I think the key with failure is to accept it as part of growth and development. I have this old saying that failure is fertilizer—it smells like sh*t, but it really is critical for growth.
Mike Smerklo is an entrepreneur and investor. He is Co-Founder of a venture capital firm in Austin, Texas called Next Coast Ventures. He is also Co-Founder of a Software Company called Nucleus Growth. Prior to this, he bought a small technology services company, ServiceSource, and ran it for 12 years, taking it from small startup to public company with over 3,000 employees around the world. He was also one of the first employees at a pioneer cloud services company called Opsware (then Loudcloud), that also went public. Before becoming an entrepreneur, he had (and thoroughly hated) jobs in investment banking and public accounting.
Where did the idea for Next Coast Ventures come from?
A longstanding belief that venture capital should be done by entrepreneurs for entrepreneurs and that there are several markets outside the coastal U.S. that need more institutional capital.
What does your typical day look like and how do you make it productive?
Other than time with my family, there is no typical day in venture capital. To be productive, I try and spend as much time as I can out of the office—meeting with entrepreneurs, listening to new ideas and researching big trends that can develop into interesting investment opportunities.
How do you bring ideas to life?
At Next Coast Ventures, we take a thematic approach to investing (versus sectoral), but I don’t think it is our job to bring ideas to life. We try and find amazing entrepreneurs who are passionate about building big businesses within the themes we focus on—when that happens we provide capital and coaching—but it is really the entrepreneurs who do the really hard work of bringing ideas to life.
What’s one trend that really excites you?
We have several that we love, but one that we are spending a lot of time on right now is what we call “digital natives becoming digital consumers.” With several critical changes happening in consumer behavior, we believe that these new behaviors will disrupt just about every major industry. With everyone becoming a digital native (not just millennials)—there is a massive opportunity to rethink just about every business and market.
What is one habit of yours that makes you more productive?
I consistently ask myself “is this the best, most productive use of my time right now?” Time management is the one tool that is open to all of us—we all essentially have the same amount of hours in each day—so I try and stay manically focused on using my time effectively.
What was the worst job you ever had and what did you learn from it?
I have had so many that it is tough to answer—although each one taught me something different. I would say the worst job was working for a unionized municipality for a summer—the hardest part was that hard work and motivation were not just ignored, but more specifically discouraged. I learned quickly that I liked meritocracy based employment—and to stay in school and receive an education!
If you were to start again, what would you do differently?
Say thank you more to all those who helped me along my career journey.
As an entrepreneur, what is the one thing you do over and over and recommend everyone else do?
Refuse to accept mediocrity. As a company grows, average performance (and average employees) can become this seeping, creeping sludge that can slow a business down in more ways than you can imagine. Relentlessly focusing on getting the best work from the best employees is key to growth, scale and building an amazing business.
What is one strategy that has helped you grow your business? Please explain how.
Traveling and spending as much time as I could with customers, prospects and my sales team. There is so much talk about spending time with customers, but it is just as important to spend time with prospects and your own sales team to fully understand what is working in the marketplace today and where your business needs to develop solutions or value propositions.
What is one failure you had and how did you overcome it?
Too many to mention. I think the key with failure is to accept it as part of growth and development. I have this old saying that failure is fertilizer—it smells like sh*t, but it really is critical for growth.
What is one business idea that you’re willing to give away to our readers?
I don’t know if it is a good idea or not, but I would like a good subscription service for children’s games, clothing, shoes, etc. I have four children so this might be personally biased, but I am constantly amazed that a better model hasn’t been built yet for consumption and exchange of all of this kid stuff.
What is the best $100 you recently spent? What and why?
WiFi on an international flight. It might not have been $100 exactly, but it was close. It allowed me to be productive and chose my entertainment options versus being enslaved by the prepackaged flight options. Also left me wondering what the elasticity curve is for inflight WiFi.
What software and web services do you use? What do you love about them?
Too many to name or count. Personally I think Amazon Prime is worth every penny and keeps getting better—the shipping is the easy part, but when you add in music, photo sharing and more it really is superb.
What is the one book that you recommend our community should read and why?
Don Norman’s classic “The Design of Everyday Things”. I remember reading this book and being blown away by it and how it helped me understand how product design, engineering and basic common sense can make or break a product or solution. It’s a great read for any current or aspiring entrepreneur.
What people have influenced your thinking and might be of interest to others?
I have several listed on my blog. I think if you really want to understand what it takes to be an entrepreneur, you need to read Ben Horowitz’s book “The Hard Thing About Hard Things”. Ben also turned me onto what I think is the best operational business book of all time, Andy Grove’s “High Output Management”.