanks on a clause in the term sheet and I'll never get paid, despite my high-quality, occasionally entertaining contributions.
I think it's critical for the VC and startup industry to kill the myths that the paid agents put out there.
It's also critical to rate and differentiate the various paid startup/VC conferences, where VCs sit on panels and listen to pitches from paying startups. There are things like Demo (more corporate than startup these days), TC50 (better for startups), and Fundingpost (I think it's a good way to learn how to pitch but not the only way), and then this email I keep getting from a Mike Segal, who charges 9k to present at the Yale Club in front of a few hundred VCs, many of whom have no interest looking at your startup in the first place.
Adeo's work has been somewhat helpful as well at the funded, but I find the reviews of VCs often skewed and without decent context.
We need more transparency and perhaps even regulation. I can't imagine paying an Angel group, some of which are not more than social clubs with low rates of investment and low rates of success. I can, however, imagine them paying me for taking the time to entertain them. I'll even play a tune if that will cover my costs.
btw-i've started another software company. consulting to startups as a startup guy just makes you want to do the startup thing again, and the pay's lousy :). For lousy pay I might as well do my own thing again ;)
fredwilson
· 2 months ago
can you do both the consulting and startup thing at the same time Charlie?
Charlie Crystle
· 2 months ago
I don't currently have a choice. MR is profitable but I'm illiquid.
Might be an interesting blog topic: should privately held, illiquid but profitable startups help their founders start the next thing?
DaveinHackensack
· 2 months ago
Why not sell some of your stake via Second Market or a similar outfit?
Charlie Crystle
· 2 months ago
maybe. maybe existing investors. Had Sun only not dropped 98%...
DaveinHackensack
· 2 months ago
I had a stock I own drop 90% this year, and now it's back above where I bought it. So you never know...
Charlie Crystle
· 2 months ago
well, this is a bit different. Cobalt acquired my company, Sun acquired Cobalt. Back in 2000. Chart since then:
Funny enough, I once received a business plan in my inbox from someone involved with Keiretsu Forum -- after talking with this individual about building a very similar application. Another reason to steer clear of these types of organizations.
Michael Dizon
· 2 months ago
Also surprised FundingPost didn't make the list. They've been at it since the early 2000's. I'll admit to getting suckered into paying for one of their conferences, but I wasn't old enough to drink yet. :)
sburkett
· 2 months ago
We've been screaming about (and fighting this problem) this for years. My thoughts - FWIW:
Fred, all good points. I wonder if some of the same criteria should also apply to VCs? The GP takes a management fee from the LPs... and the 2 & 20 standard for fund management is conceptually not so very different from the fee & commission standard in other fields. One could in fact argue that the GP is actually an agent also, on a certain level, just like an angel group organizer or a placement agent. The difference being mainly one of control, although this too is a matter of degree and can vary.
fredwilson
· 2 months ago
The difference being that the VC is not charging the penniless entrepreneurs.
I understand the irritation over the huge fees VCs earn.
Fund sizes should be small so the VCs can only get rich on carry, not fees
dan_DTE
· 2 months ago
Agreed on all counts. It's a matter of degree, I guess, and affordability. Still, I don't know if the question of initial fees for angel organizers and agents is one of getting rich as much as paying for working capital, which is similar to even small VCs. I don't know that any such groups - angel groups, agents, small VCs - could keeping doing what they do purely pro bono. If it's agreed that they each provide something of value, then there has to be a way for them to not be shut down on economics.
hardaway
· 2 months ago
In the ten years we've been investing in and consulting to startups we have seen many who have been sucked in by intermediaries. Right now, when someone comes to me saying "can you help me get money for my startup" I say no 99% of the time and go on to tell them there is no money for companies that a)aren't companies b)don't have anything but an idea. We tell them not to waste time looking for money but to go out and build something or get a real team together.
We are sometimes given a success fee as a board position with some equity attached that takes many years to become liquid, and we certainly never charge and always advise our startups not to present anywhere that charges or pay anyone a fee. We don't pay our speakers for the Arizona Entrepreneurship Conference and we allow people to pitch, launch for nothing, too. The people who attend the conference pay to attend. And yes, Loic, we also barely break even and it's all on our nonprofit foundation to put the conference on --a big risk every year. You are right about that.
For the conference, now the largest in Arizona, our goal is to charge as little as possible to as few people as possible, and still come out with enough money to run our programs for disadvantaged entrepreneurs. I'm trying to develop an ecosystem here, not make money off entrepreneurs.
stone
· 2 months ago
Everyone benefits from these presentations. Investors get to see what's happening in the marketplace. Entrepreneurs get to meet someone new. If they don't like the idea they should avoid the pitch. If they are not sure about the idea they should ask for more information and only take meetings they view as potential investments.
The idea of charging seems ugly and is not something I've ever encountered personally.
fredwilson
· 2 months ago
Me neither stone, but apparently it is very common, even here in NYC
Name
· 2 months ago
Before I state my observation - Fred, the following is not an indictment of you or your firm (at least not aware of any participation from you guys at USV). So dont get upset with what follows.
NOW to what I really wanted to say - "Yes, you heard that correctly: the rich people (angels) are charging the poor people (startup entrepreneurs desperate for cash to fuel their dreams) to hear their pitch. No, I’m not kidding. This is actually happening — and it’s widespread." - Jason Calacanis.
REALLY? Wait hold the phone - breaking news from Calacanis (who spent his early years in NYC startup world).
Fred - this crap has been going on since the late 1999/2000 - and quite a bit in NYC. And here is more breaking news for Jason. VCs - YES, VCs are part of the panels at these pay to play breakfast type functions. In fact I have a receipt for one such scam in 2003 where I was invited and only to find out after I left the carnival that I owed these clowns $XXX to sit in from of a Jerry Springer Audition Panel. Of course I told them to stick it where the sun don't shine - and that was the last time I heard from these buffoons. The panel was soo bad - I shut down my computer in half the time - and could not wait to just leave the room. They called me up unsolicited through mutual contacts with the invitation - and worse yet it was hosted at one of the top law firms in NYC. I won't mention the names of the VC that sat on that panel - not worth it.
Maybe some of the VCs on these panels are not aware of the shennigans behind the scenes - but you would think they show some discretion as to the people they choose to sit down with at these functions.
The sample "reputable scam" usually has a few members in the band - in particular a law firm of prestige, and someone who is "of counsel" to the firm (as in I rent my desk at the law firm - but they don't really care I exist).
ENOUGH SAID.
fredwilson
· 2 months ago
can you list the names of the events in NYC that do this? i will promise you that nobody from USV will ever participate in them again (and I think you are right that we don't participate in them now either)
i just want to make sure we aren't participating in this crap
Name
· 2 months ago
Fred - rather not mention names - but a suggestion - give them your USV checklist to (that included a box for "pay for play" type shennigans - maybe even post that list on your blog) - and you can sort them out in a minute or so. I would also caution the entrepreneurs to check out the "name throwing" by these organizers. They all seem to know at least "one person" on your wish list of investors - and being that it is a small world out there - a ping to these "funders/VCs" is usually a good way to call out the lies. And, in many cases it seems these organizers usually have an newcomer in the VC world as a panelist "associate types" who fall for these forums (can't blame them for though for tyring to seek out the deals). cheers -
fredwilson
· 2 months ago
Got it. Good advice
JLM
· 2 months ago
I have been in the money game --- primarily as a consumer in the institutional real estate markets --- for a big chunk of a century. The best advice I have ever been given was --- "Network like hell and never, ever get mad at the money. The money will ultimately find the good deals. Work on your deal."
I cannot tell you the number of personal and professional kindnesses I have been afforded by being in the network with pension funds, major banks, brokerages, high net worth individuals, the LBO boys, etc. I have returned the favors through the years and have always made it a point to express my gratitude even if it was only a note and a bottle of wine.
Every industry has its predators who attempt to take advantage of what in the end is a simple secret --- folks who inventory money, only inventory money. Their job is to invest money and you are simply helping them to do their job. In the VC biz today, they also provide a meaningful level of coaching, expertise and contacts but it all starts and ends with leveraging their money.
Sure there are some critical personal skills (like being a PPT or Excel wizard or being able to hit a low soft draw LOL) that are useful in telling your story but in the end, investors invest in people and only then invest in their deal.
The single most important decision you will ever make is with whom to do business --- customers, partners, employees and yes, VCs. Ooops, wives are much more important!
The same guy told me that on the day you close the deal, imagine how it might be to "work out" a failure with the guy sitting across the table from you. Think it through.
Stay clear of the blood suckers.
fredwilson
· 2 months ago
Way clear
chrisco
· 2 months ago
Indeed. A lot of scamming, at pitch time, and, even more rampantly, at term sheet time, when they try to tell you that this carrot for them or stick for you is "standard."
startup lawyer
· 2 months ago
This is an interesting debate -- there are all sorts of people who live in the startup ecosystem and make money from it. Perhaps the dividing line could be whether the person charging for the service also has the possibility of making money from the startup later. For example, if you run a conference that provides some value to startups but you are not an investor, you should be entitled to charge (and they can make their own decision about whether to pay to attend). On the other hand, if you are charging someone to attend so they can pitch and you have the chance to invest and make money later, then you shouldn't charge.
I've been a practicing startup lawyer for 10 years. Since we defer fees on startups, we are like a super-angel in that we have "investments" in many startups, the majority of which will inevitably fail. We therefore have to have some filter on who we bring in as a client, and so we often meet with them before consummating the relationship. I can't imagine charging those startups for that meeting (nor could I see them paying for it). But many hundreds of thousands of dollars of free legal advice has been doled out at these meetings and the hundreds of networking events that we attend. That's just the price of admission to the ecosystem. We make our money advising the client as they get more mature and have various legal needs, including exit transactions. Anyone that thinks they can make real money nickel and diming startups at the early stages is in the wrong business.
fredwilson
· 2 months ago
We all do it Ree. Lots of free advice is doled out to entrepreneurs by service providers, and VCs are just another service provider to the entrepreneur. You have to date before you get married and soliciting free advice is a great way for an entrpreneur to 'date'
JLM
· 2 months ago
In Austin, TX one of the most successful start up and intellectual property lawyers I have ever met --- based on actual billings, mind you --- used to and still does write a series of case studies and white papers which essentially provide a road map of many of the legal pitfalls of entrepreneurship, start ups, deal structures and venture capital. His writing is fair, unbiased and does not attempt to impose "his" solution. They are greatly educational. He used his website to disseminate this information and was known as a guy who would have lunch and spend an hour with anybody --- anybody!
Some of the deals he snagged were world class and ended up creating a client relationship which lasted forever and which tapped all the practice areas of his firm from real estate to securities to trust work. He was a real rainmaker.
At his core, he was simply a nice guy who figured he had to eat lunch every day anyway why not help some aspiring guy get a helping hand.
To this day I still see him at our favorite restaurant listening to, nodding along with and coaching some young entrepreneur.
There is a huge difference between being a skillful lawyer and being a valued counselor.
startup lawyer
· 2 months ago
Great, sounds like we're all in agreement on this one.
fredwilson
· 2 months ago
That is how I want to approach business JLM. Its the best way
Jason McCabe Calacanis
· 2 months ago
Actually, the fact that folks have to launch for the first time on stage and can't do pre-PR is the reason why TechCrunch50 has become such a huge hit.
The press realizes there is an open playing field for coverage, and the seats are PACKEd from start to finish because people want to know "what's gonna come next?!?!!"
It's an entertainment thing... we like to keep people on the edge of their seat. I understand why some folks might not understand this, but it is our secret sauce to be honest.
fredwilson
· 2 months ago
I refuse to go to TC50 Jason for this and other reasons like disallowing any company that has already launched. Its a media event but it sucks for entrepreneurs and VCs
awaterman8
· 2 months ago
Fred, with respect for your own reasons to avoid TC50 as a VC, I have to stick up for @Jason here as a TechCrunch 50 company myself.
Reason: You can't underestimate how hard it is to get on the radar of a VC like you. With the clutter of startups trying to pitch to you, understandably you have to filter based on a founder's reputation, your own network, the company's location (NYC, SV, etc.), its prior market traction, and other factors other than just raw potential of the startup at time of its launch. TechCrunch 50 gives first-time CEOs a chance to cut through these factors that would usually work against them, to be recognized for their idea and execution so far. The result is that we get "onto the map" and noticed by VCs who might have never known about us because of factors out of our control.
I agree startups that *recently* launched are penalized here just because their launch didn't coincide with the TC50 application schedule -- meanwhile a few TC50 companies are quite well funded and post-revenue but get in through loopholes like "launching a new product."
But letting into TC50 too many startups who already with PR coverage, market traction, VC funding (or connections to VCs like you), would really change the whole point of it. It'd take away its value as "leveling the playing field" and entrepreneur-discovery which we startups desperately crave. It would be like letting pros into the olympics, American Idol, So You Think You Can Dance, etc.
fredwilson
· 2 months ago
That's bullshit. You are on my radar right now.
This is the web. Use the medium to get noticed
Not old school events that are just clones of DEMO which also sucks
vanelsas
· 2 months ago
I'm going to defend Fred here, not that he needs it ;-)
I've had the chance to sit down with him before, and this happened because he isn't sitting in some ivory tower. I've found Fred to be accessible and willing to take the time to hear me out. As an entrepreneur you will always need a good pitch to get attention from others (including investors). If you have a good story people will open up for you.
awaterman8
· 2 months ago
Just to clarify Fred -- I certainly see just how accessible you are and didn't mean to imply you're not. I'm a big fan of avc. The fact that you respond to my comment on a week-old blog post is actually pretty amazing.
My point is more general about getting VC financing. Getting noticed is simple, but getting funded is not so easy. The funding market is damn competitive and not perfectly efficient at the seed stage, especially in the last year.
I did raise money -- but I was helped enormously by TechCrunch 50. I got a dozen VC meetings with people I met at the conference who would not have known about us otherwise, plus another dozen investor pitches because of the signalling value of "TechCrunch 50" alone. (But I sure didn't stop there and rest on any TC50 laurels.)
fredwilson
· 2 months ago
I get it. That's helpful. It turns out the reason you like it is the reason I avoid it
Kevin Marshall
· 2 months ago
Where do you come in on something like AngleSoft for this type of debate? If I'm not mistaken, start-ups are charged for access, but you could argue it's for 'software use' as much as for access to the network of Angels...
I've never chased any funding, and hopefully never will have to, so I really know nothing about the funding world...I just sort of watch fascinated from the outside (which is one of the reasons I enjoy your blog so much).
fredwilson
· 2 months ago
I don't like charging startups/entrepreneurs. They are the raw material of the ecosystem. Without them, all of us leeches would have nothing
davidsrose
· 2 months ago
Kevin, just to clarify, Angelsoft provides the dealflow management software for the majority of legitimate angel groups (both in the US and worldwide). For this, we charge neither the groups nor entrepreneurs, so if you apply for funding to one of the majority of legitimate groups that don't charge an application fee, then there's no cost to you. If a group elects to charge application fees we simply collect it for them, much like Eventbrite collects ticket sales for events. No one is ever forced to pay Angelsoft anything.
We do offer, purely as an option, the ability for entrepreneurs to directly post an application in the Open Deals area of the system, which is the place that angel groups themselves use to share deals for syndication. The cost for this is $250 for 30 days, which is fully described and disclosed up front. The Open Deals area is accessible by all 20,000 angels using the platform, who can browse or search for opportunities there, and then bring a company into their group for further screening. Since that $250 goes to Angelsoft, and not the group, it's not a case of pay-to-pitch. It's simply our compensation for having spent five years creating a platform that has aggregated 20,000 investors in one place. If a company believes the additional exposure is worth it, they can elect to make use of the option, but neither we nor any angel group forces them to do so.
Our goal all along has been to try to use technology to improve the whole early stage funding ecosystem, and we think we've done a pretty good job. Above all, we are completely transparent about every single thing on the platform, from the fees we charge, to the statistical results of companies and groups using the system. Indeed, we do everything we can to urge the angel groups themselves to be completely transparent, opening up their own statistics to entrepreneurs (for an example, check out the detailed stats at http://angelsoft.net/angel-group/new-york-angels).
In the months ahead, we'll be releasing some extremely cool features to help entrepreneurs with the whole funding process. They'll have nothing to do with access, but everything to do with efficiency, information, transparency and effectiveness. If we're on target, then we hope companies will be happy to pay us for the use of the tools. If we're not, then people won't use them, and we'll have to go back to the drawing board.
The bottom line on all this is that the whole early stage funding arena is still wildly inefficient, and (because of the dollars and desperation involved) inescapably attractive to sleazy and semi-sleazy operators. I'm a firm believer that the best antidote to that is lots of sunlight, which is why we'll continue our single-minded push for transparency on all sides.
-David S. Rose, CEO, Angelsoft
Kevin Marshall
· 2 months ago
David,
Thanks for the clarification. Believe me, as a software developer, I understand the need to charge for all the work that went into building and maintaining the platform...and that's what I was under the impression the $250 was for (but great to hear about some of the other options too).
I was just curious as to what the perception of AngleSoft by most start-ups is as it relates to the idea of pay-to-pitch...since it seems like that's still one of the biggest hurdles you guys have to get over (the perception vs. the reality)...but for whatever it's worth, I've heard good stuff about Angelsoft from the few people I know that have used it...so keep up the great work!
I agree, Fred, and I don't buy the "screening" purpose that these fees could putatively play in selecting "serious" start-ups. The most precious commodity entrepreneurs have is time, and the best way to weed out those who aren't serious is to ask logical, easily-answered questions about technology, or competition, or markets, and ask for the least bit of data to support it. I get contacted a lot by HR and human capital start-ups, and it is indeed revealing how efficient this stratagem is in discouraging those with half-baked ideas and half-willed efforts.
Don Jones - VentureDeal
· 2 months ago
Totally agree with this. One potential good side effect of this is that it will cause Angel groups to increase their member dues, thus weeding out the wannabe investors and/or service providers from the real investors.
mikemcgrath
· 2 months ago
I see no difference between this and sites like Angelsoft, who consolidate VC/Angel info and then charge for the honor to be visible to them, when an e-mail would have done the same thing. Some investors now make it mandatory to submit a business plan through them.
davidsrose
· 2 months ago
Mike, I actually see a pretty significant difference. It's one thing for 'investors' to make money by asking companies to pay them for the privilege of pitching. It's another thing for a third-party company to invest a great deal of time and effort to develop a platform which enables a startup to reach out to 20,000 investors in 500 organized groups and VC funds. If you honestly believe that "an email would do the same thing", then I will be the first to tell you that you absolutely, positively should send an email, and not use Angelsoft's Open Deals option.
But just to clarify, no investor (or Angelsoft itself) "makes it mandatory" to pay Angelsoft anything at all for any reason. If you apply to one of the 500 angel angel groups that uses Angelsoft to process their deal flow, Angelsoft doesn't charge either you or the group. The ONLY thing you would be charged for is whatever the group itself charges as an application fee.
The existence and amount of such fees is certainly a fair subject for discussion, as Fred and Jason have been doing, but they have nothing at all to do with Angelsoft, which simply process the credit card charges for the group, much like Eventbrite or other payment systems.
I hope that helps clarify things.
-David S. Rose, CEO, Angelsoft
ghawk17
· 2 months ago
I've done some work with an angel group that uses Angelsoft for applications from entrepreneurs. I think it is a great tool process the dealflow in that kind of a group. Entrepreneurs do not have to pay anything unless they want to. After submitting applications to a certain number of angel groups (I believe 5), additional submissions become "Bulk" submissions - just to let the angel group know that this entrepreneur may be blasting submissions to every group. But all the entrepreneurs we've dealt with have found it pretty easy to use and definitely free.
fredwilson
· 2 months ago
I agree that charging the entrepreneur is not a great model
CJ Cornell
· 2 months ago
I absolutely agree with Jason - particularly about the consultants and brokers who promise (directly or indirectly) a path to funding. The fee-charging Angels and brokers are easy to spot in any of the Silicon Valley-like areas, but they are rampant all over the country (and I suspect, the world) - where eager, naive, funding-desperate bootstrapped startups don't have much choice. The practice is often more sophisticated, and the fee charging more subtle but no less destructive, under the guise of incubators, seminars, paid advisers, board members and Interim-executives. All of these are legitimate services in other circumstances, but are often offered to entrepreneurs who don't know the difference between legit and scam.
In many other instances, venture capitalists, associates, and angels are simply not accessible: Postponed meetings, unreturned phone calls etc. Often the only way the entrepreneur can ever get on their radar is to pitch at an event where the investor is a judge. These events almost always have fees, however disguised in clever semantics, and the effect is the same: Entrepreneurs have to pay for access. All of the rational sounding reasons are meaningless to the entrepreneur: It costs money see the investor. And it's not just one event - they have to pitch many times at many venues.Most investors forget (or never knew) what it is like to be bootstrapped and seeking funding.
This process discourages (often permanently) an otherwise promising young entrepreneur. Arguments about how the "real" entrepreneurs should persevere despite discouragement are valid - but it is worth noting how much easier things are near Sand Hill Road with 3,000 other doors to knock on. For entrepreneurs outside the major hubs - a single Angel group can represent 95% of the startup funding in his/her region. Is it any wonder they can charge fees?
There is a reasonable amount of agreement here about fees, which is nice. I strongly suspect, however, that this discussion is like the dark times before "TheFunded" - where only a few brave and anonymous entrepreneurs would dare comment - for fear of being branded naive or difficult - particularly on their feelings about Techcrunch50, Demo etc.
It doesn't help nowadays that investors and conference organizers are often also top bloggers and tweeters. Not many entrepreneurs would want to risk challenging "the process" for fear they'd be branded unfundable. Now that a generation of entrepreneurs has become successful investors themselves - from Marc Andreessen to the former Paypal founders, along with a few notable and sympathetic VCs - we may see the last of these manipulative practices.
Lee Diamond @StartupAgents
· 2 months ago
Please do not confuse Fred's use of startup agents with the company StartupAgents. There is no relationship between the two.
StartupAgents aims to helps startups build their team and is free for both startup and talent to sign-up, during the beta.
fredwilson
· 2 months ago
I certainly did not mean to imply your company with those words
William Mougayar
· 2 months ago
Wow, that's a pretty dynamic discussion. I've also seen VC events that pitch entrepreneurs to pay for presenting (they pitched me), e.g. this one http://www.youngstartup.com/newyork09/overview.php , dubbed "The 2009 NY Venture Summit", and included some respectable VC names. So, that practice is not entirely restricted to angels and agents,- although in the above case VC's are brought in, but are not the organizers. I think there is enough transparency, social media and open channels in the market for VCs, Angels and Entrepreneurs to find each other without staging each encounter. If VCs/Angels are the ones holding the purses, they should be the ones bearing the largest cost.
I'd like to see an event where entrepreneurs are chosen to present purely on the merits of their accomplishments and ventures status, and are invited to do so at "no-charge" whatsover.
ADstruc
· 2 months ago
Agreed - thanks Fred for voicing your opinion on this!
John ADstruc www.adstruc.com Building an online marketplace for outdoor advertising.
Steve GLANGE
· 2 months ago
Dear Mr Wilson,
I agree with you on organisations charging entrepreneurs for pitching in view to make money BUT our Angel network charges EUR 150 as an administrative fee in order to make sure that the entrepreneurs are committed as beforehand we had some no-shows as well as entrepreneurs not sincere.
So YES it is bad to charge for pitching in view to make a profit.
Best,
fredwilson
· 2 months ago
Well that is little different. There are many meetups that charge $10 to make sure someone is really coming.
I guess it just comes down to when is a fee a revenue source and when is it a sign of committment to show up?
ghawk17
· 2 months ago
I was going to ask about this - what do you think of angel groups charging entrepreneurs for their variable costs (food, etc.) associated with attending the event?
Vijay
· 2 months ago
Even for Business Plan competition we have to pay , take a look
Eligibility The WPI Venture Forum Business Plan Contest is open to technology-based, pre-start, startup, and on-going businesses located in the Northeast. Students are eligible. The venture must involve the development of a new product, a new application, or process in an existing business or the start-up of a new technology-based business.
Upon receipt of application and accompanying executive summary, applicants that meet the criteria compete through three rounds of judging – First Round, Semi Finals, and Final Competition. Those advancing beyond the first round are eligible for coaching and mentoring.
Deadline, Application and Fee Applications and executive summaries are due by 5:00 P.M. Friday, October 9, 2009. The contest fee is $50.00 which should be submitted at the time of application. Mailing instructions are on the downloadable contest application. Application and Executive Summary may be emailed to ventureforum (at) wpi.edu. If emailing the application, please call 508-831-5075 about entry fee payment options. Collecting Fees to participate in BP competition as well , strange
fredwilson
· 2 months ago
Well $50 might not be a lot to complain about. There is some admin cost to do these
Mark Essel
· 2 months ago
Tear those scam artists schemes apart by publicly sharing their identities. I stand by transparency as a means to eliminating the obfuscation of trickery.
Great work by Jason, hope founders share knowledge of any and all shady groups like this. My brother went through a similar music distributor scam. Many aspiring artists fall prey to false promises, and knowledge of their practices has helped minimize casualties.
Jim
· 2 months ago
TechCrunch charges an appearance fee for the Demo Pit. Since you have to be approved and invited to the Demo Pit, why isn't that free? The charge in 2008 was $2,000 to appear in Pit.
Jason Bean
· 2 months ago
I have no personal experience with venture capital and getting a startup off the ground, but I think making startups "invest" in the pitch shouldn't be a requirement. Be selective on what you're willing to invest in and who to listen to and just go from there.
Scott Edward Walker
· 2 months ago
As a corporate attorney representing entrepreneurs, I generally agree in principle with Jason’s position that it is “inappropriate and predatory” for angel groups to charge entrepreneurs fees to pitch them; however, I think it is important to distinguish among the different angel groups and their respective practices. Indeed, if (i) the fees are reasonable/de minimis and are adequately disclosed and (ii) the angel group is providing a legitimate service to entrepreneurs, there may be compelling reasons to support such a fee-based service. That’s why I have strongly recommended in my recent blog post (see http://bit.ly/hAYeu) that Jason Calacanis and John Dilts (the founder and President of Maverick Angels, LLC and an attorney) meet face-to-face and have a live debate (in the great American tradition), which can be shown on the web to all interested parties via Ustream. Many thanks.
fredwilson
· 2 months ago
Love this comment on many levels
awaterman8
· 2 months ago
Much love to Stocktwits Howard, but as a TechCrunch 50 presenter in 2008 (www.emerginvest.com), I have to disagree!
Waiting an extra month or two to launch our product in front of tens of thousands of interested people was well worth it. We could've launched on our own schedule and fought to get anyone to even notice. Instead we got 10,000+ hits in a few days plus interest from VCs, the press, Angels, firms in our space, etc. whom we would have struggled to reach on our own.
Plus each team had two hours of pitching coaching from Jason Calacanis and Michael Arrington personally before TC50. Invaluable for first-time CEOs like me and really improved the quality of our pitches during the real thing on stage.... and FREE to us mind you. Not to mention being invited for free back to TechCrunch 50 2009 in the alumni demo pit.
The "cost" of giving exclusivity to Arrington and Jason on our launch was well worthwhile, and it was our choice beforehand to "pay." Many other TC50 companies I know agree with me here.
(Sorry mistaken duplicate post here...was meant as reply to Howard's at the top...can't figure out how to delete this copy.)
fredwilson
· 2 months ago
Yeah but you'll never get to some VCs that way. Its a huge turnoff to me, for example. I believe you should launch when you are ready and waiting for an event like TC50 is a bad idea
DaveinHackensack
· 3 weeks ago
The Atlantic's David Indiviglio is on the case now: Paying to Pitch.
All Comments
the cost of exclusivity ?
it's an ok discussion, but pretty flawed arguments and ambigous
policy either
but just because Jason isn't perfect, it doesn't mean his point is wrong
(it's the old video menes that get stuck in my craw).
There is most certainly a shift in the way we judge businesses. No longer is it good enough to give terms and have a mutual agreement. Now we're condemning Jason for taking advantage of startups (even though appears to be defending them)
I'm on the open market side even though I lean heavily toward favoring startup founders if there is some leeway though.
I paid 2 bucks to Mahalo to have Jason respond why startups were paying an sizable entry fee to TC 50. Isn't that the same thing as paying to pitch?
The finer aspects of cost and value need to be reviewed, especially when it pertains to a startups potential survival.
We're still a culture dominated by the motto, let the buyer beware. But at least we are quick to share info about folks that lie.
Depending on the situation, I might even pay for the opportunity to pitch. Certainly if I knew with confidence that the concept needed more than a minute or two to describe and "sell" to a reputable agency. I should be penalized with some cost if my pitch is a total waste of time. I think picking up a lunch tab is fair punishment :)
Waiting an extra month or two to launch our product in front of tens of thousands of interested people was well worth it. We could've launched on our own schedule and fought to get anyone to notice. Instead we had 10,000+ hits in a few days plus interest from VCs, the press, Angels, firms in our space, etc..
Plus each team had two hours of pitching coaching from Jason Calacanis and Michael Arrington personally before TC50. Invaluable for first-time CEOs like me and really improved the quality of our pitches during the real thing on stage.... and FREE to us mind you.
The "cost" of giving exclusivity to Arrington and Jason on our launch was well worthwhile, and it was our choice beforehand to "pay." Many other TC50 companies I know agree with me here.
You are hindering obvious connections from happening. One of the great things about stuff like the NYTech meetup, ect, is that people meet each otherm and start doing the stuff mentioned here naturally, and companies start pulling together naturally.
Pay to play prevents those sorts of refinements from happening. It laso means that the psychological growth from people pushing themselves for putting themselves out there is much higher. It's already hard to be an entrepreneur. It's harder if your barrier of entry is to pay, when it could be the random person whop is willing to read something. Paying could put ideas out of reach, when people are willing already to do this stuff. I don't get it...
The problem is this argument could be flipped upside down? In-demand properties could conceivably charge VC's to pitch them for the opportunity to invest. How much in fees could Twitter or Facebook have generated if they charged VC's for an opportunity to be considered as one of the firms with an opportunity to invest? Creating a market around access to investment on either side takes everyone's eyes off the ball.
The market shouldn't be the access. It should be the perception of the start-ups business.
Sometimes, the entrepreneur is not really serious about his stated intentions: he has no intention of taking on the fight he is proposing. Yes, not every entrepreneur pitching wants the money, or the advice. We are all aware, I'm sure, of examples of this - there are some people out there that, when pushed, will stop short of taking the final step. These "weekend rock stars" just want to be able to tell their friends they "gave it a shot."
I'm sure the same is sometimes true with investors as well - lack of sincere intent. How can an entrepreneur even know if the angel in front of them truly has the ability to invest? They may be out of investment dollars, but still want to appear to be in the game. There is no way for the entrepreneur to know.
If the investor does have money to invest, why the need for the fee? Any decent-sized investment outfit has a team of analysts in place (or at least one) for the purpose of protecting their principals from time-wasting business plans - and moving plans forward through due diligence. Investor has zero support staff? Don't waste your money on pitch fees.
The test for both sides is sincerity of purpose. If the entrepreneur is truly ready to take the risk and is willing to take investment and advice in support of building his enterprise, he should not have to pay to have his story heard. If an investor is truly in the business of investing, and has the capital and staff to support that activity, there should be no need to charge fees.
Note re coaching: I disagree with some of the comments re coaching. I think this can be money well-spent. There are some really, really smart people out there that are incapable of writing a business plan or setting pricing for their services - because their smarts lie more in the area of storage array design or protease inhibitor innovation. For these folks, paying an Excel jockey or a business coach may be the difference between being able to articulate a business and floundering in obscurity.
I've coached 7 founders this year, most for free. I can say I've done a good job with some, not as well with others. Some I didn't take on because they wanted me to run their companies or raise money for them. The ones I've charged get a great deal, and they continue to engage me to help guide them. Notably, they don't have boards, advisory boards, or partners...
But what to do if some do are not able to judge the quality of the advice they are receiving,because of lack of experience... it may be the right advice but not what they want to hear.
Just lets all sit down, and say -we will not do business with asses. That's it.
Speakers list:
Christopher J. Alden SixApart Ltd.
Eric Archambeau Wellington Partners
Michael Arrington TechCrunch
AJ Asver
Osama Bedier
Gina Bianchini Ning
Richard Binhammer Dell
Violet Blue
Lars Buttler Trion
Jeff Clavier SoftTech VC
Jennifer Corriero TakingITGlobal
Thomas Crampton
Jack Dorsey Twitter
Timothy Ferriss Author
Andrew Fisher Shazam
Laura Fitton
Steve Gillmor TechCrunchIT
Louis Gray
Baroness Susan Greenfield CBE
Nick Halstead TweetMeme
John Ham Ustream
Brent Hoberman Mydeco
Tony Hsieh Zappos.com
Chad Hurley YouTube, Inc.
Joi Ito Creative Commons
Justin Kan
Andrew Keen
Dan’l Lewin Microsoft
Marissa Mayer Google
Ben Metcalfe
Jack Moffitt
Dave Morin Facebook
Kimbal Musk
Ouriel Ohayon
Jeremiah Owyang
Sean Percival Tsavo Media
Chris Pirillo
Shervin Pishevar SGN
Steve Rubel Edelman Digital
Christopher Sacca
Robert Scoble
Yossi Vardi Investor & Entrepreneur
Martin Varsavsky FON
Founder & CEO
Gary Vaynerchuk
They get the entire event at half price as a participant and can demo their startups at no cost.
LeWeb costs more than a million euros to produce, barely breaks even and setting up a stage, a/v, wifi(! when it works ok) and a room for 2,000 people in Paris is a big deal, we believe we give a very fair deal. The startups benefit from the entire event and setup as a normal participant at half price, they get on stage for free.
I really don't see what's wrong with that, there is value in just participating at the event which we let them go to at a discount.
Some people won't understand that and will always want everything for free, that's fine, we could simply not put an event like this together with them.
Thousands of entrepreneurs come back every year and consider they get enough value for their money... Most US events cost twice as much to participate, do your research.
i think at the very least the finalists should get their 1,500 eur back if they take up the half-price tickets.
should they be treated any differently from the regular speakers?
AlwaysON and DEMO, etc. charge startups and founders to pitch at their events -- they even call you many times and nag you with emails. I think that you should be more concerned with them. Loic/LeWeb is helping startups and provides a tremendous platform of visibility.
of "trade show" or conference.
Cost and value are such personally relevant measures it's a wonder we can agree on the price of anything. $10 to me is different than $10 to Fred, which is different than $10 to Bill Gates, yet regardless it still buys a movie ticket (almost).
Although in my opinion LeWeb could even be split into two separate events: 1) the fund raising contest (Europe's got talent), that a small percentage of visitors join, mainly the smaller VCs who did not do their job around the presenting firms; and 2) the event itself which I enjoy, with various speakers, where most networking take place.
for years and which provides exposure to the startups to a very broad
public, not pitching angels or VCs. There is a very large press coverage for
example, many startups last year and the winners for sure got even featured
on our "french CNN" LCI TV channel. LeWeb is much broader than pitching vcs
and angels.
not make the deadline, we have given plenty of advance notice.... we
also need to organize everything
The limits of Freeconomics/Freemium in action. There's something to be said for time-honored business practice of charging money for a product or a service.
Unlike LeWeb, European Tech Tour's selected companies are not required to pay to attend. However, if a company is not selected, then the only way they could attend would be to buy regular tickets.
I have to think a bit more about this... :)
Having said that... no matter how you slice/dice, the fact remains that the cost for any startup that wants to enter your startup competition is 1,500 euros.
If the event costs 1m to put on, the 30k you get from the startups is relatively insignificant. they are providing you with the content for your conference... it seems like you are nickle and diming to charge these startups.
why not charge everyone else an extra 3%? you will not have scared off any of the cash-poor startups and will as a result end up with much better content...
out of curiousity... what do you charge the not so cash-poor speakers who are also providing the content that your conference is benefiting from?
I am sorry but you are talking here about an event that takes a full year for @geraldine to put together and we finance it in person. For example we have put out of pocket 200 000 euros in advance to pay for the huge room in Paris, we are also entrepreneurs and we take a big risk with this. So while I agree in principle, I am tired of people that want everything for free. An event like LeWeb can simply not happen for free, I wish it could. We're doing a lot already, like very low tickets for students, which is a first this year. We're losing money on every single of them.
There is a difference between paying a fee to pitch a group of investors and paying to launch at a stage managed event like LeWeb, TechCrunch or DEMO. Those events have huge costs to consider.
In launching our first product, Hubdub, we spent $20,000 on DEMO. On both a PR and even a CPA basis it was well spent money. I'm glad we did it. Le Web at EUR 1.5k is a steal.
The issue isn't these events. It is so-called angel groups and consultants preying on desparate entrepreneurs.
the "Mr. Anon" name doesn't help the credibility of that complaint.
I believe the salient point is that the speakers and selected startups together form the content for the event.
If you are paying speakers (entrance / travel expenses)- which it is undisputed you need to do to get them- then shouldn't you do the same for the 20 startups?
Keep in mind these are not arbitrary start-ups that want to pitch but they are the 20 that have been selected from the hundreds of applicants by Loic and his team before the event.
This argument's underlying assumption is that by not charging start-ups you would get better content (the same way that by not charging speakers gets you better speakers). i.e. you would not put off the start-ups that couldn't afford or wouldn't pay to pitch.
It also assumes that there is parity among the content i.e. that the visitors are there for the start-ups as well as for the speakers (and community). I have not yet attended le web and so cannot comment on this. Although perhaps the two are linked... i.e. if top start-ups applied then people would come for them. This also assumes that top-startups aren't already applying.
I am not in a position to determine whether these assumptions are valid. It sounds like Loic has plenty of startups willing to pay (mine included) due to the added value (exposure) that comes with presenting at le web. The proof will clearly be in the pudding.
Either way this is a hypothetical- it is clearly too late for this year and it sounds like Loic has come up with an excellent solution for next year. I think it is a credit to him that he showed this flexibility and pragmatism- and demonstrates the success of the medium he is supporting... Vive le web!
I like Loic very much and have heard very good things about the event, but the argument that begins "The startups benefit from the entire event and ....." is the same justification that all the events that charge startups to present use.
This seems like a problem that can be fixed tout de suite.
Was simply offering a thoughtful suggestion re the sponsorship, etc. Sounded like Loic found it an interesting/worthwhile idea. Full steam ahead :)
Charging a reasonable fee to cover costs of any event is more than fair though. I'm sorta torn on this issue. Do we need the conferences to get good pitches? If we do then it's part of the solution (it may push presenters psychologically to produce something more appealing to investors).
event and I attended last year and will be there this year.
On the pro-side at least new entrepreneurs can use the pitching fees as a quick litmus test to see whether the angel group is bona-fide and worth the effort of pitching. - If they have any kind of upfront fees - dont even bother.
Really, somebody must have blogged about this years ago. Here's something from my post:
"As I've suspected for a long time, he and a lot of VCs don't think very highly of companies that use agents or brokers. It says to them you don't have the drive, ambition, and curiosity to find and pitch VC yourself. And that likely means you don't have the drive, ambition, and curiosity to push you company the way it needs to be pushed to get from seed stage to exit."
The VC I'm referring to is top tier early stage (not Fred).
Fred--on success fees: I've consulted to a number of startups, a few of which wanted to pay success fees. I don't sell myself as an agent or someone who can raise money for them--they have to raise the money them selves. I can coach them, shape their pitches, provide a list of VCs to call, but I won't raise the money for them because 1) it's not my company and 2) getting a term sheet and closing a deal is too dependent on them. I could develop and work a deal that tanks on a clause in the term sheet and I'll never get paid, despite my high-quality, occasionally entertaining contributions.
I think it's critical for the VC and startup industry to kill the myths that the paid agents put out there.
It's also critical to rate and differentiate the various paid startup/VC conferences, where VCs sit on panels and listen to pitches from paying startups. There are things like Demo (more corporate than startup these days), TC50 (better for startups), and Fundingpost (I think it's a good way to learn how to pitch but not the only way), and then this email I keep getting from a Mike Segal, who charges 9k to present at the Yale Club in front of a few hundred VCs, many of whom have no interest looking at your startup in the first place.
Adeo's work has been somewhat helpful as well at the funded, but I find the reviews of VCs often skewed and without decent context.
We need more transparency and perhaps even regulation. I can't imagine paying an Angel group, some of which are not more than social clubs with low rates of investment and low rates of success. I can, however, imagine them paying me for taking the time to entertain them. I'll even play a tune if that will cover my costs.
btw-i've started another software company. consulting to startups as a startup guy just makes you want to do the startup thing again, and the pay's lousy :). For lousy pay I might as well do my own thing again ;)
Might be an interesting blog topic: should privately held, illiquid but profitable startups help their founders start the next thing?
http://bit.ly/ByYEk
http://bit.ly/k48w
Cheers.
Scott
I understand the irritation over the huge fees VCs earn.
Fund sizes should be small so the VCs can only get rich on carry, not fees
We are sometimes given a success fee as a board position with some equity attached that takes many years to become liquid, and we certainly never charge and always advise our startups not to present anywhere that charges or pay anyone a fee. We don't pay our speakers for the Arizona Entrepreneurship Conference and we allow people to pitch, launch for nothing, too. The people who attend the conference pay to attend. And yes, Loic, we also barely break even and it's all on our nonprofit foundation to put the conference on --a big risk every year. You are right about that.
For the conference, now the largest in Arizona, our goal is to charge as little as possible to as few people as possible, and still come out with enough money to run our programs for disadvantaged entrepreneurs. I'm trying to develop an ecosystem here, not make money off entrepreneurs.
The idea of charging seems ugly and is not something I've ever encountered personally.
NOW to what I really wanted to say -
"Yes, you heard that correctly: the rich people (angels) are charging the poor people (startup entrepreneurs desperate for cash to fuel their dreams) to hear their pitch. No, I’m not kidding. This is actually happening — and it’s widespread." - Jason Calacanis.
REALLY? Wait hold the phone - breaking news from Calacanis (who spent his early years in NYC startup world).
Fred - this crap has been going on since the late 1999/2000 - and quite a bit in NYC. And here is more breaking news for Jason. VCs - YES, VCs are part of the panels at these pay to play breakfast type functions. In fact I have a receipt for one such scam in 2003 where I was invited and only to find out after I left the carnival that I owed these clowns $XXX to sit in from of a Jerry Springer Audition Panel. Of course I told them to stick it where the sun don't shine - and that was the last time I heard from these buffoons. The panel was soo bad - I shut down my computer in half the time - and could not wait to just leave the room. They called me up unsolicited through mutual contacts with the invitation - and worse yet it was hosted at one of the top law firms in NYC. I won't mention the names of the VC that sat on that panel - not worth it.
Maybe some of the VCs on these panels are not aware of the shennigans behind the scenes - but you would think they show some discretion as to the people they choose to sit down with at these functions.
The sample "reputable scam" usually has a few members in the band - in particular a law firm of prestige, and someone who is "of counsel" to the firm (as in I rent my desk at the law firm - but they don't really care I exist).
ENOUGH SAID.
i will promise you that nobody from USV will ever participate in them again
(and I think you are right that we don't participate in them now either)
i just want to make sure we aren't participating in this crap
I cannot tell you the number of personal and professional kindnesses I have been afforded by being in the network with pension funds, major banks, brokerages, high net worth individuals, the LBO boys, etc. I have returned the favors through the years and have always made it a point to express my gratitude even if it was only a note and a bottle of wine.
Every industry has its predators who attempt to take advantage of what in the end is a simple secret --- folks who inventory money, only inventory money. Their job is to invest money and you are simply helping them to do their job. In the VC biz today, they also provide a meaningful level of coaching, expertise and contacts but it all starts and ends with leveraging their money.
Sure there are some critical personal skills (like being a PPT or Excel wizard or being able to hit a low soft draw LOL) that are useful in telling your story but in the end, investors invest in people and only then invest in their deal.
The single most important decision you will ever make is with whom to do business --- customers, partners, employees and yes, VCs. Ooops, wives are much more important!
The same guy told me that on the day you close the deal, imagine how it might be to "work out" a failure with the guy sitting across the table from you. Think it through.
Stay clear of the blood suckers.
I've been a practicing startup lawyer for 10 years. Since we defer fees on startups, we are like a super-angel in that we have "investments" in many startups, the majority of which will inevitably fail. We therefore have to have some filter on who we bring in as a client, and so we often meet with them before consummating the relationship. I can't imagine charging those startups for that meeting (nor could I see them paying for it). But many hundreds of thousands of dollars of free legal advice has been doled out at these meetings and the hundreds of networking events that we attend. That's just the price of admission to the ecosystem. We make our money advising the client as they get more mature and have various legal needs, including exit transactions. Anyone that thinks they can make real money nickel and diming startups at the early stages is in the wrong business.
Some of the deals he snagged were world class and ended up creating a client relationship which lasted forever and which tapped all the practice areas of his firm from real estate to securities to trust work. He was a real rainmaker.
At his core, he was simply a nice guy who figured he had to eat lunch every day anyway why not help some aspiring guy get a helping hand.
To this day I still see him at our favorite restaurant listening to, nodding along with and coaching some young entrepreneur.
There is a huge difference between being a skillful lawyer and being a valued counselor.
The press realizes there is an open playing field for coverage, and the seats are PACKEd from start to finish because people want to know "what's gonna come next?!?!!"
It's an entertainment thing... we like to keep people on the edge of their seat. I understand why some folks might not understand this, but it is our secret sauce to be honest.
Reason: You can't underestimate how hard it is to get on the radar of a VC like you. With the clutter of startups trying to pitch to you, understandably you have to filter based on a founder's reputation, your own network, the company's location (NYC, SV, etc.), its prior market traction, and other factors other than just raw potential of the startup at time of its launch. TechCrunch 50 gives first-time CEOs a chance to cut through these factors that would usually work against them, to be recognized for their idea and execution so far. The result is that we get "onto the map" and noticed by VCs who might have never known about us because of factors out of our control.
I agree startups that *recently* launched are penalized here just because their launch didn't coincide with the TC50 application schedule -- meanwhile a few TC50 companies are quite well funded and post-revenue but get in through loopholes like "launching a new product."
But letting into TC50 too many startups who already with PR coverage, market traction, VC funding (or connections to VCs like you), would really change the whole point of it. It'd take away its value as "leveling the playing field" and entrepreneur-discovery which we startups desperately crave. It would be like letting pros into the olympics, American Idol, So You Think You Can Dance, etc.
This is the web. Use the medium to get noticed
Not old school events that are just clones of DEMO which also sucks
I've had the chance to sit down with him before, and this happened because he isn't sitting in some ivory tower. I've found Fred to be accessible and willing to take the time to hear me out. As an entrepreneur you will always need a good pitch to get attention from others (including investors). If you have a good story people will open up for you.
My point is more general about getting VC financing. Getting noticed is simple, but getting funded is not so easy. The funding market is damn competitive and not perfectly efficient at the seed stage, especially in the last year.
I did raise money -- but I was helped enormously by TechCrunch 50. I got a dozen VC meetings with people I met at the conference who would not have known about us otherwise, plus another dozen investor pitches because of the signalling value of "TechCrunch 50" alone. (But I sure didn't stop there and rest on any TC50 laurels.)
I've never chased any funding, and hopefully never will have to, so I really know nothing about the funding world...I just sort of watch fascinated from the outside (which is one of the reasons I enjoy your blog so much).
We do offer, purely as an option, the ability for entrepreneurs to directly post an application in the Open Deals area of the system, which is the place that angel groups themselves use to share deals for syndication. The cost for this is $250 for 30 days, which is fully described and disclosed up front. The Open Deals area is accessible by all 20,000 angels using the platform, who can browse or search for opportunities there, and then bring a company into their group for further screening. Since that $250 goes to Angelsoft, and not the group, it's not a case of pay-to-pitch. It's simply our compensation for having spent five years creating a platform that has aggregated 20,000 investors in one place. If a company believes the additional exposure is worth it, they can elect to make use of the option, but neither we nor any angel group forces them to do so.
Our goal all along has been to try to use technology to improve the whole early stage funding ecosystem, and we think we've done a pretty good job. Above all, we are completely transparent about every single thing on the platform, from the fees we charge, to the statistical results of companies and groups using the system. Indeed, we do everything we can to urge the angel groups themselves to be completely transparent, opening up their own statistics to entrepreneurs (for an example, check out the detailed stats at http://angelsoft.net/angel-group/new-york-angels).
In the months ahead, we'll be releasing some extremely cool features to help entrepreneurs with the whole funding process. They'll have nothing to do with access, but everything to do with efficiency, information, transparency and effectiveness. If we're on target, then we hope companies will be happy to pay us for the use of the tools. If we're not, then people won't use them, and we'll have to go back to the drawing board.
The bottom line on all this is that the whole early stage funding arena is still wildly inefficient, and (because of the dollars and desperation involved) inescapably attractive to sleazy and semi-sleazy operators. I'm a firm believer that the best antidote to that is lots of sunlight, which is why we'll continue our single-minded push for transparency on all sides.
-David S. Rose, CEO, Angelsoft
Thanks for the clarification. Believe me, as a software
developer, I understand the need to charge for all the work that went
into building and maintaining the platform...and that's what I was
under the impression the $250 was for (but great to hear about some of
the other options too).
I was just curious as to what the perception of AngleSoft by most
start-ups is as it relates to the idea of pay-to-pitch...since it
seems like that's still one of the biggest hurdles you guys have to
get over (the perception vs. the reality)...but for whatever it's
worth, I've heard good stuff about Angelsoft from the few people I
know that have used it...so keep up the great work!
- Kevin
http://blog.botfu.com
But just to clarify, no investor (or Angelsoft itself) "makes it mandatory" to pay Angelsoft anything at all for any reason. If you apply to one of the 500 angel angel groups that uses Angelsoft to process their deal flow, Angelsoft doesn't charge either you or the group. The ONLY thing you would be charged for is whatever the group itself charges as an application fee.
The existence and amount of such fees is certainly a fair subject for discussion, as Fred and Jason have been doing, but they have nothing at all to do with Angelsoft, which simply process the credit card charges for the group, much like Eventbrite or other payment systems.
I hope that helps clarify things.
-David S. Rose, CEO, Angelsoft
In many other instances, venture capitalists, associates, and angels are simply not accessible: Postponed meetings, unreturned phone calls etc. Often the only way the entrepreneur can ever get on their radar is to pitch at an event where the investor is a judge. These events almost always have fees, however disguised in clever semantics, and the effect is the same: Entrepreneurs have to pay for access. All of the rational sounding reasons are meaningless to the entrepreneur: It costs money see the investor. And it's not just one event - they have to pitch many times at many venues.Most investors forget (or never knew) what it is like to be bootstrapped and seeking funding.
This process discourages (often permanently) an otherwise promising young entrepreneur. Arguments about how the "real" entrepreneurs should persevere despite discouragement are valid - but it is worth noting how much easier things are near Sand Hill Road with 3,000 other doors to knock on. For entrepreneurs outside the major hubs - a single Angel group can represent 95% of the startup funding in his/her region. Is it any wonder they can charge fees?
There is a reasonable amount of agreement here about fees, which is nice. I strongly suspect, however, that this discussion is like the dark times before "TheFunded" - where only a few brave and anonymous entrepreneurs would dare comment - for fear of being branded naive or difficult - particularly on their feelings about Techcrunch50, Demo etc.
It doesn't help nowadays that investors and conference organizers are often also top bloggers and tweeters. Not many entrepreneurs would want to risk challenging "the process" for fear they'd be branded unfundable. Now that a generation of entrepreneurs has become successful investors themselves - from Marc Andreessen to the former Paypal founders, along with a few notable and sympathetic VCs - we may see the last of these manipulative practices.
StartupAgents aims to helps startups build their team and is free for both startup and talent to sign-up, during the beta.
I've also seen VC events that pitch entrepreneurs to pay for presenting (they pitched me), e.g. this one http://www.youngstartup.com/newyork09/overview.php , dubbed "The 2009 NY Venture Summit", and included some respectable VC names.
So, that practice is not entirely restricted to angels and agents,- although in the above case VC's are brought in, but are not the organizers.
I think there is enough transparency, social media and open channels in the market for VCs, Angels and Entrepreneurs to find each other without staging each encounter. If VCs/Angels are the ones holding the purses, they should be the ones bearing the largest cost.
I'd like to see an event where entrepreneurs are chosen to present purely on the merits of their accomplishments and ventures status, and are invited to do so at "no-charge" whatsover.
John
ADstruc
www.adstruc.com
Building an online marketplace for outdoor advertising.
I agree with you on organisations charging entrepreneurs for pitching in view to make money BUT our Angel network charges EUR 150 as an administrative fee in order to make sure that the entrepreneurs are committed as beforehand we had some no-shows as well as entrepreneurs not sincere.
So YES it is bad to charge for pitching in view to make a profit.
Best,
I guess it just comes down to when is a fee a revenue source and when is it a sign of committment to show up?
http://www.wpiventureforum.org/Contest/instruct...
Eligibility
The WPI Venture Forum Business Plan Contest is open to technology-based, pre-start, startup, and on-going businesses located in the Northeast. Students are eligible. The venture must involve the development of a new product, a new application, or process in an existing business or the start-up of a new technology-based business.
Upon receipt of application and accompanying executive summary, applicants that meet the criteria compete through three rounds of judging – First Round, Semi Finals, and Final Competition. Those advancing beyond the first round are eligible for coaching and mentoring.
Deadline, Application and Fee
Applications and executive summaries are due by 5:00 P.M. Friday, October 9, 2009. The contest fee is $50.00 which should be submitted at the time of application. Mailing instructions are on the downloadable contest application. Application and Executive Summary may be emailed to ventureforum (at) wpi.edu. If emailing the application, please call 508-831-5075 about entry fee payment options.
Collecting Fees to participate in BP competition as well , strange
Great work by Jason, hope founders share knowledge of any and all shady groups like this. My brother went through a similar music distributor scam. Many aspiring artists fall prey to false promises, and knowledge of their practices has helped minimize casualties.
Waiting an extra month or two to launch our product in front of tens of thousands of interested people was well worth it. We could've launched on our own schedule and fought to get anyone to even notice. Instead we got 10,000+ hits in a few days plus interest from VCs, the press, Angels, firms in our space, etc. whom we would have struggled to reach on our own.
Plus each team had two hours of pitching coaching from Jason Calacanis and Michael Arrington personally before TC50. Invaluable for first-time CEOs like me and really improved the quality of our pitches during the real thing on stage.... and FREE to us mind you. Not to mention being invited for free back to TechCrunch 50 2009 in the alumni demo pit.
The "cost" of giving exclusivity to Arrington and Jason on our launch was well worthwhile, and it was our choice beforehand to "pay." Many other TC50 companies I know agree with me here.
(Sorry mistaken duplicate post here...was meant as reply to Howard's at the top...can't figure out how to delete this copy.)