Failure is hardly the worst thing that can happen to you in Silicon Valley.

While 2012 saw some spectacularly large IPOs like Facebook and Workday, it also had its share of major mergers and acquisitions.

In my previous blog posts, I have discussed at length the complexities of establishing an enterprise pricing structure, the dials on the model to optimize revenue and growth, and building a long term view of the price strategy. In this last post in the series, I want to go back to an even more fundamental concept: Value.

How do you monetize a unique business model based on users rather than selling an actual product? We asked members of the Young Entrepreneurs Council for their thoughts.

Biggest mistakes YOU need to avoid:

Mistake 1: Cofounder didn’t attend Lean Startup Machine, resulting in some lack of understanding. If you have a cofounder or startup team, you should all attend Lean Startup Machine together.

Mistake 2: MVP doesn’t need to be built. Now we’ve broken down MVP into 3 stages to really emphasize MVP is any experiment you run that will increase your learnings about your customer.

Mistake 3: Stop selling on vision! Start listening.

Mistake 4: Don’t ask leading questions. The way you phrase your questions determine the level of reliability in the answers you get. 

Mistake 5: Don’t think or pitch on features of the future.

Mistake 6: Beautiful design will not cure an ugly baby. (Product that no one wants)

Mistake 7: Don’t fall in love with your solution and romanticize it in your head.

 

Entrepreneurs aren’t quitters. To succeed you need to be resilient, thick skinned and borderline crazy. You need to have just the right amount of delusion to believe you can succeed, spurring you on despite the absurd odds. But sometimes, you have to quit.

“I’m just doing my best… and you can blame it all on me. It’s all my fault.”

Ouch. 

Test and innovate on your business model using the business model canvas, lean startup, and customer development.

Yummly, a semantic recipe search engine, has raised $6 million in Series A funding led by Physic Ventures and Unilever Corporate Ventures, the venture capital arm of food giant Unilever, with contributions from returning investors Harrison Metal Capital and the Harvard Commons Press, among others. Yummly aggregates over hundreds of thousands of recipes from around the web and allows you to filter results by type of food, course, and ingredient and break down recipes by diet, allergy, nutrition, price, cuisine, time, taste, and sources.

• Passion for the business to help recruit, build the brand, raise more money, and speak to the press.
• Willingness to work build his/her network to drive the business forward.
• Honesty and straightforwardness. Civility and respect for other members of the board and team.
• Decision making auditor. Someone willing to challenge the CEO.
• A great listener and someone who asks questions before making recommendations. See Why Smart Executives Fail.
• Openness for learning new models and ways of doing things. Willing to be wrong.
• Patience. Long term vision and the stomach to bear ups and downs, inevitable in any company.

The so-called early-stage funding frenzy seems to be a real phenomenon, with the numbers to prove it. The median angel round for American start-ups grew 40 percent last year, to $700,000 from $500,000.

All these assessments come from analysis of 573 deals in 2011, worth a total of $873.3 million dollars, as compiled in the first “Halo Report,” a joint project of the Angel Resource Institute, Silicon Valley Bank and CB Insights.

Great post. Must read.

The story hasn’t been fully written but consider companies like Tumblr, Twitter, Pinterest, Instagram, Foursquare, Fab, AirBnB and plenty others.

They didn’t start out as rocket ship. Quite the contrary. They started off rather slowly and bumpy. 

One area of fundraising that is not that straightforward is how to put together a syndicate of investors for your seed round. 

1. Understand the difference between and a lead and a follower.
2. Get soft-commitments early.
3. Fill in the round with value-added followers.

Here’s how I see a typical (if there is such a thing) fundraise shaping up for a $800K seed round:

Phase 1: Talk to leads and angels that know you.  Get ~$150K of soft commitments from good folks who know you (hopefully fast)

Phase 2: Close your lead.  Get ~$400K from the lead and set terms for everyone else. (could take weeks or over a month)

Phase 3: Fill in the rest.  Maybe with $150K from another seed investor, and $100K from 3 angels that are directly relevant to what you are building (hopefully fast).

If you want your start-up to become the next big thing, it’s not good enough to just build a great product. Unless you can afford to buy users, you’ll have to grow virally. The difference between getting one of your new users to convince one friend to sign up and that person getting two new friends, is huge. Assuming you start with 1,000 new users, after 9 months, it’s the difference between having 9,000 users and 511,000 users! Below are 9 ways your start-up can grow virally: Building a great product is only half the battle. Take the time to think through how you can build in as many viral growth opportunities. It’s worth the effort to go from linear to exponential growth.

Six months ago my company hadn’t even launched. Last week we found ourselves being talked about everywhere in Britain — a full page story in The Sun, the country’s biggest newspaper, columns in most of the other nationals (both online and offline) and pickup in literally hundreds of regional newspapers, radio stations, trade publications and blogs. How? Simple: We used our strengths — the data we live and breathe every day — and released a survey of the best and worst cities to find a job in the U.K.

Some really good tips. Credibility is probably the most important to me here, without you can kill every chance you may have.

• Share your idea frequently.
• Simple ideas win over complex ones.
• Have a single revenue stream.
• Identify your ideal and hopefully sole customer.
• Small markets suck.
• Explain your idea in less than 10 words.
• Have a secret sauce.
• Be original, be new.

We’d previously highlighted the top startup failure post-mortems of all-time here (32 in total) written by a group of startup entrepreneurs gracious enough to share their lessons learned from their startup’s failure. Many of you read those post-mortems and asked, what are the most common reasons for failure cited across those posts? Well, we’ve done the work, and below are your answers. After a thorough analysis of those 32 start-up post-mortems, we have determined the common reasons founders gave to compile this list of the top 20 ways to have your startup fail. First, a handy chart to highlight the top 20 reasons for failure followed by an explanation of each reason and relevant examples from the the post-mortems.

As the third most popular source of content on digital pin-board site Pinterest, Flickr and its photographers are subject to frequent acts of copyright infringement. But a site-wide update to Flickr promises to better protect members and their copyrighted works.

Flickr set up the meta Pinterest 'nopin' on all copyrighted images.

What a move!

The Boston metro area is no Silicon Valley. But it fields its fair share of startups and it raked in the lion’s share of the nearly $780 million in venture capital invested in the New England region in the fourth quarter of 2011. While the area is more famous for the tech luminaries and startups it lost to other regions — Harvard alums Facebook’s Mark Zuckerberg and Microsoft’s Bill Gates being the most famous examples – it still can claim a roster of impressive tech startups. As a Silicon Valley-based partner for Boston-based North Bridge Venture Partners‘ Paul Santinelli has studied the differences between the two technology hotbeds up close and come up with a few conclusions. ”Boston is strong in infrastructure, comms [communications], and enterprise software — the kinds of technologies needed to build businesses,” he said in a recent interview.

Pinterest could be in Fair Use territory (meaning, legally protected).  Fair Use law allows people to use work they do not own the copyright to.

There are four elements to consider when determining if something is Fair Use:

1. The purpose and character of the use, including whether such use is of commercial nature or is for nonprofit educational purposes
2. The nature of the copyrighted work [is it fictional or factual]
3. The amount and substantiality of the portion [of the work] used in relation to the copyrighted work as a whole
4. The effect of the use upon the potential market for, or value of, the copyrighted work

Perfect 10 v. Google [...] Google won the case. The courts ruled that Google Image search is Fair Use because it's transformative.

Maytal told us, "The use of the thumbnails was highly transformative, allowed users to get to a source of information that they couldn’t otherwise get." Google Image search becomes a social benefit and a reference tool.

Read more: http://www.businessinsider.com/pinterest-illegal-faq-2012-2

Pinterest has managed over the past few months is spectacular. Recently reaching the milestone of 10 million users, the site has gained traction faster than just about any other site in history. But with that growth comes the responsibility to handle it and the site seems to be falling into spammer territory. A couple of hours ago (as of the time that I’m writing this), Google’s Don Dodge started tweeting that Pinterest was sending him a mass amount of emails saying that he had been followed on the site, and then asking him to follow that person back.

Black hat email marketing?

But with the average Facebook user having 120 friends (and many folks having exponentially more), it’s easy to see how growth of active users like this could happen in a much less justifiable way. To quote a Facebook friend of my own, “spam called. They want their idea back.”

A screen grab of the BBJ's pinboard, showing architects' renderings for planned buildings throughout Boston. After a careful read of the fine print, it has been taken down.

Unlike other social media services, when you ‘pin’ something on Pinterest, you automatically upload an (at least) medium-sized version of the related image to the service. Exceptions for publishers of user-generated content protect Pinterest, but they don’t protect you. Unless you know you have a "worldwide, irrevocable, perpetual, non-exclusive, transferable, royalty-free license," you'd better tread carefully. I was not able to immediately reach Pinterest, for comment.

Advertising is the monetization plan for many of the hottest consumer Internet startups. But for brand new companies, nailing down that first brand partnership is a daunting task. It’s an experience Jeffrey Cutler, now Director of Digital Strategy at Team Epic, knows well. He spent a chunk of time “literally running up and down Madison Avenue,” he says, as Director of Marketing at Going.com before it sold to AOL in 2009. The time sink required to court brands and agencies is frustrating an...

http://hearmypitch.com/

Arguably most intriguing, however, is that 80 percent of all pins are re-pins, meaning that an overwhelming majority of content shared on site is recycled between users.

“Pinterest is conducive to sharing,” Moore said in an interview with VentureBeat. “There’s a very low barrier to sharing [pins] with everyone who is following you,” Moore said of the re-pinning phenomenon.

If i am not mistaking, this is the same for Tumblr in terms of re-sharing vs adding. It is important for any network to allow users