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Wednesday, April 18, 2012

Some Thoughts on Branding Startups and Communities

from Mark Suster





Brad Feld visited Los Angeles this past week. I always enjoy spending time with Brad as the antidote to the eco chamber. He is a unique human being with original thoughts & ideas and very limited concern for having to fit into other people’s narratives.

And I’ve always remembered a quote from high school, “Non Conformity is the Highest Form of Social Attainment.” That always stuck with me. That seems very Brad to me. It’s what I strive to.

We threw a Launchpad LA dinner to bring the community together as we tend to do 6-10 times a year. Brad was our guest of honor.

After a great 30-minute talk he took questions. Somebody asked the question, “What do you think about the term ‘Silicon Beach?” It was not a planted question by me. My views are pretty well known.

Brad wrote up his answer here – you should read it because it’s very instructive for how I believe communities ought to think about naming conventions.

In his blog he says,

“I responded that I thought it was stupid. I hate Silicon Whatever. LA should be LA.”

Many people on the Westside of Los Angeles are using the term Silicon Beach these days to describe the amazing renaissance that is truly happening here. That’s OK with me. But I think Brad actually has a point. I kind of think LA is just LA and doesn’t need some clever marketing term.

If I were to think about branding our great city I don’t think I would chose the Silicon Beach moniker myself. The way I think about branding anything is simple:

Define the Attributes You Want to Project
The first rule of choosing a brand for anything is to figure out the image you want to project. I recommend that you start by writing down the attributes you would want people to think about when they think about your brand.

Let my try those for Los Angeles as an example:

  • Second largest city in America with 13 million people
  • Third most powerful economic city in the world after NYC & Tokyo.
  • Diverse – in terms of industries, ethnicities and environments
  • Creative – we’re a place of writers, directors, producers, musicians, costume designers, make-up artists, graphic artists, 3D modelers.
  • A market leader in content, music, entertainment, textiles, engineering, aerospace and trade.
  • An innovator in technology, especially monetization. The birthplace of sponsored search (Overture), semantic search (Applied Semantics which became Google AdSense), comparison shopping (ShopZilla, PriceGrabber) and many others.
  • World-class education including Caltech, USC and UCLA
  • Home of JPL (Jet Propulsion Laboratory), which helps put rockets into space
  • Home to the Internet’s first true “accelerator,” Idealab led by Bill Gross
  • And of course a place of idyllic weather, culture and a lifestyle

This is the list I would start with. If I took more than 5 minutes I’d fill it in with all of the wonderful things I’m forgetting.

Whatever you’re trying to brand – your company, your community or yourself – this is the first exercise I would recommend that you start with. Outline your key attributes.

For me Silicon Beach doesn’t quite encapsulate the wonderful, dynamic, creative, large, thriving community that is the 13 million proud Angelinos any more than Silicon Alley captures the bustling 2012 community of New York City.

If anything using the word “Silicon” seems a bit derivative to NorCal. Don’t you think?

Interestingly, nobody I know in NorCal EVER calls it Silicon Valley, “Silicon Valley.” It seems to either be “The Peninsula” or “San Francisco” or even just “The Bay Area.”

To me, LA will always be a creative hub for TV, film, music, video games and now technology. We need to be different & unique. Not derivative.

And then there’s “Beach.” I love the beach. I live right near it and I drive by it every day. But “Beach” emphasizes the worst perception that people have about Los Angeles. It emphasizes that we’re not serious. That we’re a party. That we chose to live here simply because of lifestyle, babes, sun and nightlife. Our Bay Area brethren think, “you can have your beach, LA. We’ll work our asses off and build huge companies that will define the next generation of American’s lives.”

And of course it’s not a true assessment. The people I know in LA building serious companies ARE working their asses off. That’s how we’re producing many interesting companies like I’ve never seen before in LA. Here’s a short list that are decidedly East of the 405 freeway (i.e. not near the beach):

  • Factual, founded by Gil Elbaz who built AdSense [Century City]
  • ZestCash, founded by Douglas Merrill, former CIO of Google [Hollywood]
  • Deviant Art, led by Angelo Sotira, which is one of the largest online communities on the Internet [Hollywood]
  • ReachLocal, founded by Zorik Gordon, publicly traded company helping small businesses across America use the Internet for marketing [Woodland Hills ... North of the 101]
  • Idealab, led by Bill Gross, who founded Overture, CitySearch and MANY other business [Pasadena]
  • Oblong, led by Kwin Kramer, which houses more MIT grads per startup than probably any other in LA. They designed the next gen UI for the film The Minority Report. And do so in real life, too. [downtown LA]
  • Maker Studios, leading YouTube producer, generating hundreds of millions of video views every month [Los Angeles, near Culver City]

Also East of the 405? Caltech. UCLA. USC.

So, yeah, I would like LA to be LA. I guess Santa Monica is officially “Silicon Beach” in the local people’s minds. Still, I kind like the name, well, um, … Santa Monica.

NYC has gotten a lead on us in the perception of creating a next generation technology hub and with good reason. Every time I’m there I’m blown away by the renewed energy and the thriving communities that have formed around the Flatiron District, Brooklyn and elsewhere. And I never hear local people touting “Silicon Alley” as they did 12 years ago. They’ve grown.

Some Other Thoughts on Branding / Positioning

Think about venture capital. Those that were around 30+ years ago never had to think about branding – there were hardly any other VCs. So many had names of partners (Kleiner Perkins) or local favorite identifiers like trees (Sequoia).

But if you were going to start a venture capital fund today, you’d want to stand out. Of course if you’re already known you could put your name or location on your fund name. But consider the following:

1. First Round Capital – No prizes for guessing what kind of firm they set out to build. You could argue that choosing the name “first round” paints them into a corner in case they want to ever do a late stage fund, but I suspect they named it FRC precisely because they wanted to excel at early-stage investing. And because they’ve been so successful / dominant in this space you could argue that even now they could do later stage with this brand if they ever chose to.

2. IA Ventures – Roger Ehrenberg was doing angel investing before he became a VC. And before that he worked years at hedge funds and more broadly in the financial services industry. He was one of the first guys that I know who laid out his stall and said I want to do “big data” investments that take advantage of the explosion of data now available on the web. So his Twitter handle is @infoarbitrage and his excellent (must read) blog is Information Arbitrage. So no prizes for guessing what IA Ventures stands for. Still, he probably chose a brand like IA that allows the firm to broaden if it needs to at some point.

Whenever I have a business that is big-data oriented and financial services focused he’s my first call. There are other great ones out there but his focus, his relationships and the brand he has built seem to make me think of him first.

3. Founder Collective – If you were an early-stage startup and wanted to be funded by entrepreneurs who had walked in your shoes before, you wouldn’t have to stretch the imagination far to think of what “Founder Collective” is meant to stand for. The two managing partners are Eric Paley & David Frankel (both former entrepreneurs) but they have also aligned themselves with some of the best known startup savvy entrepreneurs including Chris Dixon (Hunch) and Caterina Fake (Flickr, Pinwheel). A quick survey of their portfolio tells you just how many high-profile startups have included them in their rounds. I know that I call them often to co-invest.

4. True Ventures – When I was raising capital for my second company back in 2006 I had talked to many brand-name VCs and had several term sheets. I had decided I wanted to work with a small VC I had never heard of where I would be their 8th investment for this fund (they had previously worked at other VCs). I chose them because they were the most transparent and because they gave me the cleanest term-sheet in an era when most VCs still tried to screw you. The name “True Ventures” sounds very Howard Roark-esque but in fact that’s how dealing with Jon & Phil seemed. Like they truly understood entrepreneurs. And like they were building a next-generation firm. Alas, I sold my company so I never became company 8 but have been a fan ever since. And the name to me speaks of clarity.

5. Andreessen Horowitz – Ok. So if you invested the browser I think you get to name the firm after yourself. The name, the person, sort of speaks for itself. And if you were right there along side the man building companies you’ve also earned the right to the logo ;-)

For many companies having “functional names” that encapsulate your key characteristics in the title can be powerful.

And for me. When I chose a name for my blog, I spent days thinking through what I wanted to represent. I thought about some Southern California angle, because this is where > 50% of my investments are. But I thought, “nah, people will figure out that I’m in LA on their own. I want to invest in the best entrepreneurs in the country – regardless of where they’re located.”

So I thought about what was unique about me. Not versus every other VC but versus many. I was a former entrepreneur. I had run 2 companies. I wanted to be hands-on. I wanted to be transparent. I wanted to model myself after Brad Feld and provide advice on dealing with VCs because that is what made me want to work with Brad when I was an entrepreneur.

And I wondered how to best represent that in a brand. I chose Both Sides of the Table because I thought it emphasized this point. I played around with shortening the URL (you can use www.bothsid.es or www.bsott.com by the way) but I figured having the name in full would help people to remember how I wanted to be positioned. And I think it has mostly resonated.

In Summary
When you think about a brand you need to create a name that will represent the kind of organization or community you want to build. You can either have a functional name (i.e. Instagram) or a nonsense name that doesn’t paint you into any particular corner (Twitter) or even a generic name where you fill in the marketing messages to define that brand (Los Angeles).

I can’t help but think that Brad’s words of wisdom to our group were apt – brought on by 20+ years of seeing naming conventions come and go and traveling tirelessly to all regions of the country. I know that the proponents of “Silicon Beach” will continue to promote their term. That’s fine. I’ve come to accept it.

I’m stick with the un-branding. And letting the amazing performance of our growing community of startups filled with creative professionals, talented engineers and entrepreneurs who have a bias toward monetization – speak for itself.

Mark Suster, a venture capitalist at GRP Partners, recently posted this on his blog, Both Sides of the Table, and gave us permission to repost it here.


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