FAW #22: Ann Winblad of Open Systems
The seminal moment
For as intangible as the idea of “company culture” is, it can be thought of as the stories that are passed on in a company and the notion of “the way things are done around here.” It seems every successful company has a breakthrough moment, an event that lives in the memories of its first employees as being a mythological “hero story” and a catalyst for later success. In the case of Open Systems, this important catalytic event came for Ann Winblad when her small team was doing consulting in 1977 for CADO computer. She was invited to present her accounting system product to a group of CADO resellers at a conference. She did a demo of the product and had the nerve to offer a “blue light special” as she called it giving a major discount to those companies that would write her a check on the spot. It was a formative, confidence-building experience as she ended up landing twelve different deals that day and walking away with $120k in checks for a company she had started from literally nothing borrowing $500 from her younger brother.
We’re still pre-revenue at JumpBox rapidly approaching sales but one of the formative memories thus far for me was our attendance at the rPath Virtual Appliances Summit last month. There we were, a company of four people along side major vendors, the next biggest one being a $15MM VC-funded, 38-person virtual appliance toolset provider. There were higher-ups from big names like Dell, HP, Sun, AMD, Intel, Parallels and VMware. Eating dinner sandwiched between the CEO of Red Hat Linux and some big dog at VMware was a little surreal but it was a major morale boost and validation to what we’ve been doing.
On teaching as opposed to telling
After Open Systems ran its course, Winblad founded a venture capital firm. When asked about how the business was different in approaching entrepreneurship from the perspective of a VC, she responded, “I think it’s really interesting being a venture capitalist because, when you’ve got 30 years of experience, then our challenge is how to teach and not tell. Because you want people to figure it out. You want to make sure that you can grab them by the coattails if they are falling off a cliff, but you want them to discover the edges by themselves. That’s the biggest challenge of moving from being a business leader to being a business investor. Your job is not to tell, but to teach.”
Winblad’s advice for founders
“We try not to give too much prescriptive advice. “Think like a big dog and then figure out how you find leverage to get there.” You have to have tactics to get to strategies, but you have to have a strategy, and you have to put your strategy up here and then see ‘Where’s my gap’ to get to this aspirational goal. You’re always going to be short of people, you’re always going to be short of money, you’re going to be short of source supply value. So you have to find leverage points, versus working your way up through tiny little rungs and seeing if you get there. Think like a big dog, and find leverage to get there.”
Winblad sold Open Systems in 1982 for $15MM+ and works now as a founding partner at Hummer Winblad Venture Partners.
May 30th, 2007 at 10:12 am
[…] Fortunately they did have an experienced CEO Barak Berkowitz who helped coach them through some of the basics in setting the business strategy and doing the things that needed to be done like establishing the basic operational infrastructure and negotiating a lease. In Ann Winblad fashion, he allowed them make small mistakes and “find the edges” themselves. “If it wasn’t for Barak, I don’t know where we would be now. We knew what we knew, which was the product. But there were all these little things that you just have no clue about. It was incredibly overwhelming. But if you think about it too much, then you don’t do it. You almost have to not know what you’re getting into to actually do it.” […]