After receiving his first shipment, Nate started taking pictures of all the components and offering them for sale on the internet, figuring that his own frustration with the lack of visual guidance available for purchasing electronic parts online meant that others could be experiencing a similar problem. It was when his third order came in from France that Nate realized he might have “grossly underestimated the market.” He also realized that he was going to need a box in which to ship the order, so he went out back to the recycling bin behind his apartment to find one.

From realizing he needed a box Nate went to realizing he needed an IT department when his company had grown to about 10 people and their search field was hacked by a Spanish soccer site redirecting traffic in order to generate click-through revenue. This helped him to recognize the dangers of trying to stay too lean as a company rather than hiring to accommodate growth. In a similar way, they decided that they would probably need to transition from a house to an office when using the printer one day, in addition to all the other electronic devices they were experimenting with, caused the entire basement to plunge into darkness.

SparkFun’s creative culture and dynamic website are regarded by some as examples of brilliant marketing, but Nate describes them more as simple solutions to document problem-solving and highlight interesting projects. For example, he once created a tutorial on how to build a portable rotary phone that was so popular the website crashed. Interesting projects are encouraged with events like the Antimov competition, which awards prizes for robots that complete trivial tasks in a highly inefficient way while destroying themselves in the process.

Another event that encourages creative projects is Free Day, when the company gives away up to $100,000 in products to their customers. Nate came up with the concept mostly because he dislikes the complexity of discount codes, but the event also happened to serve the dual purpose of testing the company’s IT infrastructure and providing great viral marketing. “The first Free Day was on a Thursday, but the site broke on Tuesday because the traffic was already way too high with people pre-loading their cart. I guess it went a little viral. We did our best to patch the holes and then went for it. That week, Google had just announced the Nexus One, which was a Twitter trend. SparkFun was also a trending topic on Twitter on Free Day. We were also the number one search term on Google.”

Congratulations to SparkFun on all their success and best of luck to everyone with CUNVC!

The panel of judges included Jeff Nytch from the Entrepreneurship Center in the Music School, Meg Ambrose from ATLAS, Frank Moyes from the Business School’s Deming Center, and Brad Bernthal of the Silicon Flatirons Center at the Law School. Presented with such an overwhelming selection of brilliant ideas, these judges were hard-pressed to choose winners, but they did their best to give recognition to some notable pitches and thank everyone for participating.

Winning for most original idea was Louis Dankovich, who presented a plan to develop bedbug traps based on CO2 management. Best pitch went to Felipe Recart for his charming presentation about providing Chileans with delicious kettle-baked potato chips instead of the thin, oily product that always leaves him with “a profound sense of remorse.” The wild card winner, Hamed Yazdi, presented his entire pitch in poetry, and the overall prize went to Sean Baxter for his online fashion game for Tween girls.

In addition to these outstanding presentations, there were many other compelling pitches throughout the evening, ranging from an actual working model of a carbon sequestration box and an app that lets people pay their friends by smart phone when dividing a big bill, to healthy beer, cool chicken coops, and covered wagon campers. Themes of the evening included a passion for social justice, community, and volunteering, an interest in health and the environment, and solutions to improve efficiency for a wide range of people.

Congratulations to everyone who got this year’s New Venture Challenge off to such a great start at Pitch Night! Remember to join us for Mentor Speed Dating Night on Monday, November 15th starting at 6:15pm in the Wolf Law School, with an Entrepreneurs Unplugged presentation followed by the opportunity to network with a wide range of business leaders. Let the games begin!

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).