Yesterday afternoon Startup Trek ventured to Sausalito, CA to visit with esteemed, senior Keiretsu Forum member Mr. Max Shapiro, CEO of innovative human resources firm PeopleConnect.com :
Backdrop for the interview: Jason Calacanis of Mahalo.com and TechCrunch.com launches “Jihad to destroy” competitor Keiretsu Forum
A campaign of false information is being directed against the Keiretsu Forum, by Sequoia-backed Mahalo.com CEO, and Tech Crunch 50 principal Jason Calacanis. The 38 year old self-proclaimed, startup expert and blogging terrorist (a Keiretsu Forum direct competitor) pictures himself on his blog as Bin Ladin, with his followers as “Jihadists” out to “destroy” Tech Crunch competitors, with the Keiretsu Forum being their primary target (wait a minute, isn’t it illegal to slander your competition?). After watching this nonsensical war being declared and waged, Startup Trek decided it was time to have a visit with a senior Keiretsu Forum Member in order to set the record straight. We ask in this video, some questions about how the Keiretsu Forum actually works.
We will follow up this interview with a few more over the coming weeks, by speaking with Keiretsu Forum funded entrepreneurs, members, and related parties.
Calacanis is truly the worst offender, in doing what he claims angers him: charging startups to pitch to investors
It is greatly amusing to me, that this campaign “to destroy the Keiretsu Forum”, in his words, is coming from Mr. Calacanis, who is a repeat offender when it comes to charging startups to “pitch to” investors. He and partner Michael Arrington of TechCrunch.com charge each and every startup employee who spend two short days pitching investors in their “DemoPit” $1,500. Today i confirmed that one still-angry entrepreneur paid Calacanis for SEVEN $1,500 admissions to their (not even a booth, just a table) spot in the Demo Pit. That’s $11,500 straight into Calacanis pocket.
Calacanis also reportedly (can anyone confirm? Jason?) rounded up $2M in corporate “sponsorships” for the Tech Crunch 50 conference, which is by all accounts a fine conference; $250K from the Microsoft BizSpark people, alone. How much of it did he give back to entrepreneurs? $50K. What happened to the other $1.95M? The Keiretsu Forum provides $30 to $50M annual to startups, indirectly through their members.
Calacanis also runs a “network” for entrepreneurs where he shows them some of his tricks. We’re working on finding out how much he is charging startups for that one.
Here’s another difference between the Tech Crunch 50 and The Keiretsu Forum: Tech Crunch meets once a year and charges startups aggregious fees to meet investors in a “minimalist” trade show setting (a table!), and raises $2M from sponsors. They give one startup $50K. The Keiretsu Forum meets 18 times a MONTH, and gives startups $30M. The numbers sort of speak for themselves, don’t they?
Here’s some FACTUAL background information about Calacanis and his partner Arrington
Last year, Calacanis business partner Arrington, the most successful tech business blogger in the world (if you base your definition of success using traffic reports) found himself dealing, by his own account on his blog, with numerous death threats and a “spit in his face” incident while speaking on a panel in Europe. Arrignton, to his credit took a month off (“without a laptop, on the beach) to reflect on his style in interacting with entrepreneurs ( e.g. “those pesky other humans!”)
Most recently, he has been observed throwing tantrums at conferences and public events, including storming off the stage at his own Tech Crunch conference last month and refusing to come back on; despite a “bring Mike back” applause campaign from the audience. Arrington shows up at events with impressively black eyes, reportedly from his herculean blogging hours; and often has sardonic insults ready for everyone within earshot, including his hosts and moderators (we’ll post a typical video from AlwaysOn soon).
By contrast, in my experience, the Keiretsu Forum is jam-packed with accomplished serial entrepreneurs and first-rate business executives. Executives with radically different attitudes and behaviors.
Arrington’s cyber-bully, partner Calacanis in tormenting others, is portraying himself as a “Robin Hood for entrepreneurs”. He has annointed himself with the role of bashing TC50 competitors like DEMO.com and the Keiretsu Forum. He and Arrington have waged a very successful campaign recently to put another competitor out of business (DEMO.com). Now their wrath is focused on the 850-member Keiretsu Forum. Sure, I agree individual Angels should not charge startups to simply hear a pitch. But the Keiretsu Forum is an 850-member, 18-location, professional private equity investment club which holds 18 “Formal” half-day meetings in large-scale private facilities, and 36 other meetings, plus hundreds of phone conferences, every month around the world. It takes a budget to do that, and most of that budget is provided by Keiretsu Members through their donation of time, effort, and by writing $3,000 annual membership checks.
The Keiretsu’s impact resembles that of a $250M venture fund. But a $250M venture fund run with the standard 2/20 rule draws a 2% annual management fee (that’s $5M annually) to cover their operating expenses. The 850 Keiretsu members pay $3k * $850 annually, that’s only $2.55M. The roughly 5 startups a month that survive six weeks of deal screening (which reduces the pool from 50-75, to 5, then pay an average of $1k (fee varies by region, and is max $1.5k) providing about $300k annually, still well short of what that venture fund uses to operate. {Note: those are my own estimates, as a Keiretsu Forum member. I do not have official or “inside information” about their finances).
What is the old saying, “don’t throw rocks if you live in a glass house”?
-steve bell | founder & ceo | Startup Trek TV, Inc. | http://StartupTrek.net/about | (408) 410-3857 cell#
