Kevin Warnock

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World of Good Inc. thanks me for investing my money

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World of Good Incorporated thank you for investing poster, February 2010

World of Good Incorporated thank you for investing poster, February 2010

I was the first financial investor in World of Good, Inc not related to the company founders by family.

I participated in the Series A, Series B and Series C rounds, after which the company was acquired.

I met founders Priya Haji and Siddharth Sanghvi in about 2005, the day they moved into the Berkeley Entrepreneurship Laboratory in the basement of The Bancroft Hotel across the street from the University of California at Berkeley. That startup space is now closed, in favor of new space at the top of the tallest building in Berkeley, California. The new name for the Berkeley Entrepreneurship Laboratory is UC Berkeley Startup Accelerator@Skydeck.

My desk was just inches from Haji’s desk, and we became very good friends, talking on the phone for hours a week.

Haji is the woman on the left in the photograph at the bottom right above.

World of Good was acquired in early 2010 by two companies.

Greater Good, owned by Charity USA bought the wholesale division of World of Good, Inc. This part of the company sold thousands of products to over 1,000 retail stores, including Whole Foods Market, among many others.

eBay bought the World of Good brand name and the matching Internet domain name so the online marketplace created earlier by both companies together could continue.

Here is the February 25, 2010 press release by World of Good, Inc. announcing the acquisitions:

“World of Good Inc. Sells Brand and Related Assets to eBay; Wholesale Division Acquired by GreaterGood/Charity USA

World of Good Brand Continues to Represent Sustainable Shopping and Market Access for Global Artisans Through E-Commerce

EMERYVILLE, Calif. – February 25, 2010 – World of Good Inc., a five-year-old social venture that connects artisans from developing communities with mainstream retail markets, announced today that eBay has fully acquired its brand and related assets. World of Good Inc. also announced that GreaterGood/Charity USA has acquired its wholesale division and line of designer, Fair Trade products which will be re-branded, while existing relationships with retailers and artisan partners will be maintained. The terms of the transactions were not disclosed.

eBay’s acquisition of the brand results from a two-year long collaboration between the two companies that led to the development of WorldofGood.com by eBay, the world’s largest multi-seller marketplace for socially and environmentally responsible shopping. The transaction reflects eBay’s growing commitment to engaging consumers to affect social change through sustainable commerce. It also represents World of Good’s commitment to creating the greatest market opportunity for small, Fair Trade and environmentally responsible producers around the world. The online marketplace hosts hundreds of sellers, with tens of thousands of sustainable products from 85 countries.

“We are excited about the opportunity to scale the World of Good mission to an unprecedented degree through eBay,” said World of Good co-founder and CEO Priya Haji. “Also, we are confident that GreaterGood will be an excellent steward of the retail partnerships we’ve built and will continue to grow Fair Trade through mainstream retail channels.”

GreaterGood’s acquisition of World of Good’s wholesale division reflects its growing Fair Trade business, including its Global Girlfriend apparel line. Since 2004, World of Good has developed extensive retail product lines for partners like Whole Foods Market, Hallmark and Disney, among others. GreaterGood will continue to work with the same retail partners and artisan groups in order to grow market access for small artisan suppliers around the globe.

World of Good was founded in 2004 by U.C. Berkeley’s Haas Graduate School of Business MBA’s Priya Haji and Siddharth Sanghvi with the mission to help small artisan producers improve their livelihoods by providing them with access to mainstream retail markets. The company has impacted more than 40,000 individual artisans across 70 countries by connecting them with millions of U.S. consumers. Haji also founded World of Good Development Organization, a sister non-profit focused on improving the lives of low-income women in the developing world. In December 2009, the Development Organization was honored by The Tech Museum of Innovation for its Fair Wage Guide, a free, open-source platform that calculates fair wages for artisans around the world and specific to their locations. The organization will continue its work to create technologies and tools that help companies ensure fair wages to informal sector workers.

Robert Chatwani, Director of eBay Global Citizenship said of the acquisition, “We look forward to this next step in our commitment to building an integrated, sustainable shopping experience within the eBay marketplace and are dedicated to applying our reach, resources and business model to create a positive impact for people, the planet and communities throughout the world.”

“GreaterGood is excited to grow the retail partnerships that World of Good built and to continue to help small artisan and Fair Trade producers reach these important retail channels,” said Stacey Edgar, founder and president of Global Girlfriend and director of the GreaterGood Wholesale Division.

About eBay:
Founded in 1995, eBay Inc. connects hundreds of millions of people around the world every day, empowering them to explore new opportunities and innovate together. eBay Inc. does this by providing the Internet platforms of choice for global commerce and payments. Building on this positive foundation, eBay’s sustainability efforts harness our technology and reach to extend this positive impact into vibrant, sustainable commerce experiences. Our sustainability portfolio includes WorldofGood.com, the eBay Green Team, the eBay Foundation, eBay Giving Works and MicroPlace.

About GreaterGood/Charity USA:
The GreaterGood Network of websites (including TheHungerSite, TheBreastCancerSite, TheAnimalRescueSite, Global Girlfriend, and others) offers the public a unique opportunity to support causes they care about through a free daily click and Gifts that Give More™ (100% of these donations go to the cause of the patron’s choice).  The GreaterGood Network’s online stores offer more than 3,000 Fair Trade items, with up to 30% of the purchase price going to charity. In fiscal year 2009, the GreaterGood Network gave more than $3 million to more than 50 charities around the world.

Media Contacts:

Lonnie Shekhtman, World of Good
240-601-5824, lonnie@worldofgoodinc.com

Annie Lescroart, eBay
(408) 376-7458, anlescroart@ebay.com

Rosemary Jones, GreaterGood/Charity USA
206-268-5496, rosemary@thehungersite.com

Haji and Sanghvhi worked incredibly diligently on World of Good.

You may click on the image of the thank you poster above to see it at full size, which will enable you to read the captions, which tell of some of the many successes World of Good is responsible for achieving. World of Good sent me the poster you see above in a beautiful frame, and I have it displayed in my home.

So that the captions can be found by search engines, here they are in text form:

  • Provided artisans in 70 countries access to new markets and enabled 50,000 people, mostly women and children, to earn better livelihoods through fair trade.
  • Supported the create of the FairWageGuide, being used to improve wages of informal sector workers by 600 companies in twenty countries.
  • Sold over three million fair trade and handcrafted products.
  • Made fair trade accessible to millions of Americans and allowed them to make more informed choices.
  • Partnered with Fortune 100 companies, including eBay, Disney, Hallmark, Walmart and Whole Foods Market, to held them source products ethically.
  • Completed 28 economic development projects that included schools, wells and healthcare initiatives in twenty countries.

I am proud to have invested in World of Good.

Have an MBA and an idea? Looking for a technical co-founder to build it and join your unfunded startup for equity alone?

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Model Karelea Mazzola from Supermodels.com

Model Karelea Mazzola from Supermodels.com

One of my highlights each month is serving as a mentor for the Haas Founders group.

Haas Founders is a group for Haas School of Business graduates from the University of California at Berkeley. It’s an invitation only group, but if you graduated from Haas you are quite likely to receive an invitation if you are a founder or co-founder of a startup company.

Another way in is to have a meaningful connection to the Haas School. That’s how I became a member. I have been a judge for the Berkeley Startup Competition from about 2004 through 2011.

Finally, all Haas graduates can buy their way in by agreeing to pay for the food and drinks. This allows service providers like bankers, investors and accountants to attend. Such service providers can meet ambitious startup founders that sometimes turn into clients.

I write the above to introduce you to the Haas Founders meeting. There is a Facebook page and a Twitter account for Haas Founders. Michael Berolzheimer moderates and organizes the Haas Founders meetings. Berolzheimer runs the genesis-stage venture firm Bee Partners which, according to his firm’s web site, pollinates visionary entrepreneurs with financial, human and social capital. Kishore Lakshminarayanan helps Berolzheimer set up the meetings, which take place at different venues each month, in the East Bay, South Bay and San Francisco, California USA. I met Berolzheimer in 2007, before he took on the responsibility for Haas Founders from the previous organizer, Mat Fogarty, CEO of Crowdcast.

Haas Founders has established a group on the professional social networking site Linked In. As of this morning there are 86 members. I believe the group is seeking new members, so if you fit the requirements, please introduce yourself to Michael Berolzheimer.

Haas Founders can be thought of as a board of directors like support group for startup founders, where no issues are off limits for discussion. That makes Haas Founders one of the most compelling meetings I’ve had the good fortune to attend.

I have attended the Haas Founders meetings since about 2005. Individual meetings are limited to 20 attendees.

This open forum for frank talk is made possible because attendees are asked to keep the the conversations confidential. To my knowledge, there has never been a meaningful breach of this rule. I think that’s a reflection of the trustworthiness and integrity of Haas students and graduates.

Given this secrecy, how can I write a blog post about Haas Founders?

Well, I am not going to discuss confidential information. The advice I am going to give is my own. I gave this advice to a participant at the most recent meeting March 6, 2012 in San Francisco.

I am not breaking confidentiality by repeating what I said that day because I have given this same advice many times without any restriction of confidentiality. It’s already public information. Problem averted. I ran this post by Berolzheimer before publishing it, as I want to be extra careful so as to not be uninvited to future meetings.

I decided to write this post because the issue I am going to talk about comes up so frequently that I have spent hours and hours answering this question over the years.

The question and answer are as follows:

Q: I am a non-technical founder and I have thought of a business idea that requires something technical be built. How do I find a talented technical co-founder to join my company for equity only to build my vision for me?

A: Forget it!

You can’t find a talented technical co-founder to join your unfunded idea stage company for equity only.

There are rare exceptions, but you can not count on them and should not consider counting on them.

One solution is to think of and pursue a business idea that you can implement with only the skills you have already. Here are three companies that I suspect began with little computer programming, for example:

  1. Become a mushroom farmer.
  2. Start a fair trade import company.
  3. Start a men’s fashion manufacturing company.

The smart people I suggest this answer to don’t quickly embrace my advice. That’s understandable. They are in love with their vision and they want to pursue that vision right now. They don’t want to hunt for a technically simpler business idea. They don’t want to learn the technical skills necessary to develop their original idea. They want a savior, a Steve Wozniak, to fall from the sky to do the real work of making a viable product. Usually such non-technical founders also want to reserve more of the company equity for themselves than for this savior, because they thought of the idea. If there is to be an equity disparity, I suggest it be weighted toward the technical contributors who make the product happen, not the non-technical people who think up the idea.

What non technical founders fail to appreciate is that talented technical individuals with the grit to want to start a company are in high demand. They are like supermodels in their desireability. A lot of people are asking them for dates. A lot of these suitors have lots of money to woo them with.

Why would a supermodel date a founder with no money when there is a line of suitors with six, seven or eight figure stacks of money at their side ready to spend?

The answer is supermodels don’t date broke founders.

Supermodels don’t hook up with unfunded MBAs that have a cool idea.

The perhaps sad truth is that MBAs are not held in high regard by many technical experts. This is not a comment on Berkeley MBAs, but on all MBAs. Of course, technical experts desperately need business experts at some point, as exits are rare for companies filled with only technical experts. I am not taking a stand on which type of person is more valuable because they are both vital. What I am saying is the technical people generally perceive that MBAs are not that important. If that’s the perception, then how can an MBA recruit a technical person without money?

There are millions of cool ideas to pursue at any moment. That’s always been the case and that will always be the case.

Talented technical people know they are in demand. They have recruiters calling them telling them so all the time. They read TechCrunch, VentureBeat and GigaOm. They know the technology world is in the middle of a full fledged boom right now. So only 2nd, 3rd, 4th and 5th rate technical people will agree to an equity only founder position with a non-technical sole co-founder.

The only practical exception is if you’ve already been friends with the person for years and they know your work and respect it. So classmates graduating together can get together and start a company, with some founders being non technical and some being technical.

But if you’re looking for a stranger to drop out of the sky to build your vision, you should forget it and focus on finding a simpler idea or on learning the technical skills yourself so you can build the first version of the product by yourself.

Yes, the product won’t likely have to polish of one created by a more seasoned expert, but it can be good enough. You only need it to be good enough to raise money that you can then use to pay a more skilled technical person to make an improved version.

I am not spouting off advice I read somewhere or heard somewhere — I know what I am talking about. Pardon me while I now go into extreme detail to convince you that I do know what I am talking about. What follows may seem like too much, but I have spent dozens and dozens of hours trying to beat this lesson into the heads of very smart non-technical company founders. I feel I need to pull out all the stops here to convince the skeptical that I am right.

I know it’s smart to learn to program because this is what I did to take my startup Hotpaper.com, Inc. from a USD $10,000 investment when I had almost no applicable skills through to a USD $10,000,000+ sale to a public company just six years later.

This is news I’ve written about more than once. But I haven’t described the grueling early work I put in that made this ‘quick success’ possible.

When I started Hotpaper, I was a minicomputer programmer. A Digital Equipment Coporation VAX minicomputer running Open VMS. There was nothing miniature about this computer. It filled an entire raised-floor water-cooled computer room and served 1,000 users in five offices in two US states. I believe it cost more than USD $12,000,000. Back then a 9 gigabyte disk drive cost USD $250,000. I saw the invoices and recall calculating the price per gigabyte.

When I started Hotpaper my only experience programming a PC was writing rudimentary DOS batch files. One can still write these for Windows, to run at a command window prompt. You can do amazing things with batch files, but you can’t write serious client-server or web applications with them. I had to learn to program graphical Microsoft Windows applications, and I had only used DOS on a PC up until that point. I had played for a few hours with a copy of Windows 3.1, but that was the extent of my experience with Windows. The one machine my employer had that ran Windows was so slow (Intel 386 with perhaps 1 megabyte of memory) that when you pressed a letter in a word processor (Ami Pro), there was a lag of about 1 full second before the character would show up on screen. It was pathetic.

I immediately bought a Hewlett Packard Pentium 60 Mhz computer with 4 megabytes of RAM and Windows 3.1 for Workgroups. I added Microsoft Office, which came on 30+ 3 1/2″ floppy disks, not a CD-ROM. This was a Pentium, not a Pentium II, III or IV. In fact, it was the slowest Pentium chip ever sold. But this was the fastest computer I had ever used. I still have it, in storage.

I all but shut myself off from the world for two years with hundreds of dollars of technical books, a 28.8K modem and a telephone. I taught myself to be an event driven computer programmer. Event driven programming is much different from the procedural programming I had done to program the huge VAX system run by my employer at the time, Cooley LLP. Yes, I knew how to program a little bit on a VAX, but Windows is so different that it’s almost as if I was learning to program from scratch.

Thankfully, Microsoft was not yet the market leader in word processing in 1994 since WordPerfect for DOS still dominated, so Microsoft tried very hard to persuade developers to embrace their Word word processing software. They offered free telephone technical support for programming problems, provided you paid for the phone call. There were no unlimited business phone lines back then, so my office phone bill was perhaps USD $100 a month due to all my calls to Microsoft — hours and hours of calls per month. I owe Microsoft so much for those calls, as they helped me to solve every problem I ever encountered. Thank you Microsoft.

Eventually Microsoft overnight switched from free technical support calls to USD $55.00 per incident technical support calls, and I had to stop calling them. But that was a couple of years later, and I had already gotten to be proficient by then, and I could get my questions answered for free on their well run newsgroups. By that point, Word and Office were the market leaders, and they didn’t need to try so hard to make developers embrace their tools.

I worked hard — really, really hard. I worked from about 10am to 10pm Monday through Saturday. On Sunday I wouldn’t come into the office until the mid afternoon, but I would still stay until 10pm or so. I did this from January 1995 through the end of 1996 or so, I believe. It took me that long to learn Windows programming reasonably well.

I didn’t know other software developers. There were no popular coworking spaces. Meetup didn’t exist. I was shy. But I was driven… really, powerfully and passionately driven. I had so little money I was living in a tiny studio apartment on Mason Street near Bush Street in San Francisco, California USA. My rent was USD $625 a month including utilities. I only owned one computer, so I could not work at home. I was at the office a lot, and it was just a seven minute walk to get there. I became really good friends with my office mates the late Stan Pasternak and patent attorney Robert Hill. I have such fond memories of that time.

Was the code I produced great? No. Was it awful? No. Was it reliable? Yes. Was it understandable to others? Yes. Did it get used by others for meaningful projects? Yes. Did I raise money with it? Yes. Did I sell the company successfully by following this model? Yes. Can you do the same? I think so.

At Hotpaper, I had a customer from the day I bought a computer. I told them I could build what they asked for. I actually had never done so on Windows. I had to figure out how to program Windows because I had a paying customer that demanded a Windows client-server based solution. They were paying me thousands so I had to deliver. I didn’t study for two years and then start to look for a client. I got the client based on my past reputation as a VAX programmer and then faked it until I made it.

It turns out that first project failed and the client never used my work or the work of any custom software developer.

They just bought an off the shelf application and conformed to its way of doing things.

But that’s irrelevant in the end. I got paid USD $30,000. I worked hard. The client made the best decision, for they should never have hired me or any developer when an off the shelf package was available for much less than having custom software written. I learned a lot, kept the rights to what I had built but did not get used, and I used that for the basis for what I then turned around and sold to Coca-Cola and the United States Department of Commerce, where it did get used on an enterprise scale.

Today it’s easier than ever to become a programmer. There are so many online tutorials like those from Codecademy. There are so many hacker co-working spaces like Hacker Dojo where you can base your new venture. You can work there as many hours as you can keep your eyes open, and there are smart people around much of the time to get help from.

Today all the software you need to do almost any project is free. That wasn’t the case in 1995, when now standard building blocks like MySQL hadn’t been popularized yet.

I have seen smart graduates spin their wheels for months or years trying to recruit a magical co-founder to build their product. How much better it would be for these people to sit down at Hacker Dojo and focus their considerable brain power on learning to program software directly. Even if the entire result is eventually rewritten later by someone more skilled, they would be better off than if they somehow found the mythical co-founder.

For once you know how to program in any language, you will be able to talk about and think about technical problems far more effectively than you can as a non programmer. It will be far more difficult for people to confuse, mislead or bamboozle you. You will be able to hire better programmers who will respect you more. You will be able to tell programmers what to attempt with more clarity and conviction because you know at least something about their world.

You will have insight into a world that’s richly diverse and totally fascinating. Your life will improve even if you never make a penny from your venture.

Programming is not easy. It can be absurdly complicated and exasperating at times. That’s why new college graduates who know little about the real world of programming can still command pay approaching USD $100,000 to start.

I am just one modestly successful entrepreneur.

Before you become a programmer, ask some technical startup founders you trust and see if they agree with what I’ve written here. Remember, Steve Jobs got lucky with Steve Wozniak. Silicon Valley was a sleepy place back then compared to today. Go make your own luck by developing your technical skills. If you have an MBA, you presumably spent four years to get an undergraduate degree and two years to get a business degree. Spend two more years to become a programmer. Doctors spend more time studying before they complete their education, so view eight years of study as normal, not crazy or silly.

I love programming, and I am extremely grateful I spent those grueling early years just powering through the books and road blocks to learn to program.

I feel I can do nearly anything I can dream up.

That’s a powerful feeling I wouldn’t give up for anything.


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