Mashup* networking event

Last night I went to my first mashup* event which was a networking evening with a short talk by Charles Cohen about how to manage a technology startup through the coming recession. Charles was an entertaining speaker and his three point message was pretty straightforward:

  1. Face the pain early: This was mainly focused at pre-revenue businesses, with the message being to calculate how many days you have left before your funding runs out and cut costs aggressively and early to increase this number.
  2. Follow the money: Find the part of your business that is making revenue and focus exclusively on that, cut away any parts that are not performing even if it means changing focus.
  3. Expand marketing: Everyone else will be slashing their marketing spend in response to the downturn but you should buck the trend by buying up the spare ad capacity at bargin prices.

His first two points speak for themselves as being pretty sound advice. You really don't want to be trying to raise another round in 2009 unless you really have to so getting back to basics on cash-flow makes an awful lot of sense. Charles's third point is a more interesting one, it seems analagous to the old stockmarket adage to buy when there is 'blood on the street'; hard advice to follow when the emotional reaction is to run with the crowd. It also ties in with the other two points, at the point the only thing that matters is converting potential leads into paying customers and marketing is your main channel for increasing conversion.

Charles also threw in several references to his belief that facebook is headed for a fall in the next couple of years by ignoring the business fundamentals of revenue and margin. Mocking Zuckerburgs comment that "Growth is primary, revenue is secondary" as naive in the current business climate.

The talk was followed by three one minute pitches by startups that were demoing at the event:
kminds, < a href="http://www.everycity.co.uk/">everycity and Bookingbug. Of the three, Bookingbug struck me as the best prospect - an online booking system for small business that provides either a full website or widgets to embed in an existing site that can take bookings for services. With a clear value proposition to push to a well defined target market I think Bookingbug stands a good chance of success even in today's troubled market.