the next hill. But non–risk-takers and non-entrepreneurs would really have big
headaches about this. They would need some level of comfort and safety.
That’s something that we look for in entrepreneurs—that they have the
courage to do the job. That they’ll have the ability to judge the business situation.
They’ll have the ability to lead people. They’ll have the ability to interact
with the marketplace and to really build confidence into strategy.
Livingston: I read that you initially started out as a consulting company and you
would do the “real” startup project at night, even though you hadn’t figured out
exactly what you planned to do.
Winblad: Yes. We did that because no one had any money. There wasn’t a
Y Combinator around to even give us $6000. In fact, I exhausted all of my
savings on the incorporation fees and was about $500 short, which I had to borrow
from my brother, who was in high school. But he had a job. He was the only
one who had $500 to borrow from that I knew. So we had to find a way to cover
ourselves.
Ann Winblad 299
We see a lot of entrepreneurs that do this. That they actually find a way to
earn some money, but they don’t . . . they find a way to separate that from the
business itself. Where entrepreneurs try to mush the two together like, “Well,
let’s compromise the real business to sort of get more money in versus let’s find
a way to get money to cover the real business and leave it uncompromised.” But
they have to perform some unnatural acts to get started, which is what we did.
We were chosen under a Request for Proposal bid to build a student
accounting system for a vocational school in the state of Minnesota, which
helped us focus on what we were going to do. We had to really say, “OK, how
good’s our accounting knowledge?”—which had nothing to do with student
accounting; this was grading systems tied to student accounting. It was really a
one-off. It also told us how we could underestimate a project, how we would
manage a project, how we would manage engineers, how we would manage our
own time. And we got paid for learning on the job. All of us owe a lot to the person
who took the risk on people who looked like children, who had no work
experience other than the . . . the other three guys had been at the Federal
Reserve Bank longer. They were each about 4 years older than me, so they had
3 and 1/2 years of work experience and I had 13 months.
We were overly thoughtful about what we would do. When it came down to
“what special skills do we have,” we went back to that accounting class and in