Are Platform Technologies A Scam?

Can someone actually explain to me what Sharepoint does?  If I worked in Microsoft’s sales department the best pitch I could give is:

“It’s the greatest, most versatile product that has ever existed. You can use it to run any complex system that your imagination could dream up.” This however would only be what I would pitch, not believe.

I’ve asked the question “ What does Sharepoint do?” to Microsoft sales staff, developers, and consultants. It always starts with something like: “Well… it’s, you know, like… a collaboration tool… BUT! It can do a ton of other stuff too”.

And that is the best answer I’ve gotten. 

I’ve asked the same question of SAP vendors, Microsoft Dynamics consultants, and IBM Watson Cloud experts. The answer is always some amorphous, borderline ridiculous answer consisting of “well it does a lot of things” and “it greatly depends on the user”. This was not me asking rhetorical questions either. I was not trying to be glib, or overly clever, or even to pull some sort of #iamverysmart coup de grâce. I was trying to articulate what I do for a living by standing on the shoulders of “giants”.

You see, my company builds a “platform as a service” (roughly) type product as well. Something that could be more than one thing to more than one person. I struggle constantly with explaining that our product is better than anything else on the entire market. This is not a brag, nor a marketing ploy – but only because what we do is so niche that only 100 or so companies in the world might care. And that is not the game IBM, Microsoft, and SAP are playing. They are ultimately the owners of your software. Sure the configurations, the modifications, and the custom programming on top of these platforms is yours, but if they take the platform away, or stop supporting it, what do you really have left? It’s even tougher in “the cloud” business because then if your subscription runs out you’re dead.

I recently made a prediction to a friend who was starting a project with IBM. I warned them of the potential lock-in problem by making a prediction something along the lines of “They are going to tell you they can build it quicker and more effienctly with IBM Watson Cloud. No project ever runs perfectly, and when you finally step in to set things straight, you will find out you have zero leverage. They will simply say you are more than welcome to fire them, because they know you would have to build everything over from scratch”. My predictions were to no avail. No one ever gets fired for hiring IBM. And guess what happened? The only upside is that I get to say “I told you so” a little more often. 

There is hope! There are other ways that platforms can be useful but also safe. One way is to use an open source platform, one that if at worst comes to worst, you can fire all your consultants and hire new ones, and the platform is still going to be around.

This is a little tougher with very niche enterprise products like ours, but we’ve done something a little different to combat my lock-in loathing: Our  products are OWNED by our clients. We sign a three year, non-exclusive agreement with our clients for support and maintenance,  and a traditional license fee is baked in. They get all the source code, and agree not to resell it. But if we don’t perform, or our clients want to go a different way, they get to keep the software and build on it themselves. We earn our right to be at the table by being the experts in a system we designed, working with their developers, adding new features, bringing our industry expertise to the conversation, and hundreds of other small bits of value. In this way we hope to be at the top of the renewals list in three years. 

The idea of someone taking your software away from me is abhorrent. If your car company one day sent you an email saying that you now had to upgrade your fuel tank, and there was going to be a new subscription service if you wanted to keep using the same type of gasoline, you would riot in the streets. The model of software is not what is wrong here, what is wrong is the lock-in. Vendor lock-in is amoral. If there is no ability to keep something running, and there is no TRUE data portability option, then you are basically being extorted. 

I get that as a business you are trying to maximize profit. I try to do the same thing. However I want to my product and my company to seen as sticky because we are valuable, and not because we would just be too painful to get rid of.

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The Clowns Judging Startup Competitions

I often find myself on panels judging startup competitions for things like hackathons, Startup Weekends, Startup Bus, Startup etc. etc. etc. I love these things. The energy, passion, excitement, and cool stuff I see is inspiring. I end up back at the office on Monday feeling like I’m 22 again and ready for anything. But on that final day, that sweet kiss good night: the judging, if done poorly, can ruin the spirit of an entire event in the final pitches.

Startup competitions are not the same as real startups. Obviously. I do actually know a bit about real startups. I’ve started a few myself, invested in six or seven that have been successful, and sat on the board for dozens of others. After your first few, you start to get a feel for what you’re looking for. I also get a lot of in person pitches these days, something that is fairly new to me (mainly because having money is fairly new to me too!) In these pitches I look for the same couple of things that anyone else would: Market opportunity, team quality, competition, technology, and what else I could bring to the table (other than just cash.) But judging whether to invest in a company that someone has spent a year on is very different from judging a company built in a three days.

The problem is that a lot (but not all) startup competition judges I’ve sat with on panels don’t seem to know what they’re doing. I’ve seen a lot of arguments in the deliberation rooms between judges, often slinging their egos around more than their expertise. Sitting on a tech startup judging panel with “pillars of the community” who know sweet-all about technology is often an exercise in futility. So I figured I’d rant a little about what I see people do wrong, and then offer some suggestions.

Judging Startup Competitions: The Clowns

Show Offs

Every competition I see judges trying to show off how much they know. Being a judge is an honor, I get it. It’s also fun. But that doesn’t mean that you have to start every sentence with “Well, I’ve actually done this exact thing before, and let me tell you what I know…” We all know you’re awesome; we read your bio on the competition’s page. Nice 80’s headshot by the way. Now show a bit of class and let the stars of the show be the ones who did the work. You’re not Gordon Ramsay, and no one thinks you’re cool because you’re so tough.

Know Nothings

If you don’t understand how something works, it’s fine to ask. Not everyone is going to be there because they’re a techie, and there is clear value in a multitude of expertise. If a competitor missed a crucial point in their pitch, it is totally fair game to prod. However, you need to listen. I cannot tell you how many times some teenager has pitched something pretty cool, and heard a judge ask them a question that was directly addressed in the presentation. We know you’re a big deal, but stop reading your American Express wine club email, and listen to the poor kid who hasn’t slept in three days for your entertainment.

Bad Advisors

Some salient advise is highly recommended. But a lot of what I hear is asinine. I’ve heard judges tell pitchers that they should dress better, or stand up straighter, or that they need a better logo. Seriously? This isn’t pitch practice – stop focusing on trappings. Let’s see YOU build something worthy of showing in a few days, built with a team of strangers, with no pitch coaching, and then let me criticize your pronunciation. Remember, these people aren’t asking for your money. They want to learn how to do this. Point out positives, approach glaring negatives with a bit of grace. Be someone to be looked up to, and don’t be a bully.

Financial Nit-Pickery

This one I just don’t get. In most of these competitions you’re dealing with people who are just dipping their toe into the entrepreneurial pool. The last thing they need is some slick-haired jerk, telling them their model doesn’t accurately take into account carried interest. I know you’ve gone to the trouble of wearing a suit to a college auditorium on a Sunday, but try and inspire people for Steve’s sake. Obviously this depends on the type of competition. If it’s a six day event, and “business people” are involved, you should expect nonsensical spreadsheets, but you wouldn’t take them seriously without doing the math yourself in a real startup, why would you in pretend one?

Big Boy Comparers

If I hear one more startup judge ask “What happens if Google decides to compete with you?” I’m going to tear up their Louis-Vuitton padfolio. The answer to this question is “What would YOU do if Google started competing against YOUR business?” Maybe don’t be that harsh, but the point is valid. The whole idea of a startup is to do something new, interesting, and competitive, with little to no resources. Microsoft don’t want to launch a tiny experimental company to see if it works – their margins need to work at their scale TOMORROW; not build a market over a few years. This is why big companies wait a while, see if something is successful, and then just buy the startups rather than gambling on their own.

Reality Checkers

Ah, my favorites. These are the wombats that assume that everything done in a competition needs to have an immediate value to the real world. This might be partly the fault of the competition’s organizers not setting expectations. Not all hackathons or startup competitions are actually about building real companies. The participants are not looking for investment (although they might think they are.) These are safe places to learn about how passion, teamwork, and resourcefulness can produce something beautiful in a short period of time. It gives newbies a way to gain insight into the startup process without the risk. Would you take your actual billion dollar idea to a Startup Weekend because you want to find a team of co-founders? That would be like using Tinder to find a house keeper. Give credit to a team trying something interesting. If it’s a non-profit, be happy. If it’s just fun and clever, that’s OK too. This isn’t Shark Tank. You’re not Mark Cuban.

Judging Startup Competitions: What to do

So now that I’ve told you what NOT to do when judging startup competitions, let’s look at some things that you should do.

Stick to the criteria

Often competitions have a theme or several judging criteria. Use these honestly, but don’t take them as gospel. You don’t have to give first place to the healthcare game if the theme was medical devices, but if it was really good, take that into account.

Be honest, but don’t be mean

You are a judging a startup competitions for a reason. Someone has to win. That doesn’t mean you have to crush someone’s dreams. Preparing them for “the real world” is the job you take if you are going to put your money where you mouth is, and invest. If the idea is terrible, you can simply say “Thank you” and then ask some questions that will show them the shortcomings. Let them work it out for themselves, or talk to them privately after the competition. You don’t have to tell them they’re going to die poor an alone, or publicly humiliate a junior school music teacher for trying something new.

Keep in mind the time frame

“This is incredible given your time constraints” is one of the nicest things you can hear from a judge. If you really are worthy of being a judge, you should have some concept of the level of effort that went into building something (unless you were brought in as the finance guy, and then the organizers made a mistake.) Don’t expect to see a startup with enterprise customers if they just launched earlier that Sunday.

Judge what has been built

Try and focus on what you can see. Usually this means the demo. There are competitions where the final product is the pitch itself, but I don’t get invited to those.

Judge the team effort

Keep in mind that most of these people only met each other a few days before the pitch. If things seem a little disjointed, that’s because they are. This is most likely the last time any of them will ever see each other. If you see a particularly strong team, give them some credit.

Be weary of pre-built teams

As a counter to the last point, know that any team that came in together. If they’ve worked on their idea outside of the competition that is called “cheating”. At the very least, it’s not fair to the rest of the teams who signed up to learn something new. My immediate reaction is to give them an honorable mention, and then go and talk to them afterwards if the idea is really good (daddy still needs companies to invest in.)

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Sponsorship: How To Get My Money

Getting a sponsorship isn’t THAT difficult. Over the last three years, I’ve sponsored a large number of local, national, and international events. My company mainly sponsors causes that are close to my heart as well as my business. This means startup community events, tech competitions, mobile app development conferences, etc. The problem is that the types of requests I’ve received from organizations have been so unbelievably poor that I’ve turned some of the requesters into whimpering piles of PTSD. I’m not a mean person by nature. If you’re going to ask me for money, please put a little time and professionalism into your request. I know that most of the people that are forced to handle these requests can be a little green, but an ounce of training, or a decent template, could go a long way to settling my annoyance.

So, here are a few tips based on some of the most egregious faux pas I’ve had to deal with.

1 .Start with the people or companies that gave last time

I’m not sure why, but I’ve heard a number of times something similar to this:

“Well, I didn’t contact you first, because you were really generous last year, and I didn’t want to bother you.”

That’s so unreasonable, I cannot begin to imagine the mindset. This can only come from eating too many crayons as a child. The entire value proposition to a company in sponsoring an event or institution is marketing exposure. Yes, you give to the events and organizations you believe in, and there is a feel-good charity aspect as well. But all the feel-good reasons in the world are not going to get anything but the largest companies to sponsor you. This is an advertising play. The deal is simple: I want exposure, you are offering exposure. You’re not bothering me by giving me the offer to promote my business.

The second thing to remember here is that no one likes to be picked last. I have had a number of organizations contact me with my other pet peeve:

“Hey there, I know you were one of our main sponsorship partners last year, and I wanted to know if you could help out. We’re only $X away from meeting our goal, and I was hoping you could help us cross that finish line.”

Are they suggesting that the only reason we’re getting the offer is because they didn’t get enough money from their first choices? Am I to understand that you’re scraping the bottom of your funding barrel with your email? No thanks.

2. Ask your sponsors to participate

Most of the types of events that I sponsor in the tech world have some sort of support role needs. These are things like being a mentor for young entrepreneurs, being a judge in a startup competition, or possibly being a guest speaker. What’s nice about this is it’s a little extra exposure; something your marketing people can write about how awesome their CEO is for helping out the little guy.

Other than the ego stroke, it is also really rewarding to help out. I feel good when I get to pass on some of the lessons I’ve learnt the hard way. I feel even better when I can steer someone into a new way of thinking that they had never considered.

Unfortunately here’s what happens: I show up at an event to which we’re the premier sponsor, and the list of mentors, judges, or dishwashers includes a list of people who didn’t actually shell out cash, listed on the event’s website (usually above our company’s logo). Not to mention that I’m not sitting at an event, which I paid a lot of money for, and I’m not doing anything. I’m not a participant. I’m not a mentor, judge, or dog walker. What am I supposed to do? Write blog posts?

Get your sponsors involved. If they’ve got the cash to fund your event, they might know a little bit about whatever it is you’re doing and can help.

3. Don’t treat the offer to sponsor as a Noble Prize nomination

Here is another gem of an email I’ve gotten:

“Hey Greg, I’ve attached a document here to our event. It’s going to be huge, and I wanted to see if you would like to get in on this.”

The document you attached is targeted toward the attendees, not potential sponsors. It tells me nothing about how much money you’re looking for (I assume you’re looking for money, but I can’t tell from your email…), or what my money will go to, how it can help you, and what exposure I will get in return.

Look, I don’t need to be buttered-up to strike a check, but for heaven’s sake, there are wiki-how articles on this stuff. Due to the last five or poor sponsorship requests, I’ve gotten I’ve changed my sponsorship policy: If you’re looking for $100 or for me to buy your homemade cookies, this is fine. If you’re looking for $10k, then you probably need to show a level of professionalism that is a little more than “this is going to be huge — let me know if you want in.”

Look, this isn’t the worst request I’ve gotten (which is embarrassing to say the least), but it’s pretty bad. Maybe you have so much money coming in that you really don’t care. Or, as you imply, the event is so big that you have sponsors fighting over those last two spots like rabid Black Fridayers. But if either were the case, it would leave a bad taste in my mouth for the next time you came to ask for money.

This is a sales call. You want me to give you a sponsorship for something in return. Something as simple as, “We would love for you to be a sponsor” would go a long to preventing your evisceration.

4. Personalize your pitch

See above point. Don’t just attach the document you’re sending out to attendees. Make the offer about me.

I have had those emails to the masses just copied and pasted to me. The last guy who sent me something got a fairly unprofessional response from me (something I regret!) His implication was, “Hit me up if you think this is cool” which I don’t see working for anyone outside of high school.

Put my logo into the sponsorship document, mention how it will benefit us, talk about our companies previous events… anything. I’ve dropped huge sums on people who have actually mocked up what a stage will look like with our logo embossed over it, and I felt great about it. A little effort goes a long way.

Let me know exactly what you’re looking for; how much money, time, and anything else. Tell me what you think the benefits to sponsoring the event will be.

5. Call me for that sponsorship

This is somehow not obvious to people. I understand an email is easy, but this is a sale. Basic sales etiquette should apply. Pick up the phone, call me, and tell me you’re going to be sending me an email to follow up. Even better, email me asking me for a call or a meeting! The sponsorship is as good as yours.

6. Make good on your promises

I recently sponsored a gala at my alma mater, for the third year in a row. I’m a got a nice award from them one year. Why wouldn’t I sponsor? Well, last year their pitch was pretty good. They promised that our logo would be smeared over every wall and digital display, there would be a kind “thank you” on stage for our few dollars of assistance, we would have a full-page ad in the event booklet, and we’d receive some social media recognition. Not bad for a few thousand bucks.

What did we get? Not even a mention.

Every screen was blank, no one said a word on stage, and there wasn’t even an event booklet. To add insult to injury, we didn’t even get an apology after the fact, let alone a thank you email. So this is called a scam. This year I declined to sponsor, even though I believe in the cause. It’ll probably take me a year or so to stop being so angry. They might be able to get something out of me again in the future. Right now though, I’m just angry.

Don’t be like these people.

Try taking a look at PRHelper or Spark Templates for some examples of how to write a sponsorship letter. Or even that SEO dreamers Wikihow’s version. There is honestly no excuse to mess this up.

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