Konstantin Guericke on How to Build a Valley Network

By David Knight |

When it comes to entrepreneurship, Konstantin Guericke knows his stuff – he was a co-founder of the enormously successful LinkedIn. Based in San Francisco, his current duties include teaching with students at Stanford and, in recent months, acting as a venture partner for Berlin-based VC Earlybird.

When we spoke to him earlier this year, he was bemoaning the lack of name recognition for Berlin startups in the US – and on a recent trip to the German capital, he gave Silicon Allee an insight into what it takes for European entrepreneurs to make in big in the Valley.

SILICON ALLEE: Last time we spoke, you said how asking someone in the US to name a German startup was like asking them who the Prime Minister of Bavaria is – they just didn’t know any. Now, four months down the line, is that any different?

KONSTANTIN GUERICKE: I don’t think it has changed. From Berlin there is maybe SoundCloud [that Americans would know], but even that is still more insiders than sort of the general person you’d meet in a coffee shop. But I think Berlin has achieved a level of positive connotation – it sounds like something promising to people, but they can’t really put their finger on it. That can only last so long; it’s time to deliver some examples of companies and products that people use. If it’s still the same in two years then people won’t really have that positive association any more. It’s like a company that has a lot of hype but never shifts its products.

SA: Among many other roles, you are working with Berlin-based VC firm Earlybird and some of their portfolio companies. What advice do you give these entrepreneurs?

KG: The question is how helpful is it really to brand yourself as being from Berlin. My general advices to founders is to focus on your users and solving their problems. For most users, whether your to-do list application comes from Israel or France or Germany doesn’t really matter. Rather than thinking ‘I’m a Berlin company,’ you should be thinking ‘how can I be the most successful’ and maybe that means putting some people here, some people there, rather than identifying yourself with one location.

SA: A trend we are increasingly seeing in Berlin is for new startups to think globally from conception. What advice would you give to German entrepreneurs who want to be in the US, for example, from the start?

KG: Having the diversity of people from different countries, from Europe and from the US, and maybe even Asia; I think it’s very important just having that experience… you have to have that starter network and I have a lot of Germans that come over who think, ‘OK, I’m going to go into this market and just try to meet people at networking events,’ or they just come in and ask me, ‘well who can you introduce me to?’ And that’s not really a very successful way to build up your network.

You need to start with the relationships that you already have, that know you personally, that know your product, what you are like – you can’t just go to a party and ask people for introductions, because it doesn’t look right. The first thing you do if you want to build a relationship is to see what you can offer the other party rather than what can they do for you.

That’s why it’s so important to assemble a team that has national ties to these places; their brother-in-law or a former co-worker works over there. And having some people who have worked with some of the big companies in Silicon Valley, like Google or Yahoo, can be very helpful, because they have an instant network of colleagues that you can tap into.

SA: What would you tell German entrepreneurs is the best way to build a network in San Francisco?

KG: When I make introductions, my criteria is that I want to feel that both people will thank me later, because then I feel I’ve done something good. If one person is very happy, but the other person wasn’t really happy, I’m really not helping either one, because nothing is going to come of that relationship. So what I would do is make use of that second degree network who your contacts have worked with before; setting up those meetings ahead of time so you’re not just a random person who is stepping off the plane from Germany. There is also something to be said for having a real presence locally, so you’re not a flyby German who comes by for their lunch and then goes back to Berlin. When people build relationships it takes some time, and people are much more willing to build a relationship where they feel like you’re going to be around, you’re going to be a partner five years from now.

SA: You work closely with your students at Stanford, but in Berlin, there seems to be a lack of synergy between the thousands of people studying at the various institutes and the startup scene. What advice would you give to students looking to get into startups?

KG: [Being an entrepreneur] is certainly not for everyone. One of the concerns I have particularly in Stanford is that it has almost become too fashionable; everyone thinks they want to be an entrepreneur, but really it is very hard being an entrepreneur. Especially after people have watched the movie The Social Network, they think it’s so easy, but the reality is not as good.

In addition, some people think it’s the path to wealth and riches, but given the risks that you take, other options are probably better paths to that. So I think doing a startup and dedicating yourself to being an entrepreneur you have to be slightly or even moderately irrational about it, because it’s not really a very good justification [in itself] – you have to love the process of it. So I try to be realistic when students talk to me about exploring entrepreneurship. If you want to really become an entrepreneur you’re going to find the way to do it.

SA: What are the benefits of for portfolio companies when it comes to working with the likes of Earlybird?

KG: One of the reasons why I’m working with Earlybird is because I’ve been very frustrated with the fact there have been so few German startups [break out], and it’s been the history of copycats and very limited startups. Earlybird with this new fund is looking for entrepreneurs who are looking outside of the normal and outside of copying existing things; trying to do innovative things that build category leaders.

Earlybird has the desire to take some risks with things that are less proven than maybe other investors would be, and they’re working with me to help people get to the market. I think that’s a really good fit, that’s a win-win. Its a win for me because I get to work with the type of companies I want to work with. Earlybird stands out as a different investor – when you look at which of the US VC firms are really successful, it’s five or six, and it’s usually the ones that have invested in some pretty crazy things that happened to be very successful. The ones that take more of the safe route, often haven’t really worked out that well because with startups usually you either get very big or you die and so you might as well try for the very big one.