In the spirit of Thanksgiving I compiled a list of things I am thankful for. The following are a few of my thankful points relating to me experience with New Enterprise Forum and entrepreneurs we help.

I am Thankful to people who have positive entrepreneur spirit. These people have been of special enjoyment to work with and in my opinion have been the most successful in their entrepreneur endeavors. To see an entrepreneur accomplish their goal is rewarding, however to see entrepreneurs enjoy what they are doing while working towards their goals is special.

I am Thankful for entrepreneurs and associates who can turn problems into opportunities, challenges and solutions. As can be seen at every NEF meeting most businesses are based on solving some problem for customers. Individuals who can apply the same attitude and skills to daily issues have an advantage and are more likely to succeed. They are also a pleasure to work with.

I am Thankful for experience of working with team players. Being a successful entrepreneur is not an individual effort or accomplishment. There are many people involved. The entrepreneurs I find special are the ones who appreciate, or you may say are thankful to, the other people involved.

A special thanks to the NEF board, program committee, stakeholders and everyone who keeps New Enterprise Forum going and in turn make it possible to part of the other items mentioned above. 

Happy Thanksgiving

The necessary evil I am referring to is forecasted financial statements included in business plans. The importance of my comments on this topic comes from a discussion during a recent NEF program committee meeting.

The discussion focused mostly on forecasts being incomplete and unreasonable. While what is included in a presentation is summarized, the business should have complete forecasts including balance sheet, income statement and statement of cash flow. Well prepared forecasts will quantify and summarize all the other discussed in the business plan. Forecasts are also a means of communicating the entrepreneur’s fiscal responsibilities and recognition of the important of communicating good financial information. We realize that preparing forecasts can be difficult, involve skills that most entrepreneurs are weak in and in the end forecasts will not match actual results. Unfortunately our understanding and sympathy will not get entrepreneurs funding.

For me unreasonable forecasts are especially frustrating. I have been involved with businesses financials for over 30 years and have never seen achieved results with 50% and better EBITA to sales like we have seen in to many forecasts. Other than straight licensing business, these kinds of results just don’t happen. When I see forecasts like this, I become suspicious of what is missing in the business plan. Unreasonable forecasts typically reflect business plan with problems. Most common issue is the marketing and sales. Entrepreneurs fail to recognize the cost to acquire customers. Close to this, is investor backed business will typically take any profits earned and put back into sales to accelerate growth.  

Whether you agree or not with the importance of forecasts, investors do believe they are important. Financial information whether forecasts or historical are one of several means of communication used in the business community. As with any form of communication people need to use methods that will be understood and believed by others.  

Coaching start-up entrepreneurs for their investor pitch is part of NEF’s DNA. At this month’s program committee meeting, thanks to a detailed presentation by Elizabeth Sikkenga, the creative force behind Crisp Marketing ( and an NEF marketing committee member, NEF coaches focused on how to improve the public speaking skills of NEF presenters.  Although it is usual for the coaching teams to provide pointers to the entrepreneurs regarding their presentation style, it was felt that our process would benefit from a more dedicated review of the presentation skills. It was decided that Elizabeth’s presentation was a good basis to develop an assessment sheet that will guide the coaches in the future and to seek the involvement of professional speakers  in the cadre of coaches though connections facilitated by Elizabeth.

Entrepreneurs interested in becoming a Showcase Presenter, should follow instructions at    

Startup Career Fair is the only career fair on the University of Michigan campus designed solely for startups and small businesses. The fair taps into the UM entrepreneurial ecosystem to bring together the best developers, designers, engineers, and business students, providing them the ability to meet and learn about the startups in which they are interested. Participating companies will engage in the recruiting process, meet other startup teams from around the country, and see what the University of Michigan has to offer when it comes to skilled student talent.

The purpose of the career fair is to introduce the coolest startups to the best talent in the country. The fair organizers encourage innovation, creation, and teamwork in order to create something incredible. They want UM students to learn about and appreciate the unique culture that startups bring to the business world and startups to have the talent they need to keep on doing even more amazing things.

Companies that sign up will receive a table at the fair, with which they can do anything they want. Sign-up will also give companies access to Handshake - an online system that allows startups to upload a company profile, post available job positions, list the skills they’re are hiring for, and sign-up for interview rooms. Students will upload their resumes and profiles to the same site, allowing for easy connections between startups and talent. There will be a post-fair after party for all attending startups and students.

To sign up for the Career fair, visit

Anyone reading the articles in Forbes, Fast Company, and the local Detroit Free Press about the tech scene in Detroit can’t but get the impression that the tech startup scene is booming.  Business incubators and accelerators like TechTown (where I work), Bizdom and tech training institutes such as Grand Circus are all part of a collective effort to nurture the creation and growth of tech startups.  There is much hope that these new businesses will create jobs and help the city diversify and grow its struggling economy.  However, in a city with a 38% poverty rate (as reported by the US Census) and a broken public school system, we have to ask ourselves: will the opportunities that tech provides be able to improve the lives of the average Detroit resident?  Can the revitalization that is happening in Downtown and Midtown also benefit the neighborhoods?  Or, will it just be a bubble?  What can we learn from both the advances and the mistakes of other cities like San Francisco, Boston, and New York about what to do (or not) to be better inclusive of the entire community?

I’ll be sharing a few articles on this topic over the next few posts.  Here’s the first one from NPR on how tech in San Francisco is actually driving a wedge in communities -

I’d also like to hear from you about what you think.  Send me a tweet @sheujane.

REDWOOD CITY, CA November 4, 2014

Avegant today announced the close of an extended $9.37 million series A round of venture funding led by Intel Capital and NHN Investment. The company will use the funds to further development of its near-eye display technology, code-named Glyph, a premium pair of headphones with integrated video. The Glyph takes advantage of micromirror technology to deliver an ultra-high quality image in a unique headphone form factor.

“This is a landmark time in Avegant’s growth profile,” Joerg Tewes, CEO of Avegant said. “Funds from this round will help carry Avegant through its manufacturing milestones and solidify our delivery commitments. I couldn’t be more excited in the future of Avegant and the near-eye display industry.”

Other investors include Kaiwu Capital, Crunch Fund, 500 Startups, DN Capital, Calvin Broadus Jr. and the Michigan Angel Fund.

Avegant was a New Enterprise Forum Showcase Presenter in April, 2013, and won the NEF’s 2013 “Best Technology” Award.


At this year Accelerate Michigan, the largest innovation competition in the state, 50 semifinalists from a wide area of advanced market sectors will compete for more than $1 million in cash and in-kind prizes. See the list of these companies at

The fourteen of these companies, listed below, were previously showcased at one of the monthly forum at one time since their formation, and benefited from NEF coaching in preparing their investor pitch. We are proud of their progress and their ranking on the competition.

A2B Bikeshare ( ), AIRS ( ), ArborWind, LLC. ( ), Brio Device, LLC. ( ), Exo Dynamics ( ), Genomenon ( ), GAPro System  ( ), Logicoul Solutions ( ),  Mito Stem ( ), Movellus Circuits, Inc. ( ), Ornicept ( ), Supported Intelligence, LLC ( ), SurClean, Inc. ( ) and White Pine Systems, LLC (


On Wednesday night, at Ann Arbor SPARK’s fall Boot Camp celebration, young entrepreneurs and mentors gathered to hear 90 second pitches from this cadre of boot camp participants and 8 minutes presentation from the 3 finalists: QR Bars, Paxton Medical and Viryaa Studios.

Paxton Medical, an early stage company developing a disposable medical device allowing for efficient layout and securement of surgical tools during OR procedures won the contest and the associated benefits from SPARK. Good luck to the father and son team behind the venture.

This was the 25th edition of SPARK Boot Camp. As part of the process, Paxton Medical and the 2 other finalists benefited from a presentation coaching session from NEF coaches. The three teams present to a panel of judges, Alain Piette, Technology Practice Manager, MI-SBDC, Paul Riser, Managing Director, TechTown-Detroit and Skip Simms, Senior Vice-President, Ann Arbor SPARK.

During Boot Camp,, campers are taken through a rigorous process spanning a two-month period. Teams refine and develop their business idea through a customer discovery process with the help of a cadre of drill instructors. The goal of camp is to allow teams to fully understand customer pain points and to adjust their solutions accordingly .  As SPARK Boot Camp Director Viktor Brandtneris likes to put it: Spend your resources building what your customers want, not what you think they need.


This past Monday (9-15)  the online edition of the Wall Street Journal, contained an interesting interview with noted Tech investor Bill Gurley, a partner at Benchmark, entitled “Venture Capitalist Sounds Alarm on Startup Investing, Silicon Valley Has Taken on Too Much Risk, Gurley Says.”    Bill also writes a blog called Above the Crowd.  This article is part of a series in the Journal called “Tech Under the Hood.”

Mr. Gurley and Benchmark are investors in Uber, Zillow, OpenTable and other Web startups.  He has recently voiced some concerns regarding the money being poured into startups in Silicon Valley. 

The Journal asked the following question:  You quoted Warren Buffett's famous quote, "Be fearful when others are greedy and greedy when others are fearful." And then you wrote: "Although we may have not reached the level of observing obvious greediness, there is most certainly an absence of fear. Those that managed companies in 2008, or 13 years ago in 2001, know exactly how fear feels. And this is not it." What did you mean by that?

Mr. Gurley: Every incremental day that goes past I have this feeling a little bit more. I think that Silicon Valley as a whole or that the venture-capital community or startup community is taking on an excessive amount of risk right now. Unprecedented since '99. In some ways less silly than '99 and in other ways more silly than in '99. I love the Buffett quote because it lays it out. No one's fearful, everyone's greedy, and it will eventually end. And there are reasons, which might take all night to explain, why this business is cyclical over time, and the more chance you have to see different cycles and to see how it slips away, you can see it. There's a phrase that I love: "discounted risk." Do people discount risk? Right now you've got private companies raising $200, $400, $500 million. If you're in a competitive ecosystem and you raise that amount of money, the only way you use it—because these companies are all human-based, they're not like building stores—is to take your burn up.

He goes on to say.  “And I guarantee you two things: One, the average burn rate at the average venture-backed company in Silicon Valley is at an all-time high since '99 and maybe in many industries higher than in '99. And two, more humans in Silicon Valley are working for money-losing companies than have been in 15 years, and that's a form of discounted risk.  In '01 or '09, you just wouldn't go take a job at a company that's burning $4 million a month. Today everyone does it without thinking.” 

WSJ: Because the equity looks so valuable?

Mr. Gurley: Yeah, it's a whole bunch of things. But you just slowly forget, and half of the entrepreneurs today, or maybe more—60% or 70%—weren't around in '99, so they have no muscle memory whatsoever.  So risk just keeps going higher, higher and higher. The problem is that because you get there slowly the correcting is really hard and catastrophic. Right now, the cost of capital is super low here. If the environment were to change dramatically, the types of gymnastics  that it would require companies to readjust their spend is massive. So I worry about it constantly.

Mr. Gurley then responds to other questions citing reasons that it appears that things are getting  excessive.   A summation of his ideas is that burn rates because capital is readily available have gone to very high levels.  Public, SAS companies which he views as potentially among the highest risks are losing tons of money but Wall Street views that as ok for these companies.  There is a vicious cycle.   Money is available from the Street to fund these losses, at very high company valuations and other public company boards see this and decide to up their burn rate because they have money being thrown at them to fund those losses. 

This leads to companies that are less able to weather storms or “to get to cash flow profitability or the ability to generate cash flow” as valuations move higher and along with it operating costs fueled by investment dollars.  Consequently, there will be some failures which in Mr. Gurley’s view will be good in returning reality, or as he says, “sanity”, to the market. 

He also references liquidation preference as a factor that in time makes it more difficult for companies to raise money because, as he states, the “liquidation preference piles up on a startup”.  This fact makes it imperative that companies can show a clear path to cash flow and profitability or the money tap will ultimately be turned off. 

This article is thought provoking because it reminds us that we have seen this in tech sphere in 2001, and in other financial segments like in the mortgage bust that lead to the crash in 2008.  It always happens where too much money starts to chase opportunity.  Credit, investing and underwriting standards decline and there is a market adjustment.  Sometimes it’s painful.  Let’s hope that this time the adjustment will not require widespread and excessive pain in the public market which will, of course, negatively impact angel and early stage venture investing too.  That said, this underlines the need for all startup companies to take the money they can get when they can get it but to guard it and use it wisely in getting to a sustainable market position and a cash flow positive situation as soon as possible.  

Entrepalooza 2014 was held at the Michigan League on September 12.  As always, it was a fun and interesting event, with good lessons about entrepreneurship from experienced entrepreneurs of all ages.

As I listened to various speakers, one theme seemed to rise above all others: the importance of relationships with other people to the success of your business.

  • Keynote Speaker Rob Pelinka talked about a focus on service, and putting others first.  You need others (customers, team members, partners) in order to succeed, and putting them first serves you best in the long run.
  • Nancy Benovich Gilby said the “I think/I know” language has to go from the speech of entrepreneurs; they need compassion and empathy for the customer as well as passion for their product and business. 
  • Doug Cass said it’s easy to start a business, but hard to build the right team; you must surround yourself with people who can do the things you’re not great at.
  • The “Pathways to Entrepreneurship” Panel seemed to agree that one of the biggest pitfalls for startups is people.  You need a diverse team to execute; people who will get along well but challenge each other to excel.  The biggest message was “you can’t do it alone!”

Entrepalooza 2014 was sponsored by, among others, the Zell Lurie Institute, Center for Entrepreneurship, and Ann Arbor SPARK, all organizations that NEF works closely with in support of furthering entrepreneurship.