Author: Chris Cameron

Lately on the startup blogosphere there has been a lot of talk about lawyers and how they relate to startups and entrepreneurs. A few weeks ago, Scott Edward Walker, a guest author on Venture Hacks, posted his Top 10 reasons why entrepreneurs hate lawyers, which prompted venture capitalist Mark Suster to write How to Work with Lawyers at a Startup.

Regardless of whether lawyers are something entrepreneurs should loathe or love, it seems as though a curation of legal resources for startups was in order. The following is a list (in no particular order or rank) of blogs, articles, websites, VC tips and other online resources for entrepreneurs and startups.

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The goal is to create a resource that startups can continue to come back to, so if you have some suggestions that aren’t on the list, please let us know in the comments.

Blogs

The Startup Lawyer
Startup Company Lawyer
Global Startup Blog
Venture Law Lines
Freeland Benevich PLLC
Mendelson’s Musings
Startup Company Blog
William Carleton, Counselor @ Law
BigStartups.com
Spam Notes
Emerging Enterprise Center Blog
BizzBangBuzz

Online Legal Tools

Legal River
Legal Zoom
Nolo
Term Sheet Generator
NVCA Model Legal Documents

Recent Articles

AllBusiness.com – Start-Up Legal and Licensing To-Do List for Small Business
Entrepreneur.com – Answers to Your Startup Legal Questions
Jeremy Freeland – Early Stage Tech Companies – When Should You Involve a Lawyer?
Venture Hacks – Bram Cohen: “Lawyers can’t tell you you can’t do something”
Venture Hacks – Top 10 reasons why entrepreneurs hate lawyers
VentureBeat – Ask the Attorney: What issues do I need to consider when forming a start-up?
Harvard Business School – Top Ten Legal Mistake Made By Entrepreneurs

Tips From VCs

Brad Feld & Jason Mendelson – Term Sheet Series Wrap Up
Guy Kawasaki – The Top Ten (Sixteen) Lies of Lawyers
Mark Suster – How to Work with Lawyers at a Startup
Don Rainey – Son, you’re going to get your butt kicked

Law Firms & Lawyers

Walker Corporate Law
George Grellas & Associates
Morgan Lewis
Dorsey & Whiteney LLP
Fenwick & West
Silicon Legal
Goodwin Proctor

Other

Startup Law 101
Great Web Startup Lawyers
25 Startup Law Resource

From ReadWriteWeb

Stock Options 101: Negotiating Ownership
Why No One Will Sign Your NDA

Ryan Roberts’ 25 Startup Law Resources was a key jumping-off point for a good portion of the links found in this list, so thanks Ryan!

Photo credit: walknboston.

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In the last few weeks here on ReadWriteStart, we’ve been chronicling various cities outside of Silicon Valley with thriving startup communities in our semi-weekly series Never Mind the Valley. We’ve told you how Boston is raking in venture funding, how Los Angeles is growing despite its northern neighbor, and even how Israel is an emerging tech hub overseas.

Despite these and other entrepreneurial cities popping up around the globe, Silicon Valley has held true as the mecca for startups. According to angel investor and Venture Hacks co-author Naval Ravikant, this is why being in the Valley is a must.

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“For years I didn’t believe this. I thought that you could take advantage of the benefits of Boston, Seattle, NY, [or] Austin,” writes Ravikant on his personal blog Startup Boy. “But I give up. I found myself telling an entrepreneur why he had to be in Silicon Valley if he wanted to succeed.”

However, Ravikant doesn’t present the usual suspects when explaining Silicon Valley’s dominance, instead he points to some benefits that tend to fly under the radar. First he says that consumer Internet businesses in Silicon Valley are increasingly becoming “winner-take-all,” whereas in other cities, a successful company might be bogged down by similar competitors.

Secondly, he says that the businesses a startup would look to partner with are all located in the Valley, and that serendipitous meetings and relationships are often at the core of many partnerships. Finally, Ravikant argues that Silicon Valley’s early-adoption community makes it easier to make use of emerging technologies and networks.

“Sure, it’s possible to build a great Consumer Internet business starting out somewhere else,” writes Ravikant. “But given that these are winner-take-all businesses, do you want to start out that far behind the curve?”

Is Silicon Valley the end all, be all of startup cities? Or do other communities have a shot at fostering competitive Internet startups? Let us know what you think in comments.

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Barack Obama’s rise to fame in the years leading up to the 2008 presidential election caused many to compare the then young Illinois senator to John F. Kennedy. Like Kennedy, Obama mobilized an enormous following across racial boundaries and of all ages with his charismatic and inspirational speeches of hope for a brighter future. But according to New York Times contributor and multi Pulitzer Prize winning author Thomas Friedman, while Kennedy continued to inspire after his eventual election, Obama has not.

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In a New York Times op-ed column from this weekend, Friedman calls on Obama to reignite the nation’s innovative and entrepreneurial flames and to make 2010 “the year of Start-Up America.” Friedman says doing so would be Obama’s “moon shot,” a reference to President Kennedy’s campaign to send American astronauts to the moon in the 1960s.

“What the country needs most now is not more government stimulus, but more stimulation,” writes Friedman. “We need to get millions of American kids, not just the geniuses, excited about innovation and entrepreneurship again.”

Friedman points to two organizations Obama should be promoting to America’s youth – National Lab Day and Network for Teaching Entrepreneurship (NFTE). National Lab Day invites teachers to request local scientific professionals in their area to come in and work hands-on with students. NFTE provides teachers with resources for teaching entrepreneurship and also hosts a nation-wide startup contest for students with a $10,000 grand prize.

As Friedman points out, Obama needs to make sure every student and teacher in America knows about these programs if his very own moon shot of inspiration is to take place. After all, when President Kennedy gave his speech declaring his goal of reaching the moon, he didn’t stand before congress and ask them to legislate. He stood before students at Rice University and urged them to innovate.

“We choose to go to the moon in this decade and do the other things, not because they are easy,” said Kennedy in September of 1962. “But because they are hard, because that goal will serve to organize and measure the best of our energies and skills.”

Disclosure: ReadWriteWeb is a syndication partner of the New York Times.

Photo by Flickr user Beth Rankin.

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The next time you find yourself claiming to not have enough time or money to form a startup, just remember the name Sebastien Eckersley-Maslin. While it may not be the easiest name to remember, it could certainly come in handy if you ever want to learn to quickly launch a startup on the cheap.

Eckersley-Maslin, an Australian entrepreneur, has challenged himself to take a startup from idea to business in just seven days on a $500 budget, all while blogging about his progress on the homepage of Australian entrepreneurship magazine Anthill. He says he is tired of hearing would-be entrepreneurs complain about a lack of time and money, so he has set out to prove that all it takes is some will and dedication.

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Beginning his journey on January 19th, the daring Aussie is currently on day four of his week-long journey. So far, Eckersley-Maslin has developed his idea, planned out his business, set up his domain, bank, and hosting accounts, developed a pitch and marketing strategy, and has begun to work on the functionality of his site. The idea? An online car mileage log that can be updated via SMS which he calls AutoCarLog.

Next on his schedule is to continue developing while working on graphic design on day 5 and the SMS gateway on day 6 before ultimately launching the product on day 7. Just as any startup needs a business plan, this Australian didn’t jump in to his experiment without thoroughly preparing.

“As there were things I could only do during business hours (visiting the bank) I split each day into two,” writes Eckersley-Maslin. “During the day I would have to cover registrations, marketing and promotions and during the evenings and weekends I could focus on development and design.”

What do you think? Will Eckersley-Maslin succeed to launch a product in just seven days? Or will the busy days and late nights wear him down before his deadline? He seems well on his way to success, but let us know what you think in the comments.

Photo by Flickr user aminCr.

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With the week coming to a close and the weekend just a few hours away, we thought we would take the opportunity to recommend a few books for the entrepreneur looking to do some weekend reading. Whether you’ve got a lot of time to sit and read, or just a little time in the car to listen to an audiobook, find some time to knock these off your reading list.

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Perhaps the most well known and most vocal venture capitalist is Guy Kawasaki, author of the aptly named blog How to Change the World and the books The Art of the Start and the more recent Reality Check, among others. If one was to enroll in Startup Entrepreneurialism 101, Kawasaki’s books would likely be required reading. Kawasaki’s years of experience from the early days at Apple and the Silicon Valley VC scene provides a wealth of information for the eager entrepreneur.

Former Economist writer turned Wired editor-in-chief Chis Anderson is also the author of popular online business books perfect for the budding entrepreneur. The Long Tail was Anderson’s first book and was adapted from an article he wrote in Wired. In it, Anderson describes how online marketplaces have opened up the door for small niche businesses to thrive. In his second book, Free, he examines how sometimes giving away your product can make you more money in the end – the so-called “freemium” model. Anderson used this model to sell the book, offering it for free as an online download while at the same time selling the hardcover version in stores and online.

The Fountainhead by Ayn Rand is one of my favorite novels of all time and it recently found itself included in Business Insider‘s list of 15 Books Every Entrepreneur Should Read. One would not expect a work of fiction to be included on a list littered with business strategy books, but Rand’s philosophy of individualism versus collectivism at the core of this novel can be easily applied to entrepreneurialism. Written in 1943, the novel is the story of an architect’s struggle to be true to his creative beliefs and not conform to traditional practices. Entrepreneurs looking to change the world should free up few open weekends to finish Rand’s dense but worthwhile novel.

Still can’t get enough entrepreneurial books? Under30CEO has an excellent list of 10 Books Every Entrepreneur Must Read From 2009, and David Siteman Garland has a great list on his blog The Rise to the Top of 13 Must Read Books For Every Entrepreneur. Have some suggestions for further reading? Let us know in the comments!

Photo by Flickr user Horia Varlan.

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Earlier this week, we told you about the thriving startup scene in Austin, TX, which is home to South By Southwest (SXSW), one of the largest events of the year for the startup community. Many startups have used the Interactive portion of SXSW to launch their new product, including Twitter and Foursquare, and now the organizers of the event are offering special package for companies that can help with that process.

Announced yesterday, The aptly named “Launch Package” provides companies with floor space at March’s Film and Interactive Trade Show, as well as advertisements in the event program, inclusion at an invite-only press event, and the opportunity to get their “creative swag” in gift bags to be distributed at the event.

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Priced at $5000, the Launch Package also includes two sponsored posts on both the SXSW Facebook page and on the event’s Twitter account. Combined with the other offers, companies can save over $2000 by purchasing the package.

“This turn-key solution includes assets to maximize your footprint at the festival, as well
as outreach through the SXSW social networking channels and direct access to key media
at a private meet the press event,” says Katie King, who manages sales for SXSW Interactive.

Exposure is great for any small business hoping to gain traction and there is no better place to be seen than at SXSW. Last year’s SXSW event saw over 31,000 attendees with over 24,000 visiting the Film and Interactive trade show, making the Launch Package a highly valuable opportunity for startups.

Pricing for vendors at SXSW can get fairly expensive depending on the size of the display and when it is ordered. The last chance to save any money on a display was back in November, and now business looking to set up shop on the trade show floor are looking at prices ranging from $1560 for a single stand to $4446 for a large end cap. Bundling the floor display with print advertisements and “swag bag” inserts could be an excellent way to save some money with the event just two months away.

Photo by Flickr user Matthew Simantov.

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Though we have previously warned startups to tread carefully when building their businesses on third party APIs, there are still plenty of successful businesses that rely on them for their day-to-day operation. For application developers, if you’ve found yourself repeatedly visiting Downforeveryoneorjustme.com to check on the status of a site or API, one company may just have the perfect solution.

A product of Dutch website monitoring service WatchMouse, API-status is an easily-interpreted heads-up display of 26 popular third party APIs. The big boys like Facebook, Twitter and Flickr are all present and accounted for, and other services like Salesforce, and Posterous are supported also.

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The site has two main windows, one for the current status, and another containing a matrix of the history over the past week. Clicking one of the API names in the current status list opens a page containing further detailed stats for that service. Included is a graph of average daily performance for various parts of the API, a map displaying the current status by country, and graphs of availability over both the last week and the last day.

As you can see in the screenshot above, the service shows some poor performance currently in South Africa and was also able to track this morning’s downtime in Twitter’s friend timeline API.

Some features we would love to see implemented would be the ability to compare two or more APIs on the various charts, as well as the support for looking further back than a week. Allowing a user to subscribe to alerts for particular APIs would also go a long way in helping those using the APIs to be instantly aware of any outage.

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American startups are not alone when it comes to the well of venture funding drying up. A recent report by the Israel Venture Capital Research Center has found that funding in Israel fell drastically to $1.12 billion in 2009, nearly half the amount from the previous year. The 46% decrease marks the lowest funding numbers since 2003 and ends Israel’s streak of three consecutive years with increasing number of companies and funding dollars.

The numbers are a sign of the worldwide economic stress that is affecting countries large and small across the globe. While funding plummeted between 2008 and 2009, the number of companies funded only fell roughly 7% from 483 to 447, which means less money is being given to each company. In the fourth quarter of 2009, the average financing round was just $2.2 million, down from $3.61 million during the same period in 2008.

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By sector, life sciences saw the most growth took the lion’s share of the money up from 15% in 2008 to 24% in 2009. Semiconductors in Israel continued a downward trend, falling from 15% of the funding in 2008 to just 8% in 2009, its lowest share since 2001. The internet and communications sectors held steady at 13% and 20% respectively, but they are nowhere near their numbers from 2000 when they combined for almost 70% of the total funding.

As reflected in the report, Israeli venture firms tend to favor mid-stage funding over seed funding by a great margin. In the fourth quarter of 2009, mid-stage companies accounted for over half of the funding, while seed companies gained just 4% of the total.

We recently reported that the fourth quarter showed hope for American startups, both in mergers and acquisitions and venture funding. For comparison, the United States saw over $20 billion in venture funding for 2461 deals in 2009, an average of nearly $8.5 million per deal.

With venture funding seemingly drying up in Israel, the United States could see an influx of foreign entrepreneurs coming to American for venture funds. Of course, this could be expedited by the creation of a startup visa program, a topic we wrote about earlier this month.

Photo by Flickr user hoyasmeg.

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Last week we told you about “lean startups” and how one of their strengths is rapidly collecting customer feedback and implementing changes to their product. With online tools like Get Satisfaction, gathering the opinons of your users is easy, and now with InstantLoop you can even hear what they have to say with automated phone surveys.

InstantLoop is the recent winner of the Twilio Startup Weekend Challenge, a contest for companies utilizing Twilio’s API for sending and receiving phone calls. Users enter questions and possible answers, pick the phone numbers to call and then sit back and watch the results come in. The service is subscription-free; instead, users pay as they go at a rate of $.10 per customer feedback with the first 20 at no charge.

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New users can sign in with one of six forms of identification: Google, OpenID, Twitter, Facebook, Yahoo and AOL. From there, users create a poll by giving the poll a name, entering in as many questions as needed, providing up to eight possible answers per question, and picking an introduction and closing message.

InstantLoop claims that users can record the questions and messages themselves, but I saw no option to do so when trying it out myself. Attempts to contact InstantLoop on this issue received no response, so perhaps this feature is still being developed.

After creating the questions and answers, users can either save the survey or enter in phone numbers and send it out for polling. InstantLoop also provides the ability to mask their phone number with a caller ID of your choosing, which may encourage users to pick up since the number may be familiar to them.

I tested the service on myself, and within seconds of hitting send I was listening to a computerized female voice asking me the questions I had entered just a minute before. A few moments later, InstantLoop had graphed my responses on a pie chart, and had created a list of questions and corresponding answers and phone numbers.

Certainly a small business can take advantage of InstantLoop, but until the ability to record personalized messages is activated, customers may be turned off by the computer-voiced calls. It would seem that since the product is still in beta that some key features have yet to be activated, such as contact management and overall interface experience.

Once these features are available, InstantLoop could be a popular way to hear back from your startup’s user base. Additionally, it will be interesting to see if InstantLoop can gain traction as a startup whose entire business relies on a third-party API. We recently told you about Totlol, a startup built on top of YouTube’s API that was damaged by a sudden change to API’s terms of service. However, a similar problem is not as likely since InstantLoop won Twilio’s own competition for using the API.

UPDATE: InstantLoop has responded to our inquiry, stating that the recording feature was pulled from the beta release, but should be coming soon.

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Settled in the 1830s along the banks of the Colorado River and named for the Father of Texas Stephen F. Austin, the city of Austin is known for its thriving music scene and as the home of the University of Texas (UT) Longhorns. But in the past few decades, the Texas capital has built up a reputation of a different sort.

With companies headquartered in Austin like Dell and Freescale Semiconductor, a spin-off of Motorola, the city has become a hotbed of information technology hardware and software. In the mid 1990s, Austin was put on the map by software companies like Motive, Vignette and Tivoli, the latter of which was quickly scooped up by IBM in 1996.

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But something these companies have in common other than their birthplace is that they were all funded by Austin Ventures, the earliest player in the venture capital industry in the city.

“Austin Ventures was pretty much the only significant game in town when it came to funding, and they knew IT software best,” says Jonas Lamis of Tech Ranch Austin, an incubator for early-stage startups.

With help from Austin Ventures, dozens of technology companies have grown out of Austin – several of which have been acquired by top IT companies like IBM, Alcatel-Lucent, Hewlett Packard, and Sun Microsystems, to name a few. With just under $4 billion in assets, Austin Ventures has become the largest non-coastal venture capital firm in the United States.

Lamis says that while a less “sexy” vertical like IT still pays the bills, its proliferation in the Austin area has been both positive and negative.

“The good news is there’s a vibrant market for it,” Lamis told ReadWriteWeb. “The bad news is that consumer internet startups were missing from Austin and even today there’s very few of them.”

But there are exceptions to every rule. Smaller startups like Gowalla (Alamofire), Socialware, Piryx and OtherInbox, as well as larger ones like Bazaarvoice, Spiceworks and SolarWinds have all found a home in Austin. And of course one would be remiss to forget the Austin community’s pride and joy, the interactive portion of South By Southwest (SXSW). A yearly showcase of some of the hottest startups and emerging technologies, SXSW has served as a launch pad for now ubiquitous startups like Twitter and Foursquare.

Another industry thriving in the Austin startup scene is biosciences and environmental businesses, spurred by the Austin Technology Incubator at the University of Texas. In addition to IT and wireless, ATI hosts divisions devoted to helping launch startups in the clean-tech and bioscience industries. Executive Director of the Austin Wireless Alliance and ATI Director Bart Bohn says the last few years have seen a large uptake in traction for clean energy startups.

“One event that signaled the transformation was the first Clean Energy Venture Summit in May of 2007 in Austin,” Bohn told ReadWriteWeb. “Thirty to forty investors came to listen to 15 or so startups, and 400 people attended. It was standing-room-only in biggest ballroom we could find.”

Along with other groups such as CleanTX and the Solar Energies Entrepreneurs Network, Austin has quickly become known for clean energy innovation. Another organization, the Pecan Street Project, a coalition of various organizations and Fortune 100 companies, plans to redevelop an old municipal airport just a few miles from the UT campus into a community hooked into a smart electrical grid.

This blending of unique industries in Austin is just a small part of what makes the city unique from other entrepreneurial communities like Silicon Valley. Mike Maples of Maples Investments knows the dichotomy that is the relationship between the Valley and Austin because his Silicon Valley-based agency invests roughly 20-25% of its money in Austin-based startups.

“Silicon Valley is an acceleration machine for sure, but the downside is there can be a flight of talent to the winning ideas,” Maples told ReadWriteWeb. “Austin is a better place to have a stable base of people working at a company.”

While Maples recognizes that Silicon Valley is a mecca for startups, he also says that arguing one over the other is like comparing apples to oranges – each has its pros and cons.

“The other issue is that sometimes Silicon Valley is like 9-year-olds playing soccer, they just all chase after the ball,” says Maples. “Austin benefits from that. You get the occasional idea that no one in Silicon Valley cares about, but its a great idea.”

Helping the Austin startup community take advantage of these opportunities are the numerous organizations and events in the city. Tech Ranch Austin, Capital Factory, Bootstrap Austin, Conjunctured, and the Austin Technology Incubator are just a few of the organizations working with Austin startups. Some of the more popular events in Austin include of course SXSW, Mobile Monday Austin, TeXchange, Austin Tech Happy Hour, and Ignite Austin.

Maples envisions only more growth from the Austin community in the future and encourages them to not mimic Silicon Valley. Instead he suggests they jump ahead of the curve to the next big thing, which he says could be the consumerization of their already massive IT businesses.

“For Austin, the opportunity is to merge software and services,” Maples says, encouraging the city to focus on what it knows best. “Always try to be your best self.”

Photos by Flickr users roland and Kumar Appaiah.

Special thanks to C. Enrique Ortiz, Jonas Lamis, Bart Bohn and Mike Maples for their help in gathering information for this article.

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Just in time for tax season, online bookkeeping service Outright.com will begin providing a 1099 tax filing service for entrepreneurs and sole proprietors on top of its current W-9 service. The site is also launching what they say is the first community for the self-employed where startups and entrepreneurs can find bookkeepers.

For most of us, tax day is April 15, but for entrepreneurs required to meet the February 1 deadline for providing 1099 forms to contracted employees, the madness starts now.

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“Startups working with contractors should have collected form W-9 by now,” Outright’s Paul O’Brien told ReadWriteWeb. Using those W-9 forms from users and their contractors, the site does the rest – automatically filling out 1099’s, e-filing them with the IRS and sending copies directly to the contractors.

Starting tomorrow, the new 1099 service will cost users $5 per filing, though for each contractor that joins Outright after their 1099 is filed, the site will refund their $5 fee. The fee for the 1099 can be deducted as a business expense on the user’s personal tax return.

The site will also be rolling out a social directory to help connect entrepreneurs and startups with Outright’s expanding community of bookkeepers. O’Brien says that there are a few thousand bookkeeping professionals using Outright, and this new directory will help them find businesses who need help around tax season.

Outright claims it is tracking over $1.2 billion worth of self employed and startup business, an increase of 21% from just three months ago when it announced tracking $1 billion. Self-employed individuals make up 75% of Outright’s users, and the majority of the remainder employ fewer than 10 people.

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Whether you’re a rookie or a seasoned veteran of the job interview process, when it comes to interviewing for a startup, there are a few tips you may need to help you land the gig. Startups are not like your every-day business, they are a unique form of company that requires equally unique interview tactics. Talent services company Sutra HR has made a name for themselves in India for helping startups find the right hires, and recently they wrote about ways to survive a startup interview.

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Before the interview, make sure to take the necessary steps to be fully prepared. While this may seem obvious, there are a few things you can do to prepare for a startup interview, such as trimming your resume and researching the company. Startups are usually on the cutting edge of their industry, and while resumes are still important, they are emphasized less and less these days.

That being said, take the time to go through your resume and trim the fat, being careful to not over-elaborate anything. Stick to what you know and what you do well, and in most cases you should be able to keep it to a single page. Spend some time reviewing the company, its founders, its business model and its competitors. With the rapidly evolving landscape that is startups, recognizing the potential of possibly viable companies is critical to a sustainable future.

After the research and preparation, when it comes time for the interview, make sure not to overdress for the occasion. For men, Sutra HR recommends skipping the suit and tie for a nice striped shirt and a nice pair of unripped, unfaded jeans. As for women, the agency simply suggests not wearing anything that would draw unnecessary attention in order to avoid being hired for the wrong reasons – just keep it semi-formal.

During the interview, Sutra HR suggests not trying to sound like a robot with your responses. Keep it natural and flowing; just have a conversation with the interviewers. And finally, they suggest to not fear talking about salaries, benefits, stock options and bonuses, but to rather to be cautious, respectful and honest when discussing your value.

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Earlier this week we told you how a well crafted elevator pitch can be more effective than a well written business plan, but a business plan is still a necessary step in any startup. Writing a business plan can be a daunting task for a first-time entrepreneur with little or no experience in business. Thankfully there are plenty of resources online for researching and creating a great business plan, so here are three great examples.

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EBS Business Plan Builder

The New England Business Service has provided an excellent online tool for easily creating a business plan. Simply fill in the fields and the NEBS does the rest, formatting your plan for you to copy and paste into a word processing application of your choice.

Critical Steps to Writing a Business Plan

Along with several other articles for writing and preparing your business plan, About.com has put together nine steps to complete to make the process simple. From determining your audience to reviewing and editing, follow these steps and you’ll have a great business plan in your hands.

Bplans.com

If you’re looking for a sample business plan to look over before you start writing one of your own, Bplans has you covered. With over 500 samples and their own software for business plan creation, Bplans is an excellent online resource for young entrepreneurs.

For an extensive list of resources for writing a business plan, be sure to check out OnlineAccountingColleges.com‘s list of 50 Free Sources for Business Plans, Templates and Models.

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Motivational speaker and author of the book Start With Why Simon Sinek believes he has found a way to map out the way inspiring leaders and innovators think. Young entrepreneurs who may think they aren’t up to snuff with the big boys of innovation should be encouraged by Sinek’s theories which seek to break down inspiration into an easily replicated formula.

He calls his concept “The Golden Circle,” a series of three concentric circles that represent the different ways we think about a product or goal. The outermost circle, labeled “What,” represents, for instance, a company’s product. The next circle, “How,” would be the technology behind this product, and the innermost circle represents “Why” the company makes the product.

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The crux of Sinek’s ideas lie within this center “Why” circle When he talks about why a company makes a product, he doesn’t mean “to make money,” because that’s the result of the “What.” Instead, the “Why” represents an innovator’s beliefs and passions that drive them toward success.

In a TEDx speech in Puget Sound, Wash., Sinek repeated a mantra several times to the audience throughout his presentation that sums up his “Golden Circle” theory.

“People don’t buy what you do, they buy why you do it. And what you do serves as the proof of what you believe,” he said.

While Sinek points out today’s leaders and innovative companies, like Steve Jobs and Apple, the best example of his theory in practice is of a historical sense. Sinek recounts the story of Samuel Pierpont Langley, who was given money and resources by the U.S. government to invent “the flying machine” only to be beaten to the punch by upstart and impassioned Wright Brothers.

Sinek says it didn’t matter that Langley – who he says was driven by greed and the possibility of fame – had more money, more people and more resources, because the Wright Brothers were driven by their belief and their passion. Entrepreneurs looking to innovate today should take note of what makes a great leader, and it all starts with “Why”, says Sinek.

“The goal is not to do business with everybody who needs what you have,” he says. “The goal is to do business with people who believe what you believe.”

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Young startups looking to get the word out about their new product or service may want to enter a new competition from digital magazine publisher Alister & Paine. The New York-based company is hosting its first annual Young Entrepreneur of the Year Competition with help from digital marketing firm Pyxl and public relations social platform PitchEngine.

The winner of the competition will receive a micro-marketing campaign from Alister & Paine, as well as an interview and editorial in their weekly online magazine geared towards business executives. Pyxl will provide the winner with two free press releases, and PitchEngine is offering a free on-year subscription to their service.

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The judges of the competition will be the founders and CEOs from Alister & Paine, Pyxl and PitchEngine, as well as Jeffrey Miron, the director of the undergraduate Economics program at Harvard University.

“Winners of the Alister & Paine Young Entrepreneur competition will get a terrific boost to their projects in ways which otherwise may not have been available to them,” said Miron. “Helping these young entrepreneurs now will become a boon to the economy’s future.”

Entrepreneurs must be U.S. citizens aged 18-25 and the companies must be domestically held and formed on of after January 1st, 2007. Applications are due by April 30th, and the winners will be announced a few weeks later on May 17th.

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If you procrastinated on applying for TechStars Boston and missed Monday night’s deadline but still want to attend a TechStars event, their summer program in Boulder, Colorado is now accepting applications.

TechStars is a highly competitive funding and mentoring program based in Boston, Boulder and Seattle that helps young startups jump-start their businesses. Their impressive list of over 50 mentors includes WordPress founder Matt Mullenweg, venture capitalist Fred Wilson and Foundry Group director Brad Feld.

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This summer’s program will be the fourth class of companies to go through the Boulder program, and if last year’s class is any example of how things will go this year, big possibilities await applicants. TechStars founder and CEO David Cohen announced last November that six of the 10 companies from the 2009 Boulder class closed investment deals with venture capital firms.

One disadvantage Boulder applicants face is that any unselected applications from the Boston program are automatically rolled over into the Boulder applications, making the selection more competitive. The same thing will happen in Seattle, which means Seattle applicants will be ultimately vying for spots against the Boston and Boulder rejects.

The deadline to apply for this summer’s Boulder program is Monday, March 22 at midnight Mountain Standard Time. Seattle applications open the following day.

Photo by Flickr user Let Ideas Compete.

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Entrepreneur Eric Ries, who previously co-founded the 3D avatar-based chat client IMVU, is also widely credited with coining the phrase “lean startup” in 2008. Ries recently gathered as many resources as he could muster for lean startups and shared them on his blog, Lessons Learned.

A lean startup is one that takes advantage of open-source technologies and other products to push a product to market at a “low burn,” while at the same producing continual revisions to its product based on customer feedback. Ries provides a wide consortium of links to wikis, mailing lists, meetups, and bloggers all focusing on the lean startup initiative – a collection of great value to any startup that wants to lower costs while feverishly iterating their product.

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Ries, who is often invited to speak about lean startups, says that this type of development is what helped IMVU achieve its loyal following. Timothy Fitz, a software engineer at IMVU, says the developers average 50 new code iterations per day.

“That’s 6 deploys an hour,” writes Fitz on his blog. “Even at that pace we’re often batching multiple commits into a single test/push cycle.”

The inspiration for this new methodology? Ries says it came from books like Lean Thinking, which outlines ways companies can reduce waste and boost revenue, but Ries is quick to point out that a lean startup and a lean company are two different things.

According to Ries, lean companies attempting to trim the fat are striving to create value for their customers, but value is not the foremost goal for the leaning of startups.

“Lean startups operate by a different standard,” says Ries. “I suggest they define waste as ‘every activity that does not contribute to learning about customers’.”

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With tourists flocking to the Boston to walk the cobblestone streets of the Freedom Trail and visit various historical landmarks, Boston is often thought of for its ties to the American Revolution. But Boston is also the birthplace of a revolution of a different sort.

In 1946, Georges Doriot, a professor at the Harvard Business School, founded the American Research and Development Corporation (ARDC) in Boston – one of the very first venture capital firms.
In 1957, the ARDC invested $70,000 in Digital Equipment Corporation, a company founded by two former Massachusetts Institute of Technology engineers working on transistor-based computing. The ARDC was later able to turn around and sell their investment for $450 million, quite possibly the best return on an investment ever at that point.

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Half a century later, Boston is a thriving and vibrant community not only for venture capital and startups, but also for large technology companies and research
corporations. With nearly a hundred regional colleges and universities – like MIT and Harvard – and over a quarter of a million students, Boston has quickly become a breeding ground for innovation in the tech sector.

“The thing that’s amazing is we don’t have to worry about attracting people into the Boston community,” said Jeffrey Bussgang of Flybridge Capital Partners in a speech at the Harvard Business School last October (see video embedded below). “The challenge is to retain people.”

And retain them they will, thanks to a plethora of resources available to young entrepreneurs and startups in Boston. Monthly meet-ups like Mobile Monday and Tech Tuesday as well as other events like the biannual Mass Tech Leadership Council Unconference are just a few of the great ways startups can get their feet off the ground.

Other organizations like TechStars and Stay in MA help Boston startups set up shop in Beantown with scholarships, funding, and mentorship. And why wouldn’t startups want to stay in Boston? Massachusetts boasts the highest per capita VC investment rate in the United States, eclipsing California and New York with $457 per person.

Data released today from information and data-services company ChubbyBrain shows that while other Northeaster states are suffering from floundering VC investment, Massachusetts is alive and expanding. While New York and Pennsylvania fell to just $513 million and $254 million respectively in the second half of 2009, Boston’s home state soared to $1.2 billion. Figures like these have vaulted Massachusetts past New York into the number two spot behind California for VC investments.

Bussgang says that reasons like these and the overall economic stability of the state have encouraged startups and entrepreneurs in Boston, despite being across the country from sunny Silicon Valley.

“Yeah the winter sucks, but Massachusetts has delivered a budget on time and balanced the last couple years… unlike what’s going on in California,” he says. Bussgang also points out that California continually ranks last on Chief Executive Magazine’s list of Best and Worst States for Business, though Massachusetts is usually not too far away.

The close-knit technology and innovation community of the greater Boston area has fostered spontaneous collaborations resulting in several successful companies across numerous industries. Cloud computing solutions like Carbonite and GlassHouse, robotics companies like Roomba-maker iRobot, online video providers like Brightcove, and e-commerce startups Vistaprint and Shoebuy are all examples of the firepower Boston’s potential can produce.

Boston has even seen recent expansion from larger corporations, such as Google, Microsoft and Cisco Systems. Having these larger companies in the Boston area provides excellent opportunities for startups, says Bussgang.

“Boston has become an outpost for a lot of these satellite R&D centers, and a place where the companies that we fund can find a home,” he says.

To learn more about the Boston startup scene, check out Don Dodge’s extensive list of events, resources and people, as well as Larry Cheng’s Massachusetts VC Blog Directory, which you can import right into your RSS reader to stay on top of what VCs in Boston are talking about.

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The first quarter of 2010 could see a higher number of investments by venture capital firms than the fourth quarter of 2009, according to figures from new reports by the National Venture Capital Association and information and data services company ChubbyBrain.

Data from a report relased by the NVCA yesterday shows that the fourth quarter of 2009 saw a growth of $1.7 billion in venture funds over the previous quarter, similar to numbers seen from Q4 2008 to Q1 2009. Data released today by ChubbyBrain shows that following the earlier growth in venture funds, Q2 2009 saw a $1.4 billion increase in VC investments, a trend that could mean big bucks for startups in the first quarter of 2010.

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As we reported last week, 2009 was a difficult year for startups and venture capital firms, with venture-backed mergers and acquisitions continuing a downward trend in 2009. Carolynn Duncan, founder and director of the startup incubator Portland Ten, says that the “pressure crunch” of 2009 caused VCs to give prospective startups more than the third degree.

“It was more like the fifth degree,” Duncan told ReadWriteWeb. “It was so intense, even for the companies showing great traction and that had bootstrapped the hell out of their project.”

Duncan believes that as the new year kicks off VCs that raised funds at the end of 2009 will be looking at a new class of startups to invest in. When asked if 2010 would be an easier year to find funding, Duncan was hesitant, but optimistic.

“I don’t think ‘easier’ is the right word, maybe just not as demanding,” she said. “People are just glad its 2010 and not 2009 anymore.”

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For young budding entrepreneurs approaching graduation this spring, or for those looking to go back for a post-graduate degree, finding the right program for your needs is very important. In their seventh annual joint effort last fall, Entrepreneur Magazine and The Princeton Review teamed up to rank the top 25 undergraduate and graduate entrepreneurship programs in the United States. Only six programs managed to make the top 10 in both lists, securing their spots at the top of the best overall entrepreneurship programs.

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#1. Babson College – Babson Park, MA

Finding themselves in the top spot of both top 25 lists is the Arthur M. Blank Center for Entrepreneurship at the F.W. Olin Graduate School of Business at Babson College. Babson’s entrepreneurial programs boast the largest enrollment by far of any of the top schools with over 3,300 total enrolled students, and offers undergraduates a total of over $300,000 in scholarships.

#2. Drexel University – Philadelphia, PA

Drexel’s undergraduate program of the Laurence A. Baiada Center for Entrepreneurship is rated sixth best, but the university’s third-ranked graduate program at the Bennett S. LeBow College of Business has boosted them into the number two spot overall. Drexel offers the most money in scholarships out of the top six, providing $350,000 for both undergraduate and graduate students, and claims that 100% of their faculty are entrepreneurs themselves.

#3 (Tie). University of Arizona – Tucson, AZ

The entrepreneurial programs at the University of Arizona are the most exclusive clubs on this list, enrolling just 100 undergrads and 50 graduate students in it’s McGuire Center for Entrepreneurship at the Eller College of Management. With $120,000 available in scholarships and low enrollment figures, entrepreneurs at Arizona have an excellent chance at receiving financial aid.

#3 (Tie). Temple University – Philadelphia, PA

Innovation and Entrepreneurship Institute at Temple’s Fox School of Business ranked 5th and 6th for undergraduate and graduate programs respectively. The school enrolls over 600 students and offers a $29,500 prize in its buisness plan competition.

#5. University of Southern California – Los Angeles, CA

With the second largest enrollment in the top six, the Lloyd Greif Center for Entrepreneurial Studies at USC’s Marshall School of Business is the home to over 2,000 young entrepreneurs. The undergraduate program is just 10th in the nation, but the school’s stellar graduate program is ranked 2nd, just below Babson College.

#6. DePaul University – Chicago, IL

Ranked 8th and 9th in undergraduate and graduate programs, the Coleman Entrepreneurship Center at DePaul’s College of Commerce and the Charles H. Kellstadt Graduate School of Business rounds out the top six. The programs enroll just under 400 students and like Drexel, 100% of the faculty are themselves entrepreneurs.

Honorable Mention: The Cyvia and Melvyn Wolff Center for Entrepreneurship at the University of Houston has ranked in the top 2 on Entrepreneur Magazine’s undergraduate list since 2007.

Honorable Mention: The Levy-Rosenblum Institute for Entrepreneurship at Tulane’s Freeman School of Business was ranked #4 in the top 25 graduate programs.

To see the complete lists of the top 25 undergraduate and graduate programs in entrepreneurship, visit Entrepreneur Magazine. If your favorite school isn’t on these lists and you want to see if they have entrepreneurship programs, be sure to look at this list of schools (including international institutions) offering entrepreneurial majors compiled by Saint Louis University.

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