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Give me your poor, your tired, your startups
March 4, 2009 11:04 AM   Subscribe

The Mark Cuban's Stimulus plan.

You must post your business plan here on my blog where I expect other people can and will comment on it. I also expect that other people will steal the idea and use it elsewhere. That is the idea. Call this an open source funding environment.

If its a good idea and worth funding, we want it replicated elsewhere. The idea is not just to help you, but to figure out how to help the economy through hard work and ingenuity. If you come up with the idea and get funding, you have a head start. If you execute better than others, you could possibly make money at it. As you will see from the rules below, these are going to be businesses that are mostly driven by sweat equity.

I will invest money in businesses presented here on this blog. No minimum, no maximum, but a very specific set of rules.


The first round of funding has been announced.
posted by jourman2 (34 comments total) 2 users marked this as a favorite

 
If we could just turn that ego into cash, we could solve all the worlds problems!

Anyway, sounds like a fun thing to do for someone with a lot of money to blow. I've heard that one of the problems that VCs are having now is that they have too much money and not enough opportunities. People don't want to give up their existing jobs to start a new company in the down economy.
posted by delmoi at 11:08 AM on March 4, 2009 [1 favorite]


*The Mark Cuban Stimulus Plan - doh!
posted by jourman2 at 11:08 AM on March 4, 2009


Reminds me of Dragon's Den, just a different format.
posted by never used baby shoes at 11:10 AM on March 4, 2009


Oh, the irony. A man proposing an "open source funding environment" is currently under indictment for insider trading.
posted by Cool Papa Bell at 11:12 AM on March 4, 2009 [1 favorite]


But I don't want to stimulate Mark Cuban.
posted by jonmc at 11:14 AM on March 4, 2009 [5 favorites]


1. Be college roommate of guy starting web-based company.
2. Beg him for job.
3. Buy domain broadcast.com
4. Wait for yahoo to buy you out during the .com bubble
5. Profit!
posted by damn dirty ape at 11:35 AM on March 4, 2009 [9 favorites]


I like the idea, don't particularly like his appropriation of the term open source for a decidedly non-open source implementation of his idea. Open source operates on an ideal of sharing and collaboration where every gives some, everybody takes some, and hopefully everybody is better off as a result. Cuban's stunt is all about him as lord and dictator over the proceedings. That's fine. He rich and he can play with his money however he wants.

But it has nothing to do with the concept of open source.
posted by COD at 11:36 AM on March 4, 2009 [1 favorite]


Technically "open source" just means that if you get a binary, you get source code too. Open source software can be proprietary and have draconian licensing terms, it just usually doesn't.
posted by jester69 at 11:42 AM on March 4, 2009 [2 favorites]


Actually, the future of open source funding is not really in question due to the recession.
posted by eclectist at 11:43 AM on March 4, 2009


@jester69 - if we are talking about software licensing you are correct. I was referring to the open source community, which is what Cuban seems to trying to connect his project to.
posted by COD at 11:46 AM on March 4, 2009


If anything can turn the USA around, it's stuffed chicken wings. Good work, Mr Cuban.
posted by GuyZero at 11:51 AM on March 4, 2009


Yeah, if anything, the companies he has funded sound like great adds for the Mavericks arena :p Pizza, wings, and enhanced headcounting.
posted by cavalier at 11:56 AM on March 4, 2009


Cuban's project technically is open source, he is "showing his work" so to speak. We get to see the plan (source) behind the business (binary.) I can see where this might bother you, but it has something to do with the "concept of open source" contrary to your assertion.
The open source movement is probably not named well, but that is what it is called. Perhaps, it should be referred to as "the open source movement" when confusion is possible.
posted by jester69 at 11:56 AM on March 4, 2009


Indeed, stuffed chicken wings, naked pizza and subscriber-based games are totally what we need to get out of this banking mess! Thanks, Mark!
posted by bclark at 11:58 AM on March 4, 2009 [1 favorite]


I've heard that one of the problems that VCs are having now is that they have too much money and not enough opportunities. People don't want to give up their existing jobs to start a new company in the down economy.

This is true and reflected by my experience in the last few months working at a start up. Of course, a sample size of me does not equal a trend.
posted by spicynuts at 12:03 PM on March 4, 2009


So are the business plans public (where are they?) or only open to Cuban and the owners?
posted by Science! at 12:10 PM on March 4, 2009


This seems crazy.
posted by empath at 12:28 PM on March 4, 2009


but rachel marsden thinks it's a great idea!
posted by klanawa at 12:33 PM on March 4, 2009 [1 favorite]


Technically "open source" just means that if you get a binary, you get source code too. Open source software can be proprietary and have draconian licensing terms, it just usually doesn't.

Ehm, wrong.
posted by DreamerFi at 12:56 PM on March 4, 2009 [1 favorite]


Technically "open source" just means that if you get a binary, you get source code too. Open source software can be proprietary and have draconian licensing terms, it just usually doesn't.

Uh, no. The term "Open Source" was a marketing term for what had been called "Free Software", and referred to a few specific software licenses, all of which made the software basically non-proprietary, able to be edited and shared without limit (other then requirement not to change the license in some cases)
posted by delmoi at 1:15 PM on March 4, 2009


My business proposal is to locate people abusing terms such as "open source" or "begging the question", punish them for their evil ways, post video on the internet and charge for access.

Also, scotch and soda.
posted by ghost of a past number at 1:17 PM on March 4, 2009


Indeed, stuffed chicken wings, naked pizza and subscriber-based games are totally what we need to get out of this banking mess!

Now all we need is Mark Cuban to fund open source beer, as in free beer, not as in free speech, i.e. as in, "Shut up Mark and get us some beer. And not that cheap shit, either."
posted by Blazecock Pileon at 1:23 PM on March 4, 2009


Look at me! Look at me! I'm Mark Cuban! Look at me!
posted by up in the old hotel at 2:03 PM on March 4, 2009


Back in the mid to late 90's the definition was as I have stated. The term has apparently since been appropriated by the Open Source Initiative, and that is fine.

Obligatory kids get off my lawn.
posted by jester69 at 2:41 PM on March 4, 2009


Here is where I stopped, because I started laughing:

3. It MUST BE CASH FLOW BREAK EVEN within 60 days
4. It must be profitable within 90 days.

In other words, you want to move cocaine.

LOL.

Sheesh.
posted by Xoebe at 2:47 PM on March 4, 2009


Cuban's also giving his team 60 days to come up with a business plan.
posted by lukemeister at 2:59 PM on March 4, 2009


Now, lets see if he can solve the credit crisis in 60 days.
posted by pakoothefakoo at 3:06 PM on March 4, 2009


Hey, when you're Mark Cuban, you can loan money to people who don't need it. Hell of a business to be in. Essentially the business owners are paying Cuban interest and/or equity for him to promote their product. Cuban's just painting it as an "investment".
posted by GuyZero at 3:12 PM on March 4, 2009


Cuban's just painting it as an "investment".

Or rather, he's investing in a business that will likely work anyway, and he juices it up with lots of built-in promotion ("It's Mark Cuban-approved!"), so now it works like gangbusters.
posted by Cool Papa Bell at 3:47 PM on March 4, 2009


I've heard that one of the problems that VCs are having now is that they have too much money and not enough opportunities.

Word in my neighborhood (SF Bay Area) is that VCs have plenty of opportunities, but are unwilling to risk taking them now, and that's why the have so much money. They want to invest in companies that are already breakeven, which seems far from the notion of venture capital.
posted by zippy at 4:05 PM on March 4, 2009


From the article: "It MUST BE CASH FLOW BREAK EVEN within 60 days". See above.
posted by zippy at 4:06 PM on March 4, 2009


My plan is to buy the Chicago Cubs.
posted by Stylus Happenstance at 5:03 PM on March 4, 2009


Yeah, the cash-flow break even in 60 days is the real deal killer for anything but an already established business. He says he wants it to be a flat organization, with no managers, where everyone works. He also says it cannot be an advertising modality business or a restaurant.

So, let's consider manufacturing for a minute. Manufacturing is a fairly flat organization until it grows above about 30 people. From an economic standpoint, it requires real estate for facilities, it requires employing people, it requires purchasing materials, it puts the transportation industry to work moving raw materials to the facility and finished product out of the facility.

It also requires a purchasing audience, but let's put that aside for a moment, and assume that suddenly, despite falling sales in every single marketplace, you can come up with a killer product that becomes the next Cabbage Patch kid or whatever, and people are fighting in the store aisles to get to your product.


There's no way to ramp up a manufacturing firm to a break-even point in 60 days...speaking as someone who just shut a manufacturing company down.


It takes a lot...and I mean a lot of capital to get a facility that meets federal regulations (in my industry), and contracts can take a couple of months to get negotiated.

Once the facilities are in order, materials have to be ordered. Some materials could be on the ground and ready to work with in a week or two, but most require at least 3 weeks to move by freight.

So...let's be optimistic and say you could have facilities and materials and even manufacturing workers in a month. I think that's blindly optimistic, but let's just go with it. That's half of the "allowed" break even time.

Then, you have to ramp up manufacturing, and make the product, design the packaging, package the product, find buyers, ship the product and somehow get to a point where you've paid for your space, materials and personnel in 30 days?

Yeah.

Don't get me wrong, I adore Mark. He's the most eccentric and fun boss I've ever had, but this idea isn't a "stimulus package" in any way shape or form. It's not an "open source" venture capital experiment.

It's a way for him to gamble on some already existing businesses and try to offset the (probably) insane capital losses that are showing in his portfolio, so he can turn them into a tax event. Were I his accountant, I would be cackling with glee at this idea. It's sheer genius from a tax standpoint.

If I were incubating a business idea (and I am), and I were working on a business plan (and I am), I wouldn't put the idea out there in shared IP territory. I would take my plan, and my deck, and make a presentation to various VC. If it's a good idea, it'll get funding under much better terms than what is being offered here. No VC expects a 2 month turn around. That's ridiculous. I know for a fact that AudioNet, which became Broadcast, which Yahoo subsequently purchased and destroyed, ran red for a whole hell of a lot longer than 2 months.
posted by dejah420 at 10:20 PM on March 4, 2009 [1 favorite]


Please note that the Open Source Movement, Initiative, or Community, whether Software or Funding or whatnot, did not originate the term "open source", nor did the term originate with "source code". It was used primarily as an intelligence term during the Cold War that referred to information gathered from published documents, rather than those obtained illicitly.

Cuban's usage seems quite in line with this longstanding definition.
posted by dhartung at 8:07 AM on March 5, 2009


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