Billion-Dollar Startups, Splunk Founder Michael Baum, and One-Minute Pitches at Annual Haas Celebration

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What’s one secret to launching a billion-dollar startup? Continually innovating your business model, not just your product or service, says Michael Baum, founder and former CEO of Splunk, which creates software that helps companies glean insights from machine data and was one of the most successful IPOs of 2012.

Baum was the featured speaker at the 12th annual Haas Celebration at Gap Inc. headquarters in San Francisco on March 18. Nearly 400 alumni, students, and friends of Haas attended the event, which this year highlighted the Lester Center for Entrepreneurship. The evening also included a one-minute pitch competition for teams of alumni and students.

In a conversation with Lester Center Executive Director Andre Marquis, MBA 96, Baum spoke about how he built Splunk and the changing landscape of entrepreneurship education. Baum’s 25-year entrepreneurial career has included six startups and five acquisitions that have created more than 3,000 jobs, more than 150 millionaires, and more than $10 billion in shareholder value.

One way Splunk innovated its business model in the early days, when it was competing with companies like IBM, was to buy Google AdWords on troubleshooting topics users might have with a competitor’s software. For anyone seeking help with a problem, Splunk repeatedly appeared as the solution.

Baum also stressed that success is about execution, not ideas. That’s why Splunk cofounders weren’t concerned with competitors seeing the product roadmap they posted online for two years to crowdsource feedback from potential customers. They knew they could deliver the software faster and better than anyone else.

Baum’s current startup is FOUNDER.org, which works with colleges, universities (including Cal), and research institutes to help students become successful entrepreneurs. Its initiatives provide students funding, education, and mentoring to prepare them for long-term success. Baum’s goal for FOUNDER.org is longevity (he’s aiming for a hundred years), so he made it a nonprofit. He says it may be one of the first nonprofit venture capital projects.

The evening also included a one-minute pitch competition among Haas and Cal student and alumni representatives from 10 startups. Audience members could learn about each startup during the cocktail hour and voted via text message. Teams pitching their ideas represented Brandizi, Twindom, Eko Devices, Magoosh, Modify Industries, OCHO Candy, PlushCare, POWr, Xcell Biosciences, and YadaZing.

The winner of Cal swag and bragging rights was Eko Devices (coincidentally affiliated with FOUNDER.org), which helps clinicians amplify, digitize, and analyze patient heart sounds through a smart device that attaches to a stethoscope. Traditional stethoscopes can’t diagnose most heart conditions but an Eko Device can. “We want to put a cardiologist in every doctor’s pocket,” said Eko cofounder and CEO Connor Landgraf, BS 13 (Bioengineering), during his pitch.

Guests at the event also enjoyed access to the renowned modern art of Gap founders Doris Fisher and her late husband, Don Fisher, BS 51, whose collection includes works by Andy Warhol, Roy Lichtenstein, Cy Twombly, Sol LeWitt, and many others.

New Kids on the Eastern Bloc

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Author: Allan Riska
Team: Georgia
Project: Develop marketing strategies to attract foreign investment

Our cab driver finally showed up to the airport at 1am, about an hour after our flight from London had landed. Alper, Rahul, Pulak and me were piled in the back seat to make room for the luggage. Ripping through the Georgian night at 120km/hour, the capital city of Tbilisi drew closer. Revealed was the cheerfully illuminated landscape of the it’s exposed rock faces, castles and cathedrals, inviting visitors to change their perceptions of the former Soviet state.   

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“An egg-white omelet, sir?” Don’t mind if I do. The five-star breakfast would be key to fueling our days that were  scrambled with government interviews, a dash of research and a pinch of mind mapping. To tackle the work, we generally split up into teams of two so that we could interview the most people, in order to get the widest perspective of the issues. The work hours were also and adjustment to make, 10am to 7pm, which stretched out our interviews time slots. AC was rarely present in the government buildings, so thankfully we were able to do most of our diverging and converging from the comfort of our hotel.

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Our moment of shock came when we showed up to meet Vera Kobalia, the Minister(ess?) of Economy and Sustainable Development. We thought it would be a casual half-hour interview, but it turned into a surreal moment when we ended up doing TV interviews and having the press film our meeting. Another unexpected moment was when we came back from dinner at 11pm only to find approximately 50 tanks in the street, practicing for Georgia’s 20th Independence Anniversary celebration.  Alper was definitely surprised by the girl who really wanted an autograph from a Turkish Diplomat…

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Throughout the process we established common themes that Georgia needed to focus on; transparency, transportation, fast business, and clean energy. The growth that Georgia has seen has been remarkable. One electrifying fact is that through liberalizing policies, Georgia has gone from experiencing rolling blackouts to being a net exporter of energy in only seven years, mostly while developing clean, hydro-power resources. For reasons like this that that we feel Georgia will be in a great geographic and political position to attract more FDI. Our client was receptive to our final presentation, where we converged on the final marketing execution strategies. It would be great to see new ads based on our work!
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Food & Wine
We ate at traditional Georgian restaurants, such as Breadhouse and Maspindzelo.The fare is quite heavy, and consists of fresh meats, breads and veggies. The Kinkali (dumplings) were particularly delicious, especially when paired with Georgian wines. I highly recommend the unique “semi-sweet reds”, of which many bottles will be making a stow-away trip in my luggage. Wine production originated in Georgia, and it shows. There was also and excellent Italian restaurant and Thai restaurant in the area, as chefs from the US and Europe return to the area. I had a special affinity for restaurants run by M Group, as the prices were perfect given the high quality, location and service.

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Side Trips
It wasn’t all work.  We did take time to enjoy Tbilisi and the surrounding areas. We were lucky enough that our assignment required us to enjoy the tourist aspects, and we did so with great admiration for the natural beauty of the area. First, we took a side-trip to towns east of Tbilisi, where the cave cities sit near the border of Azerbaijan.  The monastery on the opposite side of the hill provides a breathtaking view of the natural landscape. Next we were off to Batumi, an area described as the “Miami of Georgia,” on the coast of the Black Sea. We missed the analogy because the summer rush hasn’t yet begun there, but were shown a fun time by our hosts nonetheless. Any rush not found in the city is available during the five hour car ride from Tbilisi where our cab driver was driving in the wrong lane at 120km/hr, passing other vehicles through mountain passes. Aside from that minor brush with death, we were impressed by the hospitality of those in the government and the service industry – an area we are pushing for re-branding campaigns. 
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If you’re in the Eastern Block, take a trip to visit. You won’t be disappointed. 

 

Tear Gas, Rubber Bullets, and Wine

“In the first decade-plus following the Soviet Union’s collapse, Georgians showed themselves to be a protest-happy people. But local experts say Georgian citizens are now losing steam, with apathy taking the place of activism.” – The Georgian Times earlier this week

The reality:

Thousands of people in Tbilisi have gathered in the streets over the past few days, leading up to the 20th anniversary of Georgia’s independence this Thursday, May 26. While demanding the resignation of President Mikheil Saakashvili, these antigovernment protesters clashed with police, who resorted to firing tear gas and rubber bullets at them. The Georgian people are accusing President Saakashvili of stifling pro-Western democratic reforms promised to them when he came to power in a bloodless coup in 2003. They also are expressing their anger at the continuing poverty (50% are below the poverty line) and unemployment (close to 30%).

The representatives from the various Georgian ministries that we have been interviewing seem to disregard the protests and consider them to be small for Georgian standards. Perhaps they are just trying to ensure that such activism does not cloud our judgment of Georgia as we prepare our marketing strategy for the country.

Nevertheless, this country does have a lot to offer the world:

(Note: The shots of the casino and spa are actually from our hotel, but the casino is nothing like that. It mostly consists of a bunch of chainsmokers that don’t know how to play BlackJack and have any fun. And we are obviously too busy burning the midnight oil to make use of the spa facilities…)

Our client wants us to see more of the country, and is planning to take us from the center of the country in Tbilisi to the west coast city of Batumi, along the Black Sea. Batumi is known as both a free tourism zone and free industrial zone, which means that they offer investors enticing tax and regulatory conditions to build hotels/resorts and factories, respectively. Along the way to Batumi, we will be able to see the quality of roads and infrastructure being developed in Georgia.

In the meantime, we have been spending our off-time seeing the sites, such as the perplexing Mtatsminda Park …

… and sampling the local flavor – primarily their delicious produce (BEST. TOMATOES. EVER.) and, of course, their wine. Georgia is actually the oldest wine producing region of the world and has recently focused on boosting the quality of wines produced to improve exports, so we have been doing extensive field research on this as well:

All in all, the experience has been great and eye-opening. I would go on about it, but I am about to head to a converging session with the rest of my team – with post-its in tow, obviously.

—Rahul Bijor