Wednesday, December 28, 2011

What Do These Firms Have in Common?

What do the following entrepreneurial enterprises have in common?  (Selections from -- Entrepreneurs, with additional information provided to help you understand the nature of each company.)

Catabasis Pharmaceuticals, ( the Cambridge, MA firm, is a private, venture-backed biopharmaceutical company that leverages “the therapeutic potential of omega-3 fatty acids and other clinically validated compounds to create new medicines for the treatment of inflammatory and metabolic diseases.” Dr. Jill Milne, CEO, director and serial entrepreneur, co-founded the firm with Dr. Michael Jirousek and Dr. Steve Shoelson in June 2008. In December 2011, they raised an additional $8 Million in Series A financing bringing the total raised to $47.6 million.

ImmusanT ( is an early stage biotechnology company, now based in Cambridge, MA and focused on developing a treatment and a set of diagnostic and monitoring tools to manage patients with celiac disease. Leslie Williams is Founder, Director, CEO and President. In December 2011, the Company raised $20 million in Series A financing from Vatera Healthcare Partners.

Advanced ICU Care, ( based in St. Louis, MO, is the nation's largest independent provider of tele-ICU programs.  The firm was co-founded in 2004 by Dr. Mary Jo Gorman, M.D.; Dr. Isabelle Kopec, M.D.; and David Schopp. Dr. Gorman is the CEO of the Company which raised an undisclosed amount of new funding led by Trident Capital, Inc in November 2011.

WorkForce Software, ( the Livonia, MI leading provider of workforce management solutions for organizations with complex labor policies and stringent compliance demands, was co-founded by Kathy Cannon with Kevin Choksi and Michael Knister. In November 2011, WorkForce raised a total of $17 M in Series A and mezzanine capital raise from investors K1 Capital.

Avaxia Biologics, Inc. ( based in Lexington, MA, is a privately-held biotech company developing oral antibody drugs that act locally within the gastrointestinal tract. The company was co-founded in 2005 by Dr, Barbara Fox, the firm’s current CEO, and the late Anne B. Baia, CPA, MST, MBA.  The company began with a SBIR grant, and in November 2011 completed its first close of $2.2 million in Series A angel-led financing, led by Cherrystone Angels of Providence, Rhode Island.

Tangent Medical Technologies, Inc., ( is an Ann Arbor, MI development stage medical device company formed as a spinout from the University of Michigan’s Medical Innovation Center fellowship program. The firm was created to address health and safety shortcomings of problems with conventional peripheral intravenous (PIV) fluid/medication delivery systems. UM Medical Innovation Center fellows Adrienne Harris, Elyse Kemmerer, Merrell Sami and Steven White co-founded the company in 2009. In November, they completed a $4.5 million Series A equity financing co-led by Arboretum Ventures and Flagship Ventures.

Chromatin, Inc. ( is a Chicago, IL-based company that has developed and marketed breakthrough gene-stacking technologies for improving any crop. The company’s patented mini-chromosome technologies enable the development of new seed products and the delivery of multiple genetic traits into any plant. Founded in 2000, the firm has office and laboratory facilities in Chicago and greenhouse operations in Champaign.

As a supplier of renewable biomass feedstocks for energy producers, Chromatin Inc. announced in October 2011 that it had completed a $10 million first closing of its Series D financing round that included two strategic investors – BP Ventures and Unilever Technology Ventures – as well as three investors who participated in earlier rounds of financing: Quantitative Investment Holdings, the Malaysian Life Sciences Capital Fund, and Illinois Ventures.

Chromatin Inc. was originally housed at the Chicago Technology Park on the Chicago Near West Side and is an example of how basic research moves out of the university lab and into the commercial mainstream. With technology licensed from the University of Chicago, Chromatin was founded in 2000 to design mini-chromosomes that could be implanted in plant cells to deliver specific, commercially desirable traits. The technology also could be used to make new pharmaceuticals and chemicals.

Daphne Preuss, a University of Chicago professor of molecular genetics and biology, founded the firm.

OvaScience ( is a Boston, MA-based innovative life science company dedicated to improving the treatment of infertility. The firm’s first product, AUGMENT, aims to increase the success of in vitro fertilization (IVF) by allowing a woman to use her own cellular energy to revitalize her egg. OvaScience's patented technology is exclusively licensed from Harvard Medical School and Massachusetts General Hospital.

Privately-held, OvaScience was co-founded by Michelle Dipp, M.D., Ph.D. (now Chief Executive Officer), Rich Aldrich (now Chairman), Christoph Westphal, M.D., Ph.D. of Longwood Fund, and Professors Jonathan Tilly, Ph.D., Massachusetts General Hospital and Harvard Medical School, and David Sinclair, Ph.D., Harvard Medical School.

In October 2011, Ovascience obtained $6 million in venture capital Series A funding from Longwood and Bessemer Venture Partners. Inc. ( is a Waltham, MA-based company that offers a website to match care givers with clients who need care for children, adults and seniors, the elderly, pets and other purposes such as housekeeping and personal services. Again, the emphasis is on security checks and certified reviewers. offers limited access for a Basic (free) membership, with broader and safety-oriented access at Premium membership pricing.

The firm was founded by current CEO, Sheila Lirio Marcelo, in 2006 after she faced a difficult time finding care during a family issue. In October 2011, raised $25 million of venture capital funding from Texas-based financier and insurer USAA as corporate VC. According to USAA, “Earlier this year, USAA and announced a relationship to jointly develop integrated online solutions for managing unique military lifestyle changes, such as deployments or a military moves, with a focus on facilitating the management of care-related issues.”

This round was the fourth funding for the company, which also brought in $3.5 million in 2007 and $10 million in 2008.

HarQen, ( is a Madison, WI-based business media company co-founded by CEO and serial entrepreneur, E. Kelly Fitzsimmons with Jeff Fitzsimmons. HarQen assembled a top tier team and launched Voice Advantage in March 2008 and the HarQen platform in 2009. HarQen's award winning Intelligent Voice Service lets business use the phone and a simple web-based dashboard to create and distribute custom, recorded phone interviews.

"[It] enables meetings, interviews and other business conversations to be captured, enriched, organized, navigated, shared and analyzed – improving collaboration and adding a new layer of business intelligence to existing data management systems". HarQuen secured over half of its targeted $4 million Series B funding in October 2011.

Take the Inteview ( is a Cambridge, MA-based video interviewing platform for employers and job candidates founded in early 2011 by company CEO Danielle Weinblatt, a former private equity associate and investment banking analyst (and current MBA student at Harvard Business School). In November 2011, Take the Interview raised $775,000 in new funding from angel investors.

Kenandy Inc.( is the Redwood City, CA-based Manufacturing Management system built for cloud computing. Integrating Inventory Management, Engineering, Purchasing, Production, and Requirements Planning together with state-of-the-art supply chain collaboration.  Kenandy is built on, the leading platform for cloud applications. Kenandy was funded by’s Marc Benioff , former Oracle exec Ray Lane via Kleiner Perkins Caufield & Byers, and Wilson Sonsini Goodrich Rosati.  Sandra Kurtzig, Founder and CEO of Kenandy, Inc. (previously founder, CEO and chairman of the ASK Group) announced the closing of a $10.5 million Series A round of funding in August 2011.

Angie's List, ( is the online referral service created in Columbus, OH with 1,000 members in 1995 by Angie Hicks, now the company’s Chief Marketing Officer. Over a million members use Angie's List to find high quality service companies and health care professionals in over 550 categories. Before reviews are posted, they are checked in order to guard against providers and companies trying to report on themselves or their competitors -- a process that was reviewed and approved during a 2009 audit by BPA Worldwide. Angie’s List is a membership-based revenue model with multi-year discounts.  In November, Angie's List, Inc. announced it was seeking $114 M in an initial public offering of 8,793,408 shares of common stock at the public price of $13.00 per share.

TaskRabbit, ( is the San Francisco, CA-based company that mediates outsourcing of errands founded by Leah Busque. Its CEO since October 2011 is Ed Grosse. TaskRabbit raised $17.8 million in Series B financing led by LightSpeed Venture Partners in December 2011.  TaskRabbit entered the Los Angeles and Orange County marketplace in June 2011.

Saturday, December 24, 2011

Getting Real

Many investors, women as well as men, lost money which they genuinely believed could have produced a return based on the facts known about the business at the time they made their investment. Having lost money in the dot-com bubble, the financial melt-down, the Ponzi environment of the Madoff era, or the housing-flipper marketplace has made investors much more cautious about their choices. So, we should not be surprised if, today, venture or angel capital is in somewhat shorter supply.

Not only do memories of once-burnt-twice-shy circumstances weigh heavily on investors minds, but recent well-intended state and federal legislation significantly damper growth activities. 

Yesterday’s cowboy entrepreneurs could play fast and loose with chimera stock options, promising exorbitant compensation for gullible high-tech employees.  Today’s conscientious entrepreneur knows she faces tougher reporting requirements and must actually expense stock options rather than treat them like vaporware.  The good ol’ boys in the good ol’ days could pretend contract workers were independent even though they were fully-utilized private employees.  Today’s entrepreneur who mis-classifies independent contracts are subject to much tougher criteria and will face far more onerous consequences than his simple tap on the company wrist.

The bar is higher today for women entering entrepreneurship because we expect companies to perform like legal, civil, and responsible entities. Women entrepreneurs must step up to the plate in an era where performance expectations are higher than ever before.

In these tougher circumstances, women-owned or co-owned businesses cannot be in the same simple businesses our mothers crafted to occupy their time in those more plush periods.  Today, we do find that many more interesting women ARE creating successful businesses that meet viable, substantive needs.  A woman created Constant Contact, iRobot, and now a woman is CEO of Businesswire. Not bad!

If women-owned/co-owned businesses are “real,” they must meet seven essential criteria, to my mind.  I would award seven stars to the best businesses, representing the following criteria:

1.         The problem the business addresses is significant.
2.         The proposed solution is valuable enough to sustain a revenue stream over time.
3.         There are enough customers (men as well as women) to maintain the business’ long-term growth.
4.         The business grows by reaching beyond its initial geographic market area.
5.        The business is scalable -- capable of generating ever-higher revenues through the expanded application of resources.
6.         The business has the potential for a value-realizing event.
7.         The business can prevail beyond the passion and dedication of the initial leader and management team.

An example of a seven star enterprise is Leah Busque’s TaskRabbit ( -- the San Francisco-based company that mediates outsourcing of errands. Its CEO since October 2011 is Ed Grosse. TaskRabbit entered the LA & OC marketplace in June 2011. It is a viable micro-enterprise engine that offers entrepreneurs in multiple markets an opportunity to offer their services or to contract for services. TaskRabbit has a revenue model that grows with expansion. A must-read entry in their blog explains why TaskRabbit is a perfect example of the law of comparative advantage in action. Most importantly, the company has focused first and foremost on the security of TaskRabbit errand personnel -- an essential in today’s more anxious marketplace. TaskRabbit raised $17.8 million in Series B financing led by LightSpeed Venture Partners in December 2011. Earlier, TaskRabbit received received $1M in seed funding in August 2009 and $5M in Series A funding in May 2011.

All of which proves that seed, angel, and venture funds are available for the right women-owned businesses in today’s marketplace.

Friday, December 23, 2011

Managing the Nonprofit Organization

Several years ago, I had the distinct honor and pleasure of listening to Peter Drucker speak for a series of about six evenings on the topic of his research, his insights, and his wisdom. I have never seen anyone speak for so long without referring to any notes. I remember his comments on how the nonprofit organization was going to be a more important part of our economy. Now that this has come to pass, it's important to understand what Peter Drucker expected from the nonprofit. His book, Managing the Nonprofit Organization, provides a very high level of performance -- a level that has been attained by very few. His book actually provides insight for leaders of traditional companies as well as nonprofits. Noteworthy to me, as an author, is the additional fact that his book includes inspirational and informative interviews with some of the best minds available.

Managing the Nonprofit Organization: Principles and Practices, by Peter Drucker
(Harper Paperbacks: May 9, 2006)


1. The Commitment.
2. Leadership Is a Foul-Weather Job.
3. Setting New Goals - Interview with Frances Hesselbein.
4. What the Leader Owes - Inteview with Max De Pree.
5. Summary: The Action Implications.

1. Converting Good Intentions into Results.
2. Winning Strategies.
3. Defining the Market - Interview with Philip Kolter.
4. Building the Donor Constituency - Interview with Dudley Hafner.
5. Summary: The Action Implications.

1. What is the Bottom Line When There is No "Bottom Line"?
2. Don't's and Do's -The Basic Rules.
3. The Effective Decision.
4. How to Make the Schools Accountable - Interview with Albert Shanker.
5. Summary: The Action Implications.

1. People Decisions.
2. The Key Relationships.
3. From Volunteers to Unpaid Staff - Interview with Father Leo Bartel.
4. The Effective Board - Interview with Dr. David Hubbard.
5. Summary: The Action Implications.

1. You Are Responsible.
2. What Do You Want to Be Remembered For?
3. Non-Profits: The Second Career - Interview with Robert Buford.
4. The Woman Executive in the Non-Profit Institution - Interview with Roxanne Spitzer-Lehmann.
5. Summary: The Action Implications.

Start at the End

Creative thinkers and innovators have this unique ability to think about a problem by envisioning a solution, then working their way backwards to the beginning in order to focus on what is required to get to that end result.  By starting at the end, creative people visualize the way things would be if they were the way we wanted them to be.  

On a huge scale, like the recent Pacific Coast Highway “carmageddon” (the reconstruction of the 405 Freeway overpass at Mulholland bridge) might have begun with the solution: “We’ve got to destroy the whole bridge in order to replace it.” Then, working backwards,

“We could do it in two steps, one lane at a time.”
“We’d have to drop a lot of concrete on the freeway below.”
“We could layer the freeway with 4 feet of dirt to protect it.”
“We’d have to stop all traffic for a couple of days.”

Thinking that starts at the end could relate to simpler problems as well.
“As I get older, it’s tougher to open jars or peel potatoes.” This kind of thinking led to the development of Get A Grip products to help elderly, arthritic hands deal with common problems.
“Being a good Dad is challenging enough without trying to find a place to change a diaper in the men’s room:” This thinking led to the invention of the now-ubiquitious drop-down diaper change stations in every bathroom in the country.

Thinking that starts at the end is a form of mental mapping -- where do you want to be, where are you now? What is the most direct or satisfactory route between the two?

By contrast, there is Dead End Thinking, best exemplified by the whine which focuses only on where you are today and all of its undesirable traits.

            “I hate my job, my salary, my boss, my commute, my hours, the competitiveness.”

Dead end thinking keeps you where you are by fostering a focus on the problem(s) and ignoring the possibility of solutions or alternatives.

There also is Sideroad Thinking which is also know as The Grass is Greener Logic.  Sideroad thinking is best exemplified by people sitting at a restaurant and rubbernecking to diners at nearby tables -- “What are THEY having?” “Oh, isn’t THAT interesting?” “I’ll just have whatever SHE’S having.”  Sideroad thinking is lemming behavior, not problem-solving thinking.

Sideroad thinking is missing both assessment and ego.  Assessment would ask: does the end solve the challenge? Do I understand the challenge? Ego requires the result be personally and intellectually satisfying.  Doing something just because everyone else is doing it is following others, not acting on your own behalf.

Starting at the end thinking does not have to be rocket science.  It could be as simple as “How can I spoon just enough batter into a cupcake holder in one scoop with minimal or no spillage?”  Or it could be as complex as “How can we increase the number and quality of child care facilities in any given city, pay teachers well, and give them reasonable benefits at reasonable cost?” Or "How can we reduce the huge and soaring burden our federal deficit is having on our national debt and on future generations?"

If we’re going to make a dent in our familiar problems, we’re going to have to exercise our minds to think more along the lines of starting at the end and working our way back to where we are today. 


Onward! is the second book by Starbucks founder Howard Schultz (with Joanne Gordon) - this one is about how (like Apple's Steve jobs) he took back the helm of the firm just as it was headed over the falls.

Schultz tells his story in five parts titled Love, Confidence, Pain, Hope, and Courage. Love is about his passion for all things coffee. Schultz is a man with strong emotions, especially about coffee. When people talk about entrepreneurs requiring passion to survive, they can look to Schultz for a living definition of exactly what that means. Confidence is about the bold and fearless choices nd decisions he had to make to turn his company around. Pain describes the losses and disappointments required along the way. Hope and Courage describe the steps back from the brink and how much of that recovery required simple leaps of faith.

Schultz wrote something of a business plan to guide his company's revival - only he called it a Transformation Agenda -- describing the process by which he wanted to transform the company from where it was (disaster) into where he wanted it to be (at peak performance). At the highest level, it had seven core requirements that guided everything he and his company would do.

First, be the undisputed coffee authority. Know your business, in all of its facets, better than anyone else anywhere. From coffee seeds in the ground to the aroma in each store, Schultz and all his people excelled at their trade.

Second, engage and inspire our partners. Interesting that he described "employees" or "franchisees" as partners. Schultz recognized that Starbucks would fail without the unswerving support of all the people from the ground up.

Third, ignite the emotional attachment with our customers. Finally, comes the buyers, the clients, the marketplace. But, customers are not seen simply as dollar bills - they consume with an "ignited emotional attachment." their very hearts, souls, taste buds
and olfactory systems are consumed in their consumption. Keeping all those sensory triggers firing was crucial to daily sales.

Fourth, expand our global presence. This agenda item comes from the guy who started out with one tiny shop at Pike Place in Seattle. Growth is essential.

Fifth, be a leader in ethical sourcing and environmental impact. Schultz innovated in supply chain management and innovation. Since all coffee beans come from under-developed sources, this provided opportunities to create new economies that would be substantively better than his predecessors. This part of the equation tapped the partners' and customers' social consciousness as well.

Sixth, create innovative growth platforms worthy of our coffee. Don't just grow mindlessly. Don't simply diversify without integrating products or services intelligently into the pre-existing offerings. Expand rationally.

Seventh and finally, deliver a sustainable economic model. Make all this work sufficiently well to generate returns adequate to re-invest in whatever needs to be enhanced. Appropriate, not excessive or irrational, returns.  Make it possible to continue the good work.

This is a book that should be read by every new entrepreneur to gauge whether you have the intestinal fortitude to lead your company with this level of commitment, dedication, and enthusiasm. That is the true test of a Transformational Agenda.