Startup Camp U.K.: Are Domestic VCs Missing Out On Better Opportunities?Startup Camp U.K.: Are Domestic VCs Missing Out On Better Opportunities?
As I write this blog post -- a reflection on Startup Camp London -- I'm on a Boeing 777 that's racing across the Atlantic to Boston's Logan airport. This plane is full of technology. Presumably, the first class cabin has seats that can convert into beds or that can pivot and face a variety of directions. I heard that everyone up there also gets Bose noise canceling headphones. I'm not sure. It's a secretive place that only people who've paid 10 times what I've paid to cross the Atlantic are allo
March 11, 2008
As I write this blog post -- a reflection on Startup Camp London -- I'm on a Boeing 777 that's racing across the Atlantic to Boston's Logan airport. This plane is full of technology. Presumably, the first class cabin has seats that can convert into beds or that can pivot and face a variety of directions. I heard that everyone up there also gets Bose noise canceling headphones. I'm not sure. It's a secretive place that only people who've paid 10 times what I've paid to cross the Atlantic are allowed to see. One thing I do know: several of the entrepreneurs we saw at Startup Camp London will one day be able to buy seats in that cabin. For their entire families.Over the last 18 months, I've had the opportunity to be the "head counselor" at four Startup Camps. The first three were in America's two biggest hotbeds of investment: twice in Northern California and once in New York City (the fifth will be held on May 4th and 5th in San Francisco). But this one, our fourth Startup Camp, was held at the Cavendish Centre in London and one of the biggest questions in my mind as we prepared for it was whether or not we'd see the same sort of innovative ideas and passion that we had seen at prior Startup Camps in America. Or, is the startup culture just so uniquely American that the rest of the world can only pretend?
By the end of Startup Camp London, I was left wondering why the venture capital community isn't climbing over itself (the way it is in the U.S.) to fund European startups. European entrepreneurs think differently then their American counterparts. And, if you ask me, that's a good thing. Toward the end of Startup Camp, one of the campers told me how much harder it is to raise money in the U.K. than it is in the United States. Venture capital is just harder to come by, I'm told. There's not as much of it in Europe (and especially in the U.K.) as there is in the United States and, of what little there is, the competition for it is stiff. Well, if you're a venture capitalist that's reading this blog post and you haven't thought to consider your European options, not only might you be selling yourself and your investors (if you have any) short, you're also probably letting your insularism (be it driven by distance, culture, fear of flying, or whatever) control your opportunity costs. It's not a way to run any business. For example (and proving the insularism isn't just one-way), most of the software and Web startups (there were other types) who competed at the first three camps had not given much thought to internationalizing their technology. But at Startup Camp London, where, in addition to the locals, there were entrepreneurs from Ireland, Scotland, Sweden, Finland, Germany, France, Italy, Poland and other countries, it was clear that internationalizing one's business idea is a requirement rather than an after-thought. For example, applications that involved transactions like Scred from Kristoffer Lawson (pictured left) already were capable of managing exchange rates. Another issue of internationalization that's foremost in the minds of European entrepreneurs is multilingualism. I had no idea there was such a dearth in expertise and tools when it comes to internationalizing Web applications, sites, and even regular software. Where such tools exist, they're apparently just not a fit for the direction most startups are taking when it comes to developing their software or "Webware" as it may be. Or, where there are solutions, they're prohibitively expensive (startups are justifiably very cost-sensitive). Multilingualism is such an important issue to European entrepreneurs that, near the end of Startup Camp London, it was determined that one of the action items moving forward for Europe's startup community is to set up some sort of public domain concern (perhaps something Open Source or Creative Commons-ish) as a resource to which any startup could turn in an effort to prioritize multilingualism in their offerings. Internationalization is not a concern unique to Europe. Globalization is by far the most important trend in the business world and it's no secret that the biggest opportunities for growth of American companies actually lies outside America. Yet, for some reason, internationalization is not a priority for most startups in the U.S. I'm not saying that this form of default insularism isn't understandable. Having started a company of my own, I know that when it comes to starting up, time and resources are limited. Founders often try to tap the easiest market they can in an effort to get their businesses out of the gate, and what of the complicated stuff like internationalization? Well, that can wait until later. Can't it? The decision to wait could be shortsighted (VC's take note). Imagine if, in the United States, five startups dove into the same "new" software niche (e.g,, blog search) around the same time (OK, true story) and all of them focused primarily on the English-speaking market (small potatoes in a big world). Why, if you're a VC, would you invest your money in the sixth, seventh, or eighth startup that does the same thing instead of looking for the one that goes after the rest of the world (and the bigger market)? In some small way, this is what Antonio Lopes (pictured right, competing), co-founder of WebCanvas.com, has done. Lopes was the second-place winner in the Best Startup Contest at Startup Camp London and TechWeb's Fritz Nelson interviewed Lopes on camera about his startup. WebCanvas.com gives your browser access to a giant collaborative canvas on which any Web user can paint. At about 1:30 into the video interview, Lopes talks about how graphics tablets like Wacom's ultracool Cintiq (which displays the image you're drawing right on the tablet) are standard fare with Asian PC users, where most of WebCanvas.com's users currently come from. He has successfully plugged his startup into a foreign market where he already is enjoying a natural advantage. Surprisingly, though, despite the common sense that it makes to go after the international markets, so many American startups treat the international opportunity as an afterthought and even more surprising is that they're the ones still having the easiest time finding money. Perhaps when we bring Startup Camp back to London in the not too distant future, we'll see more interest from the American venture community because of the obvious common sense it makes to consider European startups before sinking most of what they've got into the locals. Just to be sure, if you're one of those VCs, consider this blog post your official invitation. And, for those of you with no immediate interest in the European startup community, we've got something for you. Startup Camp is returning to San Francisco on May 3rd and 4th. Register here.
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