Sequoia’s Process

This post is for all those entrepreneurs who have sent me emails (and for those who have not, but are in the same shoes, dealing with positioning / fund-raising issues) :

Read this section on Sequoia’s website about their Process. Focus especially on Clarity (Can you explain your business on the back of a business card?), Market, Customers, Need, Differentiation, and Frugality.

The two NOT to focus on are : DNA and Inferno. DNA claims that successful entrepreneurs come from modest backgrounds. This would mean Bill Gates did not happen. And Inferno claims that all businesses can be built with little money. This isn’t true. Amazon burnt through a lot of money and was in the red for long. Google had a $100 Million cash infusion from Yahoo, deftly maneuvered by none other than Mike Moritz. These were not exactly boot-strapped businesses. eBAY, on the other hand, did consume very little capital, so yes, great businesses have been built for very little money in the past, and will be again. You have to pick one that can be built in this mode, or else you get into the endless cycle of down-rounds and financial restructurings …

Anyway, thought this would be useful for some of you.