Silicon Valley Frontlines

My Holiday Season Resolution ... Volunteer Business Advisor!

Last Christmas Eve I did a post titled "A Beacon of Hope This Holiday Season ..." about the San Francisco Homeless PreNatal Program. Still there in their 20th year, still doing great work! If you supported them last year as a result of my post, a big thank you. If you can contribute now, please do!

This holiday season I'm personally trying something a bit different. Given my background I'm going to offer my help as a volunteer business advisor through Pacific Community Ventures, a Bay Area initiative that helps small businesses create jobs and opportunities in lower income communities. They have supported many entrepreneurs starting and running bakeries, restaurants, landscaping, bag making and including some higher profile businesses such as Flora Grubb, my favourite San Francisco garden store, or Heath Ceramics, a long-time Bay Area operation.

It's not usually visible to most of us just how hard it is for people to make these businesses work. This recent story about Flora (yes, Flora Grubb is her real name - isn't that perfect for a gardener!) in the San Francisco Chronicle is what piqued my interest in PCV. Without them Flora Grubb (the store) might no longer exist and her 25 employees would be joining the ranks of job seekers. And I'd miss a great place to browse, shop and drink Ritual Coffee Roasters fabulous blends! Here are some pictures I took at a recent visit to Flora's store:

So, not exactly high tech - but important grassroots in our bigger ecosystem (so to speak). Maybe I can help a little bit, and in a longer-term manner than just writing a check.

As always, I hope you and yours have a happy holiday season and prosperous 2011, look out for and take care of the ones you love, and thanks once again for reading my blog!

Cheers!

Philip

A Beacon of Hope This Holiday Season ...

Every now and then I come across something touching, sharply contrasting - something that reminds me that there are many other human stories that serve to put a better perspective on my own life. It seems particularly appropriate to share this during the holiday season and after such a tough year for so many less-fortunate people.

Whenever I'm in San Francisco I head over to Coffee Bar on 17th St. and Florida to check my email and  catch up with friends on Twitter. A block or so away on 18th St. I often pass a building with the sign "Homeless Prenatal Program". There's a wonderfully touching 8-minute video on the site that really captures the spirit and hope this organization has provided to homeless women and children whose lives have been turned around with their help. Check it out at Homeless Prenatal Program.

To donate to their highly-regarded and effective programs please click here! Here is the video - it's worth watching the entire segment:

I hope you and your family have a happy and joyous holiday season and, no matter what your circumstances, I hope you find a space in your heart to help someone less-fortunate than yourself in some small way.

Best regards and many thanks for reading my blog this year.

Philip

The Case for Optimism - Plug and Play in BusinessWeek

For the last four months or so I've been working out of the Plug and Play Tech facility in Sunnyvale as an Executive-in-Residence. Not quite the same thing as the EIRs at venture capital firms who are typically executives of prior portfolio companies looking for their next portfolio company gig, and paid by the VC in the meantime. At Plug and Play I pay rent and get no salary - but I do get a great opportunity to develop relationships with many of the 200 or so start-ups based there, leading to potential consulting, interim or advisory roles, and perhaps the next full-time situation. Oh yes - and i have to pay Plug and Play a cut on any consulting with these companies. Costly? Yes. Worth it? Yes. Great place to be; very interesting opportunities and the chance to help companies who really need it. Good blog material too!

One thing I like about Plug and Play - it is a hotbed of optimism. Everyone here - even though struggling to raise cash and find customers in the current environment - is pursuing a vision or a dream and doing whatever they can to make it happen. You have to like the energy and drive and some of the ideas are terrific.

This week BusinessWeek has published a whole series of articles titled "The Case for Optimism" and Plug and Play is prominently featured in the segment "Keeping the Faith in Silicon Valley". Nice article with a good profile of Saeed Amidi, the founder of Plug and Play. The business is his brainchild and is primarily successful in its mission as a result of his energy, vision and networking. And its a lot of fun to be there and part of it.

Real Estate in the Valley ... My Personal Story This Year, Part 2

Image via CrunchBase

In my May 31st post I talked about my dismay in the lack of interest from potential buyers of my great Mountain View townhouse. Here was my conclusion ... "despite record low interest rates, and despite having excellent credit ratings in many cases, people are just not buying. Period. Thirty properties in my price range and general size have been listed in Mountain View in the last six months. Only three have sold. That's it. People just don't want to make the commitment - job uncertainty and a fear/hope that prices will drop further. There's no confidence."

Given that lack of interest the obvious next step was to rent it out and wait until a market recovery to sell. I have to say I faced that with some trepidation - what if people are just not interested in that either? So I carefully researched the market with agents and looking at other online listings, figured a reasonable asking price and then posted the unit via Postlets on Craigslist and a bunch of other sites - Google Homebase etc. Here's the listing.

I was swamped! Within a week I had more than 40 inquiries, a dozen or so people who came and looked (I just couldn't schedule any more), and serious interest from almost everyone. Well-qualified professionals, families, postgraduate students .... you name it.

I even had someone looking to relocate from New York want to take it without even seeing it in person and looking to send a deposit the same day (this was just a few hours after the posting). This latter was not bogus either - this individual had been here looking in person and found nothing at all that met his family's criteria - and he then flew out to see my place a couple of days later. He and his family are now my new tenants and are paying me - happily for all - more than my asking price!

So now what did I learn from this quite opposite experience?

• The demand for housing is still very strong in the Valley. So strong that I underpriced the unit despite my research
• While people are unwilling (or unable) to commit to buying in this environment they still want to live here. In fact, I had inquiries from Chicago and Germany as well as New York. I think this augurs very well still for the longer-term in the Valley and despite the economy is a still better than the net exodus we experienced after the dot-com implosion at the start of the decade
• Craigslist is it! 100% of my inquiries were from that posting. No other site created any interest whatsoever. None. And its still free!
• Postlets is great. I put the link to the posting above to show what can be done with this very sexy service. Ok, you have to take the pics and write the copy - but look at what you can do as a non-professional with a little effort. Its free for basic service and for just $5 I could add a boatload of additional pictures (pictures sell). By the way, this is how it shows up on Craigslist - very professional, don't you think?
• Well marketed product can still sell well.
• Newpapers are dead. Even the online services from some local papers just can't do what Postlets and Craigslist can do.

So I rented my home for more than my asking price for a little effort and a total cost of $5 listing and $30 for all the forms and lease documents (Nolo Press and California Association of Realtors). How cool is that??!!

Real Estate in the Valley ... My Personal Story This Year, Part 1

I've been looking for a buyer for my townhouse in Mountain View for a few months now. Let's face it, not an ideal time to sell but my experience is an interesting example of the state of the market. And lessons learned.

I listed my unit for $850k in mid-March. This after doing quite a bit of research on Zillow, Trulia and other sites, visiting other open houses, talking to realtors, looking at new and resale properties, prior sales in my small complex and so on. I thought it was a pretty informed price, although I'm realistic enough to know that all these sources reflect history and no-one can say exactly what will happen with your property at any particular time in any specific market.

I also knew that the marketing strategy would be particularly important. When times are tough you need to find every angle and spare no effort to find buyers for your product - no different to the startups I work with every day.

Mistake number one - hiring the wrong realtor. Family friend, husband is a general contractor who remodeled the other house I still own in Los Altos. Helped me buy the townhouse in 2006 and did a great job. Her marketing strategy now - list it on MLS and a few other places linked to MLS, hold a couple of open houses and .... that's it. Refuses to hold any more open houses unless I reduce the price 8% or more. Says they don't work - only 2% or so of sales come through holding open houses. While this may be true, what's also then clear is that without open houses you don't get that 2%. Basically not hungry, not aggressive. Would being hungry and aggressive get a buyer in this market? Maybe not even then - but surely more likely than standing back and doing nothing.

Mistake number two - assuming my realtor actually knows something about internet-based real estate marketing. Not aware that a listing on Trulia doesn't happen automatically by listing on MLS. Not aware that using free, easy tools like Postlets gets the property on lots of other sites (Craigslist, Facebook, Zillow, Trulia, Oodle, Google Base, Twitter etc) in one simple post. Viral, Web2.0 marketing, right?

So I get her to put all the listings out there and then hold the open houses myself (all the signs out, publicized online on the various sites). What do I have to lose? The next weekend I get a couple dozen people coming by, some staying a long time (beginning to think I should have offered then tea and sandwiches). Some with realtors in tow. But no offers and not even an inquiry about making an offer. A couple of weeks later, I hold one more open house. Nobody comes. Not one single, solitary person.

I talk with another couple of realtors. One at least works hard. For every house he lists he prints hundreds of flyers and then takes them door-to-door in the neighbourhood - every week. Why? He figures people who already live in the neighbourhood will tell their friends who might be interested in moving to the area. Cynically, of course, I know its also nicely promoting his name around the community as someone who is selected to sell local properties. But, you know, its still a lot of work and is more likely to turn up a buyer than doing nothing.

Also now becoming clear - despite record low interest rates, and despite having excellent credit ratings in many cases, people are just not buying. Period. Thirty properties in my price range and general size have been listed in Mountain View in the last six months. Only three have sold. That's it. People just don't want to make the commitment - job uncertainty and a fear/hope that prices will drop further. There's no confidence. Would having a better realtor have helped? Maybe, but unlikely.

By the way, I should say its a beautiful place I'm selling. 4 bedrooms, 3 full bathrooms, totally remodeled top to bottom, pool, gardens, best schools. In a "normal" market, this would sell easily.

So now what?

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• Postlets - Real Estate Marketing Tool (smtusa.com)