Perceptions on the Brexit vote

August 23, 2016

Interesting graph from the FT this month. Could it be that France sees something that the rest of Europe overlooks ?

brexit-perceptions

#FirstSeven…

August 13, 2016

Ok it’s August holiday period so why not a little fun joining in Twitter’s #FirstSeven meme. Here are my first seven…

#FirstSevenJobs

  1. Paperboy: SF Chronicle and SJ Mercury News
  2. Dishwasher at a convalescent home
  3. Grocery bagger at Nob Hill Foods
  4. Stock clerk and Cashier at Toys-R-Us
  5. Manufacturing floor gopher at Raychem
  6. Reggae DJ: 89.3 FM radio and Chicago’s Wild Hare club
  7. Entrepreneur

 

#FirstSevenLanguages

  1. English
  2. French
  3. Basic
  4. Pascal
  5. Patois
  6. Dyula
  7. Japanese

 

RudeVC’s Summer reading list 2016

July 25, 2016

As long-time readers of this blog know, around this time every year I publish a short list of summer reading recommendations. The guiding selection criteria for books on this list are generally: i) some connection to startups, technology, VC, or Europe; and ii) not too heavy or intensely intellectual. I also try to limit the list to one business book, maximum.

Zero to OneFor the one business book quota this summer I’m recommending Peter Thiel’s Zero to One. The book is actually a compilation of lecture notes from Thiel’s course at Stanford, thus very conversational in tone. Regardless of your opinions about Thiel, Zero to One is an enjoyable read and will inspire some healthy contrarian thinking over the summer. The book also strikes me as quite timely given the controversy surrounding Thiel’s backing of the lawsuit against Gawker and his enigmatic participation in last week’s Republican National Convention.

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A Brief History of Seven KillingsA Brief History of Seven Killings, by Marlon James. Awarded the 2015 Man Booker Prize, A Brief History… tells the story of Jamaica in the 1970s and early 80s, when the guns flooded in, CIA agents took up residence, and the island experienced one of its most violently defining moments. If you appreciate reggae music, you’ll know about the attempted assassination of Bob Marley, which the book recounts in deep context. This culturally rich island nation’s phase of excessive conflict and strife during this period represents a broader lesson for many fire-burning regions around the globe today.

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AncillaryTrilogyThe Ancillary Justice trilogy by Ann Leckie. A science fiction writer and friend of mine recommended I try this three-book series by a relatively fresh new author to the genre. I started reading book one during take-off of a 12-hour flight and found myself still fully engrossed in the story during landing. Wow! My friend was right when she told me, “Trust me, you’re going to be rooting for the lesbian AI killing machine with a conscience.”

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For those interested, here’s a list of what noteworthy business leaders are reading these days.

A smooth face on demand

July 21, 2016

Two years ago I wrote a piece about Dollar Shave Club that provoked an unexpected reaction from some quarters (I hadn’t realized there were so many razor-blades-on-demand haters). The irony is that my article at the time was more an ode to the revenue model — give away the razor for free and make money on selling the blades — than to DSC, Harry’s, Bevel per se (although I admire them too).

It’s with admiration that I read about Unilever’s $1 billion acquisition of Dollar Shave Club in this week’s press.

For some great insight into the ingredients of this success story and its implications, I encourage you to read Dollar Shave Club: How Michael Dubin Created A Massively Successful Company and Re-Defined CPG by DSC’s lead investor David Pakman at Venrock, as well as Dollar Shave Club and The Disruption of Everything by Ben Thompson.

DollarShaveClub

I’m bullish on Fintech investment in Japan. So are a bunch of CVCs.

July 8, 2016

tokyo-stock-exchangeA few months ago I summarized my first impressions of Japan’s burgeoning Fintech sector. Now that I’ve had an opportunity to meet more of the key actors, I’m relatively bullish on this market for both innovation and venture investment.

Perhaps reinforcing my appetite, this recent piece in TechCrunch offers a worthwhile primer on the Fintech world beyond Silicon Valley and Europe but ostensibly neglects to mention Japan.

The Japanese government’s support of innovation in Fintech, such as by way of its modernizing of financial regulations and offering business incentives to firms that encourage the creation of startup incubators — is one contributing factor. Another is the average Japanese consumer’s substantial investable asset base, especially after the mid-life step function I explained earlier. Although I would not quite characterize the Japanese consumer of holding the same degree of mistrust for banks the way we do in the West, investing experience of the average household is relatively more limited in Japan than say in the U.S. In fact, I observe a more kindred mindset of conservatism (or prudence) with European households.

That is not to suggest that Japanese consumers are close-minded to creative financial products. On the contrary, some very promising young firms are tapping into a consumer appetite for solutions ranging from robo-advisory (Money Design) to peer-to-peer small business lending (Crowdcredit).

Financial institutions in Japan are determined to not just remain bystanders. To their credit, many acknowledge that innovation can take place outside their corporate walls… and sometimes even outside the country’s borders.

Increasingly, these established corporations are taking small stakes in Fintech startups. A new draft measure in Japan’s parliament will ease the restrictions on banks’ ability to invest in operating companies.

Many are also setting up dedicated venture capital units. Although historically, corporate venture capital funds underperform independent VC firms on a purely financial return basis, a corporation’s objectives also encompass strategic considerations, so making direct investments in startups can make sense.

By last count, I’ve counted over 20 corporate venture capital funds in Japan who make Fintech investments. This list is by no means exhaustive, but includes (listed alphabetically):

Adways Ventures Mizuho Venture Capital
Credit Saison Ventures Monex Ventures
DBJ Capital Opt Ventures
Dentsu Rakuten Ventures
GCI Capital Recruit Strategic
GMO Venture Partners    Partners
Gree Ventures Salesforce
Intel Capital SBI Holdings
Itochu Corporation Shinsei
Mitsubishi UFJ Capital SMBC Venture Capital
Mitsui Fudosan YJ Capital

Although I haven’t met all of them yet, the relatively few of this group with whom I’ve shared deals have behaved much like a purely financial VC would expect of them. By this I mean that these funds have issued relatively market-standard term sheets, have not demanded any special privileges, and have at least in my experience properly balanced the financial objectives of the investment with their own strategic agenda. Far from viewing them as competitors, I welcome the opportunity to coinvest with CVCs because of their complementarity with independent, financially-driven VCs.

In addition to open innovation initiatives or establishing in house CVC units, I submit that another option exists which merits serious consideration for Japanese corporations and financial institutions. More on that soon…

VC fishing expeditions vs. genuine inbound interest

July 4, 2016

vc-fishing-expeditionThis post caught my attention on how entrepreneurs should handle unsolicited inbound fishing expeditions from VCs. Manu Kumar of micro-VC fund K9 Ventures writes about instances where an individual at a VC firm requests a phone conference with one of his portfolio companies in order to hear the entrepreneur’s views on the sector.

To cut straight to the conclusion, he suggests to not waste any time in responding to most of such inquiries. In an effort to gain market intelligence, VC firms often task junior hires, sometimes college interns, to amass information on a space by surveying experts: who better a resource to tap than startup founders in the given space? They’re casting a wide net over the market in order to build a knowledge base from the best practitioners in an emerging field.

Serving as a free consultant for some junior associate at a VC firm that has a brand name attached to it does nothing for you — other than perhaps stroke your ego that a brand-name firm was interested in your fledgling startup.

– Manu Kumar, K9 Ventures

I believe Kumar’s advice is directionally accurate, certainly for startups in North America. In the cases where the inquiry is coming from an overseas VC — it’s more often a North American VC practice anyway — and the entrepreneur is foreign, however, I would offer a slightly different take.

For entrepreneurs with relatively light international experience — and I encounter several outstanding individuals in both Europe and Japan in this situation — I often recommend that they accept one or two such solicitations from VCs outside of their home market in order to hone their pitch and sharpen their game.

However, as Kumar rightly points out, time is an entrepreneur’s most precious asset. Such conference calls should be properly qualified and prepared to ensure an efficient and mutually beneficial exchange. Here are a few tips I give to my portfolio companies:

  1. Qualify the inquiring person first. Kumar offers some suggestions on how best to do so. Understanding the source of the inquiry will give you some indication on how much credence to give it. If it comes from a decision-maker or the VC partner who sits on the board of a highly complementary portfolio company, the inquiry may be seriously genuine and warrant responding quickly. [Note: Kumar also warns to beware of VC “Partners” in title only; one litmus test is the VC’s number of board seats.]
  2. Time-box the call and manage the clock. 30 minutes is often ideal, and one hour should be a maximum.
  3. Make your pitch and any answers to their inquiries as concise as possible. Make sure you leave time to ask questions. Take control of the conversation assertively by the 20-minute mark if necessary.
  4. This means that you should prepare some questions for the inquisitive VC in advance. What are their views on your sector through the lens of an investor? Who in their opinion are the most innovative players? What is their thesis on the winning strategy? Where do they believe the ultimate exit avenue could lie?
  5. Think of this as an opportunity to learn from someone who, by brute force if not by way of any special expertise, will likely possess some context about your sector that you may not have. I’ve even known clever founders to persuade the VC to send over their firm’s in-house analysis of the space (in the spirit of knowledge sharing).
  6. Once you recognize the VC’s agenda, don’t hold it against them. The person is simply doing his/her job, even if your respective goals don’t match. Moreover, they could be a resource for you at some point in the future.
  7. A word of warning, the inquiring VC firm may be already actively pursuing an investment in your sector and is simply attempting to glean competitive intelligence. While you cannot judge with certainty the veracity of their answer, it’s worth asking them point blank if they are before scheduling the call. Most VCs act with integrity, and all rely on their reputations.

Brexit not our problem? Think again.

June 27, 2016

I received a few intriguing comments on Friday’s fretful post about the worrisome consequences of Brexit for Europe’s innovation ecosystem.

One person affiliated with LaFrenchTech believes England’s departure from the EU will prove a boon to France’s tech scene. Another purported that Paris will now become the Continent’s rightful hub of Fintech.

I hope such a rosy outlook bears out, but I’m not so sure. In a very provincial sense, certain countries in Continental Europe may benefit from a relative shift in startup activity. Nordic or Baltic startups previously planning to base their operations in London may instead choose Amsterdam, Berlin, or Paris as their platform (or simply keep their headquarters at home).

Yet on the world stage, I fear the ramifications of Brexit for Europe will outweigh any short-term uptake. Europe’s appeal for foreign investment from Asia and North America derives largely from its outside perception as a unified, developed market. While nobody held any illusions about its heterogeneity, the differences among member states could be somewhat overlooked by outsiders attracted by Europe’s scale of disposable income and mass consumption.

europe-divided

The Brexit vote represents an acute reminder to the rest of the world that Europe is far from unified.

It is an exclamation point reinforcing a message that was subtly insinuated for years by well-meaning politicians. When LaFrenchTech fosters an atmosphere of rivalry, rather than one of collaboration, with London’s Tech City… When Berlin produces analytical league tables suggesting its superiority as a startup hub… these actions remind outsiders that Europe’s tech ecosystem is a collection of rivals, each with their own agendas, just like the political project of Europe itself. It reminds outsiders that Europe is complicated.

I mentioned on Friday in the wake of the Brexit vote how two Japanese tech actors decided to cancel their trips to France this week. Both were planning to attend the upcoming VivaTech conference at Porte de Versailles. “But VivaTech is in Paris. It has nothing to do with the Brexit!” one French political insider bewailed to me.

His exasperation demonstrates exactly my point. It’s easy on the inside to remain wrapped up in one’s own little local bubble. The very attraction of VivaTech for Japanese investors and entrepreneurs was its opportunity to be a starting point for a broader European rollout. I can understand their sudden apprehension, now that the fluidity of innovation across Europe is in question. Let’s not forget that last Thursday’s vote was called the EU Referendum.

Sometimes shocks can jolt politicians into doing the right thing. I hope the Brexit vote can galvanize more cooperation among the Continent’s disparate (but in the end, more similar than different) tech communities.

What will Brexit mean for Europe’s tech ecosystem ?

June 24, 2016

sad_face_europe_brexitLike much of the rest of Europe, I woke up this morning to the shocker that Britons voted to leave the European Union.

Although I still believe that venture investing is more about the micro than the macro, I admit that I’m nervous about the fallout Brexit may have, both on my European venture portfolio, and on the European tech ecosystem as a whole, not to mention the grander European project for which I’ve been a supporter.

My first reaction this morning (after the initial shock) was to take a mental inventory of my portfolio’s exposure to the UK market. Fortunately, the Sterling plays a limited direct role in most of my current investments. There are no UK companies in our present portfolio; albeit a handful do have operations in London.

However, I am quite wary of potential indirect effects. In the immediate term, the vote for Brexit has ushered in an environment of tremendous uncertainty. In times of uncertainty, decision-making slows and people become more risk-averse. Longer decision cycles from potential customers hamper revenue which can wreak havoc on startups without an excess cash buffer. Entrepreneurs currently engaged in fundraising in Europe (and VCs, for that matter) will likely be treading water for a while. I expect the window for technology IPOs will also close for the time being.

The short-time volatility will eventually pass for those who can ride it out. The long-term impact on the European tech ecosystem concerns me more.

Take for instance one of the most popular areas for venture capital over the past half decade: Fintech. London is arguably the Fintech hub of Europe, and Europe arguably leads the world in Fintech innovation. One of the perks of EU membership enables UK-based Fintech innovators to employ their financial regulatory accreditations in any other EU country by way of “passporting.” An accreditation process of a few months in the UK can take a couple years in other EU countries. Forfeiting this feature of expediency by leaving the EU will undoubtedly dilute the appeal of London as a Fintech base.

Almost simultaneously this morning, while I was assessing the damage, I received two emails from business contacts in Japan: one a Fintech entrepreneur, the other a manager of a large investment fund. Both were planning to attend the VivaTech conference in Paris next week. Both informed me they were canceling their travels due to this new climate of uncertainty.

As I had declared with conviction in 2016 Will Be The Year Of The European entrepreneur, one of Europe’s greatest strengths is its common market of richly diverse cultures, a wealth of talent for tech startups building complementary, multicultural teams. Now, with one of its largest partners pulling up the drawbridges, Europe’s credibility to come together comes into question.

次なるシリコンバレーを目指す世界のエコシステムに捧げる物語:最終話「日本がシリコンバレーから学べること」

June 20, 2016

stanford-university-arch

ここ数週間にわたって、シリコンバレーの歴史と、シリコンバレーのモデルを他の場所でも再現しようしてきた試みを振り返った。

私は、シリコンバレーをまねようとすることは無意味であると書いたが、日本の政府やビジネス界は、シリコンバレーを成功に導いたさまざまな要素から インスピレーションを得ることはできるだろう。イノベーション・クラスターの構築に成功を見出した地域では、人々は自分たちの流儀とユニークな強みを貫 き、政府は失敗を罰することなく邪魔をしない環境を整えている。うまくやっている事例として、まず頭に浮かぶのはニューヨーク市だ。しばらく前に会った ニューヨークを拠点とするイノベーターは、ニューヨークがシリコンアレーという名前を捨てたときから、同市の起業エコシステムが本格的に立ち上がり始めた と指摘した。

では、日本がシリコンバレーのモデルから得られるインスピレーションは何か?

これは、2つの理由から回答が難しい質問だ。第一に、シリコンバレーを成功に導いた要素をすべて把握できる人は存在しない。そこにあるのは、ある程度のチャンスと、極めて難しいシリコンバレーをコピーしようとする試みが作り出す認知的不協和だ。

そして第二に、シリコンバレーを成功に導いた主因の一つだが、異常な野心を持った人々が極めて多い環境は、他の地域に容易に輸出できる要素ではな い。LinkedIn プロフィールの分析によると、シリコンバレーの住民は、世界のどの地域よりも大きな夢を描いているようだ。LinkedIn プロフィールに「change the world(世界を変える)」というキーワードを入れている人の多さは、世界のどこよりもサンフランシスコ・ベイエリアが際立っている(出典:Venture Capital Dispatch)。

おそらく、より具合の良い質問はこうだ。「私たちの都市にも転用可能な、シリコンバレーのシークレット・ソースの成分とは何か?」

私には、注意して考えるべき、日本にも当てはまるであろう2つの要素が思い浮かぶ。それは、1. 近接と 2. 移民だ。

近接

ここで私が言わんとするのは、教育機関、ビジネスを営む企業、デザインコミュニティが近接していることだ。これらの多様なグループが近接しているこ とは重要で、なぜなら、多くの分野にわたる専門知識を持った人が集まるとき、イノベーションを起こすセレンディピティな出会いの可能性が著しく高まるから だ。フェアチャイルド・セミコンダクターの設立に関わった「8人の反逆者」のうち、最もよく知られる Robert Noyce と Gordon Moore の2人は、そのすぐ近くにインテルを設立した。メンロパークからさほど遠くない場所で、Eugene Kleiner の名で知られるフェアチャイルド三番目の創業メンバーは、パロアルトの近くで HP を退職した Tom Perkins と意気投合し、世界で最も高名なベンチャーキャピタルファンドを生み出した(KPCB)。

より最近の事例で、間違いなく歴史上最も成功した起業努力の一つは、パロアルトのスタンフォード大学で Sergey Brin と Larry Page が出会ったことによる Google の誕生だろう。スタンフォード大学や UC バークレーのような組織が近くにあったことで、Google にとっては、同社が成長する上で、腕のいいエンジニアやマネージャーの採用を容易にした。その一人がスタンフォード大学を卒業した Marissa Mayer で、彼女は Google のホームページを華麗にシンプルなデザインに変えた人物だ。

このデザインの要素は、特に今日のイノベーションにおいて侮れない部分だ。オープンソースコード、クラウドインフラ、HTML のようなオープンスタンダードの急増ににより、新しいハイテクを作り出すことは、かなりやりやすくなった。プロダクトやサービスのイノベーションは、基礎 技術の複雑さではなく、ユーザエクスペリエンスの中にある。デザイン、あるいは、より進化した形の創造的知性が、ユーザエクスペリエンスの核を作り出し、 シリコンバレーは常に、アーティスト、デザイナー、クリエイティブを作り出す人にあふれている。

移民

わかりにくいかもしれないが、移民も近接と同じく重要な要素の一つだ。電子フロンティア財団(EFF)のディレクター Brad Templeton が、フォーブス誌に「The Real Secret Behind Silicon Valley’s Success(仮訳:シリコンバレーの成功の裏にある、本当の秘密)」という素晴らしい寄稿を している。その中で、彼は1990年代後半の PC やインターネットのエグゼクティブ向けのハイエンド・カンファレンスで思いついたことを紹介している。ハイテク企業の創業者やエグゼクティブが集まるカン ファレンス会場で、あるスピーカーが移民について話したいと述べた。「アメリカ国外で生まれた人は起立してほしい」と聴衆に尋ねたところ、実に半分以上の 人々が立ち上がった。

デューク大学の研究者グループはある報告書の中で、移民が創業した企業が2005年には45万件を超える仕事を生み出し、アメリカのスタートアップ創業者の52%が移民であると結論付けた。彼らの多くは以前いた場所での生活をあきらめ、起業の夢に邁進しようとシリコンバレーにやってきた人々だ。

意識を起業へと向かわせる移民の DNA の中には何かがある。それはおそらく、新しい冒険に対して恐怖を抱かず、社会の片隅で生きる能力であり、社会規範や従来からの考えにとらわれず、何かを始 める時の一か八かのプレッシャーに負けない強さ、あるいは、これらの要素の組み合わせによるものだろう。

さて、ここから日本が学べるものは何か?

その一つとして、外国人が日本への血縁や由来の有無にかかわらず、才能ある起業家の誕生を妨げない、移民受け入れの政策立案を提案したい。最近、発表されたスタートアップビザのしくみは正しい方向へと進む第一歩であり、このことについて、私は日本政府に拍手を送りたい。ここで最も難しいのは、不正な入国滞在を防ぎつつ、起業家がビジネスを立ち上げるのに必要な滞在日数をどの程度与えるかという、バランスの取りどころだろう。

さらにもう一つ学べるのは、近接することによる人々の相互引力の重要性だ。私は東京のさまざまなイノベーションハブが、オーガニックなクリエイティ ビティというよりは、不動産デベロッパーらによって運営されている印象を持っている(三菱地所による新丸の内ビル、森ビルによる六本木・赤坂、東急による 渋谷エリアなど)。

日本が持つ最上級の交通インフラは人々の距離を縮めたが、クリエイティビティを生み出す上で、人々の出会いがもたらすことの重要性を過小評価してはいけない。

私は、日本の急成長するスタートアップ・エコシステムで日々出会う起業家に感心しており、この国で投資を始めることに興奮している。

次なるシリコンバレーを目指す世界のエコシステムに捧げる物語:第2話「シリコンバレーのコピー」

June 11, 2016

red-rock-coffee

この連載のパート1では、シリコンバレーの物語を簡単に取り上げた。シリコンバレーについて、より詳しく振り返るなら、Piero Scaruffi と Arun Rao が書いた「A History of Silicon Valley」が最もよく包括しているかもしれないし、Robert Cringely の「Accidental Empires(邦題:コンピュータ帝国の興亡)」 は、今日のウェブ時代の前にパソコン産業が築き上げられていった様子にフォーカスしている。ヨーロッパからアジアまで、あらゆる国々の政府が努力している ように、地元のコミュニティにシリコンバレーのモデルをコピーを試みる人にとって、シリコンバレーの物語を理解することは重要だ。

これらの政府が長年にわたり、そのような努力を押してみたり、または引いてみたりするのを見てきたが、ここで考えるべき2つの質問を提起したい。

  • 各国政府は、シリコンバレーをコピーしようとすべきなのか?
  • シリコンバレーを、アントレプレナーシップやイノベーションの礎にせしめているのは何か?

Silicon-valley-map最 初の質問については、私の意見では、その答えは概してノーだ。今日のシリコンバレーは、いくつかの要素が独特に組み合わさることで成立している。その要素 の中には、計画的なものもあれば、偶発的なものもあり、多くはそれを確かめることすらできない。シリコンバレーのコピーを地元市場に作ろうとする各国政府 の試みは、無駄な努力に終わるだろう。

シリコンバレーのモデルは、長年にわたって進化してきた。オープンな市場経済の世界において、30年間にも及ぶプロジェクトを進める力を持った政府 はいないだろう。さらに言えることは、シリコンバレーは、政府による国策の結果ではないということである。政府、より詳しく述べれば、カリフォルニア州は シリコンバレーの勃興を促す環境を作ったが、その多くは悪あがきに終わった。今日のシリコンバレーの基礎を作ったのは、民間と多くの武骨の人たちだ。

私が尊敬する経験豊かなヨーロッパのベンチャーキャピタリストは、1997年にシリコンバレーをコピーしようとしたオランダ政府の過ちについて、次のように言っていたのを思い出す。

1997年、オランダ政府は、Twinning という政府支援ファンドを組成し、ITアントレプレナーシップを刺激しようと考えた。意気盛んな時代だった。ともあれ、政府による他の多くのイニシアティ ブ同様、このアイデアは大失敗に終わった。私の意見では、シリコンバレーのやり方をコピーしても仕方がない。なぜなら、シリコンバレーはユニークな状況・ 環境・インフラ・知識・経験だからだ。それと同時に、他にはない遺産・長年の経験・歴史でもある。そのコピーに5年かけても仕方が無い。とにかく、コピー することは意味が無い。

ここでオランダの話を引用したのは、何もオランダのことを悪く言おうという意図ではない。それとは対照的に、オランダはこのレッスンから学習し、今 日では、輸出型アントレプレナーシップとイノベーションを振興するロールモデル的な存在となっていると言えるだろう(この点については、次回パート3で詳 しく述べたいと思う)。

コピーしようとするな、違う視点で考えろ(Don’t try to copy. Think different.)

israel-startup-map

イスラエルのスタートアップ・マップ(出典:Mapped in Israel

「コピーしようとするな、違う視点で考えろ」−−この言葉が多くの地域の挑戦を未然に防いだ事例は存在しない。Silicon Valley(ニューヨーク)、Silicon Prairie(テキサス)、Silicon Roundabout(ロンドン)、Silicon Gulf(フィリピン・ダバオ)、Silicon Welly(ニュージーランド)、Silicon Beach(ロサンゼルス)、Silicon Border(サンディエゴ)、Silicon Desert(アメリカ・アリゾナ州フェニックス)、Silicon Glen(イギリス・スコットランド)など、これらはシリコンの名前で始まる地名の一部に過ぎない。そのリストたるや、シリコン名の多さは実に馬鹿げたも のだ。

イノベーション・クラスターを創造する上で成功した地域では、人々は自分たちのやり方と独自の強みを貫いてきた。そのような地域では、政府は失敗を罰しない環境を整え、邪魔をしない。

ニューヨーク市は、この地域のファッションやメディア業界の恩恵に預かり、VC が支援するデジタルメディアスタートアップの、世界で2つ目に大きな市場として頭角を現した(皮肉なことに、シリコンバレー流はファッションでは通用しな い)。前ニューヨーク市長の Bloomberg 氏の政策は、ライフスタイルやデザインの活気あるエコシステムを〝招き入れる〟というものだった。

ロサンゼルスは、ゲームのスタートアップにとって、その格好の場所としてのステータスを向上させつつある。言うまでもなく、ハリウッドの映画スタジオに近接していることが重要な役割を担っている。

イスラエルは人口当たりのハイテク企業の数では世界で最も集中している地域であり、世界に輸出する最先端の通信技術やセキュリティ技術を開発する企業がひしめきあっている。

私は、各国政府がシリコンバレーをコピーするのではなく、むしろシリコンバレーを成功に導いた事実要素からインスピレーションを得るべきだと言いた い。この連載の最後となるパート3では、イノベーションを起こしたい日本にインスピレーションとなるかもしれない、シリコンバレーの役に立つ事例を紹介し たい。

My personal crib sheet for equity incentive instruments in French startups

June 2, 2016

rudevc-french-equity-drainAs venture investors, we favor equity compensation in our portfolio companies for two primary reasons:

i) improved alignment between employees and shareholders toward company success; and

ii) the affordability of employing strong, driven people without an unwieldy up-front cash outlay.

For investors unfamiliar with the intricacies of French regulation, granting equity in a French startup can seem daunting. Moreover, the official rules — and even the application of those rules — are in frequent flux. Foreign investors need not be discouraged, however. Granting equity to startup employees and directors is not impossible in France. Thanks to the recently voted Macron Law, one such equity instrument — free shares — has become more straightforward.

For my own reference, I’ve compiled a table summarizing the current state of affairs governing the most prominent equity incentive instruments in France (which I’m happy to share as a service to readers of this blog).

Four basic equity incentive instruments exist for French startups:

  1. Options
  2. Free shares
  3. BSPCE – bons de souscription de parts de créateur d’entreprise) – I’ll call them “Founder Warrants”
  4. BSA – bons de souscription d’actions – I’ll call them “Investor Warrants”

Of course, more esoteric methods exist, such as creating a custom share class with certain rights, but the above four tools represent the basic building blocks.

Each of the four instruments carry a range of advantages, disadvantages, and eligibility constraints. I’ve deliberately excluded stock options from my chart because their fiscal complexity renders them almost universally inferior to any one of the other instruments in the context of French startups. The clarified tax treatment of free shares slightly alters my calculus that I had explained previously (the comments section contains some good insight from other VC practitioners as well), though my preferred starting point remains the BSPCE when feasible.

So here below is my own reference table to consult at your own leisure (or peril), with the customary caveat that your mileage may vary. [Note: If anyone would like to design a fancy infographic of this, you will earn my admiration.]

In a future post I’ll expand on some of the lessons I’ve learned over the years on setting remuneration structures in venture-backed startups across Europe.

 rudevc-france-equity-grants

Longevity of the firm and zombie corporations

May 20, 2016

longevity_kanjiIn stark contrast to say, The Netherlands, France bemoans the moment one of its home-grown emerging champions gets acquired by a foreign company. [I have a whole blog post in my head on just this topic alone]. Corporations are viewed in France as containers of jobs, with the obligation to provide secure employment to its workers. Secure employment requires that the corporation remain a going concern on a profitable basis, indefinitely.

However, in order to survive corporations must continue to offer products that meet a market demand. A corporation whose products no longer have a market must adapt (such as by joining forces or optimizing its cost structure), or innovate (such as by creating new products or tapping new unmet demand).

Both require flexibility. This is the fundamental tension at the source of the current hand-wringing over proposed labor reforms in France.

Even for companies that aren’t arguably hamstrung by rigid labor laws, one of the compelling questions of our day is whether building a sustainable, everlasting corporation is always an appropriate goal.

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