Week 10: Inbetween placements at Kauffman Foundation

This week I have been in between placements which has given me an excellent opportunity to work on my business idea. I have teamed up with one of the other Kauffman Scholars: Luke Jefferson (see his profile here). Together we are working to start a web company which will monetize social networks.

Why? For many reasons. Here's my take on the social networking:

1. Epitomized by the dot com bubble a lot of web start ups thought that if they could get enough page views they could figure out where the money would come from later. 'Eyeballs over earnings'. *
   
2. Just look at the number of websites on the internet and compare that to website revenue. I think the internet has a long tail of very low earners and maybe 100 winners (and then the anomaly Google).
3. Now narrow the market down to just Social networks. Of the top 100 sites on Alexa only 10 are true social networks. Compare that to the 10,000's of social network startups this year which have faded into obscurity.
   
4. How much revenue do these sites make? There is very little solid evidence to confirm this as there are no published figures, the only real solid figures are the prices that the web companies were acquired for. (And theres only 1 big social network acquisition: Myspace by Newcorp for $580,000,000).

So it appears that most social networks don't wish to disclose earnings, and yet its very easy to find approximate page views (like Facebook's staggering 5.5+ BILLION page views per month and rising). It would seem like conversion of adverts into click-through/ sales is phenomenally small.

Despite this, businesses are still turning more and more to the internet to target their audiences. It would seem like internet advertising is either:

1. more successful than traditional media
2. potentially more successful than traditional media
   

Yes I agree targeting of the prospect in the right situation is much better on the internet than traditional media, but engaging the prospect to look at the advert and take it in is still very very difficult.

To combat this problem, and to exploit what Luke and I see as a huge gap in the internet advertising landscape, we aim to launch a new type of innovative advertising platform which will focus on earnings for the advertiser and ourselves from day 1. With our focus in the area of social networking.

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*In a way I also think Google has spread this false model: "if we build it they will come: if they're here then we'll figure out how to make money" but what they have that no one else has is the best advertising platform on the earth. This huge financial security allows them to try and fail at many things until they hit another great idea (like Gmail). The founding entrepreneur simply doesn't have this money cushion.

Week 9: Start of 3 month internship

This week has been a very interesting one for me. All the Global Scholars have been placed on internships throughout America with leading high tech companies: often start up companies, where they can get an understanding of American business and entrepreneurship and contribute their skills to the company.

These internships have been careful chosen to suit the Scholars needs and that of the host company. I was placed in Black and Veatch a Kansas based Civil Engineering company which provides solutions to business and government for their power station, water works and building needs (amongst many other functions). This is a very well known company in Kansas, with offices worldwide and about 8000 employees.

However over the time on this course my expectations and aspirations had changed considerably. The business I want to found has changed to a different field, and the sheer quality of the course has lead me to want and expect a different focus of business activity. Myself and my boss at Black and Veatch came to the mutual agreement that what I was doing at Black and Veatch was no longer right for what I wanted to achieve. And I have to say Black and Veatch were very helpful in understanding my needs and helping me to find something else. They are a great company to work for who have real respect for their workforce.

Leaving Black and Veatch taught me some really valuable lessons:

• trust your instincts; if it doesn't feel right act on it
• Pursue your own goals as best you can: don't have regrets about not going for it
• In doing so people will respect your decisions and the outcome is more beneficial to both parties although sometimes it can be difficult to get to that point
  

In the meantime I have been back at the Kauffman Foundation who have been incredibly helpful in finding me another placement.

Week 8: Final week in Boston

Boston is home of 2 of the most famous educational institutions in the world: MIT and Harvard. And out of the places I have seen in America so far, Boston reminds me most of a European city.

The most memorable events of this week, for me, were the 'Negotiation Skills Workshop' by Mellisa Manwaring, the day spent at Harvard Business School where we had a talk by Prof. Tony Stuart and in the afternoon attending a HBS Case with a 2nd year class. Finally we had a leving meal in the Harvard Faculty building, where our Harvard Coordinator Paul Bottino, gave us a fairwell talk and a commemorative photograph.

At Harvard we all also took part in a business plan competition, where the top 4 plans won $150. It was with great satisfaction that all the prizes went to the Global Scholars, who fended off competition from top MIT and Harvard students.

As a student who has never taken a negotiation lecture I found the art of negotiation fascinating. There are 7 key elements to negotiation:
In many ways these elements are interdependent, however the one which needs to be evaluated fully before every negotiation is 'Alternatives'. This is simply what can I do if this negotiation doesn't happen. Having listed all the alternatives you then choose your BATNA (Best Alternative To Non Agreement). The BATNA often determines the flow of the negotiation and ask one of the most important questions: "Do I need to negotiate".

Another very interesting concept which Melissa explained to us was 'anchoring' this is the well documented psychological effect where the first offer given by one of the negotiating parties acts to anchor the further offers and has the greatest effect on the outcome of the negotiation out of all the offers. No matter how ridiculous!

A day later we were able to see a master negotiator at work when the writer of the definitive guide to negotiation "Getting to Yes" Roger Fisher gave us a role play example of negotiating.

The opportunities available to Students at Harvard, Stanford and MIT is just incredible. If only I had known what was available at university when I was still at school, maybe I would have worked harder ;)

Week 7: Leave Stanford arrive in Harvard

Flying from West to East coast of America takes approximately 3500km and 7 hours, almost the length of the trip to get from the UK to America.

Highlights this week included Northbridge Venture Partners: a chance to network over free food and drink with local entrepreneurs, a Harvard Business School Case by David Ager focusing on IDEO and quite possibly the highlight of the whole experience in America meeting Dean Kamen of DEKA.



Its difficult to describe Dean Kamen; we arrived at DEKA for lunch and sat in the board room to wait for him. In the mean time a multi millionaire from Switzerland came to join us along with 2 people from a well known web company. Dean entered the room, a short to medium build man who always wears a Denim Shirt and Denim jacket (there are pictures on the wall of the boardroom of him shaking hands with various past presidents wearing the same outfit) and for the next 2 hours captivated the audience talking about his history and what he is working on now.


To say that Dean Kamen is a prolific inventor is an understatement. By the time he was my age (24) he had created the lighting for the New York City Christmas lights, made a kidney dialysis machine which revolutionized the way diabetes were treated. He has also invented a heart stem, drug dispenser, iBot and the shame of it all is that the one invention he is known for in the UK (if any) is the Skegway.

And the story doesn't end there, Dean has also solved drinking water problems in the 3rd world. Poor drinking water is the worlds biggest killer. National governments and intenational bodies have thrown huge amounts of money at research to try and solve the problem (some estimates at $trillion!!) without resolving it. And now Dean Kamen has a solution. As a group of 16 engineers we walked round Dean's company in awe.

I really think it was a life changing experience to find out that there really are people in this world who have the drive, genius and money to make big changes happen: another great example of this being Ewin Marion Kauffman and the legacy he left in the Kauffman Foundation.

Kauffman Lecture Series

While on the program one of the core focuses has been on receiving lectures from some of the best lecturers and entrepreneurs in the country. Kauffman has gone to great lengths in selecting people to speak to us and flying them in from all over.
Some highlight for me include:

• Noam Wasserman: Harvard Business School Lecturer
  
• Eugene Fitzgerald: MIT Professor of Materials Science and Engineering and Founder of Amber wave
• Ted Zoller: Executive Director, Center for Entrepreneurial Studies UNC, and founder
• Nick Franano: Kansas city Entrepeneur and Founder of Proteon Therapeutics
• and Ken Harrington: Managing Director, The Skandalaris Center for Entrepreneurial Studies

I hope to write a brief summary of all the lectures I have received while being on the program. Hopefully some will find it informative and useful.