Life of a Startup: “One Day it’s a Great Day, the Next Day, We’re Dead” says Jean Anne Booth

By SUSAN LAHEY
Reporter with Silicon Hills News

Serial Entrepreneur Jean Anne Booth gave members of Austin Women in Technology the straight skinny on what it takes to become an entrepreneur Thursday night including some advice that a lot of entrepreneurs fail to stress such as:
• If you hope to raise real money from a venture capitalist—more than $3 million—don’t do a friends and family investment round. It only confuses things when the VC comes in.
• Never offer percentages of the company to employees during the startup phase.
• VCs will want to see that you have skin in the game. If you’ve quit your job and have no other source of income, that counts as skin in the game.
Booth, whose most recent startup, Luminary Micro, sold to Texas Instruments in 2009, was the featured speaker at AWT’s Intelligent Talks with Smart Women Dinner at Chez Zee. About 50 AWT members attended.
Booth has nearly 30 years experience in high tech including P&L business unit management to marketing; product definition; systems, software, and applications engineering; silicon development engineering; and operations and product engineering.
Luminary Micro created Stellaris® microcontroller (MCU) platform and the first to market with ARM® Cortex™-M3-based microcontroller solutions. Before Luminary, Booth was an executive founder and marketing head for startup Intrinsity—bought by Apple in 2010– and was part of the management team for startup Exponential Technology. She has a bachelor’s in electrical engineering from UT and a masters in computer engineering from National Technical University. She left TI in November 2011 after serving as General Manager for TI’s Stellaris products.
Besides some of the obvious requirements of being an entrepreneur, such as tenacity and thick skin, Booth said, you have to have other things like the support of your family.
“Expect to hear 20 no’s for every yes,” she said. “You’ll go in to a meeting with this idea and expect everyone to be excited about it. But in fact they’ll all tell you why you can’t do it.”
With that kind of discouragement, and 80-hour workweeks, you’d better have complete buy-in from your family. Booth’s companies invited families of prospective employees to come in and interview the company, in fact.
An entrepreneur has to be able to weather every storm of knowing that, in the beginning, every single decision you make could kill the company.
“You have to be able to deal with the fact that one day it’s a great day; the next day, we’re dead; it’s a great day! We’re dead….”
An entrepreneur has to be able and willing to empty the trash, lease office space, plan the company picnic, buy health insurance for everyone, build a website, understand SEO….
Anyone who doesn’t know if she’s cut out to be an entrepreneur, Booth said, should take a job at a startup—but only if she believes in the company’s vision.
“Startups sell the payoff, “ she said, “maybe that will happen and maybe it won’t. You must believe in their vision enough to happily work 80 hours a week for it. You must expect and demand openness in leadership. You deserve to know how the funding is going, how the company is doing. You have to be able to go home and say “I’m meeting the commitment we made when we joined this company.”
You know you’re not cut out to be an entrepreneur, she said, if you need structure, regular raises and reviews, HR training and leadership development and if you prefer to avoid conflict.
Anyone interested in being an entrepreneur should use her network, she told the group, even if they’re not in tech.
“The fundamental issues in business are the fundamental issues in business.”
Look for mentors, ask specific questions. If an advisor is helping, ask him or her to be on your advisory board. If not, don’t continue to meet with them.
You need a good lawyer, she said, but don’t believe the ones who promise they’ve got the VC contacts and can get you funding.
“I don’t know anybody who got funded because of their lawyer,” she said.
When you hire people, Booth recommended, offer shares, not percentages. But make sure you retain most of the shares of your company.
“The person who owns the vision drives the company,” she said. “With Luminary, I chose not to be the CEO. But make no mistake, I had the most shares.”
That’s especially important for entrepreneurs who have the idea but not the technical know-how to bring it to fruition.
Finally, Booth said, you need luck. If you have a great idea but the economy tanks, you aren’t likely to succeed.
Booth, who “loves creating products and bringing them to market” said she will create another company, but she hasn’t figured out yet what that will be.
In the meantime, she’s scuba diving.