Paul Singh and the business of tech startups
To kick off Startup Week 2016, Tallahassee hosted Angel investor and startup guru Paul Singh to speak in the Honors, Scholars, and Fellows House on campus at Florida State. After a short introduction by Tallahassee mayor Andrew Gillum, Paul took front and center to give advice and inspiration to the local community rallying around startup and entrepreneurship culture.
Just like David G. Cohen during his visit to TLH, Singh carried himself casually, but seemed genuinely excited about the things happening at Domi and the newly endowed Jim Moran Institute for Global Entrepreneurship.
“Right now Tallahassee has one coworking space (Domi). In ten years, there will be five.”
He spoke briefly about his rise to prominence in the tech world, and about his life before technology. Starting out as a bricklayer in D.C. and eventually working as “the best selling car salesman in the D.C. area,” he didn’t enter the world of tech and I.T. until he “begged” for a job at the AOL branch across from his dealership.
From there, Paul rose fast. Using his success at AOL as a stepping-off point, Paul became a tech investor. He listed off an impressive portfolio of startups he had been a part of, including fintech app Mint, 3D printing startup Makerbot, and Twilio (a service we’ve used before). His experience working with successful startups set him up as someone who knows not only how they work, but how VC funds operate on the inside. After the introduction, he got to the meat of his talk, focusing on how technology is the biggest driving factor of growth in urban economies.
Paul began in earnest by talking about the changing state of the economy in 2016, and how software and automation are making business less costly. As software becomes more capable, the cost per service shrinks and the number of employees needed to maintain a service becomes smaller than ever. The low cost of starting a business, however, is what makes tech and software startups so ripe with opportunity.
“Most of our parents had one job over the course of their lives; we will probably have six. Our kids will have six at once.”
Paul is a believer in technology and innovation as economic forces, stating that tech is the “fundamental driver of growth in the industrialized world.” He spoke of how entrepreneurship and technology create opportunities for growth and employment, especially when communities grow around them. The result, Singh says, is a “near perfect correlation between urbanization and prosperity.”
Much of his talk focused on how urban communities are changing to be more tech and entrepreneurship oriented, even saying that “The age of the industrial city is over.” The avenues to employment and success in the field of technology are growing, and as the movement gains momentum even more growth will occur in these urban hotspots of innovation. He cited that jobs in tech and startups are 30% higher than average wages in any given city, defying the stereotype of the broke startup founder.
“Traction is the new intellectual property, growth is what sells.”
The other half of his talk focused on the “dirty secrets” of funding and venture capital, jokingly saying “Don’t tweet this part” before revealing a tidbit of VC info. The big takeaway from his remarks on venture capital is that growth and traction are key to success, rather than the quality of a startup idea. The way he put it, “The fastest people win, not the smartest.”
Offering advice to the dozen or so startup founders in the room, Paul remarked that the decision to invest in a startup is based more on available data than a good pitch. With so much data available, there is more transparency than ever when starting a business.
“It’s 2016, there’s no excuse for having a sh*tty pitch.”
After the talk, FSU Social Entrepreneur in Residence Chris Markl opened the floor for questions.
When asked about burn rates in startups, Paul stressed that he would rather have a startup spend all the money and fail than sit on the investment for too long, because “VC funds can’t sit on their money” if they want to exist.
When asked about the first steps to building a startup from an idea, he argued that you should first see if there are people out there interested in your idea.
“Create a landing page, and see if you can attract at least 100 people. Then you start building your product.”
The biggest takeaway from Singh’s talk was that technology and entrepreneurship are the biggest factors in growth and employment for the economy of the future, and that communities like Tallahassee can get behind these ideas to empower its residents to build a better future for themselves and for their city.
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