Monday, March 3, 2008

Starting a Company from the Business Side

Last post of the day, and another flu induced data dump. From The Washington Post comes Dot-Commitment:

"By the time he arrived at Virginia Tech in January 2004, Fahad Hassan still was not over his first business failure. He had poured his heart into a computer support business in his final year of high school, but after a promising few months the customers dried up and the expenses ballooned."


Regardless of a business person's age, getting a start-up off the ground is a risky proposition. Researchers at the University of Maryland recently examined the fate of venture capital-seeking Internet companies started at the height of the technology boom in the late 1990s. Only half existed five years later.

Yet young entrepreneurs like Hassan persist, and they've become an enduring dot-com archetype. In the Washington area, two of the best-known Web start-ups -- Freewebs and Clearspring -- are led by people in their mid-20s.

Since Hassan launched his company, he's had to work tirelessly to solicit venture capital money and to manage employees who are old enough to be his parents.

Hassan "reminded me of the early days of the Internet where it was digital natives: the people who grew up with technology who saw the future," said April Young, a prominent local technology banker who has tried to help Hassan build his company. "The challenge that he and other early entrepreneurs face is: How much control are they willing to give up both financially and intellectually?"


Not everyone was as easily won over by Hassan's vision. Hassan later visited John Burke, a partner at venture capital firm True Ventures, which has an office in Great Falls. Hassan was searching for money, and True Ventures had backed young entrepreneurs before.

"He only saw his product from a user standpoint. There was no business model," Burke said. "My skepticism revolved around: 'How is he going to make money around this? How is he going to get professors to sign up? How is he going to get universities to switch horses midstream?' "


On an evening last week, Hassan did what he most needs to do as a young chief executive: take advice from others.

He went to a Washington Capitals hockey game at Verizon Center as part of the MindShare program, which has been a local forum for established technology entrepreneurs to help start-ups. Before the game, he listened to AOL vice chairman emeritus Ted Leonsis give a talk on entrepreneurship.

Hassan sat a few rows up, one of 40 people all hoping to be in charge of the next great technology company. Most of them were 10 or more years his senior.