Friday, March 22, 2013

Should You Apply to the Founder Institute? My Pros / Cons and Tips Shared After Graduation

. So you are thinking about joining the Founder Institute (FI)? Playing with the idea to create your own startup? Or your first startup in the States? I graduated from the 2012/2013 Silicon Valley chapter of the Founder Institute so let me share my experiences and also lessons learned with you.



Short version - for the busy reader



The Founder’s Institute is a 4 month startup acceleration / incubation program that uses top-down style classes (remember high school?), assignment and a pitch-driven approach to help you to formulate and drive startup ideas from first thought to incorporated business.

What was awesome about it:


  • Structured, well organized acceleration program that you apply to yourself and your own idea and later startup
  • Assessment to see whether you are the right fit for a startup entrepreneur lifestyle and to help you develop personally and qualify your idea
  • Great resources for each class (previous recorded talks, reading, templates, etc)
  • Incredible network of mentors that is accessible to you from day one.
  • Fellows during the program and graduates after the program form a strong peer-support community. This is especially important after graduation as you will continue to motivate each other to maintain a sense of urgency and professionalism for each other! Also helps that after graduation, we own small parts of each others' companies ;-)
  • A great partner network - graduates will have access to special deals with vendors such as Rackspace, First Republic Bank, etc. 
If the course fee and the 3.5% equity contribution are of concern to you, I suggest to read the Quora article on whether the Founder Institute a good deal for entrepreneurs.



What you should know:

  • Not very lean yet. 4 months are a long time for a lean startup to go through one serial curriculum of topics. I’d like an incubator to adopt lean practices, enforce iterative Build-Measure-Learn cycles with review milestones with standardized metrics at which point the founder either decides to stay on course or pivot.
  • Come with thick skin and expect some tough love. Feedback will be brutally honest which is great! However with one out of 25 Mentors or so... the feedback can even get a bit personal/mildly abusive. I’d like FI to keep up the brutal honesty but let's keep it professional at all times. At those times, just thank the judge and don’t talk back.
  • Assignments are a lot of work but at the end, you don’t receive feedback on it from FI. So make sure you do them for yourself and your startup.
  • It's just part time. So if you already quit your job, this might not be enough of a structure for you to accompany your startup every day. So don’t rely on FI to manage your daily life but see it as an accompanying program.


Early Conclusion (see more below):

  1. Definitely apply if you are still in a job and would like help in figuring out if your idea or you are Startup ready
  2. Apply when you are new to the West Coast and want to build your advisory / mentor network.
  3. Apply when you want to further your personal development and further strengthen your entrepreneurial toolbox.


For me, number 2 and 3 applied and for me, the Founder Institute was an awesome experience!


Convinced it is the right fit for you? Then go ahead and apply!



Misha Chellam (Director of the FI SV Chapter), Stefan Broda and Adeo Ressi (Founder of FI) at the 
Graduation ceremony


. Stefan often expresses enthusiasm by picking you off the ground ;-)






The longer version - to support your decision to apply or not



Curriculum and Assignments

Throughout the 4 months of the program, entrepreneurs receive lectures in a wide spectrum of startup-relevant topics. It starts with vision and values, to put your idea and the problems you want to address into perspective. “Pick an idea that is worth failing for” (Thanks, Marcos Polanco!) is the most important take-away I had from that session which made me pick BeforeWeDo amongst other ‘fun-app’ ideas I had. Then, the sessions take you from research, to naming/branding, legal, hiring, product development, finance, MVP, outsourcing, marketing/sales, publicity and... Surprise... fundraising.


Each session is accompanied with assignments with homework in each of these topics. These assignments are all applied directly to your startup so you benefit from them but they also test how serious you are about it. Examples here are to create a newsletter which you then regularly send to all of your friends and family, a logo competition you are expected to launch, financial planning, engaging legal counsel, doing first product development etc. Don’t expect though that all your assignments are rated/reviewed. Although it felt like school, the assignments are primarily for yourself so you at the end are the ultimate judge about the quality and effort your want to put in. In hindsight, I think it would be good to integrate the sessions better with the assignments and have peer review implemented amongst the founders.

Other blog posts like Founder Institute: the good, the bad... the gold out there criticize the assignments to be too general and too software-specific. There must have been an overhaul of the assignments text because I did not feel that to be the case. As long as you remember that you do the assignments for yourself and not for a teacher, you will be fine!


Pitches

And let us not forget the pitches. At the Founder Institute, the major measure of your progress is your ability to clearly and convincingly pitch your startup in one minute at first, then three minutes without slides and at the end in three minutes with slides. Before and after each session, some founders need to pitch their startup in this format and receives a rating (1-5 without 3) and very honest and direct feedback. Key milestones of the program are three major mentor reviews in which every founder needs to present, is challenged by the mentors in a Q&A period and given more extensive feedback.


Very important: learn how to manage feedback. When mentors give you feedback... SHUT UP! Let me be clear... DON’T respond, explain, defend, etc... But DO take notes (or have someone in the audience take notes for you). Analyze later, then you can approach them in the bar afterwards and discuss further.


You probably will end up spending ⅔ effort on assignments and ⅓ on preparing and practicing pitching.


Commitment and Dropping out

The program requires both a reasonable financial and time commitment (if you disregard the special assignments that you might receive at any time).  It will however, require hard commitments from you such as the selection and engagement of a legal counsel and an incorporation of a C-Corporation for your business idea. So it is both, a resource to you for your personal development and a qualification mechanism to go from “playing startup” to “doing startup”.


Whenever you ask a group of people to show commitment and to cope with challenging assignments, you can expect dropouts. At Founder Institute, the churn was significant as we started with over 44 individuals and graduated with 16. You are invited to join a later chapter and we actually had 2 graduates my term that were former dropouts but I had the impression that the majority of dropouts would not re-apply. But that is OK - maybe the FI helped a bunch of people to figure out that doing a startup is not as wonderful of a world as they imagined it to be.




Prepare to drink after class

After each session, the founders go into the nearby Nuthouse where beers and peanuts accompany more discussions with the mentors and amongst the founders. It was stressed very early on that founders are expected to show up here and indeed, this is where a lot of the important learnings took place! If you know already that you will go home straight after class and not join socializing afterwards, FI is probably not the right program for you.


Just as social proof, this is also a major take from Jennifer Seigal’s blog post about her experience going through the Founder Institute.  


Some more take-aways and lessons learned from the program:

  • Research: Let somebody in your working group conduct a couple of customer interviews about YOUR startup idea. This is huge as they are not biased the same way you are.
  • Naming/Branding: This is a matter of taste but don’t pick a startup name that is totally misspelled because there was no domain available for the real thing. Also, do a phonetic test (pronounce the name of your company without top level domain to 10 people and ask them to open the website, check what happens).
  • Pitching: record yourself with your smart phone or tablet as you stand and pitch. So easy to review your performance and double check your time management that way. Then share that with your group. I also use techtalks.tv to sync video and slides.
  • Legal: Start with this at least ONE MONTH before the legal counsel selection deadline. Go to Orrick’s, WSGR’s, Cooley’s and other law firms events (e.g. free startup lunch sessions), build relationships with lawyers way ahead of your FI/legal counsel deadline. You really want to pick a person as your legal counsel you get along well. Also, ask Wayne W. for his awesome corporate document structure.
  • Co-Founders/Hiring: I see video being a cool new thing to do in job posts. Just take a video in which you explain the position, the culture and what you are looking for. Really distinguishes yourself from all the other startups out there. I certainly will do this for my open founding team positions!
  • Product Development: Do some reading on agile development (backlog, sprints, scrum meetings, etc.) and the lean startup (BML cycles, actionable metrics, etc.). That was not really covered in my chapter.


Overall Conclusion

As we have seen, the Founder Institute covers a wide array of topics that are important to go through as you create your startup company. It is probably ideal to start the program while still engaged in another job/gig and use the curriculum to make a decision whether you want to pursue it full time or not. If you already are full time into your startup, then you can see it as a part-time personal development program in which you can further build the network of mentorship. If you are worried about the costs of the program - I don’t think that should be an issue at all - I perceive the value I got out of the program to be many times exceeding the program fee. Also, consider that once you graduate your access to the network and the resources of the institute will be infinite!


And if you read until here and feel up for it to “do startup”, go ahead and apply!


The Graduating Class and more FI experience blog posts


Graduates from the 2012/2013 Silicon Valley Chapter of the Founder Institute. From left to right:



8 comments:

  1. I got accepted for the Singapore chapter starting from the end of May 2013. Your article gave me ideas what we will be expected during the program. Thanks for sharing!! I am looking forward to it :)

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    1. Hey Waki, Awesome, glad this article helped you! Feel free to ping me if any more questions :)

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    2. hey Waki! how long it took to hear about the admission decision after you apply? tx!

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  2. There will be a new San Francisco chapter in 2013. Deadline to apply is this Sunday (May 5th, 2013). Go ahead and apply: http://bit.ly/FI_SF

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  3. Great post Stefan! I'm in week 3 of the Denver chapter right now and I'm blown away by how much I've learned already, including about myself which I hadn't anticipated. I'm starting to think there's even more behind this program than they let on, its very clever.

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    1. Thanks a lot for the comment, Dave! Wow, you learned about yourself? Would you like to share more? Anything related to how you act under pressure? ;-)

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  4. I also found this very useful Stefan, thank you very much. I have just been accepted to the newly launched Johannesburg chapter wholly sponsored by Microsoft and am really looking forward to it. Just very nervous about the fact that I don't have a solid idea for my start up going into this.And hopefully, this will materialise during the course of the program.

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    1. Hey Ndumiso,

      thanks a lot for your comment! Actually, you are in a GREAT position! You are not married to an idea yet! That enables you to do two things:

      - You can do the assignments, such as the market analysis, the customer development interviews with an open mind. When people are already married to an idea, they will often only hear and read what fits into their mindset.

      - You can also even join another team! This is not done enough at FI in my humble opinion yet. Being a single founder is HARD and as we all know - misery seeks company ;-) So by joining forces and splitting up the work of a startup - you can gain major advantage over others!

      Keep me posted about your progress and I'll be drinking delicious South African wine in the meantime!

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