1. Although ownership is the all-American dream, most people go to work for somebody else.
2. Develop new applications for new technologies.
3. Image and Source use a Hollywood model to create and deliver product for clients.
4. When a startup company begins to hit its initial stride, growth can be fast and furious.

Startup Funding Source. Elbow grease, living at home with parents, delivering Dominos at night. 

Big Teaching Point. Jeff and Geoff are so young no one took them seriously. Geoff was only 19 when the two started Source. They needed up front cash to build a system for Mobil Oil and after talking to many bankers, Jeff finally found and "angel." In the world of finance, and angel is an individual investor who believes in your product and your ability to earn profits. Banks are not the only place to go for money. Geoff says, "Figure out what you really want and you can have it. If you don't get it, then you really didn't want it."

Big Idea #1:  Although ownership is the all-American dream, most people go to work for somebody else.

Jeff Gordon and Geoff Allen, the two youngest entrepreneurs in this series, could hardly wait to start their own business. Even those people who want to have their own business assume they need some experience with another company before they start their own business.

To start a business requires a decision to risk. It is to assume the responsibility for the unpredictable. To begin to approach a decision to start one's own business, these "20-something" entrepreneurs challenge viewers to examine motivation -- money, passion, commitment, ideas, value. People who meet Jeff and Geoff say, "They're on mission. They're driven." 

Geoff started his first company when he was 18 years old. Jeff started immediately out of college. Both believe large companies have a lot of baggage. Geoff says, "You got to sacrifice. You got to be willing to work for nothing. If you do something that you love - you enjoy - that's stimulating. That's success." Topic for discussion: Who should start their own business? when? why? Focus on your perception of the nature of risk. What is the biggest risk in starting your own business? Can you weigh risks versus the rewards?

Possible answers: Many highly successful businesses were started by entrepreneurs who could not wait to get out of college and get to work. Bill Gates left Harvard. Can you image what his friends and family said? However, Gates was driven to be a leader of the first wave of computer geeks and nerds. He dreamt operating systems. That same passion is what the Jeff/Geoff share with founders of most any company. These people say, "I had to do it." It is almost like a calling to be a doctor or religious leader. Often they have a hard time articulating this sense of mission. 

Possibly the most important question any of us can answer is, "Why am I here?" Immanuel Kant said there are four primary questions, "Who am I? Where did I come from? Where am I going? And what is the meaning and value of my life?" To be an entrepreneur does requires a mission that is so large the risks seem small. Examine your mission. Examine your faith. What key traits of an entrepreneur? Risk-takers, self-confident, hard working, goal setting, innovative. successful entrepreneurs are also accountable. 

Big Idea #2: Develop new applications for new technologies 

Image Communications and Source Data did not create new technologies; they were among the first to develop new applications for new technologies. They blended three technologies: 
1) Graphics and multimedia design. They utilize the latest technology to take the ideas and concepts of their clients and create images and sounds to describe that reality. 
2) Computer-aided design of presentation system. They even use computers to design the kiosks and other delivery systems to take these client concepts/ideas and make them accessible to others. And, 
3) Systems integration and fabrication. Then, they take three technologies -- information, multimedia, and communications -- and make them work together within a delivery system that meets their clients requirements. 

Jeff says, "We were early adopters of technology and embraced a multi-platform approach." He says, "We function as a blending of an advertising agency, and a multimedia, and software development house." Theirs is a partnership of diverse talents. 

Topics for discussion: When should an idea become a business? Can you enter into the risk? Examine it. Is this area a special opportunity for young entrepreneurs within what Geoff calls "the bleeding edge"? What makes the bleeding edge bleed? Are they on that edge? If so, why don't they bleed to death? Is this an area especially made for the young? 

Possible answers: A part of university education that appears undervalued is the luxury of reflection, time to think about big questions, particular answers, and speculative solutions to old problems. 

Mark Andressen's move from the University of Illinois to Netscape, from student to entrepreneur happened because Mark reflected many hours about the value and power of Mosaic, the precursor of Netscape. In much the same way, before they started their businesses, Jeff and Geoff used the individual tools that would be incorporated in their future business; they each had a profound sense of knowing -- some would say an intuition -- about how these tools could be used in new ways. Geoff says that he looks for open opportunities. He says that within big companies there is no one group that understands a cross-section of disciplines so they are unable to develop a working concept to meld diverse ideas together to create a new product or solve an old problem. 

He says big companies have a lot of baggage and they have their hands full. What do you think? Is this a risky premise for starting a business? Some say risk is an inherent part of the physical world; it is not perfect. Bad things happen. Some would say, "It's Heisenberg. We can not know." Geoff says, "When you have faith and do the things that scare the hell out of you, the next time it is not so hard . . " These fellows accept risk as part of life and know that they will deal with whatever comes and, if need be, make lemonade out of lemons. The bleeding edge has little precedent or history. It is the new frontier -- and every discipline has one-- where the first principles of that discipline are being stretched, modified and even changed. It takes a special fluidity of thinking, yet it is most often successful when the first principles are so well understood that a person can dare to be take a new position and introduce a new insight.

Big Idea #3: Consider using the "Hollywood" model. 

Image and Source use a Hollywood model to create and deliver product for clients. That is, they pull together a specific team, drawing from their entire staff and as many as a dozen free-lancers, to maximize performance. This model opens the entire employee-employer relation and puts it into a new content. Use the metaphor; think about roles of each person in a film or television production; there are actors, writers, directors, producers, and crew. Look at credits of a current movie or your favorite show. That cast of characters is a virtual company. Each production introduces new dynamics as new teams are formed. 

Jeff says, "We have a team of self-starters; we don't need to micro-manage. We get better levels of creativity and productivity." They also have a strong cast of supporting players because they use computer networking to facilitate the involvement of people who work from home offices. Jeff says, "We sift through 300 to hire one." You have to start somewhere so think about how you get to hiring your first employee. As an entrepreneur it is a landmark occasion. Often in the evolution of a startup, friends and consultants are used (and sometimes these people become partners), but then there is the first real hire. Jeff has set a role model for his company. First, he says, "I am not the highest paid person here" and he later comments, "I hire people who are smarter than me." 

Topic for discussion: Explore using the Hollywood model to get your company started. How does this model facilitate creativity and productivity? What are its weaknesses? How are you going to do it within your new business? How are you going to get to the point when you hire your first employee? How would you characterize your employer-employee relation? Extend now from your second to your fifth employee. 

Possible answer: In the Hollywood model everybody has ownership for the success (or failure) of a project. Nobody is in a rut. There are fewer preconceived notions as to how things ought to be done. There are fewer power positions and the ideas of one person can get more readily counterbalanced by another. Expertise is developed in process and flow. 

Big Idea #4:  When a startup company begins to hit its initial stride, growth can be fast and furious.

Managing fast growth is a challenge for entrepreneurs. At $3.5M in revenue, Jeff brought in a CFO. At that time growth was 100% and expected to go higher. Cash management became an issue. Jeff is involved in the Council of Growing Companies and the Young Entrepreneurs Organization (YEO). He has mentors. He has an angel. He stayed focused on his strengths and brought in key people to pick up key pieces of work that were critical to the growth of the company. 

Topic for discussion: Consider your company (every adult American has an idea for a company) and your products and/or /services. Can you create a graph, growth-to-key people where on the line are the people you must hire, a job description for your first and each subsequent hire, a description of your weakness that is being covered, and the company's anticipated growth in revenue) with each hire. Extrapolate at least to your second and third hire. How far can you extrapolate? . . three people? five people? ten people? Look at your growth now add under that revenue figure a date. How quickly must you hire to keep up with your anticipated growth? What is the logic? 

Jim Schell answers the question: Where do I go for startup funding? 

Questions? Drop us a note.