ANZA Technology Network panel discussion: Bootstrapping or Venture Backing?

Last night, I attended a panel discussion sponsored by the ANZA Technology Network and ADVANCE.

This event was of interest to me for two reasons: first, because in the Philippines, where VC access is very very hard, the option of bootstrapping becomes the necessary choice for technopreneurs, and second, because ADVANCE is a group of Australian professionals in the United States, which, for me, is an good model for diaspora unity.

They had a pretty good line-up of Australian entrepreneurs: Larry Marshall of Intersymbol, Gower Smith of Zoom Systems, Adrian Turner of Mocana, and Geoff Yarranton of Kalobios, a biotech startup.

I have only read of experiences pitching to VC's, so it was nice to hear foreigner entrepreneurs who were able to do it successfully in the Valley.

Some notable points were as follows:
- Postpone the decision to go to the VC as much as possible. The speakers who have approached VC's were already bringing a business that had a product that has already been validated by the market, and were cash flow positive.
- Options other than VC's or bootstrapping are available, such as strategic investment, or multiple-strategic investments. The caveat here though is that there might be differences in interest that might slow the venture down.
- This came as an important point to me. When trying to secure funds from VC's in the Valley, particularly Tier 1 VC's, it is almost absolutely required to have a 415 phone number and an office in the Valley, Palo Alto preferred. However, as globalization goes in the top of mind of VC's, outsourcing is increasingly becoming a strategic option.
- In addition to having an office and a phone number, sales and marketing departments should also be based in the US, since VC's are primarily interested in their venture's US customers. For hardware, the engineering teams will have to also be based in the US to talk to US customers' engineering depts.
- A speaker also noted the value of VC's beyond financing, which is having an outside perspective of the business. This was from a VC who was the first outsider in the board of Microsoft, and was there specifically for the purpose of having this outside perspective.
- Lawyers are also a good source of valuable contacts in the Valley.

It was quite an enlightening talk from the perspective of another foreign group setting up roots in the Valley.