15 Minutes with Congressman Francisco"Quico" Canseco

Congressman Francisco Canseco may be a freshman, but don’t let that fool you.

The attorney turned entrepreneur has built businesses from the ground up, creating hundreds of jobs and generating an inestimable economic impact on the communities they serve.
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15 Minutes with Congressman Francisco “Quico” Canseco
(TX-R), Congressional District 23   
   By Christi Fish

On January 3, Francisco "Quico" Canseco took office as a United States Congressman. He represents a 20-county district in southwest Texas that is home to more than 650,000 people. It is a new path for the Laredo, Texas native, but one that draws upon his skills as a successful attorney, investor, businessman and entrepreneur. Recently, the Congressman and Startech CEO Jim Poage discussed the challenges facing today's entrepreneurs. Canseco also elaborated on why the Alamo City is rapidly becoming the nation's next major center for technology innovation.

Congressman Francisco Canseco may be a freshman, but don't let that fool you.

The 61-year-old attorney turned entrepreneur has built businesses from the ground up, creating hundreds of jobs and generating an inestimable economic impact on the communities they serve.

He has also saved businesses on the brink of disaster.

In the mid-90s, First National Bank of Hondo called on Canseco to help develop strategies that would avert it from permanently closing its doors. He was successful. Today, the bank is a first-class institution that serves its community with four thriving branch locations.

When asked to pick his favorite project, however, Canseco won't choose.

"That's like asking me, 'What do you prefer: a New York cheesecake or a double chocolate cake?' They’re all equally satisfying."

However, Poage won’t let the Congressman off so easily. He presses and Canseco admits that he fondly recalls his time as an attorney. He is also enthusiastic about his days as a real estate developer.

"When we were building shopping and retail centers, we were engaged in every aspect of entrepreneurship," recalls Canseco. "We identified the land, worked with the various commissions and agencies and sold our ideas to the big boxes, the large national companies we wanted to engage. Then we lined up interim and permanent financing and worked with contractors to build the centers, which we ultimately put under management and sold to investors. Each project presented a different challenge. Each was a new adventure."

Canseco is careful to point out that an entrepreneur's life is not easy.

"Entrepreneurs need to be patient in today's market, and they need to hone their skills," he says. "You can't give up just because it's a tough market. You need to take advantage of the rough times. Set aside enough capital for rainy days. Line up investors to jump in when the market turns. Get ahead of the curve at minimal risk by paying attention to what is happening in Washington, in Austin and at City Hall. Take the time to understand what your correlative markets are doing."

The Anatomy of a Sound Investment
Canseco tells Poage that he believes that an entrepreneur's business strategy is the best indicator of an investment's potential. Attractive start-ups offer investors healthy rewards commensurate with the type of risk inherent in the project.

Poage agrees. Through a tailored suite of enterprise, investment and networking services, Startech is cultivating the technology businesses of promising entrepreneurs to make the region an attractive landscape for future innovation. Last year, Startech's clients raised nearly $68 million in external funding.

"Our clients are usually new entrepreneurs who are trying to get their companies up and going," says Poage. "Most of the time they come to us with a need for dollars to put in their company. It's our job to help them move their innovations from concept to commercialization."

Texas-Sized Innovation
In 2005, at the direction of Governor Rick Perry, the Legislature created the Texas Emerging Technology Fund (ETF), a $400 million fund targeting Texas and the nation's most promising entrepreneurs to grow their companies in Texas. With an average of a four-to-one return on investment, the ETF has become the benchmark case study for other states looking to secure their economic future with knowledge based jobs and industry.

Canseco believes the ETF is indicative of Texas' renowned "can do" attitude that is already making San Antonio a hotbed for technology innovation.

"When you nurture and mentor new entrepreneurs, you unleash a tremendous amount of energy in them to be willing to take common sense risks to grow their businesses. That creates jobs. That contributes to the economy," Canseco says.

Canseco praises Toyota, which discarded traditional business models and integrated entrepreneurial suppliers and sub-manufacturers into the same plant, directly on the Toyota assembly line. The innovation paid off and is now saving the auto manufacturer enormous amounts of capital.

Moreover, Canseco says BRAC, BAMC, UT Health Science Center, UTSA, Port San Antonio and others are anchors of innovation that attract entrepreneurs to stay in or come to the Alamo City. "San Antonio leaders need to develop their assets with a view toward making sure these flurries of entrepreneurial activity can be nurtured and grown into successful businesses."

Canseco is very satisfied in his role as a public servant, describing his new venture as "the cherry on top" of his successful and multi-faceted career.

He says, "I represent an extraordinary number of Texans in the 23rd Congressional district and that is very, very satisfying. Hopefully, that satisfaction will continue to accrue and give great dividends to the people that I represent."

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Business Isn't War...or is it?
By Bruce Hughes, Project Manager, Technology Commercialization, Startech & STRCIC

There are two metaphors that often seem overused in talking about business. One is team sports and the other is war. I wonder, however, whether there is a deeper truth in the latter—one we often miss.

We often think of our businesses in a competitive landscape in which other companies contending for the same customers are our adversaries. What if, instead, we consider competitors to be adverse features of the environment, to be understood and evaded where possible? Then we can focus on the entity that should be the real target of our efforts—the customer.

If you look at business successes, I think you will see that there is a common thread among them, and that is time. Time is the most critical, and the scarcest, resource of all. The business that masters time in communicating with its customers is in a superior position, because this business can create new offerings to create and satisfy new customer expectations before customers themselves realize they have them.

In recent events, look for example at the Apple iPad. The iPad by all accounts was a screaming success, and created a new category of products. Just when a large number of competitive offerings appeared, Apple released the iPad 2, with just enough new features and refinements at the same price that it sold between 500,000 and 1 million units in the launch weekend. Apple seized the ground in the customer's mind that represented the computing tablet, and changed the game once again so that its competitors will have difficulty keeping up. Apple can do this because they understand themselves and their capabilities, and they focus relentlessly on execution based on time constraints.

Another example from history is The "H-Y War" between Honda and Yamaha. In 1981 Yamaha built the largest motorcycle factory in the world and announced its intention to become the world's largest manufacturer of motorcycles, a position held at the time by Honda. Honda responded to this by introducing 113 new models in the next eighteen months; Yamaha could manage only 37. This more rapid interaction with the customers led to Honda cementing its image as the style leader, leaving Yamaha with unsellable inventory.

So, when you are thinking about your competitive strategy, try to understand the mind of the customer better and faster than your competition. If you do this, you may be almost certain to win. For more insight into business as maneuver conflict, see Certain to Win by Chet Richards.

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So Who's the Decision Maker?
By David Clark, Director of Investment Services, Startech & STRCIC

You've been working on a major deal for several months. You've answered all the objections of the head of the IT department (or lab director or principle investigator or "whoever's in charge") and have secured agreement that your product or service is exactly what is needed to solve his or her problem. You know the price is right and are ready to close the deal. Only at the last moment do you find out that the individual you with whom you have been dealing with for the past two months can't sign the order and can't get approval to move forward.

This disappointing result is typically caused by two failures on the part of the sales professional: first, not knowing the decision process of the organization; and second, not addressing needs of all the decision makers. The first error is not discussed here. The second error is a common mistake made by sales professionals – particularly those in the technology space.

Most organizations of any size will have three or perhaps four decision makers. While it is possible that these decision makers can be the same individual it is useful to address the needs and concerns of each as though they may be separate. They are:

1. The technical decision maker. This decision maker is typically the target for most sales professionals in the technical space. This is the person mentioned in the first paragraph above. It is natural that this is the thrust of your sales activities. It's logical to pursue this person as he/she will have the knowledge to understand the benefits of your solution. Also, this individual can be energized to see the technical elegance of your solution, especially if it is "leading edge".

2. The business problem/solution decision maker. The decision maker is perhaps the key to a successful close to the sales effort. This person must be convinced that your solution solves a business problem and in such a manner that it can be implemented with a minimum of disruption to the operations of the organization. In a 'Feature, Function, Benefit' analysis this is the 'Benefit' portion. You need to be able to articulate the business 'Benefit' of your solution in a manner that resonates with this decision maker. An impressive array of technically superior 'Features' and 'Functions' will not necessarily motivate this decision maker.

3. The financial decision maker. This decision maker can be the primary obstacle in closing your deal. A good sales rep will qualify the prospect early as to 'budget' but this is only part of the financial decision maker's analysis. The successful sales professional should be able to show a financial benefit to acquiring the proposed solution. Techniques such as "return on investment" (ROI) and "Total Cost of Ownership" (TCO) are extremely useful with this decision maker.

4. The political decision maker. While sometimes found in the private sector, this decision maker is most often found in the public sector. Normally not a key protagonist or antagonist, nonetheless the skilled sales professional is always on the lookout for this decision maker. This person many times can be a very senior member of the organization's management team. As a simple example, it could be politically unwise for a City government to buy your solution when your competitor is the single largest mployer in the City.

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Federal Funding Available through the National Science Foundation 2011 Small Business Innovation Research Program
By Rosalinda Palacios, Assistant Project manager, Technology Commercialization, Startech & STRCIC

The National Science Foundation (NSF) has released its 2011 Small Business Innovation Research (SBIR) solicitation which will open to receive proposals on May 10, 2011 and close June 10, 2011.

The four broad topics are:

• Biological and Chemical Technologies
• Education Applications
• Electronics, Information and Communication Technologies
• Nanotechnology, Advanced Materials, and Manufacturing

The Small Business Innovation Research (SBIR) Program stimulates technological innovation in the private sector by strengthening the role of small business concerns in meeting Federal research and development needs, increasing the commercial application of federally supported research results, and fostering and encouraging participation by socially and economically disadvantaged and women-owned small businesses. A main purpose of the legislation is to stimulate technological innovation and increase private sector commercialization.

The NSF SBIR program is in a unique position by transforming scientific discovery into both social and economic benefit, and by emphasizing private sector commercialization. Accordingly, NSF has formulated broad solicitation topics for SBIR that conform to the high-technology investment sector's interests.

Startech Can Help
We're here to help you with understanding agency administrative requirements, proposal review, and assistance and advice on commercialization plans and strategies. Contact Rosalinda Palacios today at 210-458-2739 or rp@startech1.org to see how Startech can help you.

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From the Tech Startup Desk
Bigger & Better – The New Ventures Forum Summer 2011
By Bruce Hughes, Project Manager, Technology Commercialization, Startech & STRCIC

Startech announced new dates for the New Ventures Forum, a successful seminar series designed to help entrepreneurs, inventors, and businesses seeking Emerging Technology Fund (ETF) funding and/or Angel Equity Investment. Beginning on Wednesday, May 4, Startech's New Ventures Forum will provide start-up technology companies with the basic knowledge and skills needed to improve their probability of equity funding. Additionally, Startech has expanded the New Ventures Forum from six to seven sessions to include additional content on Intellectual Property & Valuation and a session on the FDA Regulatory Pathways.

The New Ventures Forum is presented weekly in seven core sessions. This series of sessions are on Wednesdays, starting Wednesday, May 4 through Wednesday, June 15, from 1:30 pm to 4:30 pm in the San Antonio Technology Center at 3463 Magic Drive, San Antonio, Texas.

The forum is designed as an interactive workshop with dialogue between experts and entrepreneurs. Participants are encouraged to apply their company as a case study for group discussion. Class size is limited. "The Venture Forum is a 'must' for any individual who wants to start a business" said Rao Govindaraju of Sai Global Technologies, Inc.

Topics of the New Venture Forum include ETF Funding & Angel Equity Investment, Intellectual Property & Market Research, Building Your Management Team, Financial & Contract Preparation, Investor Presentation & Elevator Pitch, and Term Sheets & The Business Plan.

The cost is $250 for all 7 sessions. Attendees who complete 6 of the 7 Core Sessions will receive waived application fees to the Texas Emerging Technology Fund (ETF) and/or the South Texas Angel Network (STAN) - a $250 value.

Register
To enroll or for more information, please contact Startech at 210-458-2760 or at marketing@startech1.org.

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South by Southwest Interactive Conference Report
Reid Hoffman's Rules for Entrepreneurial Success
By Mikal E. Belicove

LinkedIn co-founder and angel investor Reid Hoffman says now's the time for bold entrepreneurship. Current economic conditions offer an ideal environment for startups, he says, because you have more time to get a new venture off the ground before the competition catches on.

At the recent South by Southwest Interactive conference in Austin, Texas, Hoffman offered what he calls his "Ten Rules on Entrepreneurship". If anyone is qualified to come up with such a list, it's this web-savvy wizard who was a founding board member and executive vice president of PayPal and now serves as a partner at venture capital powerhouse Greylock Partners.

Here are 4 of Hoffman's top mandates for entrepreneurs. Read the full list of "Reid Hoffman's 10 Rules for Entrepreneurial Success" at: Reid Hoffman's 10 Rules for Entrepreneurial Success

1. Be disruptive. Ask yourself: "Is this massive and different? It's got to be ten-times different. It's got to be something that changes an industry." Hoffman uses Skype as an example, calling it a disruptive company because, "it removes these very expensive cross barrier phone charges."

2. Seek honesty. You need friends who will tell you that you have an ugly baby. Keep your aspirations high, but don't drink your own Kool-Aid -- all the while leveraging the advice of your friends. And once and for all: No, flushing your toilet does not do the same thing.

3. Grow your network. Your network includes investors, advisers, employees and customers. With a broad network, you have the ability to make important, global-sized changes.

4. Maintain flexible persistence. On one hand, the goal is to have a vision and be persistent. On the other hand, flexibility and being able to change based on what your customers want is paramount. "The art is knowing when to be persistent and when to be flexible and how to blend them."

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