Nathan Lustig

The Whiteboard Desk

Category : Entrepreneurship
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When people come to our office for the first time, they almost always comment on our desks and tables.    Ever since we moved in two years ago, we covered all of the available surfaces in white boards.  I love being able to sit at our big table and just write things down on the table as I think of them.  It’s great for taking notes on phone calls and writing todo lists.  It’s certainly helped increase my productivity and it was super cheap to set up.

We went to home depot and bought two 8×4 foot tile boards for a total of $20.  We had the guys at Home Depot cut our boards into our desks’ dimensions and taped them down with double sided tape.  It was a cheap investment that’s been a unique addition to our office.  Check out some pictures:

Do you have anything unique in your office that helps you work better or more efficiently?

Happy Two Year Anniversary Capital Entrepreneurs

Category : Entrepreneurship
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It’s been two years since I started Capital Entrepreneurs, an organization to help Madison entrepreneurs connect. I’ve been blown away by how fast CE has grown and how quickly time has gone by.  On our two year anniversary, here’s the story of how we got to where we are today.

In April 2009, I was a month short of gruduating from UW.  I had just started my second company, Entrustet, with my business partner Jesse Davis.  Many of our friends were taking jobs outside of Madison and the two of us were going to be staying in Madison to startup Entrustet.  We both had been a part of the UW entrepreneur scene and had received support from other students, professors and the university itself, but since we were graduating, we were worried that we would not be able to take advantage of the support system any more.

I realized that most people make new friends after college via their job, but since Jesse and I were the only people in our company, I worried that we’d get isolated.  I knew that there were other founders in town who were graduating who likely felt the same and wanted to do something make us more like coworkers, even though we were all working on separate businesses.

I’d been to most of the startup focused meetups and events around town and thought that there was a niche for a group that was specifically for founders that could compliment the existing networking events like High Tech Happy Hour and Madison Magnet.  I wanted to create a place where founders could get to know each other, hang out and talk freely about their problems, dreams and goals, without having to worry about getting pitched by attorneys, insurance agents, accounts or the press.  I wanted a place where ideas flowed freely and entrepreneurs would feel comfortable both asking for help.  I wanted it to be free and without structure.  I wanted Madison’s entrepreneurs to be a community of friends, not a disparate group of people who just happened to start companies.

At the end of April, I talked to a few of my entrepreneur friends and asked them what they thought.  Everyone loved the idea, so I started to look for a venue that would give us a private space for free, along with some other enticement to get our business.  Our friends at Brocach gave us a space in their upstairs bar, along with a nice food special and we set our first meeting.  I invited all of my friends who met two simple rules.  They were:

  1. The founder or first employee of a Madison business
  2. Were not a service provider like an attorney, accountant, insurance agent

Our first meeting was right before graudation in May 2009.  Around 10 founders showed up.  We introduced ourselves, had beers and talked.  It was great.  We decided to do a second meeting that next month.  I quickly realized that Madison entrepreneurs were doing some amazing things, but that the rest of the community had no idea.  So I started a website.  It’s a simple blog that gets updates whenever a CE company gets press, sends out a press release or the city itself makes news.  It also includes a list of member companies, resources for Madison’s startups, along with info on how to join.

Since May 2009, CE has grown slowly, but surely each month.  The second meeting had 12 founders, the 4th 17.  It just kept growing.  One year later, CE had 34 member companies and 60 registered members.  As we grew, service providers wanted to attend to meet the entrepreneurs.  We decided service providers could sponsor CE and attend ONE meeting per year.  At that meeting, they are not allowed to sell their services, just answer questions and get to know the entrepreneurs.  They also have to pay for our bar tab.

We were lucky enough that Neider and Boucher, Michael Best, Boardman Law Firm, Marquette Golden Angels and Venture Investors agreed to be our first sponsors.  Sponsorship worked out great for CE and the sponsors.  It was a great way for entrepreneurs to get to know service providers and for the service providers to get to know us.  It was also a great way to attract new, high growth clients.

CE continued to grow, but I was a little worried when Jesse and I got selected for the Startup Chile program.  Forrest Woolworth stepped up and ran CE while I was gone and did an amazing job.  Over the last year and especially in the last six months, CE has started to take off.  We now have over 75 member companies and 120 people on the email list.  We’ve been featured in Techcrunch, Read Write Web, Madison Magazine and tons of other publications.

Member companies have been featured in the NY Times, The Economist, Financial Times, Wall Street Journal, Techcrunch, Mashabale, Forbes, BBC and hundreds of other influential blogs, newspapers and magazines.  CE companies have created over 300 full and part time jobs during one of the worst economies in recent history.  We’ve raise over $15m in funding.  Spinback, founded by CE alumni Andrew Ferenci and Corey Capasso, was acquired.  Spill, founded by CE alum Heidi Allstop was selected for Techstars.  My company, Entrustet, was selected for Startup Chile.  CE members have been instrumental in helping start the Forward Technology Conference, Build Madison and other entrepreneurship initiatives in Madison.

Madison’s startup scene has grown significantly in the past few years and I’m excited and proud that CE has been a part of it.  I can’t wait to see what the Madison startup scene looks like in another year!  I’d like to thank everyone who’s helped make Capital Entrepreneurs what it is today.  It would never have been a success without all of your help!

Wow! Food is Expensive!

Category : Political Science & Economics
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I just made my first trip to the supermarket after coming back to the states today.  It was amazing to see how much more expensive food is than when I left.  I had read that food prices had gone up, but I hadn’t realized how bad it was.  I bought three bags of groceries and it cost $68.  The same three bags would have cost about $55 when I left.  The most jarring examples were meat, boxed cereal and dairy products.

Chicken breasts are now up to $7 per pound, up from $4.50.  Beef stew meat is $3.99, up from $2.50.  A box of frosted mini wheats $4.75, up from $4.  Premium deli roast beef $10.50, on sale, up from $8.50 when I left.  It’s crazy.  My favorite sandwich shop raised prices from $5 to $5.50 and my favorite bagel store raised prices by $1.

So why are prices so much higher?  It’s a confluence of government policy, a falling dollar, rising commodity prices, mandates for corn based ethanol and crop failures around the world.  In the last six months, corn has nearly tripled in price.  Farmers feed corn to chickens, pigs and sometimes cows.  Add in higher fuel prices for transportation and you get much higher prices.  Pork has gone up 33%. Beef at least 12%. Chicken at least 10%. Wheat 25%.

The government claims that inflation is 1.8%, but since it does not include food and fuel, it’s a completely meaningless number.  When I left in November, the average price of a gallon of gas was $2.85.  Now it’s $3.96, a 39% increase.

Rising food and fuel prices disproportionately hurt the middle class, the poor and seniors on fixed income.  Food and fuel make up a larger portion of the monthly budget for those who are not wealthy.  Government policy is to blame.  Instead of letting banks and bondholders take losses, the Federal Reserve cut interest rates in an attempt to let the banks earn their way back to solvency.  Low rates hurt savers and retirees who put their money into CDs, money markets and savings accounts.

On the other hand, banks can borrow from the Fed for virtually nothing and led it back to the government at 3%, generating 100% risk free profits.  With “quantitative easing,” which is just another name for printing money, the value of the dollar is falling quickly.  Since commodities are priced in dollars, it takes more dollars to buy goods.

Government policy is to bail out the banks at the expense of the poor, those on a fixed income and the middle class.  It started under Bush and has accelerated under Obama.  I don’t understand why more people aren’t outraged.

I Can Feel the Tension in the Air

Category : Political Science & Economics
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I got back to the US on Sunday after living in Chile for the past six months and one of the first things I noticed was the tension in the air.  People seem on edge, ready to jump at the smallest things.  People are scared.  We’re living in an era of extreme change, taking place at an unprecedented pace.  Most Americans have not experienced hard times.  Yes, there have been recessions, but nothing that compares to the confluence of events that has caused our current predicament.  We’re in the biggest era of change since the industrial revolution.  The recession started almost three years ago, but the mood of the country seems to have soured noticeably in the past six months.

I can see it on Facebook and Twitter in the status updates of my friends and network.  I can see it in the moods of my friends without jobs or stuck in dead en jobs.  I can see it in the blogosphere, cable news, the looks on people’s faces walking around town and how people are treating each other.  I saw it in the airport security line in NYC as the TSA employees and passengers struggled to interact civally.  I saw it on my flight to Milwaukee when two women got in a fight over a reclining seat.  It’s especially evident in Wisconsin with the current administration and counter protesters.  The anger, tension and fear is there.

Beyond the recession, our political climate is toxic and people feel powerless to make their lives better.  It used to be that if you worked hard, got a good education, you’d get a good job and be able to support yourself and live well.  Both the left and the right are getting more extreme and the center is increasinly empty, silent or powerless.  The reasonable center is afraid to speak up, or believes they can’t do anything.  In order to be heard, the reasobable center is moving to the margins and becoming more extreme, or just checking out entirely.

Our politicians are not willing to do what is actually best for the country, they are simply trying to win political points and get reelected.  There are hundreds of policies that both sides could likely agree on, but will never get voted on because they do not win political points.  Both sides are cultivating the us vs. them narrative and becoming more extreme.  Reasonable political discussions are almost impossible.  You risk getting your head bitten off.

Democrats are playing the class card, but doing it poorly.  There’s a difference between a rich small business owner or entrepreneur and the finance guys who are just moving money around.  Republicans are attempting to cut social programs, while keeping taxes low for the rich and demonizing the people who are not finding success in this economy.  Many on the right are anti intellectual, under the guise of anti elitism.

Well intentioned guys like President Obama and Representative Paul Ryan have never had a private meeting, even though they are trying to fix the same problems.  Although they don’t agree, leaders should be talking.  But they don’t.  Both sides look for outlandish claims to punish new thinking.  President Obama equated Ryan’s plan with murdering old people and the Republicans have come with all sorts of nonsense to attack the President. Nothing will get done if we keep going down this path.

People have a feeling that the game is rigged, but they don’t think they can do anything about it.  Every week, there’s another scandal, but people dont seem to react.  People know they are getting fucked by the banks, their government, insurance companies and other lobbying groups, but they don’t have any idea how to fix the situation.  They feel powerless and this leads to tension, anger and the current mood of the country.

It was really jarring to come back to the US and feel the tension.  The reasonable center needs to start speaking up, challenging both sides and demanding compromise.  We need to stop dealing in half true soundbites and start actually talking.  We need to demand more from ourselves and our politicians.  We can’t keep going on this way.