Brent: It’s intervention time. The Austin startup scene has perhaps had a few too many Kool-Aids, and it’s time for some cold water and aspirin. Or at least that’s what Mike Maples, the one-time Austinite and prominent Silicon Valley investor, seems to suggest. Consider Maples’ comments on a post about a decline in venture capital investments from Austin entrepreneur Richard Bagdonas in the Austin Startups public group on Facebook:
“I will probably get flamed for even responding to this but someone who loves you needs to tell you: The Austin startup scene isn’t getting it done. And as long as this is the case, the startup dollars that flow to ATX will decline. Austin startups and the local ecosystem need to level up…PRONTO. Quit blaming VCs. Stop daydreaming you are an awesome startup hub when you are declining year by year. Start producing exits that MATTER. In the meantime, every time I see yet another article on this forum where Austin congratulates itself for being an awesome place for startups I throw up in my mouth slightly. PR does not equal results. You can’t distract people from poor results with a nice press hit. Sorry to be so blunt, but Austin’s startup community needs to wake up before it’s too late. So far, that is not even close to happening.”
Harsh words, indeed. Maples, a general partner at Floodgate, the Silicon Valley venture capital firm, has been sour on Austin in the past. (He declared Floodgate would no longer invest in Austin companies with on-demand services after the Austin City Council approved stricter regulations for ride-hailing companies and short-term rentals last year.) Maples’ comments are part of a long discussion chain on Facebook, which is part of an even longer-running debate on both FB and Twitter about the flow of startup funding, or lack thereof, in Austin. Of course, a venture capitalist may be the first to feel frustrated by a lack of big time exits in the market, especially within their own portfolios. But Maples isn’t alone. Bob Metcalfe, the ethernet co-inventor and UT entrepenerership professor, has also said he believes Austin lacks high-quality CEOs to bring more startups to big exits.
Metcalfe wrote: “Damn those risk-averse VCs and their selfish LPs for not backing more of Austin’s passionate first-time-founder life-balanced diverse pay-it-forward early-exit social-mobile-cloud weird startups, like we deserve? Not. Fundraising is not begging, it is selling. Onward!”
Mark Phillip, founder and CEO of Are You Watching This?, seems to have had enough with the never-ending debate. He followed Maples comments with this.
“…If you believe that people like me, or the inspiring entrepreneurs I meet with every week don’t have fire in their eyes as they work their asses off to “get it done”, or are somehow in love with our press clippings, then maybe you’re not meeting with the right people. Stop posting platitudes and taking potshots from Palo Alto.”
But, of course, the status of a geographic region’s business reputation, isn’t a zero-sum game.
Serial entrepreneur and co-founder of Conversable Andrew Busey wrote that the percentage change in VC funding year-over-year, which is how most reports are generated, aren’t particularly helpful comparisons. He pushed for more honesty.
“Plus a lot of people whine about stuff here, in SV you fail faster, get a job at a big co or another start-up, learn shit, and try another start-up if you have a compelling idea,” he wrote. “Here you raise money for years and people encourage you and tell you that you have a great idea and to keep going when you should give up. I’m not encouraging anyone to give up by the way, but you need to have some intellectual honesty about where you are.” |