The Program

TechStars Blog

18th September 2012

Why You Should Apply to TechStars Cloud

I’m Jason Seats and I run TechStars Cloud. Before I pitch you on why you should apply, let me briefly tell you about myself.

More than you probably wanted to know about Jason Seats

I’m an engineer (double major CS and EE) and in 2006 I co-founded a hosting company called Slicehost with a good college friend, Matt Tanase. Rackspace acquired us in 2008 and inside of Rackspace I launched the Rackspace Cloud Server product and eventually took over managing the engineering teams for their full cloud portfolio. I left Rackspace in 2010 and spent nearly a year in an existential limbo, around the time that Matt and I did this interview. I knew I wasn’t cut out for bigco, but wasn’t sure where my heart was.

Building Slicehost was a crazy ride, filled with tons of pain, lots of fun, and a new challenge every day. One thing we never had though was any true mentor or advisor. Largely this was a result of being a bootstrapped company, which itself was a result of not having a very big personal network. In any case, there were mentors out there for the taking, but we were too naive and unaware to notice or take advantage of them. I’ll give you a crazy example – one day in the normal course of running Slicehost, Pierre Omidyar, Ebay founder, wanders in our chat room working on a personal project. How easily we could have just said, ‘Hey Pierre, what would you think about giving us some advice on our business?’ Instead in our infinite wisdom we decided we were going to go out of our way to treat him exactly the same as every other customer. We were total idiots.

If I had it to do all over again, this would be the one thing I assuredly would have done differently. After gaining some great personal mentors (including the fantastic senior leaders at Rackspace), I figured out what I was missing. As I was pondering my ‘what next’ move, I knew for sure I wanted to spend as much time as I could with startups, giving them what I wished someone had given us.

By 2011 I had begun relationships advising a few companies when the opportunity fell in my lap to run the first TechStars Cloud program. When I met with David Cohen and Nicole Glaros to discuss it, my biggest concern was that I wasn’t sure if I even ‘believed in the whole venture thing.’ I built my company with my own money, why shouldn’t everyone else have to walk through the same sludge? I realized even as I expressed this view that I was revealing a pretty big chip I had on my shoulder about the whole startup scene.

TechStars has bootstrapping in its genes

The response that I got was not one I expected. David Cohen, having also been a bootstrapper, was more similar to me than I knew. Recognizing that my internal bias against fundraising was due to my own negative experience raising capital, I walked away with opened eyes. I decided that I definitely wanted to be connected to TechStars. Over my last year at TechStars I’ve become much more balanced about both sides of this debate. For my part, I’m happy to recommend bootstrapping or financing to companies when it’s clear which option is optimal. Otherwise, I defer to their wishes. And in every case, as the TechStars mantra says – it’s your company, you make the call.

I’ve also personally invested in over a dozen companies, which is a far cry from where I was just a year ago. Accelerators work on investors and mentors too. I’ve crammed years worth of investing knowledge into the last 12 months.

About TechStars Cloud

So enough about me, back to TechStars. Why should you care and why does this matter to you?

This was kind of a long winded way of saying, I’m one of you, a founder. I built a company and sold it, and I did it the hard way (all alone). I’m skeptical of the hype bubble and ‘news of the day’ startup nonsense, just like you are. This program is for real companies building real things and mostly I just want to help people avoid making the mistakes that I made. In fact this is the essence of what TechStars is all about, sharing the hard earned wisdom that hordes of founders have gained before you. We believe that the best way for you to increase your chances of success is to simply decrease your risk of failure.

We have assembled a top notch set of mentors who have been there too. We have founders of bootstrapped startups with exits, VC funded companies, VCs themselves, operators at all stages of the game, and 6 years of alumni doing amazing things. The most common reason that our mentors give when pressed for why they contribute their time is that they had a great mentor in their past. The TechStars network very much is one big family. Imagine the confidence you’d have tackling your startup’s biggest challenges when reaching out to Brad Feld is as easy as getting ahold of your Great Aunt Edna. Jim Franklin, CEO of SendGrid is like a second cousin and Mat Ellis, founder of Cloudability, is like your older brother who will come home to visit from college and beat you up right when you need it. The technical bench is pretty deep too, with technical founders like Nathan Day from SoftLayer, Dirk Elmendorf of Rackspace, Jud Valeski of Gnip and Eric Jensen from Summize/Twitter.

TechStars is three months long, it’s intense and it’s worth it. For a TMI version of what bits of the process feel like, you can read the inside thoughts of the Keen.io team (TS Cloud 2012) before, during and after.

What does ‘Cloud’ mean?

Everything above is true of all the TechStars programs. TechStars is something pretty special and I’m proud to be a part of it. The Cloud program, though, is a little different than the others, and that difference requires some extra clarity.

TechStars Cloud is a thematic program, which means we are somehow filtering companies with the criteria of what we consider to be ‘Cloud.’ So what does that filter look like? Well, one short-cut would be to just tell you to look at the companies we selected in the last batch. In the past, we described our target company as one that is building the ‘plumbing of the internet’. That’s a great metaphor, but it may be a little misleading. In some sense, this program is more like TechStars Technical in that any sufficiently technology heavy company is probably going to feel like a fit.

I still worry that we are causing some of you to self-filter incorrectly. Does this mean we only take b2b businesses or can consumer oriented companies still count as cloud? Both qualify. There is no question in my mind that a company like DropBox is a cloud company or all of the Google Apps products or even Gmail itself. To me the key on the b2b side is deeper technology and on the b2c side it’s innovation around the delivery of technology (in other words I think consumer cloud is more about usability innovation). In both cases though, the hallmark of cloud is the step function increase in output that the user gets from the technology. Cloud is about leverage.

In summary, if any of the following words relate to you, more likely than not, you are a fit: analytics, big data, infrastructure, security, platforms, developer APIs, storage, SaaS, enterprise software and hosting. And I’ve always said, I’d rather rationalize why a fantastic company is a ‘cloud’ company than miss the opportunity to see that awesome company in the first place.

Is this for you?

I hope you have a least a little better understanding of why I’m personally doing this, what TechStars is about and what makes a cloud company ‘cloudy.’ If you think this might be for you, then your next step is to apply here. Also feel free to hit me up on Twitter : @seats or email me directly (jason AT techstars.com). I’d love to hear about what you are working on.