A Conversation with Penelope Trunk
This is my site Written by Alora on March 20, 2009 – 9:51 pm

Author, Blogger & CEO, Penelope Trunk

Author, Blogger & CEO, Penelope Trunk

Author, blogger and serial entrepreneur Penelope Trunk sat down with me at SXSW to discuss life as an entrepreneur, building a startup outside of the tech corridor, and what an organization’s technology choices say to potential employees.

Penelope is currently building her third business, the Brazen Careerist. In addition to trying to connect Employers with candidates (often Millenials), Penelope is also attempting the rare feat of trying to build a technology startup in the least likely of places: Madison, Wisconsin. This was the topic of her panel on Sunday morning (with Robert Scoble, Kaiser Kuo, Mike Maples and John Erik Metcalf) at SXSW, “Ditch the Valley, Run for the Hills.”

While much of the panel discussion centered around VC funding, Penelope is quick to emphasize something critial: all money is local — so if you are not near the VCs (e.g. SF or the Valley), don’t expect to be funded by them. Furthermore, VC money is not practical unless you are already showing success. A sales curve that “looks like a hockey stick” is a prerequisite to have a persuasive VC argument.

Of course, the “pink elephant in the room” that Penelope strongly advocates acknowledging is that living in San Francisco or the Valley is expensive — often times, too expensive — for someone trying to get a startup off the ground. During the panel, she noted that a San Francisco/Silicon Valley location might be an acceptable trade-off for a single male in his twenties, but as a single mother, it is often unrealistic to expect that an entrepreneur can support a family while getting a business off the ground in one of the country’s most expensive locales.

Conversely, being off the beaten path also has its disadvantages, most notably in the area of recruiting. Penelope quips that, as an example, there is “one SEO person in every state.” So, if you’re in a non-tech part of the country, part of your job is to convince that solo local specialist to join your team. And what if they don’t want to leave their secure job for a new startup? According to Penelope, if that happens, it’s time to look at your business model and ask why that person doesn’t want to join you.

So what about finding expertise that isn’t local? Penelope cautions that in the early stages of a new business, most business models are too fragile for that to be prudent. A startup hiring employee number three or four is likely to need someone who can sit in the same office and work through problems together, since life in an early stage startup can require constant tweaking and refining.

When it comes to the question of Generation Y and the Enterprise, Penelope is emphatic: “The technology and the culture go hand-in-hand.” The tools an enterprise implements will speak volumes about their values and their expectations of their employees.

Noting that tools like Yammer or Twitter imply that thinking and communicating are valued characteristics; and tools like wikis indicate a premium is placed on collaboration. An enterprise that claims to value those qualities without having the tools in place to support the activities is not being credible. In order to ‘walk the talk’ an enterprise needs to put tools in place that support the type of work environment they hope to foster.

Furthermore, Penelope notes that the value of those tools is absolutely measurable. She points out that large corporations have been measuring the value of communication-related functions for years. If there is a problem defining the ROI for something, odds are the right people are not involved in the discussion. Penelope refers to “a knowledge gap between the social media gurus and the Fortune 500.” But that doesn’t mean that the things social media influences are not measurable.

When it comes to the implementation of Web 2.0 tools in the enterprise, Penelope emphasizes the importance of not trying to sell the tools to the IT Department, because technology teams are not the ones empowered to make operational and procedural policy. The organizational leaders who need to be engaged are the ones with P&L authority in the areas of human resources, public relationship, marketing, and product development. Those disciplines are well-rehearsed at calculating the value of improvements in communications. Those are not things an IT Department is in the business of measuring.

Of course, the bottom line to selling a solution of any kind into an enterprise environment (especially in a tight economy) is pretty simple: it either needs to decrease costs or increase sales. Ms. Trunk is unapologetic: No matter how ‘cool’ the gadget may be, if there is no way to prove a tool can do that, then it has no business being bought and implemented in a business environment.