Recently, Capital Business sat down with experts from the Dingman Center for Entrepreneurship at the University of Maryland’s Robert H. Smith School of Business to talk about the state of play in the Washington entrepreneurship community. Dingman Center Managing Director Elana Fine and veteran investors and entrepreneurs-in-residence Ed Barrientos and Jason Shrensky talked about their experiences and what it takes to be an entrepreneur (here’s a hint:courage , confidence and a thick skin).
Barrientos currently manages an angel investment firm and heads Brazen Careerist, a career-focused social networking site targeting the millennial generation. Shrensky is an angel investor and also splits his time between two start-ups he co-founded: ÜberOffices, a co-working office space in Rosslyn, and enterprise software developer ComplexInterests. Before coming to the Dingman Center, Fine was a venture investor and adviser as vice president of Revolution Partners, an investment bank specializing in mergers and acquisitions and private capital advisory for the tech industry.
Here are excerpts from their conversation with Dan Beyers, editor of Capital Business. You can also listen to their discussion at www.capbiz.biz.
How can someone get involved in the entrepreneurship scene to connect with people and look for job opportunities?
Fine: “There definitely are a lot of ways to network, and there are a lot of local events. The D.C. Tech Meetups have been very popular for starting-out entrepreneurs. But I think also you need to be very focused. If you’re starting a business, I think you need to be targeting the types of events and the types of locations you go to. ... And if you’re looking to join a start-up, I think you also need to think about what is the vertical or the sector that you want to be in? If you want to work for a start-up, which can be grueling at times, you need to be just as passionate about that start-up as the founders are.”
As someone who’s actually gone through and started a company, how did you get started? What was your thought process?
Shrensky: “You don’t start a business just to do it. Today, I think there’s so much noise. It seems sexy to be an entrepreneur. We live in frothy times when it comes to entrepreneurship. I didn’t look to just be an entrepreneur. Actually, I was an attorney. I was not a particularly happy attorney, but I saw a problem that was happening within law firms as related to continuing education, so I saw a problem based on a place where I worked and then decided to solve that problem.
“And I think that’s where you see the best entrepreneurs come from, is where they really know a problem, because they live it. They didn’t just want to start a business to start a business. They’re actually solving a problem and trying to create something of value. So that was kind of the angle I came from.
“Though, I also have to say as I fall on my own sword here, I did get caught up in the time, because I wanted to start a company or wanted to solve this problem during the dotcom days. So I gave notice at my law firm on March 15th and said, ‘I’m leaving, I’m going to go start a business. I’m going to go raise money.’ I was in New York City, this is what everyone was doing, and two days later the bubble burst, March 17th. So I was really in a bad way and I did not raise a dollar, ended up packing my bags, I moved home with my parents and I started my business and bootstrapped it. And it turned out to be the greatest thing that could have happened, because I then owned 100 percent of my business when I sold it seven years later, as opposed to being with a VC, or whatever else would have happened, and the pressures that come with that.”
As an investor, do you invest in the idea or the person?
Barrientos: “I’ve changed my views on this over the years. I’ve been at this, I hate to say, since the mid-90s, investing in firms. There was a time when I strongly believed that the idea trumped everything else. It had to be a great idea and so forth. I think over the years — and I’ve got plenty of scars to show it — I’ve learned a lot of lessons about that.
“Ultimately, ideas change. They almost change immediately. The minute you have an idea and you think, ‘This is the idea that I want to implement, I’m moving towards that.’ You find yourself realizing, okay, well, I didn’t realize that there were these problems with that idea, it must change. After a couple of months, years, you realize that you’ve done probably a 90- if not a 180-degree turn from the original idea. It doesn’t mean that it’s not going to be a great business, you’ve just changed radically.
“So if you think about that, if you think about the fact that ideas stay for just a short amount of time, what does stay is the team, is the entrepreneur. So ultimately their ability, his or her ability to know when to change, when to — we probably overuse the term ‘pivot’ in the start-up world — but knowing when to pivot away from your original vision or your original idea is critical. So if you ask me today, absolutely it’s the individual that I’m betting on.”
Shrensky:“I always go with the expression, ‘Version 1.0 is always wrong,’ but you have to ship 1.0. You have to start somewhere and believe in it, and then you’ll do it, and you’ll find out why you were wrong. And then you’ll do Version 2, and Version 2 is where you’ll make money. Version 1.0 will always be wrong. I’ve never seen it not be the case.”