Last week was the Demo Day for the latest TechStars Mobility class in Detroit. I’d be lying if I said that I can see any demo day and not be nervous for the founders; it brings back memories of weeks of pitch practice and then getting up in front of the crowd with enormous expectations. So while it’s nice to be on the other side of the stage, I still deeply feel the emotions the founders are feeling on Demo Day.

ALL the TechStars Mobility companies have a bright future and the world is theirs for the taking. Not a single company didn’t massively improve from when I first saw them in the selection process. I didn’t have as much opportunity to sit with and help the companies as I had wished during the program, so for some of the companies this was really the best time for me to see the changes.

A few notes that wowed me (in no particular order):

* Fathom: This is a team that I think has huge potential… and a really fun product in an easy-to-use underwater drone. Their wedge of focusing on experiences and the travel market seems like a very neat place from which to broaden their offerings. I hope the focus works well for them and increases the LTV they can receive from each unit delivered. 

* SEEVA: This father-daughter duo are a team you’re drawn to immediately. I truthfully don’t know how their technology works and whether it’s an incremental improvement or a 10x improvement, but I know sensors for autonomous vehicles are going to need to deal with dirt/grime/snow/ice/etc and if SEEVA is a true and defensible solution, they should be on their way.

* Damon: Damon is building an ADAS for motorcyclists. I really loved the demo video they showed and was impressed to learn the size of the motorcycle market worldwide (with density in Asia). Another win for automation and mobility.

* Gridwise: This app – giving rideshare drivers better intel to make more money – has a great founding team and are executing well in the absence of the rideshare companies doing anything quickly here. Seeing their penetration in the markets they’ve already entered leads me to believe they could be a perfect tuck-in.

* Startup Detroit: Ted and Lisa announced the Startup Detroit community at Demo Day and I’m excited to see it come together. Entrepreneurs helping entrepreneurs is one of the most important pieces of a thriving startup community, and bodes well to my thesis that Detroit has plenty of talent and not enough of the right dollars.

* Ted and Lisa: Ted and Lisa have done an amazing job with TechStars Mobility. They’re bringing great founders, corporate partners, and investors to Detroit and are building the community in a meaningful way. Thanks for all you do.

Last week I attended the Rise of the Rest event in Ann Arbor. Put on by Steve Case and his Revolution organization, they’re showing that technology entrepreneurship isn’t just a Bay Area thing. 

A few thoughts reflecting on the event itself, which included a panel (with Steve Case, JD Vance, Dan Gilbert, and Mary Grove), a pitch competition, and some networking:

* It was a shockingly packed house. I’d bet 400 or so people were in attendance, ranging from young and old, students and founders, entrepreneurs and employees. There was a good amount of diversity, too, and there were multiple female led teams in the pitch competition (including the winner). As I’ve said, this ecosystem is not lacking for talent (nor appetite to go for it).

* Automation was front and center. Kim Hart from Axios was in Ann Arbor as well as the other cities on the tour, and wrote this: “President Trump made dwindling manufacturing jobs a big theme of the presidential election, blaming globalization for the losses. Now many fear that artificial intelligence-infused technologies and robots will kill even more legacy jobs. Some small and mid-sized cities are looking to use their mechanical backgrounds to their advantage.”

* Ann Arbor and Detroit are still too disconnected, something even the panelists themselves noted. This is one community pretending and acting as if it is two. We need to bring people together more and kill the divide.

* Axios followed my posts from last week, writing of Michigan (emphasis mine): “There aren’t enough investors tuned in to Michigan startups, and not enough Michigan-based investors in general. As more and more Silicon Valley companies move into the self-driving car market, Michigan has stiff competition for investment, talent and attention.” She continued, “78% of the total capital invested in Michigan startups last year came from out-of-state investors, according to the association” and, “currently, there are 141 venture-backed startup companies in Michigan, an increase of 48% over the last 5 years. But an estimated $504 million of additional venture capital will be needed to adequately fund the growth of those companies over the next two years alone, per the MVCA.”

Following up on yesterday’s post about money/talent mismatch in Detroit, Crain’s reported later in the day on NVCA/PitchBook’s Q3 VC analysis, including number of deals and total amount raised by city.

Truthfully, I don’t care much about the total amount raised right now. Detroit should be in a “let 1,000 flowers bloom” era right now – funding lots of early-stage startups. Plus, the total amount raised is often gobbled up by just a few monster deals; deals I want to see Detroit get someday no doubt, but am not worried about them currently. To that point, $3b of NYC’s $5.1b was solely put to work in WeWork.

But I do care about our deal velocity, or the number of deals. There were only 22 deals done across all stages and industries in the quarter (compared to 580 for CA or 70 for WA). In the flower blooming stage, we need to be investing in lots of companies at the earliest stage… And then supporting the hell out of them and doubling down on the winners, creating breakout successes that will prime the pump for multiple generations of founders.

There was a healthy debate across my contacts yesterday about my post, again with about half saying talent is the problem and half saying money is. Again, we absolutely need more of both, but I KNOW we have enough smart would-be founders in Michigan to get more than 22 deals done in a quarter. The smart-money just isn’t there for them to do so successfully. And that’s why you’ve heard the giant sucking sound coming from the Bay Area for thirty-plus years.

Since I’ve moved back to Detroit (call it six months), I’ve been asking a simple question to smart people in the startup community: Which is more lacking, money or talent?

That is, are there too many dollars chasing too few founders, or are founders unable to finance their businesses due to too few investors?

The truth is, there’s not enough of either, and there’s plenty of room to grow both. A vibrant ecosystem has LOTS of both.

But what’s funny has been the split in answers. Generally speaking, investors worry about there not being enough founders, while founders don’t see enough local capital (thus heading west to find it).

My take is that this split is a symptom of the type of capital available, and the terms it comes along with. I’ve already seen deals where a Series A investment ends up owning 50% of the company. Or where the funds are too large, needing to deploy massive checks (like the size manufacturing or biotech companies would need, but to software firms), which leads to skewed incentives and doesn’t map to the modern realities of building a software business today (with low op-ex and plenty of scaling milestones for future fundraising). Or where the money is smart, but not early stage smart, with investors who have more traditional finance or manufacturing backgrounds, but few who have scaled software startups.

These symptoms mean founders are subtly disincentivized to start their startup here in the Detroit region. It means great would-be founders (of which there are MANY by my estimation) don’t have the support systems they need to learn how to build the business they envision.

We need more money with founder-friendly terms. We need investors who have done it before, can relate, and have the pattern recognition to support their portfolio through the good, bad, and ugly of startups. We need earlier money, when it’s still just a founding team with an idea and the initial inkling of a product.

If you’re a Detroiter, what do you think?

I’m getting tired of seeing the debate rage on about whether, as a startup founder/employee, you have to work 20 hour days, 7 days a week and not see your family or children in order to succeed. There’s DHH, clearly on the side you don’t need to. Then there’s Keith Rabois and Mark Suster clearly on the side that you must.

What I keep being amazed by is how these smart people can’t see past a little bit of black and white. I’m increasingly convinced the formula for success is actually quite straightforward:

Work output * Strategy * Luck = Success

Breaking it down:

• You can’t be successful without producing something – the work output. If you leave strategy and luck constant, the person/startup who creates more work output will be further ahead and win. In an environment where competition are also of equal intelligence to create work output, the one putting more hours in will produce more work output.
• You can work 20+ hour days forever but if your competitors are pursuing an order of magnitude smarter and more effective strategy, well, then I don’t care how much you work because you’re going to lose.
• Don’t ever tell me that luck doesn’t play a massive part in success. Being in the right place at the right time and getting lucky is critical to success. Without some amount of luck, success will never happen.
• The equation is multiplicative, not additive. That is to say, each of these factors magnify each other, and if you have a zero on any of these factors, you can not succeed. To some extent, though, you can choose where you want to place your bets – a smarter strategy, more output, or more luck.

I personally reject the notion that you have to give up everything in your life to be successful in startups, but I believe hard work is a critical component to success, right alongside being strategic and getting lucky.

I remember vividly growing up and hearing my dad talk about how we live in the greatest country in the world. He’d say it after learning about the Holocaust in Hebrew school, after we invented another amazing new technology that blew our minds, or after a great Olympics gold medal effort. I believed it then because he told me it was so.

But the older I got, the more I believed it on my own accord. The opportunity. The freedom. The inclusiveness. The beauty. The humility. The diversity. The love. The hustle.

We are testing the strength of many of those traits right now. Today hit me hard. Really hard. I cried for the first time in about a decade. The horror of turning away refugees. Of turning away green card holders. Of applying a ban on a religion. I won’t be the equivalent of the otherwise well-intentioned Germans who stood by trying not to overreact or unsure of what to do.

But I am nonetheless emboldened by the scenes I witnessed today: donations stacking up to the ACLU; protestors organizing quickly, effectively, and peacefully at airports around the country; calls made to congressmen and congresswomen; a judge showing us that the three branches of government do, indeed, provide checks and balances.

I bought an American flag this evening, to proudly hang at our house and also to bring to more protests – because protesting our government’s decisions is as American as it gets.

I still believe this is the best country in the world and we will prove yet again exactly why. But freedom doesn’t come free, so I will never give up fighting for our democratic values and what’s morally right.

I’m missing two years of data, but find it pretty crazy that it’s likely that, in each of the past 5 years, Amazon has sold more of their own devices than any other product in their catalog during the holidays. And that each year, it’s a different product.

2016: Amazon Echo Dot
2015: Amazon Fire
2014: ?
2013: ?
2012: Amazon Kindle Fire HD

It’s relatively common for a product owner to define his/her role as, at least in part, finding “creative ways to say no.” That is, requests for features or new products come in on a daily basis, and the product owner must find ways to say no to all those requests, allowing the team to remain highly focused and steered directly at the goal. To do this, one must be very good at saying no in new and creative ways, so as not to look like a jerk.

I would posit that this is backwards thinking. Of course it is important to focus. Of course you’ll have to say no to many various things. But it misses the point of a product owner’s actual role: to find creative solutions to give customers what they want.

The goal isn’t to find creative ways to say no. The the best product owners find creative ways to say yes. How can you fulfill a customer need in the shortest amount if time possible, while still keeping the puck pointed toward where the player is headed, not where they’re currently at? How can you take advantage of work your team has already completed to offer something in a slightly different, more interesting way?

Saying no is compelling in theory, but saying yes in truly creative ways can be much more powerful in practice.

Jason Fried has been going off recently (and forever, really) about the myth of outworking someone. And about why 40 hour weeks are all you need. He’s saying the same thing others have said for years: work smarter, not harder. It’s a glamorous outlook on work, especially in startups: you don’t need to work hard, long hours, you can still get all the benefits of winning the startup game with the hours of a salaryman. 

On the other side, Paul Graham has talked about startups as compressing 40 years of low intensity work into 4 grueling years. This is glamorous in its own right: 4 years of long, tough work for a payoff of 36 years of freedom. 

The truth of the matter is, neither of these represent reality. Like most good stories, they’re too simplistic. Over time, I’ve built up a framework that allows me to make the right play call in the right situation: do I need to work harder right now, or do I need to work smarter?

The Framework

The framework is very simple. You ask two questions: Is this a WH moment or a WS moment; and where am I on my own personal productivity chart?

WH moment or WS moment?

The first question to be answered is whether the current task at hand can “win” (beat competitors, gain/retain customers, etc) by working smarter only. If it can, perhaps because your strategy differentiates you or because a more clever algorithm means you only have to do 10% of the work as a competitor, then you should choose to Work Smarter (WS). Why waste effort when you don’t need to?

But if this is a place where your path to winning is clearly defined but easily replicable, you should be thinking hard about how to outwork others. This is a Work Harder (WH) moment. Your effort alone will produce a winning outcome; leave it all out on the field, as they say.

Personal Productivity Chart

Once you’ve determined the type of task at hand, you need to decide where on your personal productivity chart you currently are. Some people can work for 100 hours every week and be okay. Others go to 50% productivity after just 50 hours in a week.

Me personally? I am unproductive at under 10 hours (can’t get into a rhythm) but fully productive from 10-60 hours, and then completely unproductive after about 60 hours. My brain needs time to recover. So if I’m past that 60 hour mark – even if this is a WH moment – I know I need a break and should step away, just for a few hours to get some exercise, sleep, social time, whatever. 

After being introduced to the meshnet concept by coworkers, I’ve been spending a bunch of free time learning more – especially CJDNS. Yesterday I attended my first Seattle Meshnet meetup. The Seattle Meshnet turns out to be one of the bigger local meshnets (meshlocal) in the world, which is cool. The community is still tiny (there were about 8 of us at the meetup), but it’s clear the members are passionate and engaged. I still feel like a n00b, but in my mind there are a few really interesting reasons why the meshnet is important:

1. Privacy/Security: We live in an increasingly digital world, and our current internet and laws are insufficient to protect us from hackers and the government alike.
2. Increased 3rd world internet access: Third world countries still aren’t connected to the internet in the way they should be. Education, information, and connectivity are catalysts to bring these countries out of poverty, and the meshnet provides opportunities to do so more cheaply and efficiently than before.
3. Decreased internet cost and increased reliability: Similarly, our dependency on high-cost internet access from the giants (Comcast, Time Warner, etc) has a huge opportunity to be disrupted. Moreover, the changes in net neutrality happening now are equally terrifying to the future of innovation.

1. The meshnet requires physical connections (radio or wired) between peer nodes. An infrastructure of these must be built, and technologies to increase range while decreasing costs must happen as well (think: long-range, high-power, omni directional antennas for cheap).
2. Less tunneling: Right now there’s almost no possibility to truly run the meshnet without tunneling over the existing internet.
3. The opportunities for meshnet to interact with mobile needs to be improved.
4. Killer apps and services need to be built, that are meshnet only or meshnet enhanced. A coworker had the idea that the equivalent of HTTP+HTML (as the killer framework for the internet) needs to be developed for the meshnet – a framework to allow developers to build P2P services easily.
5. Currently you have to peer with folks manually. I believe auto-peering is a huge piece of the puzzle that has to be built. Auto-discover and connect close peers quickly and easily.