10.10.10 is an innovative program that combines 10 wicked problems, 10 prospective CEOs, and 10 days together in Denver. The bigger the problems the bigger the opportunities, and they’re intent on finding the most massive problems out there and empowering CEOs to create solutions. The first program launches in August, 2014 and is the first of its kind.
I had the chance to sit down with Founder Tom Higley and Managing Director Nicole Gravagna at Thrive LoDo last week. Nicole is also the co-author of Venture Capital for Dummies, and the former Director of Operations at the Rockies Venture Club. Tom is an 8-time CEO, having founded or co-founded 6 of those companies. He has also been a mentor for TechStars, Galvanize, and other startup CEOs. Once, when he was between CEO gigs, he got a call from Brad Feld about the next opportunity – ServiceMetrics – that Tom sold 18 months later for $280 million.
However, many CEOs find themselves stuck in that lull between exiting a company and their next great project. 10.10.10 is a program for those CEOs in that interim – when they know they want to do something big and new, but aren’t sure what it is yet.
What makes 10.10.10 different than an accelerator like Y Combinator or TechStars?
Tom: We aren’t looking for teams of people, or ideas, or traction in the marketplace. Instead, we’re looking for the serial or 2nd or 3rd time entrepreneur who has been successful before, and we’re asking them to come to 10.10.10 when they know they’re going to start their next company, but they don’t yet know what it’s going to be about. We want them in that blank slate, that ‘tabula rasa’ mode, so they can be challenged to do a bigger thing than they might otherwise do. They can test with their peers whether the problem/solution set they’re working on is worth the investment. After all, they are making a decision about how to invest the next chapter of their lives.
Instead, we’re looking for something we call ‘validated problems,’ meaning problems where someone is saying ‘yes I have that problem, and yes I would be a paying customer for that solution.’ During the program, we reach out to those affected by the problem and ask them to give input on whether a particular approach to the solution is something that would work for them. That early customer validation piece is really important.
Why is 10.10.10 important?
Tom: It’s pretty clear to us that startups are easier and less expensive to start than ever before. That’s why there are so many more of them. Of course, we know that more startups means more failures, but it also means more successes. What’s really interesting, though, is that there will be many more second and third time entrepreneurs who start companies, and those people are the scarce resources that startup communities need to pay attention to. These people are the magnets for top talent around the country, and for bringing in investors outside the area. When startup communities embrace these entrepreneurs it is a really powerful thing and we can see a great opportunity there with 10.10.10.
At the end of that 10-day period, we expect a few problems will yield interesting solutions that are the beginnings of fundable companies. If it works well, we do it a couple times a year in Denver, and in other startup communities as the interest and need arises.
What would success look like for the program?
Tom: First, a couple fundable companies would emerge each time. Second, even if a prospective CEO didn’t land in one of those fundable companies, they’d say “I would invest 10 days of my time again in a heartbeat, because I learned more about myself, I learned more about the kinds of opportunities I’m interested in, and I would recommend this to others.” Success also looks like the beginnings of a network that is supportive for these kinds of initiatives, and oriented not just around 10.10.10 and its participants, but around certain themes and these wicked problems as well.
What are ‘themes’ in this context?
Tom: Themes for us are kind of a window to the future or a crystal ball: they help a prospective CEO see 20+ years into the future. For instance, Gordon Moore articulated a theme in the ’60’s that we now call “Moore’s Law.” That practical law drove investment in businesses powered by semiconductors, and has carried the day for the last 50 years or so. That’s just one example of a theme; other examples include 3D printing, the internet of things, big data, and a whole collection of trends that relate to the re-imagination and reinvention of learning.
The point is not to focus on a vertical, it’s to find the kind of things that generate the capacity to place a long term bet, to invest in a way that allows you to be strategic about what you do. It’s how Jeff Bezos thinks about things, how Steve Jobs thought about things.
What do you mean by the ‘reinvention of learning?’
Nicole: This is a fascinating thing. I’m going to parallel it with the reinvention of business and the introduction of venture capital. Early on VC investment was rare, and since then it has become much more common, and redefined in different ways. Investments now go in earlier, there’s all these social investments, people are re-envisioning other forms of financing, and so on.
To parallel with education: people think of education in terms of the classroom, and even with new ideas like the “flipped classroom” it’s still education in the way we traditionally think of it. A paradigm shift really has to happen, and that includes accepting failure since it’s huge part of learning in general. If you’re pushing people to get only straight A’s, the ones who are driven enough will. But that also means they haven’t found the limits of their ability, and they aren’t finding how far they can go. (On the 10.10.10 website, it says, “Failures are not required, but are desirable.”)
Where do these ‘wicked problems’ come from?
Tom: Problems come to us from lots of places. You can’t even submit an application as a prospective CEO without also submitting a problem. We don’t guarantee that the problem you submit will be one we work with in the program. What’s really key to us is that when the CEOs arrive, we have enough structure to have a good understanding of the problems already. So, what’s the history of this problem? What has been tried before in terms of solutions? Who are the domain experts that can be engaged to validate this? What power do the themes have in the context of this problem? In the class of CEOs we bring in, who has strengths or background or experience? In looking at the problem as stated, what happens if you ‘go up a level’ and focus on the context of its environment, or ‘down a level’ and isolate different dimensions of the problem, or subordinate problems? Any problem may have a range of possible solutions, but it’ll be the CEOs job to surface the solutions that are interesting, and that includes the folks who provide validation: potential customers, strategic acquirers, etc.
Nicole: “Problem milling” is when you get a problem, and it’s not necessarily presented the way you need to think about it. There’s a lot of work that can be done on the problem prior to even attempting to find the solution.
How do you separate problems from ideas?
Nicole: Many people feel the need to jump quickly to the ideas, and sometimes we have to pull them back and ask them to submit an actual problem. We had a CEO apply, and instead of submitting a problem with a couple of possible solutions, he submitted an idea with a couple of possible problems. That’s the way people think, the way that things have been done for a long time. It often takes people hearing what we do a couple times before they can separate problems from ideas. It’s a paradigm shift for people. Part of the lean startup movement – “wait, we are talking to customers before and as we build the product?” It’s a whole different way of validating.
Tom: One of the things that’s different here than some of the accelerator programs is that the CEOs aren’t even building a team until they know what problem they’re working on. Instead of pivoting a business model based on the team they have, they’re building the team around the problem set, so the CEO and team can be more tailored to the problem they’re trying to solve. Some of the problems may be things that the CEOs wouldn’t normally imagine working on.
Nicole: Some of these big, meaningful problems really don’t have to have a lower ROI than easier ones.
This sort of sounds like an outsourced (VC) Entrepreneur In Residence program.
Tom: It does, and it really resonates with entrepreneurs and VC’s. VC’s are actually eager to provide the people to go through the program, on the condition that they get a crack at leading the round of financing for the new venture.
Nicole: We actually talked to a group that currently had more than 10 EIRs, and in nearly 2 years, not a single one of them had picked up an idea they wanted to run with. Some had explored some potential deals or found a board seat on portfolio companies, but nothing they had taken up on their own. The VC’s were starting to get a little bit worried and thought this was an interesting alternative.
Tom: Most VC’s won’t fund an EIR for that long. Usually the understanding is that they’re here for a finite amount of time, and the VC will support them only in respect to certain industries that they’re both interested in. 10.10.10 will provide a good source of new connections and potential companies that they can get quick feedback on.
What kind of CEOs are you looking for?
Nicole: They have to be adventurous.
Tom: Personalities vary. We’re interested in people who are sufficiently ambitious, who are eager to start the next big thing, whatever that is. We’re also interested in people who understand that this is a context in which they’ll be challenged, and they have the confidence to put themselves in that situation. If they’re too ego invested, or not nearly as confident as they might appear and need that ego stroking all the time, this will be hard. I imagine this will weed out some candidates because they don’t want to put in an environment where they’re with a bunch of peers. Many of these people are used to being the leader in the room, but they have to be able to set that aside and avoid “posturing for power.” During the program, nobody reports to you and you don’t report to anyone, and we insist that everyone is treated with respect. Also, anyone, at any time, can call bullshit.
Are you trying to attract women?
Nicole: We’ve tried to be conscious of how we approach the gender balance all along. Something we’ve seen in looking for speakers, is that when we ask someone if they can recommend someone, they’ll rattle off a list of names. And then we’ll ask if they know any women – and they rattle off another list of names. It’s been a dedicated effort all along to attract women to the program.
Tom: To start with, Nicole is the managing director, and that helps in making this an environment that’s more likely to be encouraging of women participating. About half of our speakers are female, and we’ve also been clear in conversations looking for candidates that we ask people to think of women who would be available to apply as CEOs. And the more female participation there is, the easier it becomes for people to imagine themselves in that context. We can do more.
Who else are you bringing in for the program?
Nicole: We have amazing speakers. Jane and Tabor met in the Biosphere and started a company called Paragon Space Development Corporation. This recently spun out a space tourism company based on a weather balloon at the edge of space, Worldview. Jane Poynter is the CEO of Worldview, and husband Tabor McCullen is the CEO/CTO of Paragon.
Lalita Booth is starting Social Technology Partners, a Wikipedia for processes and protocols, like how to approach medical treatment, get into college, or raise a child with autism. She has very interesting life experience and is the epitome of overcoming barriers.
Erine Grey is revolutionizing social services applications in Texas and expanding elsewhere. Bernard Amadei is the founder of Engineers Without Borders, and we also have Jessica Lybeck – CEO of Dabble. She was working at an architectural firm in Chicago, board to tears, when she realized she was far more interested in helping others solve the problems they were encountering.
What do you need from the startup community?
Tom: We’ve had a significant number of prospective CEOs apply but we still need more – the more candidates in the pool the better. We also need volunteers that can help us with a range of things. We have some people in place working with the CEOs, our messaging, the website, and a bunch of folks that have contributed time to the program. We also have a monthly meetup group open to the public, and we’re really trying to give the community insight into how these companies are formed. As we get closer, the most important things for us are really making sure we have a great group of candidates that will work well together in the program. We wouldn’t do it unless we were confident we had the right candidates.
What other groups are involved so far?
Tom: We have the CU-Boulder Deming Center Venture Fund helping us do research and diligence. Also on our steering committee is Robert Reich (founder of the BDNT Meetup), Erik Mitisek (president of the Colorado Technology Association) and Tami Door (CEO of the Downtown Denver Partnership). They’re really helping us become better connected.
Nicole: We also started a LinkedIn group that currently has about 150 serious entrepreneurs. Not just those exploring it, not ‘wantrepreneurs’, not VC’s, not service providers. The ones that are really in the thick of it.
Tom: The Denver CEO/CTO Meetup group has been powerful as well, as those are two of the core roles in tech startups.
Nicole: We’re also connected to the Office of Economic Development and the city. I’m a consultant to OEDIT, and they’ve been very supportive and interested, particularly in the Advanced Industries Grant Program that just launched here. They have 7 industry leaders and other heads of association groups they’re pulling together every month. They’ve been really good sources of problems for us, industry-wide problems that they are intimately involved in. This connection is incredibly powerful for us, that we can tap into and ultimately provide solutions for these global problems that happen to be locally identified.
Will these new companies all stay in Colorado?
Tom: If we limited the group of participating CEOs to those that were wiling to start their companies in Denver we wouldn’t be attracting top performers — the best and brightest. We want them to be in the place where they can build the strongest company with the most compelling response to the problem. That said, we expect that some CEOs will come here, and after they’ve experienced what it’s like to be in Denver, they’ll think ‘well, this wouldn’t be a bad place to touch down and build a company.’
Nicole: This feeling that you need to keep everything homegrown and local, and ‘don’t let anyone leave ‘is an interesting notion that happens with the development of any startup community. Eventually you come to the realization that this thought process serves no one. Being able to actually send away some of your own people, who have the relationships they formed here, builds stronger connections between the communities. By us allowing them to take the company to another place, we have the benefit of a stronger connection elsewhere. It’s not intuitive for some people so we have to frame it that way.
Tom: The whole program is based on a fundamental notion that startup communities that are better connected to thought leaders, entrepreneurs, and investors from outside the community, do better. We leverage the people who have networks and connections that extend beyond Denver.
Nicole: We’ve also seen that many of the people who have talked to us about becoming candidates have some attraction or connection to Denver anyway. A lot of folks want to live here so we expect some to stay.
Tom: The Foundry Group and TechStars are great examples of building networks outside of Colorado. They also inspired the Unreasonable Institute, which started in Boulder but has been sailing around the world building solutions to problems. Startup Weekend went worldwide too. Boulder understands the power that comes from being connected. Denver could – but it hasn’t yet. 10.10.10 is tailored to address that. That’s exactly what it’s about. We think this is an opportunity for Denver, and it’s also an opportunity for other startup communities. So if this works and works well, we take it elsewhere too.
More information on 10.10.10 and applications for prospective CEOs can be found here.
Tim Harvey is a regular contributor to the Rockies Venture Club and a Master’s of Engineering (Management) student at CU-Boulder. He has also worked in high tech startups, Fortune 500 consulting, and in personal and corporate investments. He is also looking for a full-time job to go along with his part-time/online classes! Find him on Twitter @taharveyconsult.