As a startup founder, I found it hard to commit to attending SXSW until the past week, and I don’t have the time to spend goofing around hunting for a cheap ticket. I need the purchase to be transactional. SXSW will gladly sell you a last-minute pass for $950. But that’s expensive, and I’d rather spend my money building Badgy than on inflated ticket prices.

Time for our old friend eBay. A quick search for “SXSW Interactive” tickets with the “Buy it Now” option brings up several $600 options. Quick $350 savings. Amazingly, that’s just $5 more than what people paid if they committed to the “early bird” rate before September 23rd. I did this yesterday afternoon, swapped emails with the seller while I was at the gym, and had the pass transferred by 6 pm. Fast, transactional, cheap.

If the supply of $600 passes dies out on eBay, $700 seems like the going rate on CraigsList. A little more expensive, and less transactional, but still doable.

I can’t really help you with cheap airfare or lodging. The cheapest option for lodging would probably be to rent a van and sleep in it. And you can probably stay pretty close to all of the happenings. For next year, and really for any big event, a great option is to pre-book a room with a loose cancellation policy on AirBNB long before the renters and everyone else realize they need to book and jack up the rates for that week. If you decide you’re not going on the trip, you’ll only lose the AirBNB booking fee (10% of the overall price) when you cancel. I did this for the Super Bowl and was able to stay walking distance from all of the festivities in Indianapolis.

If you’re going to SXSW, let’s meet up! Give me a call or text at 404-663-9945, or email rob@bad.gy.

Entrepreneur-turned-VC Mark Suster has a great blog post explaining that he invests in “lines, not dots”. Especially outside of “frothy” markets, tech startups are unlikely to find big ticket investors or customers who will throw money at them after a 30 minute meeting. Customers and investors need momentum to motivate them to write you a check NOW instead of waiting until later when the price may be higher. The discount gambit applies to both.

The first time you meet someone, you get to tell someone what you’re working on, and they get to decide whether the idea is cool. The second time you meet them, they expect to hear progress, and you had better be prepared to give it to them. If you see someone a few times over the course of a few months, and you cannot give them specific updates on progress your startup is making, you’re working on a hobby, not a company. They probably also expect to hear updates on some of the things you were working on last time you talked.

I do recommend that startups get out of their cave more often. Every week, as I consider the events I’m going to that week, I also think about who I’m going to see, and what the few interesting things are that I can share about the progress Badgy is making. A few years ago, I learned how awkward and pointless it feels to tell people that your company update is that your “product is coming along nicely”. That means nothing, and unless you’re VERY early-stage, nobody cares. If you’re in “stealth mode”, your secrecy means people don’t even have an opportunity to share expertise or contacts that could help you figure out your product. (I hope you’re good at guessing what people want.)

Here are some examples of company momentum I’ve heard lately:

• We have new customer X, they are a great use of feature Y
• Potential partner X wants to put us in front of all of their customers
• We’re finishing up Feature Y, which many potential customers have asked for
• We just got coverage from News Outlet Blah, and that generated X total new leads
• [talking to investors] This smart investor who knows our space is funding our current round

I previously wrote about the importance of “tent pole events” for building community. But you’re busy building your startup. Selfishly, you might not feel like you have time to build community. Selfishly, you still need to get out to events with regularity for the sake of your startup.

One thing I have rapidly learned in the process of building Badgy is how important and helpful people outside of your company can be in helping your company succeed. In the early stages, you need people who will point out the parts of your plan and product that suck. At any stage, you need to meet prospective customers, prospective investors, prospective advisors, future employees/employers, future acquirers, and other startups addressing similar or different problems to share lessons and tips. Starting a company is hard. Starting a consumer-based startup in your basement without ever talking to anyone else and hoping people show up to your site is impossible.

Very few people will want to join you as an investor, advisor, customer, employee, or introduce you to people who can fill those roles, the first time they meet you. VC Mark Suster often quips that he invests “in lines, not dots“, which is to say that he forms his opinion of companies based on the momentum and behavior of companies and people over time. Many people you need to invest social or financial capital in your company are the same way – they’ll give you any introduction you want, but they have to trust you first.

You can’t get some of these relationships when you need them. You need to cultivate them in advance. In the past couple of weeks, I have been blessed with face/phone time from some successful Atlanta entrepreneurs who are possibly THE best people to guide Badgy toward success. I can trace the origin of these introductions to the first Atlanta Startup Weekend in 2007, relationships that emerged from that weekend, and the incubation of those relationships over countless events and meetings since then.

If you’re starting a company, YES, you’re busy. If you have a wife, a daughter, and a second daughter coming soon like me, you’re even busier. I also spend a great deal of time at Cumberland Community Church and related events, because I believe in serving people and our community to encourage people to know and serve God. I work well much more than the “full-time” tally of 40 hours/week. Amidst all of that, I make it a priority to get out to a startup event roughly once a week. It’s important. Setting that standard gets me out enough to hit the important events, but also forces me to be selective and avoid the diminishing returns that definitely exist if you hit 4 events per week.

I talk to FAR too many tech startup founders who attend zero events. They work for months on their startup. If they’re lucky, they sometimes talk to customers. Sometimes, not even that. Building product without building a network around your company to help you succeed is a recipe for failure. You MUST find time to find the people who can help you succeed.

This week, Atlanta Startup Drinks is Tuesday night from 5-10 pm at 5 Seasons Westside. I think it’s the best event of the week in Atlanta, and one of the best events each month. I love this event because, much like Twitter, it is an place where serendipitous relationships and introductions are accelerated.  I hope you’ll be there.

How many events do you go to? Which events are crucial to you? How have you benefitted from getting out of the “office” and into community?

ATDC’s Startup Showcase will take place this Monday, May 9th, 2011. At $10 for a ticket, I recommend you take the afternoon and figure out a way to attend. I’ve enjoyed this event the past 2 years, and if I weren’t travelling next week, would absolutely be there. Some of the great reasons to attend:

• Affordable – At $10/ticket ($15 walk up), it’s a lot easier buy than many conferences. Not only do you not need your company to pay for your ticket, you can actually pay for a ticket from cash in your waller.
• Great Graduate Companies – A great class of companies is being recognized. I’ve had contact with graduates PlayOn Sports, BLiNQ Media, and Solohealth, and think very highly of them. Great startups, great momentum, and I expect the other graduates hold to a similar standard.
• The Showcase – want to see what several dozen awesome Georgia startups are working on, and get the chance to actually talk to them instead of just staring at press releases and web sites? Lots of companies will have tables set up to show off and talk to you. If you want a startup job, this can be a good place to find a company that’s hiring.
• Community – If you’re working on a startup, you need help, and you probably haven’t met everyone who could help you, or whom you could help with their company. Spend a few hours meeting other entrepreneurs, get some feedback on your ideas, pitch, strategies. Find someone to help. Good chance you’ll find someone you can help too.

Make no mistake about it. When it comes to entrepreneurial technical talent, Atlanta is losing the talent war on a daily basis.

Buried in an article about booming tech jobs is a mention of Brian Gorby. Brian’s a Georgia Tech grad who was working for Modosports, an Atlanta gaming company that folded due to funding issues, when I met him. He was pretty well versed in Adobe Flash & Flex development, and digging into iPhone development – he had the intellectual curiosity and internal drive that startups need & crave. I was at Xeko Elf Island – we liked Brian a lot, but because of our own funding challenges, couldn’t move fast enough to offer him a job before he was snapped up by Moxie, a prominent marketing agency (and he may or may not have joined us either way). He spent a brief turn after that in consulting, then built up iOS experience at Sapient before his apparent move to San Francisco – he’s now a Senior Mobile Developer at EventBrite, a pretty darn hot startup focused around event registration.

There are MASSIVE startup opportunities right now in the area of mobile and social. Now ask yourself… what hot Atlanta startup should a talented, entrepreneurial iOS developer have joined? Pretty limited options. After a couple of years at EventBrite, a solid senior engineer will probably be well-positioned to start their own company. What comparable opportunity is there in Atlanta?

Let’s look at the criteria many investors apply to startups – Stanford provides a nice framework of team, product, and market. Momentum is often a 4th criteria. Startup uber-incubator YCombinator focuses primarily on team, presumably because if you have a great team that handles feedback well, an investor can help a great team build the right product for the right market. So what is the crisis of conscience in Atlanta? There is NO lack of talent. We have founder-quality talent moving across the country to accept lesser roles than they would have as Silicon Valley natives. Do our investors lack the confidence that they can help companies find the right market and product? Perhaps.

At Xeko, we lost any chance we had of hiring Brian Gorby because our funding was in flux, and no other social gaming startup in Atlanta was ready to hire a developer with all of the right skills at a time when social gaming was a prime market opportunity (mid-2009).

Atlanta startup founders are often faced with the question of “Are you working on the business full time?” For technical founders, this question is a joke. Any technical founder with 2+ years of experience can pull down $80-120k per year, easy. Suggesting they should go for broke before their startup finds product-market fit is insane and makes no sense from an opportunity-cost perspective, especially when they start families and need insurance and the ability to provide for their family in a town where seed-stage cash is scarce. Once a startup finds traction, they should be able to find funding without being disqualified because they still have a day job they want to quit.

This isn’t a small problem. Atlanta has founder-quality entrepreneurs moving across the country to take staff-level jobs because we can’t recognize the OBVIOUS market opportunities. Mobile, social, gaming – HUGE opportunities. How many investor-driven startups are in Atlanta in this space? Do investors believe our teams aren’t equal to the task? Are investors uncertain in their ability to help great teams find the right market and product? Many investors seem to just want financial projections that imply a guarantee of success. That attitude leads to more brain drain. I hope we can do better, and retain more “Brians”.

Growing communities need rallying points, and Atlanta’s startup community is no exception. 

I joined the Atlanta startup community a little over 10 years ago as a developer at Air2Web.  I missed most of the dot-com free-flowing cash, but my experience at the TechJournal Deck Party in 2007 was that a lot of people flooded into startups in Atlanta and washed out when the money dried up.

Things were pretty quiet until around 2007, when events like Atlanta Startup Weekend (which spawned Skribit) and a couple of other events helped us all realize that we weren’t alone in wanting to build great new companies. I’ve hired 2 people I met that weekend, have worked with many more people, and keep in touch with many more people that that from 2007. Before this, I didn’t know of Atlanta startup events, and this was a great awakening.

A couple of years ago, there was a great debate over whether there were “too many” events. We had multiple startup events every week, and nobody knew which ones were important enough to go to. We still have numerous events each week. Some people go to most events, some people go to zero events, nobody knows which events they “should” go to.

I am suggesting that some events should be “can’t miss” events, but they need to be big enough that “important” people can blend in. Some friends we visited this past weekend attend a huge church in Nashville. Several fairly major celebrities such as country music star Brad Paisley attend this church because the event is big enough that they can blend in and not be noticed. Until we outgrow it, I’m suggesting that Atlanta needs some “tent pole” events that form the basis of our community, where successful and aspiring entrepreneurs, VCs, angel investors, and anyone else interesting can mingle without the event being so small that they feel like a target.

I am suggesting that Atlanta Startup Drinks and ATDC Entrepreneur’s Night should be “can’t miss” events each month. I think Startup Drinks needs to grow up a bit, but is up to the task. It needs to look more like the Mashable/Regator mixer, every month. Sponsored, big, in an event space. At this month’s Startup Drinks, we were kicked out at 8 pm – the hospitality and free food/drink were great, but the early ending was just too… early. $5k/month in sponsorships would give sponsors great exposure to some of the smartest, most innovative people in Atlanta and make for a KILLER monthly event.

I give great credit to ATDC for starting Entrepreneurs’ Night, apparently on the 3rd Thursday of each month. I’ve been to 2 of the 3 meetings so far, and assuming Cloud Sherpas doesn’t announce they are leaving town on April 21st, it should be a great event. If your startup isn’t willing to pony up $50/year for some of the best advice and networking in Atlanta, I question how serious you are about your startup. I don’t know if ATDC opens this event to angels and VCs, but I hope they do.

A tent without poles looks like a messy blanket. Atlanta needs some tent pole events to move our community forward. We have too many struggling one-person startups, too many people who NEVER show up to ANY event, too many existing entrepreneurs with “FU Money” working on vanity projects, too many investors afraid of attending an event for fear of spending  an hour talking to a biz dev guy who wants to build a daily deal site but can’t find a developer to build it for them for 1% of the company.

What do YOU think? Could a couple of highly intentional monthly events plus a few annual/quarterly events do a better job of building community and success among Atlanta startups? Are there better monthly events to anchor community? What annual/quarterly events are key to the community?

I’ve been concerned about the wording of the ballot initiative known as Amendment One since the first time I read it.  Political candidates aren’t allowed to campaign within hundreds of feet of polling places, but this wording campaigns for itself right there on the ballot.  Who wouldn’t want to “make Georgia more economically competitive”.  The situation smells fishy, and I want to highlight some of the fishiness through some of my recent experience.

I recently finished spending over 2 years as CTO of  Elf Island (and then Xeko after a merger).  We hired several key artists from a Rezilio, another local gaming company.  The company couldn’t pay its employees, but they hoped to turn the company around.  If they had enforceable non-compete agreements with these employees, they probably would have enforced them against us.  That’s not a judgement against Rezilio, just a logical move.  It’s much easier to turn a company around if the key employees haven’t been hired by someone else.  We would have spent much more time looking for excellent artists familiar with building flash games, and those employees would have waited for courts to sort out the non-competes or abandoned their game skills to start from scratch in another industry.

More recently, Xeko itself closed, leaving myself and several key employees without job or salary.  The company hopes to take on more funding and reopen the game.  While I also hope that happens, I have a family, a mortgage, and many other financial obligations.  Waiting around for funding was not an option.  Fortunately, we knew some people at Menue Americas, who were looking to add a development team to make a new Facebook game.  7 days after Xeko let us go, 6 of us had new jobs with competitive pay, great benefits, and exciting work.  We moved as a functioning team, which has allowed us to produce MUCH faster than a newly formed team could possibly have produced.

While I trust that Xeko’s founders would have treated us fairly, we had taken on several rounds of funding that could have left the decision of how to handle our employment agreements in the hands of investors.  The best interest of these investors is to ensure that key employees would be available to resume company operations in the event that new funding was secured.  I am fairly certain that folks like our team – CTOs, creative directors, art directors, lead developers, etc, are exactly the sort of people that Amendment 1 would seek to constrain under non-compete agreements.  If amendment 1 were in place, I have serious doubts that such a peaceful and quick transition could have been made.  Menue might have hesitated to hire us, fearing that Xeko’s investors would invoke their non-compete rights.  If they did hire us, they could have been tied up in legal disputes for months for the crime of hiring people who had lost their jobs.

Simply put, if you are an employee, or ever expect to be an employee, Amendment 1 is very bad for you in that it WILL limit your ability to use the expertise used in one job to find another job.  Critics suggest that employees should merely read and negotiate their employment agreements as they enter a job.  In the past decade, every single job I have taken has required a non-compete agreement which I have been told is non-negotiable.  This is with small companies – imagine trying to tell AT&T, UPS, Turner, etc. that you, as a staff employee, wish to negotiate your non-compete agreement.  They’ll tell you to go find another job, and the issue is that under Amendment 1, every company’s lawyers will tell them to construct the most restrictive employment agreements possible and let the courts sort it out.  Especially in a time of 10% unemployment (but really any time), people need jobs FAR more than the hiring firms need specific people for specific jobs.  There is an imbalance of negotiating power that current Georgia law addresses, while the proposed law leaves employees with very little power.

Consider the 6 of us who needed a job post-Xeko.  Imagine that we showed up for work on day 1 and had non-compete agreements thrust at us precluding us from working on games for 2 years after our employment with Menue (they did not, but note that the 1st day of work is typically when this sort of agreement is dumped on an employee).  We’re then faced with a choice – extend our period of zero income, or put a major constraint on our future job prospects – most would choose the former, and this does NOT “make Georgia more economically competitive”.  Are we to go home and tell our family that we quit the job on the first day because they threw a document at us that we didn’t like, that the next employer is equally likely to throw at us?  The lack of enforceable non-competes allowed 6 employees and 1 company to reach a mutually beneficial agreement quickly.

There are cases where the government needs to step in to address power imbalances in the free market.  Lawyers and their paranoid advice to companies create a power imbalance in employment that Georgia’s government has, to this point, addressed.  This misleading amendment throws employees to the wolves, where employees will not be able to accept most interesting jobs without compromising their future employability.  This amendment asks voters to vote themselves into handcuffs.  There is no evidence suggesting that Georgia’s economic competitiveness has been harmed.  Newell-Rubbermaid and NCR moved here quite recently, and there’s little evidence that our existing Fortune 500 companies are looking for an escape route because non-competes are harming their business.  There is plenty of research and obvious logical evidence that this will harm early-stage technology firms in Georgia.

Please strongly consider voting “No” on Georgia’s amendment 1.