Networking in Silicon Valley

Shandy Lo

Two German entrepreneurs traveled almost 10,000 kilometers to Silicon Valley to find a backer for their startup idea. They tell us what’s so special about networking in the U.S. and why it’s not the same in Europe. (Photo:


Every startup founder dreams of being successful and of attracting an investor. Aspiring entrepreneurs Jörg Bienert and Michael Hummel were prepared to go as far as Silicon Valley in pursuit of their dream, and managed to secure a million-dollar investment deal from Sun Microsystems co-founder, Vinod Khosla. Their company, ParStream, has developed a technology that delivers ultra-fast analytic results on big data.

Bienert and Hummel were able to spend three months in the nerve center of the IT world after winning a place on the German Silicon Valley Accelerator Program. This initiative, funded by the German Federal Ministry of Economics, aims to give German entrepreneurs the opportunity to build up business networks in Silicon Valley and, ideally, to find an investor. In this interview, Jörg Bienert talks about his experiences in Silicon Valley, explains the obstacles faced by startups in Germany, and points out the potential pitfalls. What gave you the idea to set up ParStream?

Jörg Bienert: ParStream is actually a spin-off of our consulting company, empulse Gmbh. Back in 2008, we were commissioned to work on a tourism project that involved developing an online travel search engine.  We had to analyze 14 billion datasets, but we couldn’t find a database technology that would help us do it. In the end, we developed our own algorithm and compression techniques and created a prototype with one billion datasets on a single server. And that’s where we got the idea for ParStream.

Why did you decide to apply for the German Silicon Valley Accelerator Program?

We’d been to Silicon Valley a few times before and we knew that networking was supremely important in the U.S. Things happen at a very different pace over there.  When we heard about the program, we thought it would give us exactly the opportunity we needed to build up those all-important networks.

Was it always your intention to go to the U.S.? Did you consider Europe or Asia at all?

As far as we were concerned, the United States was really the only option, because Silicon Valley’s IT network and ecosystem are unique. There’s no better place to find customers and business partners.

How did you qualify for the program?

Basically, about forty startups turned up on a specific day to pitch their business ideas. Each one had a ten-minute slot. We were one of the six who were selected. Starting in June 2012, we then had six months in which to build up contacts in Silicon Valley and spend time with our coaches, honing our ideas and our business interview techniques.

What benefits does the program offer?

Being accepted to the program means that you are automatically provided with an office and a number of coaches. You have to pay for your travel, accommodation, and living costs yourself. Obviously, it’s very important to have a place to work, a roof over your head, and the infrastructure you need; in other words, a stable base from which to work. Another valuable component of the program is the coaching you receive, because it teaches you how to present your business case to a potential investor and makes you aware of all the aspects you need to consider. The most valuable element, however, are the networking opportunities that the program provides. It opens doors for you and gets you introductions to all kinds of people – including potential investors and venture capital companies. For me, these networking opportunities are what make Silicon Valley so unique. You get to meet the right people much more effectively and faster than you do in Europe.

Jörg Bienert, CEO of ParStream, talks about his startup experience and how to find success in Silicon Valley (Photo: private)

Who were your coaches?

Most of them were fellow Germans, but we also worked with Americans who had spent time in Germany.  They all had an entrepreneurial background or had founded startups themselves.

Your stay in Silicon Valley was clearly a great success because you managed to secure an investment from Vinod Khosla. Was it as simple as it sounds?

The general rule of thumb is that it takes at least three to six months to find an investor. We attended 60 meetings with potential investors while we were in Silicon Valley. During the most intensive period, we had up to seven appointments scheduled every day.

What did you learn from the program?

What we found was that once our talks with one investor had reached a relatively advanced stage, other potential investors realized that we were an interesting option and that we would soon be “snapped up”. This speeded up the whole process significantly and gave it a momentum of its own. Inquiries started pouring in from all sides. What we learned from this is that you should never give investors the feeling that you’ve got plenty of time. You have to exert a certain amount of market pressure.

Networking is supremely important. It’s vital to talk with lots of people, because you sometimes discover new contacts purely by chance. It took us no time at all to build up a network that is at least as big as the one we have in Germany.

What difference has the investment made for you?

Well, our bank account is certainly looking pretty healthy (laughter).  Seriously though, it gives us the foundation we need to plan accurately for the future and to investigate other avenues of investment. The fact that an American businessman has invested in us has also altered our image on the German market. We wouldn’t command the same degree of attention if our investor were German.

We’ll certainly use the capital to expand our business in Germany, but our main objective is to build up our U.S. business. Our development operations and company headquarters will remain in Cologne, Germany. After all, it’s the German “GmbH” that Vinod Khosla has invested in.

Would you say that startups in the United States have it easier than their counterparts in Europe?

Investors in Silicon Valley move faster than European investors, and business talks begin at a very early stage. That’s what the market thrives on. The process of investing in startups and entrepreneurships is part of daily business life in Silicon Valley and enjoys a much greater status than it does in Europe. The Americans are more willing to take risks; in Silicon Valley, particularly, you sense that there’s a very different spirit at work in the business community. When you add this to the high-speed communication and networking that is possible there, you get a very different momentum.

We held investment discussions in Germany too, but we soon realized that it made more sense for us to focus our efforts on the U.S., because things happen faster there and we need to establish our product on the U.S. market.

Would you say that Germany’s startup culture is off the pace?

American companies are more willing to take risks. They move faster. And they believe in new technologies. They are also more open to new business models. In the past, German companies have tended to invest in startups that copy a business model, so-called “copy cats”. Germans focus more on where and whether a model has already been successful. There are lots of German startups developing on a very high technological level, but it takes them longer than their American competitors to get their products to the market. So they end up being overtaken left and right by U.S. companies.

In Germany, it takes too long to arrange a business meeting with a partner or an investor.  In the U.S., networking happens much faster. And you have to be prepared to follow the pace. For example, business partners expect you to respond to an e-mail inquiry within 24 hours.

What advice can you offer startups that want to try their luck in Silicon Valley?

They should be prepared to adjust to the way Americans do business and be sure to stick to the rules.  We probably broke them on a couple of occasions. Never postpone appointments, always show up on time, adapt to the way communication takes place, and be straightforward.

Would you say that it is easier to found a startup in Germany today than it was three or four years ago?

Lots of investors in Germany are certainly prepared to take more of a risk than they were a few years ago. The reason is that the hurdles to investment are lower and less difficult to surmount. Cloud services, for example, have made the IT infrastructure much cheaper and more flexible: As long as you have a notebook and mobile data connections, you can work anywhere. And, thanks to the Internet and social networks, it has become much easier to find contacts and build up networks.

What are the typical mistakes that young entrepreneurs make?

They tend to devote too much time to the development phase, which means that by the time they take their product to the market, the market has gone. Also, they spend too long “cooking in their own juice” and fail to obtain feedback from outside. Startups should always be willing to learn. Another common mistake is omitting to conduct a market analysis.

What are your three “top tips” for startups?

First, build up a good network. You won’t get anywhere without one. Second, act fast. It’s very important to make and execute on decisions quickly. And third, stay in control. You should never assume that things will simply start happening just because you’ve made a few good contacts. You have to stay on the ball and show 150% commitment.




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13 Scary Statistics On Employee Engagement [INFOGRAPHIC]

Jacob Shriar

There is a serious problem with the way we work.

Most employees are disengaged and not passionate about the work they do. This is costing companies a ton of money in lost productivity, absenteeism, and turnover. It’s also harmful to employees, because they’re more stressed out than ever.

The thing that bothers me the most about it, is that it’s all so easy to fix. I can’t figure out why managers aren’t more proactive about this. Besides the human element of caring for our employees, it’s costing them money, so they should care more about fixing it. Something as simple as saying thank you to your employees can have a huge effect on their engagement, not to mention it’s good for your level of happiness.

The infographic that we put together has some pretty shocking statistics in it, but there are a few common themes. Employees feel overworked, overwhelmed, and they don’t like what they do. Companies are noticing it, with 75% of them saying they can’t attract the right talent, and 83% of them feeling that their employer brand isn’t compelling. Companies that want to fix this need to be smart, and patient. This doesn’t happen overnight, but like I mentioned, it’s easy to do. Being patient might be the hardest thing for companies, and I understand how frustrating it can be not to see results right away, but it’s important that you invest in this, because the ROI of employee engagement is huge.

Here are 4 simple (and free) things you can do to get that passion back into employees. These are all based on research from Deloitte.

1.  Encourage side projects

Employees feel overworked and underappreciated, so as leaders, we need to stop overloading them to the point where they can’t handle the workload. Let them explore their own passions and interests, and work on side projects. Ideally, they wouldn’t have to be related to the company, but if you’re worried about them wasting time, you can set that boundary that it has to be related to the company. What this does, is give them autonomy, and let them improve on their skills (mastery), two of the biggest motivators for work.

Employees feel overworked and underappreciated, so as leaders, we need to stop overloading them to the point where they can’t handle the workload.

2.  Encourage workers to engage with customers

At Wistia, a video hosting company, they make everyone in the company do customer support during their onboarding, and they often rotate people into customer support. When I asked Chris, their CEO, why they do this, he mentioned to me that it’s so every single person in the company understands how their customers are using their product. What pains they’re having, what they like about it, it gets everyone on the same page. It keeps all employees in the loop, and can really motivate you to work when you’re talking directly with customers.

3.  Encourage workers to work cross-functionally

Both Apple and Google have created common areas in their offices, specifically and strategically located, so that different workers that don’t normally interact with each other can have a chance to chat.

This isn’t a coincidence. It’s meant for that collaborative learning, and building those relationships with your colleagues.

4.  Encourage networking in their industry

This is similar to number 2 on the list, but it’s important for employees to grow and learn more about what they do. It helps them build that passion for their industry. It’s important to go to networking events, and encourage your employees to participate in these things. Websites like Eventbrite or Meetup have lots of great resources, and most of the events on there are free.

13 Disturbing Facts About Employee Engagement [Infographic]

What do you do to increase employee engagement? Let me know your thoughts in the comments!

Did you like today’s post? If so you’ll love our frequent newsletter! Sign up here and receive The Switch and Shift Change Playbook, by Shawn Murphy, as our thanks to you!

This infographic was crafted with love by Officevibe, the employee survey tool that helps companies improve their corporate wellness, and have a better organizational culture.


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Supply Chain Fraud: The Threat from Within

Lindsey LaManna

Supply chain fraud – whether perpetrated by suppliers, subcontractors, employees, or some combination of those – can take many forms. Among the most common are:

  • Falsified labor
  • Inflated bills or expense accounts
  • Bribery and corruption
  • Phantom vendor accounts or invoices
  • Bid rigging
  • Grey markets (counterfeit or knockoff products)
  • Failure to meet specifications (resulting in substandard or dangerous goods)
  • Unauthorized disbursements

LSAP_Smart Supply Chains_graphics_briefook inside

Perhaps the most damaging sources of supply chain fraud are internal, especially collusion between an employee and a supplier. Such partnerships help fraudsters evade independent checks and other controls, enabling them to steal larger amounts. The median loss from fraud committed
by a single thief was US$80,000, according to the Association of Certified Fraud Examiners (ACFE).

Costs increase along with the number of perpetrators involved. Fraud involving two thieves had a median loss of US$200,000; fraud involving three people had a median loss of US$355,000; and fraud with four or more had a median loss of more than US$500,000, according to ACFE.

Build a culture to fight fraud

The most effective method to fight internal supply chain theft is to create a culture dedicated to fighting it. Here are a few ways to do it:

  • Make sure the board and C-level executives understand the critical nature of the supply chain and the risk of fraud throughout the procurement lifecycle.
  • Market the organization’s supply chain policies internally and among contractors.
  • Institute policies that prohibit conflicts of interest, and cross-check employee and supplier data to uncover potential conflicts.
  • Define the rules for accepting gifts from suppliers and insist that all gifts be documented.
  • Require two employees to sign off on any proposed changes to suppliers.
  • Watch for staff defections to suppliers, and pay close attention to any supplier that has recently poached an employee.

About Lindsey LaManna

Lindsey LaManna is Social and Reporting Manager for the Digitalist Magazine by SAP Global Marketing. Follow @LindseyLaManna on Twitter, on LinkedIn or Google+.


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The Future Of Supplier Collaboration: 9 Things CPOs Want Their Managers To Know Now

Sundar Kamak

As a sourcing or procurement manager, you may think there’s nothing new about supplier collaboration. Your chief procurement officer (CPO) most likely disagrees.
Forward-thinking CPOs acknowledge the benefit of supplier partnerships. They not only value collaboration, but require a revolution in how their buying organization conducts its business and operations. “Procurement must start looking to suppliers for inspiration and new capability, stop prescribing specifications and start tapping into the expertise of suppliers,” writes David Rae in Procurement Leaders. The CEO expects it of your CPO, and your CPO expects it of you. For sourcing managers, this can be a lot of pressure.

Here are nine things your CPO wants you to know about how supplier collaboration is changing – and why it matters to your company’s future and your own future.

1. The need for supplier collaboration in procurement is greater than ever

Over half (65%) of procurement practitioners say procurement at their company is becoming more collaborative with suppliers, according to The Future of Procurement, Making Collaboration Pay Off, by Oxford Economics. Why? Because the pace of business has increased exponentially, and businesses must be able to respond to new market demands with agility and innovation. In this climate, buyers are relying on suppliers more than ever before. And buyers aren’t collaborating with suppliers merely as providers of materials and goods, but as strategic partners that can help create products that are competitive differentiators.

Supplier collaboration itself isn’t new. What’s new is that it’s taken on a much greater urgency and importance.

2. You’re probably not realizing the full collective power of your supplier relationships

Supplier collaboration has always been a function of maintaining a delicate balance between demand and supply. For the most part, the primary focus of the supplier relationship is ensuring the right materials are available at the right time and location. However, sourcing managers with a narrow focus on delivery are missing out on one of the greatest advantages of forging collaborative supplier partnerships: an opportunity to drive synergies that are otherwise perceived as impossible within the confines of the business. The game-changer is when you drive those synergies with thousands, not hundreds of suppliers. Look at the Apple Store as a prime example of collaboration en masse. Without the apps, the iPhone is just another ordinary phone!

3. Collaboration comes in more than one flavor

Suppliers don’t just collaborate with you to provide a critical component or service. They also work with your engineers to help ensure costs are optimized from the buyer’s perspective as well as the supplier’s side. They may even take over the provisioning of an entire end-to-end solution. Or co-design with your R&D team through joint research and development. These forms of collaboration aren’t new, but they are becoming more common and more critical. And they are becoming more impactful, because once you start extending any of these collaboration models to more and more suppliers, your capabilities as a business increase by orders of magnitude. If one good supplier can enable your company to build its brand, expand its reach, and establish its position as a market leader – imagine what’s possible when you work collaboratively with hundreds or thousands of suppliers.

4. Keeping product sustainability top of mind pays off

Facing increasing demand for sustainable products and production, companies are relying on suppliers to answer this new market requirement.

As a sourcing manager, you may need to go outside your comfort zone to think about new, innovative ways to collaborate for achieving sustainability. Recently, I heard from an acquaintance who is a CPO of a leading services company. His organization is currently collaborating with one of the largest suppliers in the world to adhere to regulatory mandates and consumer demand for “lean and green” lightbulbs. Although this approach was interesting to me, what really struck me was his observation on how this co-innovation with the supplier is spawning cost and resource optimization and the delivery of competitive products. As reported by Andrew Winston in The Harvard Business Review, Target and Walmart partnered to launch the Personal Care Sustainability Summit last year. So even competitors are collaborating with each other and with their suppliers in the name of sustainability.

5. Co-marketing is a win-win

Look at your list of suppliers. Does anyone have a brand that is bigger than your company’s? Believe it or not, almost all of us do. So why not seize the opportunity to raise your and your supplier’s brand profile in the marketplace?

Take Intel, for example. The laptop you’re working on right now may very well have an “Intel inside” sticker on it. That’s co-marketing at work. Consistently ranked as one of the world’s top 100 most valuable brands by Millward Brown Optimor, this largest supplier of microprocessors is world-renowned for its technology and innovation. For many companies that buy supplies from Intel, the decision to co-market is a strategic approach to convey that the product is reliable and provides real value for their computing needs.

6. Suppliers get to choose their customers, too

Increased competition for high-performing suppliers is changing the way procurement operates, say 58% of procurement executives in the Oxford Economics study. Buyers have a responsibility to the supplier – and to their CEO – to be a customer of choice. When the economy is going well, you might be able to dictate the supplier’s goods and services – and sometimes even the service delivery model. When times get tough (and they can very quickly), suppliers will typically reevaluate your organization’s needs to see whether they can continue service in a fiscally responsible manner. To secure suppliers’ attention in favorable and challenging economic conditions, your organization should establish collaborative and mutually productive partnerships with them.

7. Suppliers can help simplify operations

Cost optimization will always be one of your performance metrics; however, that is only one small part of the entire puzzle. What will help your organization get noticed is leveraging the supplier relationship to innovate new and better ways of managing the product line and operating the business while balancing risk and cost optimization. Ask yourself: Which functions are no longer needed? Can they be outsourced to a supplier that can perform them better? What can be automated?

8. Suppliers have a better grasp of your sourcing categories than you do

Understand your category like never before so that your organization can realize the full potential of its supplier investments while delivering products that are consistent and of high quality. How? By leveraging the wisdom of your suppliers. To be blunt: they know more than you do. Tap into that knowledge to gain a solid understanding of the product, market category, suppliers’ capabilities, and shifting dynamics in the industry, If a buyer does not understand these areas deeply, no amount of collaboration will empower a supplier to help your company innovate as well as optimize costs and resources.

9. Remember that there’s something in it for you as well

All of us want to do strategic, impactful work. Sourcing managers with aspirations of becoming CPOs should move beyond writing contracts and pushing PO requests by building strategic procurement skill sets. For example, a working knowledge in analytics allows you to choose suppliers that can shape the market and help a product succeed – and can catch the eye of the senior leadership team.

Sundar Kamak is global vice president of solutions marketing at Ariba, an SAP company.

For more on supplier collaboration, read Making Collaboration Pay Off, part of a series on the Future of Procurement, by Oxford Economics.


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The Importance Of Leadership On Employee Engagement [INFOGRAPHIC]

Charmian Solter

Here at Switch & Shift we strive to illuminate effective leadership practices. We pride ourselves on creating cutting-edge solutions for employee engagement, communication, and creating company culture, to name a few.

Why are these topics so important? Well, according to The Importance of Employee Engagement infographic by NBRI, courtesy of Brandon Gaille, if leadership doesn’t step up and affect change and build trust and engagement, their employees will be busy doing anything but work while on the job! This infographic says it all.


For more on developing more engaged, loyal, and productive workers, see How Empowering Employees Creates a More Engaged Workforce.


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