There’s no truth to the rumor that there are bracelets circulating around Silicon Valley inscribed with WWGD (What Would Guy Do), but it’s not inconceivable. Guy Kawasaki has an uncanny knack of being at the right place at the right time with the right strategy. He describes it as “Guy’s Golden Touch: Whatever is Gold, Guy Touches.”
Considering the traffic on his “How to Change the World” blog, and the success of his Truemors site, a lot of people are hoping the Guy Touch rubs off on them.
Guy will be a featured speaker at Business of Software 2007, October 29-30 in San Jose (www.businessofsoftware.org). He was kind enough to answer some questions from Business of Software on the current VC environment, evangelism, and what he would do if he was on the Microsoft board.
BoS: You write and speak extensively about innovation. Where are you seeing innovation today in the software industry?
Kawasaki: Most of the innovation is happening with "two guys/gals in a garage" creating web sites with MySQL, Ruby, and other open-source tools.
BoS: Where is the software industry in most need of innovation?
Kawasaki: Innovation is needed everywhere you look. It’s just that some places look like they’re already "owned" by large companies. That’s a fallacy.
BoS: You’re a VC. If two guys/gals in a garage came to you and said they wanted to create a new search engine, would you fund them if they were persuasive enough?
Kawasaki: Based on the Google phenomenon, we’d certainly take a look at it, but it would be an uphill battle because there’s already Google. Of course, there was already Yahoo! and Inktomi when Google was starting. This is the conundrum of venture capital: You never know.
BoS: What attributes are you looking for in terms of technology and management for companies you fund?
Kawasaki: I look for unproven people in unproven markets with unproven business models because this is where I think the big hits occur. However, I’ve yet to prove this theory.
BoS: You set up Truemors for $12,000. Presumably you have people telling you similar stories and asking for millions in return. How has your experience with Truemors changed your behavior as a VC?
Kawasaki: I certainly know now what can be done in two months with $12,000. If an entrepreneur tells me that he or she needs $1 million, five engineers, and a year to build a social networking or user-generated content site, I will throw them out.
BoS: Would you have funded Truemors?
Kawasaki: No. It didn’t need enough capital, and the CEO has a dubious amount of management experience.
BoS: Are we in a bubble?
Kawasaki: You bet we are. Isn’t life great?
BoS: So why are you still investing?
Kawasaki: Because hope springs eternal and because venture capital firms are not set up to short private companies. Just because we’re in a bubble doesn’t mean that every company will fail.
BoS: You are perhaps the world’s best-known evangelist for your work at Apple. Is evangelism still effective?
Kawasaki: More so than ever because more companies are starting with smaller, if not non-existent, marketing and advertising budgets. When you have $20 million to introduce a product, you seldom rely on evangelism.
BoS: You often make fun of Windows in your speeches. But Apple still isn’t one of the top 5 PC manufacturers in the world, and you won’t see many IPhones replacing the Blackberry on Wall Street. You’ve already worked at Apple (twice), so suppose you were on the board of Microsoft sitting on your 90%+ market share. What would you do?
Kawasaki: I would be wondering whether I should buy a house in Montana or the south of France –or maybe both. Or which Gulfstream would look best in my hangar. And why the company whose board I sit on can’t seem to hire designers despite the infinite money it has.