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#SXSW Day 2: Reconnecting with Inspiration by

There are so many people who are jaded about the SXSW experience.  I can understand that. It is overwhelming in its size and scope as it spreads out in Austin’s Downtown area. And some people don’t like to be mixed in with large crowds.

25,000 people in Downtown Austin, that aren’t normally there, is a lot.  But that’s also what makes it so interesting.  If you poke your head up from Twitter, you can really have interesting conversations with people.

On Day 2, an overcast, drizzly day, I started out with a cup of coffee from Medici, after once again getting stuck parking in the Austin City Hall (quite far from the action).  I met a startup advisor/legal specialist on my way to the Lean Startup sessions. One of those brilliant, independent freelancers that you immediately want to work with.  We met because she was concerned I was about to win a Darwin award for getting a shoelace caught in the massive escalators at the Hilton.

The Lean Startup Machine

This has grown every year for the last 3 years at SXSW.  This year they doubled the ball room that the day-long agenda received, which dramatically helped with crowd control.  You really don’t want a situation where there is a person in every chair and seated along the walls.

The first session was from Travis of Uber – discussing the challenges of upending a highly regulated industry.  In particular, you have the industry players fighting back, but also using the bureaucracy of cities and states to build a firewall against new entrants into the space. It is all about preserving the status quo.  And the challenge for Uber is to get these cities and governments to see that transit in their city could be improved by the advent of Uber and similar services.  That cabs might need to innovate as well.

Travis also talked about the challenges of growing a business that has caught the tiger by the tail.  20% growth month over month – you have to take on investment to tackle that – you can’t just “lean” your way to growth in that situation.

Scott Chacon of Github was up next, and then the founder of AirBnB.  Scott focused on work-life balance, a luxury of the type of business that they started, and something that in a sense firewalls them against many reasons for high turnover in tech.  AirBnB focused on localization as a challenge (using a trivial example of marketing/ad copy).

Whatever you think of the Lean Startup, it has changed the way entrepreneurs think about starting up companies, and finding winning products (phrases like product-market fit roll off the tongue these days).  The sessions at SXSW-interactive have been a pretty good barometer of how much the Lean Startup has caught on – bigger and bigger attendance each year, more interesting startup founders ready to talk each year.

Steve Blank, Hollywood, and Startups

Steve Blank talked about how similar startups have become to Hollywood.  While both industries started out anonymous, run by hard workers trying to create great products, and both industries escaped the east coast for the west coast in order to be out of sight of the east coast establishment and culture. In Hollywood, very quickly, a star ecosystem was born…

  • gossip press, star system from hollywood
  • gatekeepers
  • herd effect in product creation (everyone makes westerns at the same time)
  • Fad investing
  • poseurs
  • Auteurs
  • Hard workers (at the bottom of the ecosystem

Silicon Valley didn’t have any of this culture for more than 20 years -because they weren’t producing products that everyone cared about. But the advent of consumer tech has changed this – everyone cares now.  We have our own gossip press in the Valley – tech crunch, the verge, pando daily.  We have CEOs and founders who are no longer anonymous and sometimes are treated as celebrities.

And so the star ecosystem is born in Silicon Valley… and Steve says it is coming to the rest of us, if our startup ecosystems get big enough and successful enough.

His advice: the change is here. We’re not going back.  So get used to it. And deal with it:

  • Focus on the signal (good product, hard work, product-market fit, customers)
  • Ignore the noise (press, hangers-on, what the Jones’ are doing
  • Build a great product,
  • Find a customer who will literally grab it out of your hands

Great session. And of course, at BP3 we love his advice because it reflects what we do – ignore the noise, focus on the signal.

Elon Musk, Terrestrial and Extra-terrestrial concerns.

Elon Musk is the entrepreneur of our time.  Not content to build another financial transaction company (PayPal), he’s tackling what he refers to as the big terrestrial concerns: Energy production and consumption (Solar City and Tesla); and the one big extra-terrestrial concern, making space travel affordable and reasonable. He reminds me very much of the entrepreneur described in Stephen Baxter’s novels (e.g. Manifold:Space).  How does one get a private space travel business going?

As the interview was happening, the Dragon spaceship was docked to the international space station.  Elon was asked how stressful the launch is, and he described it as the intensity decreases as the rocket gets higher – because the damage is less upon failure, and your options for rescuing the mission increase as you get further off the ground.

He also revealed that he’d like to open a commercial spaceport in Texas.  This received applause even in the overflow room, watching on the big screen.  Rightly, he pointed out that at some point, commercial flights shouldn’t be taking off and landing from military installations – just as commercial airlines don’t take off and land from military airfields.

 Check out the video – with a nod to Johnny Cash…

Elon moves quickly – his hope is to open this spaceport in 2-3 years with a launch.

He also talked about the grasshopper – a rocket that can take off -and land- vertically… with the precision of a helicopter.  Each of the three stages of the rocket would be re-usable. This would dramatically reduce the cost of space travel as 99% of the cost of a launch is the rocket – not the fuel (that was news to me).

Elon was fully of funny quotes during the talk, some of which I captured on twitter.  He even managed to work the word “interstitial” into the conversation – not a small feat.  He took time out to thank Peter Thiel for investing in SpaceX at a critical time (after the third failure, and before the first successful launch).

One of my favorite moments.  Elon describing his attempt to send a greenhouse to Mars, based on the theory that we needed the will to focus on space travel. That America had lost the will.  And he thought he needed to inspire it.  Paraphrasing his statement:

“We hadn’t lost the will. We are a nation of explorers. I shouldn’t have believed we don’t have the will. We just have to show that it is possible.  That it is affordable.  It is not a question will, it is a question of way”

Whether you like Elon or not, this was an inspiring subject.  I walked out of that session with more optimism about our space program and what’s possible than I’ve ever had.  I also walked out of that session feeling more optimistic about capitalism.

Reconnecting (with Trilogy Alumni)

The Trilogy Alumni effect was in full effect at this SXSW.  We organized a meetup at Capital Factory’s amazing space on the 16th floor of the Omni building.  I don’t know if there was a gathering in Austin with more business owners and influencers – 70 alumni showed up and it was great to catch up with people doing great things.  It was scheduled from 4:30 to 6pm.  But at 8:30pm I was cleaning up the last few drinks as we cleared out.  That’s a powerful networking group of entrepreneurs.   And in this case, we had folks from all over the country (or outside the country) who were in town for SXSW.

If you’re involved in startups and with entrepreneurs, you could do worse than to connect your startups and founders and investors with Trilogy Alumni.  (Speaking of Trilogy Alumni and startups, congrats to the folks at Handshakez, who just took in $3.6M in funding!)

Closure

I wrapped up the night with dinner at a nice Italian restaurant in North Austin. As we drove by looking for parking, we saw the brand new Tesla store, just opened.  Well, sometimes your day comes full circle.