“Changing the Way We Start Companies”: Q&A with AngelPad’s Thomas Korte
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build a good company around it. I don’t think it comes naturally to someone out of college to think about e-commerce optimization or mobile ad serving. So I think we have different kinds of companies just because of the different experiences people have had over the last couple of years, rather than from their college or just-post-college experience.
X: Do you ever worry that there might be too many incubators—that there might be a little bit of exhaustion? It seems there is a demo day every month or two these days, and often it’s the same faces—the same angel investors, the same venture partners—showing up.
TK: I don’t worry about that at all. In fact, I think there ought to be hundreds more incubators, literally. If you look at universities, there are hundreds of universities that have different specialties, different criteria. For me, this new wave of incubators, Incubator 2.0, is really in large part a [a reflection of the] failure of engineering and business schools to actually teach people how to start companies and to actually teach MBAs how you really do start companies. Nobody writes a business plan anymore, no one does a five-year forecast. For me, there ought to be a lot more. There should be an incubator that understands the wine industry really well and starts wine companies. There should be an incubator for restauranteurs. There should be incubators for all these different places where people start companies, and we would end up with much better companies than we have today.
X: That’s a really interesting idea. It strikes me as sort of like medical school, in a way—there’s a realization that a four-year medical education doesn’t really qualify you to be a doctor, so you have at least three to five years of residency after that, where you’re working alongside experienced professionals.
TK: Precisely. It’s like the real deal, this is how it’s done. In a way, it’s for engineers to touch PowerPoint for the first time, and it’s for MBAs to drop the PowerPoint and actually do something that matters. To ask what is the problem we’re solving, not what is the market we’re looking for.
X: It does seem that your groups here are mostly engineers. I didn’t see anyone among the founders who is clearly a marketing person by background.
TK: Yes, absolutely. When you start and fund and found a technology company, the most important thing is to be able to build something. Especially if you don’t have funding, and you can’t hire people to build it. The iteration cycle has now become so fast—if you were to have an idea, spec it out, go to a design firm, go to an engineer to build it, and by the time it’s done and you have spent $50,000 on it, [in that time] you should have iterated three more times. These are engineers, and they can iterate by themselves. They see that this works, this doesn’t work. Starting a technology company is not about making all the right decisions, it’s about making more right decisions than wrong decisions, and realizing them very early on and doing it very fast over and over and over again.
X: I wanted to ask you about the 10-week schedule. It strikes me as an incredibly short time. How are you supposed to have time, in 10 weeks, for at least one pivot—you want to leave room for that—and build a decent product, and have time to polish the presentation at the end?
TK: It is a very short time. But a lot of what’s happening here is proving out a vision, building something, iterating on it, and seeing if there is some traction. You heard some of these companies talking about how they had found thousands of users in a few … Next Page »