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TC08 Chicago – Looking at Technology For Your Business In New Ways

TECH cocktail CONFERENCE 08 in Chicago got started with Mike Domek, after which the guys from Threadless gave a simple and fun session with some practical insight


Scaling…printers, vendors, etc

Inventory is hard….

The Internet is Serious Business

Dealing with problems that we are not prepared to deal with… (can be an advantage too)


Our Users – Do they care? Do they help?

Technology Agnosticism

Awesome Staff – “Innovation comes from the bottom up” – Golden advice on how to build a culture…

Harper then ended with an interesting comment about Bin Laden….implied that he saw some false flag elements…

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Best of Show: Chicago Global Food and Style Expo 2008

This year the Global Food and Style Expo did not have the FMI show co-located along with the All Things Organic, Fancy Food Show and the U.S. Food Export Showcase so it was a slightly smaller show with less foot traffic. But it was filled with innovative products and amazing entrepreneurial stories! it’s a shame most consumers do not have the opportunity to meet the creators of new products like this and hear their stories of passion and how those overcome distribution.

It gives me great pleasure to announce these items as best of show:

VinJus – A unique non-alcoholic grape juice drink! Not yet publicly launched, it is scheduled to be distributed shortly. It’s a unique drink. They describe it as:

NAPA VinJus™ – the perfect non-alcoholic aperitif! Refreshing virgin vineyard grape juice – created for your sophisticated palette as an alternative to soda, water or energy drinks. It’s unique balance of crisp, tart and sweet lingers with a hint of green apple, honeysuckle, wildflower and lavender.

Made in the beautiful Napa Valley from early picked varietals, such as Chardonnay and more, this delicious drink is but one single ingredient – mouth watering virgin vineyard grape juice and nothing more! Compared to wine it’s almost half the calories and compared to regular grape juice it’s about half the sugar! And it’s made by a GREEN company!!!

Lucy’sSmart Cookies. Made with Love. Norfolk, Virginia based Dr. Lucy Gibney M.D. has a son with major food allergies. Lucy describes it best on their website.

Every crispy, crunchy, delicious Dr. Lucy’s cookie is baked without wheat, gluten, dairy milk, butter, eggs, casein, peanuts or tree nuts. But you’d never know it. They taste delicious! We use only high quality ingredients in our carefully controlled bakery to be sure our products meet our tight allergen testing criteria.

Lucy was amazed at the lack of food available to serve that market. Lucy turned to the kitchen in order to change that and once a few varieties were perfected she decided to solve the problem for others without her unique combination of talents. They weren’t even supposed to be at the show, they got added to new items section at the last minute. I’m glad they did, Lucy is a wonderful person and I know her niche product will succeed. Terry Starbucker is already a huge fan.

Blackwing Meats, Inc. – A variety of elk, buffalo, ostrich and other exotic organic meats as wide as I’ve ever seen! They get bonus point for having an highly functional e-commerce site to ship Roger Gerber’s creations directly to you. Even in the down economy Roger says 1st quarter sales were up 77% over the previous year. These items have momentum and the distribution to match it.

Bionade is a unique German based, non-alcoholic refreshment drink that is scheduled to be introduced in the United States later this year. It’s unlike anything I’ve ever tasted, but it is truly outstanding. In Germany the Elderberry is most popular, however I like the Herbs flavor the best (see picture here). If they are able to get shelf space and have an affordable price point, it could easily be a hit in the USA.

Leggio’s herb infused olive oil – Chef Joseph Leggio creates an “amazing” herb infused olive oil product. While there were others at the show with offerings in this vertical, none match the taste of Leggio’s. Joseph started experimenting with the concept several years ago. Then one day asked his wife to ask her dad, a wine maker, to bring over some bottling equipment for him to test with. Though she thought he was crazy, she did it anyway and his hunch paid off, his business is growing quite briskly and he claims to have some other innovative ideas up his sleeve, I can’t wait to see what they are.

Sheila B’s Popcorn (web site under development) – awesome butter flavor, ultra high pop rate, doesn’t dry out upon popping, no aftertaste like most popcorn has and best of all, not really more expensive than other popcorn on the market! Really nice folks too that taught me about the current state of agriculture.

BigHorn Extreme Foods – Peter Andrews has unique sausage offerings as well as tasty buffalo and elk burgers for restaurants and retail outlets.

WowBacon – Amazing clean cooking micro-wave bacon preparer. 6 years to perfect as an invention. Works extremely well the first few times you try it. Durability is a question.

Tre Bella Foods Organic – Gail Tiburzi’s organic Italian foods were inspired by her grandmother’s original recipes. It’s not everyday you meet a former investment banker turned food distributor, my time with Gail was all too short as she had a meeting. I told her to call me if she had time during the rest of the show to compare projects, I guess she was too busy taking orders as I never heard from her!

For those needing last minute Mother’s Day gift ideas, there you go!

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Tom Churchwell Venture Capital Speech at University of Chicago GSB

The following are high level notes of Tom Churchwell’s speech discussing venture capital at The University of Chicago Graduate School of Business (Chicago GSB). This talk took place in Chicago on January 22, 2008. I’m posting it today in celebration of this week’s Midwest Venture Summit.

Typical Fund Structure
– Management Fee 2.5% of committed capital
– Carried Interest – after losses offset by profits
– 80% Net Profit – Investors
– 20% Net Profit – General Partner
– 50-70% desired return…
– Vesting occurs over 5 years

– Experienced, successful entrepreneurs abound throughout the country
– Start-up companies have access to abundant early-stage venture capital
– Skilled attorneys, accountants, consultants are readily available
– The majority of start-ups can result in successful IPO’s within 2-3 years
– Increasingly hedge funds are an alternative financing source
– Angel capital is more available in Chicago than it used to be

– The space a VC plays in is extremely important – industry sector, growth

– Tom has changed management 3 times on average in the 60 companies he’s invested in

– Buckets of entrepreneurship seed entrepreneurs, beta stage, scaling skills

– Discipline = Success

– Proprietary product or service
– Sustainable competitive advantage
– Viable business model
– Large markets
– Experienced management team
– Appropriate use of funds
– Target 10-15x growth 5-7 years
– Objective: Sale of IPO in 5-7 years

– The most critical resource
– More important than all other elements
– Stage appropriate, later stages may require different management
– Must have a significant stake in success
– Tom says “Management experience is management experience, big company experience is just as good as small company experience in his view.” (Note: I actually find a *mixture* of both sizes in your experience to be of high value)
“We don’t make money on IPO’s, we make money selling to the Baxter’s, Motorola’s etc.”

“Nothing succeeds like revenue, it’s the cheapest form of capital.”

In 60+ company investments, I can only say that once it was the technology that made the company fail. It’s about getting the product in the marketplace.

What makes you say yes?
Passion. A product I have to get on the marketplace that solves a real problem. Management discipline which means they can step back and say realistically this is how long it will take, this is the team you will need, etc.

Revenue is an outcome, it’s not a driver. What is going to cause the business to scale? It’s business model testing. I don’t care about year 5, I care about what will get us more proof of concept and closer to a success.

The first screening process is where did this plan come from, if another VC sent it to us, we pay attention more. I ask, “Do I want to have a beer with this guy? You shouldn’t be there if you can’t say yes. ”

60% of the time we at least get our money back.

Scientific Board of Directors (compensated with a point of equity +/- a bit)
– Should be at least equivalent in stature to the scientific founders
– Like the Board of Directors, should have complementary skills
– Used properly, play a vital strategic role
– Typically meet semi-annually

Tom never signs an NDA.

The Business Plan
– Executive Summary is most important
– Shorter is better
– Assume the full appreciation of the technology will come in the due diligence
– Avoid jargon
– Avoid the hockey stick
– Focus on the revenue model
– Have a realistic exit strategy
– IPO’s are rare – most VCs are quite happy with a nice M&A exit
– Nobody reads the full business plan – I care about the executive summary
– Cashflow is more important than revenue during this phase

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Chicago’s Lake Shore Drive and Other Potholes

The Chicago Tribune has a nice user generated content piece where they allow readers to input pothole locations. It is an open thread that simply says: Tell us: Where are the worst potholes? Potholes seem to be everywhere this winter, but who has the worst — the city or suburbs? Tell us where you’ve seen the biggest and deepest.”

What’s upsetting is that just like the mismanagement of the CTA for decades, many of the comments allude to years of neglect and mismanagement by the government of the City of Chicago. CBS put together a story on how to file a claim for damage. Why must everything become a crisis before anybody does anything about these things? Maybe the city and state will put in resources to fix the lack of easy access to entrepreneurial grants and angel investor tax incentives like Wisconson has next – while we still have an economy…

Here are a few answers Chicago Tribune readers gave (some make you laugh and cry at the same time):

Potholes on my entire way to work on Devon Avenue Between Northwest Hwy and Caldwell Ave. Noticed several vehicles with flat tires this morning causing a traffic jam

Westbound on North Ave, there are are at least 2 or 3 massive potholes just before and after Elston Ave. Stay out of the right hand lane

On Webster between Clybourn and Ashland. There is a fifty foot section with about 25 potholes

One more vote for Lincoln Ave. between Petersen and Devon — avoid at all costs if you care about your car

Central Road, from Milwaukee west to River Road. It is like driving a road in a third world county. Cars bob and weave into oncoming traffic. You can’t driver over 20 mph. Someone at county should be fired for letting a road deteriorate to this degree

Just as you get off LSD on to LaSalle North exit going south right lane is full of potholes

Park Ridge: Cumberland Avenue between Devon and Higgins

Worst — take your pick, LSD Irving Park Road to Foster. Second worst — Oak Street underpass northbound to LSD. Third worst. 47th underpass to LSD. Some of these above holes are a foot deep and several feet across

Cicero Ave and Lawrence, in the left hand turn lane on Cicero… it’s like an unavoidable abyss

On westbound Lake Street between Ashland and Western there are so many little potholes the drive seems like you are off-roading

Under the pass to get on Lake Shore Drive from Oak it’s been like that for over a year! Disgraceful! The CTA ride is awful and 311 doesn’t do anything about it! The drivers try to drive on the left side when possible as the busses bounce horribly!

Western bridge going over Belmont, southbound, west lane. They’ve been there for at least a month

Have you seen the pothole on the bridge at Division and Halsted… Big enough to make a person disappear

Westbound on Grand just east of Milwaukee Ave. The whole thing is one series of huge potholes

The pot hole at Archer & Cicero in the northbound lanes just cost me $550 in repairs – yeah lets spend some more $$ on the Olympics -idiots

Like others have said, Cicero between 21st and 51st is a landmine. It’s so bad, I saw a small car driving along and it just disappeared into a hole….lol


Southbound on N. Clark Street, just north of Upper Wacker Drive, right lane swallowed my car. Still can’t find it

Right lanes of Ridge Road in Evanston. Very bad in both directions

The worst pothole is on the east edge of the southbound Fullerton entrance ramp to LSD. A close second are numerous potholes on Halstead between Chicago and Erie. You have to drive like you are going through an obstacle course

Almost all lanes of LaSalle Street between the Lake Shore Drive ramps and the intersection of LaSalle and Clark

4200 South Ashland. Even the CTA bus won’t go near it! And avoid at all costs Pershing Rd. between Halstead and Ashland

Bridgeport – 31st street between the Dan Ryan Expressway and Halstead (especially under the viaduct near Canal St) and the ENTIRE 31st St ramp getting onto the inbound Ryan. I’ve already replaced two tires this year.

Try driving on Cicero Ave. anywhere near the Stevenson. Pot holes deep enough to strand tanks. Been this way for weeks.

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Chicago Tribune User Generated Content Pioneer Terrence Elijah Armour Passes Away








(Chicago Tribune photo of Terry Armour shaking Sam Zell’s hand by Charles Osgood / December 20, 2007)

The Chicago Tribune has communicated that Terry Armour has passed away. This is both sad and shocking as Terry Armour was so relatively young and full of life in every thing that he did. You can see how much he was loved by his coworkers and the public so clearly in the stories readers have told.

Chicago Blackhawks beat writer Chris Kuc discusses Terry’s universal appeal:

People knew him by sight, and if they didn’t, they instantly recognized him as soon as they heard his distinctive voice. And Terry enjoyed that. He relished being recognized and loved talking with people, whether he knew them or was meeting them for the first time. Sitting with Terry in the Stadium Club during a Sox rain delay would bring a steady stream of admirers by the table, ranging from celebrities to fans to concession-stand workers. It prompted me to once ask him, “Is there anyone you don’t know?” He said, “I don’t think so.”

These tributes are emotional and show his personality. But they miss his most under appreciated quality – encouraging interaction with people, listening to their thoughts and creating stories from these interactions. He lived user generated content long before the term was fashionable. My favorite experience with Terry was in 2003. I had breakfast with a friend and his column that day asked for people to send in thoughts on their favorite horror flick of all time. I jokingly said to my friend “Cubs NLCS Series 2003” (the year of Steve Bartman). My friend said, “You should email that answer in to Terry”. What you see below is the email thread (read it from the bottom up) where he eventually joked that I was trying to take his job!

Date: Mon, 20 Oct 2003 16:54:21 -0500 [10/20/2003 05:54:21 PM EST]
From: “Armour, Terry” <>
To: Me
Subject: RE: Favorite horror flick
Headers: Show All Headers

jeez, what are you trying to do, take my job? funny stuff. i’ve got to get
the sequel stuff in there, too.

—–Original Message—–
From: Me
Sent: Monday, October 20, 2003 4:52 PM
To: Armour, Terry
Subject: RE: Favorite horror flick

Finally, you already know that there is a sequel in the making…FOR
SURE…you just have no idea when or where it will appear on your screen…

OK, that’s it, I’m done with that, it’s taken it’s full course.

Quoting “Armour, Terry”:

boom shakalaka, thanks d……..

—–Original Message—–
From: Me
Sent: Monday, October 20, 2003 4:42 PM
To: Armour, Terry
Subject: RE: Favorite horror flick

“Why create fiction when reality is far more frightening?”

(just so you have my reasoning down) 🙂

Quoting “Armour, Terry”:

ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha…..dude, this rocks. you
made it. you will be in on sunday. christ, that’s pretty effing funny.

—–Original Message—–
From: Me
Sent: Monday, October 20, 2003 4:36 PM
To: Armour, Terry
Subject: Favorite horror flick

Cubs NLCS Series 2003

The article which he eventually printed that I can’t seem to find online (maybe the Tribune can help out) but I remember it saying “Let it go, Dave. Let it go.” as a mocking reference to the Cubs and Steve Bartman. That friend who asked me to email Terry still says “Let it go, Dave. Let it go.” to me about things all the time! It’s my most personal interaction with Terry, but it’s where I noticed how he turned to others to create user generated content. I noticed this pattern of user contributions in so many of his future articles. So my friend, I thank you for your contributions and let you go onto that great newspaper in the sky…

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San Francisco Bay Area Rapid Transit Commission Increases Nightly and Weekend Service in 2008

I’m planning an upcoming trip to San Francisco and I was startled by the massive difference in both service level and tone between BART and the CTA. As you likely know, the CTA here in Chicago is threatening major service cuts and fare increases($1.75 to $2.25 with transit card):

Due to insufficient state funding, the CTA will be forced to raise fares and eliminate service on January 20, 2008.

The CTA will eliminate 81 of its 154 bus routes; lay off more than 2,400 employees; and raise fares to record levels. In addition, with more than 700 fewer buses operating due to the bus route eliminations, the CTA will close three of its eight garages. Service on the remaining routes will be provided by other locations.

The CTA is fighting for funding to avoid these cuts. Contact your state legislators and tell them how important mass transit is to you. Go to (UPDATE -site is  offline 7/2009) for more information.

Meanwhile, San Francisco Bay Area Rapid Transit Commission (BART) is scheduling a 33% increase in service while increasing fares a nominal amount (about 5%):

“Just as everyone is winding down with their holiday gift giving, we’re going to deliver our customers a goody bag of great service,” BART Board President Lynette Sweet said. “We hope our plans for richer service will put a big smile on the faces of all our 360,000 weekday riders.”

Starting January 1, 2008, BART riders will see enhanced service including:

  • More trains, more often after 7 p.m. Monday-Saturday & all the time Sunday
  • Double the trains to most stations on the San Francisco International Airport (SFO)/Millbrae extension
  • Faster commutes times and direct service from Millbrae to downtown San Francisco
  • Earlier start time for train service to SFO

The new schedule change will mean more frequent service after 7 p.m. Monday through Saturday and all the time on Sunday. During this time period trains will run every 15 minutes instead of every 20 minutes.

“That’s a 33% increase in service,” BART General Manager Dorothy Dugger said. “We’re extremely excited to be able to offer the same frequency of service at night that our customers currently enjoy during the day. This will be a boon for drivers who are becoming increasingly frustrated with nighttime and weekend traffic jams. We have plenty of parking during this time, giving people a greater incentive to avoid the traffic tie ups, save the environment, jump on BART and enjoy a hassle-free ride.”

Starting January 1, the popular Pittsburg/Bay Point (Yellow) line will begin serving SFO at all times while the Richmond (Red) line will go directly into Millbrae Station starting January 2 (January 1, BART will run on a Sunday schedule). This means that commuters going from Millbrae to downtown San Francisco will see a six-minute (16%) drop in their travel time.

Which region is truly more green? Which region is more focused on quality of life? It’s amazing how two similar web sites in terms of function can send such massively different messages, isn’t it?