Jason Mendelson, Co-Founder and Managing Director of Foundry Group, a Boulder venture capital firm, kicked off the New Venture Challenge Crash Course series to a packed house last night.  His wealth of experience – software engineer, then deal attorney, then venture capitalist – came through in lively style.  He’s not afraid to call a spade a spade, either.  Take his advice on very early stage financing:

“Do you really need financing yet?  Early stage financing is very risky, and therefore, expensive.  I’m going to act more like a loan shark than a VC.  An angel investor will give you a better deal.  Create value and the money will follow.”

This was the first in an every-Wednesday “Crash Course” series put on by the New Venture Challenge.  Each workshop is presented by a seasoned entrepreneur or business leaders.  Mendelson’s talk, titled “How to Build a Company,” dished out advice and highlighted common mistakes:

“You need a partner who complements your skills.  The biggest red flag for me as a VC is someone starting a company solo.”

“Most people fall down on estimating the competition.  Lots of entrepreneurs say, “We are different.”  Are you really?  Take social networking sites; your competition might just be your customers’ time.”

“Marketing and advertising will not save you: Every marketing guy knows that half of his budget is wasted; he just doesn’t know which half.”

Mendelson also praised Boulder as a place to build a company.  Successful entrepreneurs are happy to mentor those starting out, and the city is one of the most socially-networked that he’s worked in.  Mendelson illustrated with a parting shot.

“What should you say to a Sand Hill Road venture capitalist?  Compliment him on his Ferrari.”

Below are the slides from Jason’s presentation.  Thanks Jason!  Here is the video of the crash course.

How to Pick a Business from Paul Berberian on Vimeo.

A Washington lawyer friend recently told me about layoffs at his firm. I asked him who was getting axed. He said it was interesting: lawyers who were used to just showing up and having work handed to them were the first to go because with the bursting of the credit bubble, that flow of work just isn’t there. But those who have the ability to imagine new services, new opportunities and new ways to recruit work were being retained. They are the new untouchables.

That is the key to understanding our full education challenge today. Those who are waiting for this recession to end so someone can again hand them work could have a long wait. Those with the imagination to make themselves untouchables — to invent smarter ways to do old jobs, energy-saving ways to provide new services, new ways to attract old customers or new ways to combine existing technologies — will thrive. Therefore, we not only need a higher percentage of our kids graduating from high school and college — more education — but we need more of them with the right education.

Mint CEO Aaron Patzer on Startups from Techcrunch on Vimeo.

Description: “How do investors gauge whether a company is one from a pool of thousands worth their resources? KPCB partner Beth Seidenberg shares her firm’s five measures for financial fortitude.”

Thanks to Guy Kawasaki and Alltop for this find.

For instance, Niel gleaned the following lessons from his experience with the failure of Newmerix, a company he co-founded.  He underlined that choosing your business partner is a vital process; it needs to be the right person for the business (as opposed to someone whose personality meshes well with yours).  He said he also made the mistake of letting the management team take big salaries from the outset; it set a cultural momentum in the company that was hard to come back from.  Another problem with that company was that it was so insular.  In retrospect, they should have gone out to talk to customers.  Niel learned that it is best to bring people in and get their feedback throughout the development process.

A seasoned veteran of venture-backed startups, Niel had the following advice for fellow entrepreneurs:
On how to protect your crown jewels (IP) when getting advice from others on your entrepreneurial idea, he said that it is a myth that if you talk to people about your idea, someone will steal it from you.  This rarely happens. He recommended talking to as many people that matter as possible before starting your company.  Talking to people is cheap.  It is expensive to actually start your business, and you want to be sure you are approaching it correctly.

Neil also advised two things to never skimp on or do later: Legal & Accounting.  On using advisors, Neil said to take advantage of your advisors – have them come in to your company for a limited time on a regular basis (ex: once a week for 1-to-3 hours) for a well-defined purpose and compensate them by having food at the meeting.  On starting a business and getting funding, Neil has been successful by establish relationships with potential investors first (before pitching to them).