You just provided a whole lot of technical information about the efficiency of your algorithm, and even some financial projections for your company. That's the sort of information that you should keep to yourself unless specifically asked for because it is the valuable part of your company. The problem you are trying to solve is the part you should actively talking about, because that's what's going to get people's interest.
You clearly have a great understanding of the technical side of things, but the business/marketing/financial side is just as difficult. It's impossible to be good at everything, you will want help, either in the form of a cofounder and/or a board that can advise you.
Another saying that my prof used to repeat was "you can be rich or you can be king, but not both." Entrepreneurs like to have control, that's why we start companies in the first place. We think we can solve a problem better than anyone else can. As a result, we try to control every aspect of the company. Unfortunately, this is the fastest way to hurt the company. If you want to control 100% of the company, you will only be able to grow so much. If you are hoping to own a yacht as you mentioned earlier, you're going to have to be willing to give up control and accept advice and help from others. Think of it this way: 25% of a big number is better than 100% of a small number.
Do you think Zuckerberg could have built Facebook to where it is today without help from more business-savvy people? Do you think Google would be as big as it is today if Page and Brin had maintained control instead of bringing in Schmidt to be CEO? Do you think Woz would have built Apple without Jobs? These are all examples of extremely intelligent people who needed help to grow their company. Like I said, it is impossible to be good at everything.
Running a startup is like raising a kid. It's hard enough to do that under normal circumstance. Why make it harder by making yourself a single parent?
Just some advice based on my own experiences, observations, and advice I've received from others.
For "interest", venture capital wants to see, first, just the UI/UX and then, second, ComScore numbers. For the UI/UX, that's the last software I'm writing, not the first. Nothing else I said here interests venture capital at all. Nothing. Actually, for the advantage and technological barrier to entry from the math, they just get torqued because they know it's not within their 'deep domain knowledge' and they want to feel that they know more than the entrepreneur. And I tell them the problem I'm solving as the users see it, and that doesn't impress them, either.
It's like, and I suspect, and this is much of the reason for the recent rise of the angels, that to stop another bubble the few, large LPs got together and wrote on the back of a 3 x 5" card the dirt simple criteria for each of seed and Series A, B, C, D. The criteria rule out considering anything I've said here or even the users' problem I'm solving. With these rules, could teach a dog to be a VC in a weekend. So, the LPs won't let the VCs actually 'review' a business plan and apply 'judgment'. So, that's why some VCs blog: That's about the only advantage they have left, that is, to get the 'deal flow', and otherwise are reduced to being just another dog following the 3 x 5" card.
I've seen a lot in business, from small companies to large and successful ones to large and sick ones. I helped start a large, successful one and learned a lot there. One of the main things I learned is, there isn't a lot to learn. I've been a B-school prof where I also ran a consulting company with four important clients in business. So, for someone doing a startup, I am relatively well informed on business and how to start and run one. None of this background impresses VCs either!
Actually, I learned that the most important thing to learn for business is People 101.
Besides, on Main Streets all across the US there are sole proprietors being successful. Actually, they own nearly all the yachts under 100 feet long. My business is really different only in the advantages of Moore's law, the technical core, and the potential. They do it; I should be able to do it, too.
The Koch brothers never went public; they just ran their business.
That I have some technical knowledge doesn't really mean that I have too little 'business knowledge'!
Sure, if I go public, then I'll have staffs helping me entertain Wall Street, the institutional investors, the WSJ and the NYT, CNBC, keep the SEC happy, keep me out of trouble with Sarbanes-Oxley, entertain Congress, etc.
I'm eager to learn: E.g., I work hard on the Internet to learn, from AVC.com, TechCrunch, VentureBeat, C|Net, SAI, HN, and the best I can get. AVC.com has some of the best information, mostly from people who comment.
Early on I won't try to do bookkeeping, accounting, or legal. ASAP I will just get the best paid technical support I can from Microsoft and deliberately resist learning all the details of Windows Server administration. Same for Cisco's products: I have a basic understanding of TCP/IP, DNS, and even MPLS and have written socket software, but I will work to 'outsource' as much as possible on networking to the right people at Microsoft and Cisco.
But a pattern is developing: I have to get this project to some ComScore numbers with just my own eight fingers and two thumbs. And I won't want the ComScore users much before I have some ads to get me some revenue. Then my planning arithmetic indicates that if I do get users, early on the 'free cash flow' from two weeks of revenue can pay to double the capacity of the server farm.
Why? Take reasonable values for charge per click or charge per 1000 ads displayed, take the small size of my simple Web pages, add in current prices for servers and bandwidth, and conclude that in two weeks a busy server can make money enough to replace itself. The key is to get the server busy!
So, after a few doublings, there's a good chance that I'll have so much revenue that a Series A check for a few million dollars would not be very interesting.
So, the venture capital people want me to wait so long that they are very close to having me wait so long I won't want venture capital. Or if I've been live for a few months and go for venture capital, then it's because my business is less good than I planned!
For my having a good, complete, well rounded team, on the Internet no one can tell that a Web site is run by a team, one person, or a dog. If people really like the Web site, then I'm awash in money to 'outsource', hire, etc. Really, the next key, nearly both necessary and sufficient, is just for people to like the Web site.
Maybe the LPs think that VC is like PE where just wait for an owner of a good business to go for fast women, slow horses, and cheap booze, get into a nasty divorce, etc. and then buy him out cheap, put in their own CEO to do just routine things, rebuild the company, and sell it.
There is the example of Plenty of Fish: A romantic matchmaking site in Canada, ads just from Google with no additional targeting, $10 million a year in revenue, two old Dell servers, and one guy. So, right, his business is worth ballpark $1 billion.
For examples, I liked Gates at Microsoft, Ellison at Oracle, Viterbi at QUALCOMM, and a few more.
For Schmidt at Google, it seemed to me that his main role was to make the investment bankers and institutional investors happy. Now he's booted himself upstairs. Seemed to me that Page and Brin were doing fine and now are again.
Even if my company could be the most valuable in the world, I don't much care. When someone offers me $1 billion for it, I'll sell, buy the yacht, and write music. The buyer can take the company and run it up to $300 billion if he wants. If no one wants to buy and I have a Board eager for the rest of the value, then I'll stay and help, out of obligation, and for some pride in seeing the success, but it will delay my work on music and physics.
There is an issue of power and public responsibility: A company or a person worth $300 billion has a lot of power. I would want at least to see that the power was not abused. It would be ugly music to write to leave the company and have someone else take the power of $300 billion and abuse it.
For some of the best advice I've seen in business, I'm not super thrilled. I'm crossing rough waters in a small canoe, and it's not clear to me that having someone else in the canoe will make the crossing easier. I just have to get that canoe across the water. That work is my responsibility, and there's no way I can 'outsource' or really even share that.
You clearly have a great understanding of the technical side of things, but the business/marketing/financial side is just as difficult. It's impossible to be good at everything, you will want help, either in the form of a cofounder and/or a board that can advise you.
Another saying that my prof used to repeat was "you can be rich or you can be king, but not both." Entrepreneurs like to have control, that's why we start companies in the first place. We think we can solve a problem better than anyone else can. As a result, we try to control every aspect of the company. Unfortunately, this is the fastest way to hurt the company. If you want to control 100% of the company, you will only be able to grow so much. If you are hoping to own a yacht as you mentioned earlier, you're going to have to be willing to give up control and accept advice and help from others. Think of it this way: 25% of a big number is better than 100% of a small number.
Do you think Zuckerberg could have built Facebook to where it is today without help from more business-savvy people? Do you think Google would be as big as it is today if Page and Brin had maintained control instead of bringing in Schmidt to be CEO? Do you think Woz would have built Apple without Jobs? These are all examples of extremely intelligent people who needed help to grow their company. Like I said, it is impossible to be good at everything.
Running a startup is like raising a kid. It's hard enough to do that under normal circumstance. Why make it harder by making yourself a single parent?
Just some advice based on my own experiences, observations, and advice I've received from others.