Entrepreneurship is not for wimps. It’s a good thing Barry Weinbaum learned how to take a punch when he was a kid growing up in the Bronx. He got socked by a massive telecom market meltdown, an over-sized, cash burning lab and factory, a founder law suit and a divided board. Oh yeah, and he had a few competitors as well. Barry lived to fight another day, so listen in to hear the valuable lessons he learned.
Barry Weinbaum became a serial entrepreneur after a 20+ year career at Lucent Technologies. With his rich telecom infrastructure and technology experience, he left Lucent to lead NanoOpto Corp. After selling NanoOpto, he headed into the lighting sector as CEO of Renaissance Lighting, a venture capital and angel backed LED company. Renaissance was acquired by Acuity Brands and Barry took on corporate marketing, strategy and coordination across Acuity Brands’ 22 lines of business. Investors then recruited Barry to head back into the start-up world to try and turn around LUMEnergi, a lighting control company. He managed a successful sale of the company’s assets and investor exit. Currently Barry is launching Social Learning and Payments, Inc. (aka SLAP). The Slap platform provides self-service tools for identifying and driving desired real-world and online actions among communities, and then providing rewards (a “slap on the back”) when those actions occur.
Along the way Barry has been issued three patents in both telecom and lighting. He originally hails from the Bronx New York and has degrees in Computer Science from Union College and Columbia University.
The Take Home Lessons
- Barry was recruited out of a corporate career to take over as CEO in a founder led company. The transition did not go well. Barry ended up putting a lot of effort into dealing with the founder and making sure the Company had a firm foundation of its own intellectual property.
- As the telecom industry collapsed, the Company had to pivot and start selling into the consumer electronics sector. “Design wins” were easier to come by because of the large number of mobile phones being released. Sales were not guaranteed for any particular model and this creating forecasting problems.
- NanoOpto’s founder had built out a large R&D and manufacturing facility. Without sales this overhead became a monster that needed to be feed. Barry describes the facility has hardware collecting a pension that you can’t afford to pay.
- Board Size – The Company’s board grew to 15 people with 9 members and 6 “observers”. This got unwieldy and dysfunctional. In hind site,keeping the board down in size and limiting observers (who ended up participating, not observing) would have prevented a lot of wasted energy.
- Smart Money – Barry notes that in the later stages, NanoOpto took investments from funds that didn’t understand the business or add any strategic value. When things started going sideways, they created numerous problems.
- CEOs must understand that venture capitalists have a tough conflict of interest to reconcile. When the going gets tough, investors will almost without fail do what’s in the best interest of the fund, not the Company. The venture backed CEO that doesn’t understand is in for some confusing interaction with board members.
- Of course you have to over communicate and treat people like adults. Especially when things are going badly. The same goes for industry partners outside of the company.
- Lastly, Barry advises entrepreneurs to manage their mood and emotions carefully. Don’t get too high and don’t get too low. People are always watching and they’ll either be overly optimistic or overly pessimistic if that’s the vibe you send out.
Resources & Links
Why a Venture Capital Podcast About Failure?
From early childhood you’ve always heard the saying “Learn from your mistakes.” In the venture capital industry you frequently hear “Fail fast” to learn and get to the right idea. Great advice. So, for this venture capital podcast I interview venture capital backed entrepreneurs about what they learned when their start-up didn’t go as planned. I hope you can learn from their valuable experience.