By SUSAN LAHEY
Reporter with Silicon Hills News
Mike Maples Sr. with Startup Grind Austin’s Andi Gillentine
After his retirement in 1995, Maples said, he began investing partly because “I’m kinda driven by the concept that life dealt me an overly lucky hand. It had little to do with how smart I was. I was at the right place at the right time. Maybe you owe part of that back. You can’t just spend every day in Hawaii looking at sunsets.”
Investing to Stay in the Game
He picks companies with ideas that interest him, he said, because he wants to be part of the game. He’s not as worried about customers and revenue as people who invest more money. He’s not interested in “hockey stick charts” showing projected revenues 15 years out because, at 69, he said, he’s not going to be around to see any of that. “If all my investments hit home runs, I’m not going to change my lifestyle. If they all go to zero, I wouldn’t change my lifestyle. I’m just fat, dumb and happy.”
“Three days a month, I’ll talk to anybody who wants to talk for half an hour. I have an hourglass and I turn it over when you come. When it runs out you get to leave.”
What he wants to know is “What do you need besides money? What do you need besides an advisor? I might invest if I think the idea is interesting. There are certain things I know something about. My question is, ‘Do I know people to connect you with? Do I have experiences that will help?’ If the idea seems interesting and I can be of value, that filter works for me.”
Entrepreneurship is About the Struggle
Maples asked how many of the people in the audience had advanced degrees and many hands went up.
“Most of you voted out of being entrepreneurs,” he said. “If you look at the major tech companies, Bill Gates, Larry Ellison, Steve Jobs, they didn’t waste time going to college getting advanced degrees. They went out and built a company. The fact that you went to college means you may be a little conservative on the risk side…that’s not to say a PhD isn’t useful to running a company.”
Many incubators and accelerators he said, excessively baby entrepreneurs.
“There’s something about the struggle, adversity, the trial and error and worrying at night about things that makes the entrepreneur better and stronger. Of course, you can appreciate that more when it has passed than you do now.”
Lack of focus, he said, kills more startups than anything else.
“Good ideas without passion and execution never work,” he said. “A lot of companies that fail, they didn’t believe with all their hearts that this was the most important thing to be doing and they didn’t focus…any time you have pivots 4-or-5 times a year you haven’t got enough focus. If you don’t give ever give x a chance to work out, it never will.”
Among his suggestions for business success:
- Hire people smarter than you, and trust them to do their jobs.
- Don’t partner with a big company hoping “the magic will rub off.” Likely the big company will use you and your ideas and wind up with the credit and the money. But if you do link up with bigger partners, find those who need your solution more than you need their money.
- Ignore the advice to forget your competition and focus on your product. If you ignore the competition you’re losing a learning opportunity.
- You can put your product out if it doesn’t have full functionality. “No good idea is solved with one release.” And you can put it out late. But don’t put it out with poor quality.
“What you need to know is what does the customer expect?” he said. “When we came out with Word the fact that it would even print was important. That was back in the days when Word first came out and it barely worked. That was okay because the customer didn’t expect much more than that.” - Don’t focus on VCs until your company is ready to expand to the hundreds of millions. Look at “how can you get to revenue faster? How can you get by with less?”
On Microsoft and Bill Gates
Maples addressed questions about a recent Microsoft restructuring around devices and services. Structuring a company like Microsoft is a challenge, he said. When he was responsible for a restructuring, they tried to put teams around each of the products so each was like its own little company.
“The Word guys talked about the Word customers and the Excel guys were thinking about Excel and there was not a lot of talking about Microsoft Office. It got to be extreme so in 2005 they had a reorganization,” he said. There was a focus on bringing the company back together as a whole. A developer wasn’t an Xbox developer, but a Microsoft developer. That reorganization didn’t really work either, he said, because it sacrificed knowledge of specific customer bases. “Tradeoffs for the good of the whole are not very effective.”
Maples worked closely with Bill Gates as part of a “presidential office” team. Gates, he said, was one of the smartest men he’s ever known and he gets credited with both technical and business acumen. But what he believes accounts for Gates’ success is a near-perfect recall or photographic memory and an ability to synthesize information and analyze leading indicators to know what’s on the horizon. He can look at a sheet of statistics and recall the numbers perfectly months later.
“He’s an extraordinarily interesting person and he can be very emotional and get very loud but you never have a feeling that anything is personal,” he said.
Each year, Gates would ask his key people to suggest books or write white papers on topics they felt he should know about. Then he would take “think weeks” where he would consume all the material and return with a letter stating “I think these are the areas we want to look into.”
When asked what entrepreneurs should read to understand the direction of the future, Maples said Gates got it right about 65 percent of the time but other people get it right 40 percent.
“I’m opinionated about everything,” Maples said. “The advice I’m giving you is probably worth what you’re paying for it. I don’t think you’re learning any grand wisdom. The only thing you’re learning is a lot of experience.”
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