My feeling is that VC’s tend to wait for the deal of the century in order to throw in as much money as possible in order to get a large part of the pie. While this might work for some industries (Pharmaceutics for example), it no longer works with the Internet industry. A few months ago, the BlitzWeekend project proved that a great concept/prototype could be designed and created in less than 48h. Many people were skeptic but in the end, very interesting prototypes were indeed demoed to the attendees and a judge team.

The facts are plain simple:

• We don’t need expensive Sun servers
• We don’t need expensive bandwidth
• We don’t need expensive Oracle databases
• We don’t need expensive phone systems (PBX)
• We don’t need expensive Aeron chairs either

• We only need money to pay salaries.

Of course, that’s exaggerating of course but that’s how cheap it is to start a business nowadays.

Guy Kawasaki spent 20k on Truemors (one of his startup) and I think he paid too much for it. A big chuck of it was on legal fees actually. Being a VC himself, we can’t blame him for not covering that area. He’s probably used to deal with lawyers.

Everything is in the cloud these days. You can host your web servers and your database online. You don’t even need a physical office anymore. Everything is becoming virtual, even assistants! My prediction is that there will soon be toolkits (like Yahoo Pipes but more advanced) to develop your own online business for a low monthly fee. Everything from code to design to marketing will come out of the box. The worse thing? I’m pretty sure someone is working on this as we speak..!

It’s becoming that easy!

Will we see a change in the way VC’s work with Internet companies? Will we see them leave the Internet industry to focus on other larger industries? It remains to be seen but I believe they must adapt or die.

The way I see it, VC’s must become startup centers where you bring your ideas. If you are accepted, then they will match you with other people so you can use their skills (to fulfill your lacks). You will be able to use their network and office space (if needed) for a few months until your product is ready. A super incubator in some way. That would be nice and we would see way more great companies. Maybe not all rock stars like Google, but a lot of damn good companies for sure. If I were a VC, I’d be working on this right now.

1 – Cozimo
2 – Tungle
3 – Streametrics
4 – iGotcha Media
5 – YourTeleDoctor

Selected companies will each give a 10 minute presentation, then they will receive 5 to 10 minutes of feedback and questions from the audience.

There are still “paying tickets” available (service providers @ 200$ and sponsors @ 1000$) so if you want to participate as a service provider or as a sponsor, please do not hesitate as there might be  startups looking for help (lawyers, accountants, consultant and so on).

Non presenting startups will still have the chance to present their company informally so please join us!

I spoke with the Embrase folks whom are organizing the event along other very fine and interesting folks yesterday but Sebastien Provencher got the scoop out first.

This will be an exciting event where 5 lucky startups will be choosen and will be invited to “pitch” in front of an audience.

As most “startup” related events, this will take place at the SAT [map] on January 23rd, 2008 (6-10pm).

Think of it as a BarCamp for Entrepreneur. It will be very interesting and if you want to come, hurry up as seating is limited. You can register using EventBrite.

My startup, YulNews will participate and I hope to be chosen as one of the lucky ones but even if I’m not selected, I know this will be a great even to socialize and meet great people. Come on, come all!

From my experience, I believe that starting a business is 80% of yourself (your time, efforts, knowledge, promotion, selling yourself, etc.) and 20% money. That 20% money actually helps you move closer to the 90/10 as you can delegate some work to other people (since you now have money to hire someone). When you get a lot of money (big VC deal) then you can work 100% on the project while not having to worry (too much at least) about money.

So why get $5M if you don’t really know what to do with it? It’s definitively welcomed when you want to expand aggressively, but it is too much money just to come up with a deliverable product. Sure, I’d like to have the latest clustering / blade system and a big SAN but why now? These days, it seems like big guys are buying smaller guys so why worry about growth? Let the big guys worry about it when they’ll buy you. They have the money anyway. If you really need storage, consider Amazon’s S3 (Twitter is using it), DabbleDB or even Google base (entire sites are using it). If you need bandwidth, consider unmetered hosting.

Kevin Rose for example, started Digg with $2000, a web developer working for $10 per hour, and a $99 per month hosting plan. They did raise some money (at least $8+M) but now they have a much larger team and a lot of salaries to pay…

Good luck guys and keep up the good work!

Traditional business centers already exist, but they are mostly equipped with basic amenities such as conference rooms, copiers, faxes and so on. Basic stuff and nothing very impressive. A geek-ish business center could have much more such as a shared small scale data center where you could “borrow” space on an existing server until your project is ready for prime time. Having a limited number of businesses could result in decent performances compared to an overcrowded shared hosting provider.

Having multiple of those geek-ish business centers would also allow redundancy and geographical load balance thus allowing users to benefit from a heavy duty data center at a very low cost. Try getting this from your current hosting company…

On the HR side, there could be many beneficial services such as accountants, lawyers, marketing gurus, programmers, designers and other freelance people. These resources could be available on a contract basis or be included as part of the regular package. Of course, VC folks would be very interested in following those new start-ups and I believe that high quality start-ups would come out of this machine.

Basically incubator meets business centers. This could allow people with ideas to come in, “add some water” and voila!

There are some incubators and similar services around here but none of them offer the equivalent of what TechShop offers.

I guess this is something WE do all the time in a way. In order words, why bother putting a little bit of money in many bank accounts when we can put all our money in a few accounts that have different risk levels as long as our overall risk level is acceptable..? I don’t think anyone would feel very excited about having to deal with a dozen of so bank accounts. That would be way too much work. In that way, same goes with VC’s.

With that in mind, I also agree with Heri on the fact that some people don’t need a lot of money. I, for instance, am working on a project where I don’t need a full scale datacenter to support my project. Of course, if you give me $2M then I might re-think my wish-list but I don’t need that much money, at least not for the first year or so. But on the other side, I could use a few $10K’s to pay for a full time programmer, an artist, etc.

So what to do? Garage’s idea about a seed fund is nice. Put some money in a high risk, high reward fund. Let a college graduate (tech-savvy and low paid) manage it. A one or two million dollar fund could go quite far especially if there is a $100K investment limit. I don’t know about you but I could do a LOT of things with that much money and I’m not talking about buying Aeron chairs.

Other than “micro-financing”, I believe that an incubator would be welcomed as long as they don’t get too much participation in return of a small investment. Y Combinator, for example, received bad critics for getting a too big participation while bringing-in little value. While I don’t want to bring the eternal issue of participation and % of shares, it’s often better to have a little piece of something big than a big piece of nothing. Small companies often have the same needs as larger ones do. No one is an Internet marketing, accounting, HR guru and getting some help/coaching through an incubator is a nice thing.