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Key Idea: Think Big

Bill Wiedemann raised $18 million with two rounds of venture capital.

Key Question:

A: 

Have a very big idea if you want to go after venture capital. Bill's company makes software to provide security for Internet commerce.  This product is demand-driven because commerce on the Internet is increasing at very fast speeds and security is the number one concern people have when using the Internet.

Brian Kissel's  product is demand-driven because speed saves money. Animations and most forms of computer graphics are very slow and tedious. Consider, too, that the demand for cartoons has increased due in part to the popularity of animated Disney feature films and the government requirement that television networks create educational programming for children.

Consider the fate of the emu ranchers. There has been no demand for emu meat even though emu ranchers have been trying to say for years that emu is the meat of the 21st century (because it is low fat and tastes like beef). But, no one is demanding to buy emu meat. So, those investors who paid $2,000 for one emu egg lost their shirts as prices dropped to $2.

Think about it

Do you have an idea that is big enough to attract venture capital?  If not, is your idea big enough for an individual angel?  Is it good enough for family and friends to invest in?

Clip from: The Enterprise Network

Santa Clara and San Jose, California: Silicon Valley is famous for technology startups and its goal is to never lose the distinction of being "the place" for innovation. The Enterprise Network (TEN) houses over a dozen start-ups working to bring new technologies to the marketplace. At TEN they find low-cost office space and mentors who guide them. You will meet the men who run the incubator and a number of the entrepreneurs who depend upon the leadership and camaraderie offered here.

According to the National Business Incubation Association, there are about 5,000 incubators worldwide with about 1,100 in the US. 

We chose this incubator because it became famous during the dot-com boom and it is situated  close to Stanford University. 

Stanford was early to the idea of technology licensing.  Technology licensing has assisted faculty and students in the process of launching companies which in turn have created thousands of jobs and brought millions of dollars into Stanford University.  Stanford enjoys the "success breeds success" principal so things are popping there.   In this program we go to the campus to see how one PhD student is working to commercialize his discoveries.

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Think Big

(Voiceover) Bill Wiedemann is a fresh success story for The Enterprise Network.

BILL WIEDEMANN: We make hardware and software solutions that allow corporations to use the Internet for secure business communications. We brought in $1.3 million in our first round of funding, which was just about two years ago now. And, to date, we've taken in $18 million, so it's kind of amazing when you think about it.

HATTIE: You get some good help here?

BILL: Yeah, great help. Yeah. It's really necessary . . .

BILL WIEDEMANN:: From the start, you know, we told the venture capitalists that this is going to be such a huge opportunity, that we need to bring in people that have done it before; you know, credible people from the industry that can make this grow with a large velocity.

HATTIE: So what you're saying is just when you get to having--you've got the product, you've got the funding, you've got these people, you're willing to step aside and let somebody else run the company?

BILL: Oh, that's the way we design it from the start, because we can grow then and take advantage of the opportunity that we've set up.

You know, it's been set up; we've got the product out on the market; we have some acceptance in the marketplace, and, you know, now it's time to bring in the people that have taken it from this stage before and can really capitalize on it, make it a very, very large opportunity.

HATTIE: But what are you going to do with your time and your life and all your money?

BILL: Well, it's not money yet. We have to get to a liquidation event, as I'm sure the investors hope. And at that point, then, there are certainly many other things you can do. But, you know, right now, I'm coming back to the incubator and spending time here and helping other people with--you know, through my experience. The same as the people who were here when I came through, you know, helped me . . .

HATTIE: So are you...

BILL: . . . helping them be successful.

HATTIE: You think you'll do it again? You'll find another opportunity?

BILL: Oh, there's always opportunities.

HATTIE: Are you hooked?

BILL: Absolutely.

HATTIE: Yeah. It's like, you've got to do it again.

BILL: Yeah. Yeah. It's just kind of something that you--you know, you get started on it, you just want to do it over and over again. And you run across opportunities, and you use your experience from this situation to, you know, filter out things and take them out.

HATTIE: Is there a name for a guy like you? I mean, it's a start-up wunderkind or something, you know?

BILL: Not yet. Not yet. When I have three or four of these under my belt, then I guess you could say that. But right now, it's just--one of my friends called me when we got our first funding and he said, `Congratulations, you're in the 1 percent club,' because the amount of deals that get funded is, you know, about 1 percent. So I made it into the 1 percent club, and now what I need to do is make it into the 1/4 percent club or the 1/2 percent club, and move on and get a successful liquidation and go on to some other things, so...

HATTIE: Why are you doing this instead of something else? Like a job or something?

BILL: I think you get to the point in your career that you say that you want to do something for yourself and you want to make a difference. And it's incredible satisfaction to get other people excited about what you're doing about your dream. And to see companies make commitments to your product and start buying it and start using it because it brings in value, and it's incredible gratification, you know, and people that work for--we have 65 employees now. People that come and work for you, you know, they just say, `Gee, thanks for this opportunity,' you know, and you can't get that anywhere else.

JOE BECKER: They are now starting to grow exponentially up the sales ramp. They have customers, they have products, they're fully invested in now. I don't know how many employees they have, but I'm guessing it's over 50 at this point. And they are exhibiting the classic signs of what we call a gazelle. A gazelle is a very high-growth company that tends to double sales every year.

Sean Griffin: . . . basically proposed to him the creation of a virtual amusement park.

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