The meeting rooms looked underutilized late in the day but maybe the important action happens earlier. The library is full of appropriate titles on coding, business development, and DIY things that today we call "life hacking." Thankfully there is no fiction or pop psychology to distract serious thinkers from the hard work of new venture creation.
Hacker Dojo has its incongruous moments in the spirit of random assembly. Consider this photo of an aerialist in mid-climb.
Eager students can learn aerial acrobatics in some gyms and health clubs. Come to Hacker Dojo and you'll learn among dinosaur murals and a mock-up of Doctor Who's TARDIS. BTW, the blonde in the foreground was cute.
Consider this photo of an ordinary vending machine. Don't expect the same old snacks at Hacker Dojo.
The contents include Arduino boards and USB connectors. The guy at the soldering desk told me it's the most-photographed item in Hacker Dojo. I have a newfound respect for nerd culture.
I came across one book randomly positioned in a plug-and-play tech room, A. David Silver's Venture Capital: The Complete Guide for Investors. There's an old saying . . . when the student is ready, the teacher will appear. Books have always been my best teachers so this must have been my Zen moment. The publishing date in 1985 is not a liability. Some principles don't change even if the industries they track disappear.
I flipped to the chapter on metrics, in the spirit of the analytics revolution that has gripped new venture enthusiasts and their funders. Silver proposes the "Three Laws of VC:"
1. No more than two risks per investment.
2. V = P x S x E, where . . .
V = Valuation
P = Size of problem (the one painful thing the startup proposes to solve)
S = Elegance
E = Quality of entrepreneurial team
3. Invest in big-P companies because the market will give them high valuations irrespective of S and E
Silver believes the most efficient rating system for P, S, and E is 0-3, so the max value of V in this model will be 27. He later proposes that S = B x T, where B = the business plan or solution delivery mechanism and T = the existence of low-priced tech (presumably a resource input that makes the startup's task easier with fewer innovation hurdles to cross). The existence of two more variables means the max value of either B or T cannot be greater than the square root of 3, because when multiplied together they must allow S to be no greater than 3 itself. Otherwise the larger equation's V would be greater than 27 and the whole premise of controlling risk with a formula goes out the window.
The ratings in this model would have to be subjective. VCs in the mid-80s and before would not have had access to large sets of market data outside of proprietary sources. Big Data solves that problem today. High-quality granular data on anything is available for free on the Web or at a nominal cost from market research portals. HBR did a 20003 case study on the VC formula but I've seen these types of valuation metrics in my MBA coursework (also of early 2000s vintage).
I don't know the specific risk criteria that the Valley's most prominent VC firms use to score startups. The Drapers judged startups at beGLOBAL 2013 according to a scale of either "like" or "dislike" with no middle ground allowed. Scales that force VCs to make clear decisions early on help preserve investor capital by shutting out startups that are a poor fit for the VC's model.
Sooner or later, someone is going to pull one of those Arduino boards out of that vending machine and solder it to something that will make a VC swoon. They'd better have their equations ready.