[LUAU] The VC Squeeze, Desktop Linux and Hawaii's future

[Jim Thompson]

Hawaii Linux Institute wrote:

> Jim Thompson wrote:
>
>> Just some ideas, a bit more "bomb throwing" @ 4am.
>
> As someone who is looking at his career/life from a rearview mirror, I 
> probably should keep my mouth shut.  But we used to represent an 
> out-of-state VC, and it was equally frustrating for us to try to find 
> good candidates here.

There are no "out of state VCs", they don't want to live that far from 
their investment(s).

> One suggestion I may make is to loiter at MIC at least once a while.  
> Digital Islands, WordPlace, and a bunch of other tech companies all 
> started there.  Actually I used to chat with founders of DI and WP 
> when both were essentially on-man ops.  I understand that MIC is 
> getting very crowded now.  & it's good to know.

yes, this kind of communication and cultural exchange is vital (and from 
what I can tell after 16 months on island, mostly lacking.)

> As you are aware, different VCs have different operational 
> philosophies.  This particular VC that we were associated with was 
> mostly interested in acquiring companies with a good "market access".  
> Hawaii itself is a very small market, but there is something else that 
> makes Hawaii potentially a very big market.  I don't want to go into 
> it, but I believe you know what I am talking about.

VCs don't acquire companies, well, not until they're in a "death spiral" 
(typified by taking cash with too many ugly conditions).   The type of 
firm you describe is typical known as a "private equity investment 
firm".  KK&R is a prime example.

> Another hot topic in the VC circle that I am familiar with is the 
> "China-connection".  It's very difficult to imagine that some country 
> (if you combine China, Hong Kong, and Taiwan) could amsss a cash 
> reserve in excess of $1 trillion USD in such a short period of time.  
> This number is too big to make any sense to most of us.  But to many 
> VCs, it does.  & one of the keys of getting some VCs interested is 
> probably to develop a product/technology that will sell in China.  If 
> anyone can combine China and Japan in the same conversation, it's even 
> better.  (US companies oursource software development to India, & 
> Japanese companies to China, more particularly to the city of Dalian.  
> This is something to keep in mind.)

You appear to want to only pursue the "big markets" by making "products" 
that they want to "buy".  I think you're stuck in the 90s, man.  :-)

> Now the question, what will sell in China, especially wrt to open 
> source software?  A few years back, when I mentioned Linux or Red Hat 
> or Mandrake or whatever in China, no one knew what I was talking 
> about.  Nowadays, everyone wants to show/sell me the Linux-based 
> technology that have developed (& I am suddenly reduced to a 
> technoignoramus--don't laugh, they apply the same label to anyone from 
> the US who mentions Linux).
>
> Thus, how to define a "sellable" technology is something that needs to 
> be diligently discussed.  One of the reasons that I am interested in 
> Solaris/OpenSolaris is that not too many people are aware of it, yet.  
> Will that get me somewhere?  I don't know.  But I feel prouder talking 
> about OpenSolaris than Linux, that's for sure.   Wayne
>
The perfect market theory says that you're not going to gain much here.  
If OpenSolaris is better than Linux (and I'm not saying it isn't) and if 
a "better mousetrap" wins in the market, then, since there is no barrier 
to entry for people adopting OpenSolaris, then you might have a window 
of as much as six months.