The Voice of Experience

In 1951, Lillian Vernon started her mail-order business from her kitchen table with $2,000 that she had received for her wedding. Today, Lillian Vernon Corp. is a $240 million specialty catalog and online retailer. Her autobiography, An Eye For Winners, was published by HarperCollins in 1996.

Frank S. Greene

Founding partner
New Vista Capital
Palo Alto, California

My advice to young entrepreneurs? Don't be so quick to run out and start a business. Young people today think they'll miss their big chance if they don't get involved in a startup immediately. But what many people don't recognize is that the basic skills of building a company are the same today as they were 20 years ago: Know how to create customers, deliver on your promises, and keep your costs lower than your revenue. The problem is that many people are simply too inexperienced to start their own business. We see a lot of technologists with a bit of project experience who suddenly want to start a company. But their lack of knowledge about management, profit and loss, and building an organization -- the kinds of things ultimately needed to grow a company -- makes them a poor investment.

Don't get me wrong. We invest in companies knowing that there's a lot of learning that needs to occur. But we look for people who are smart enough to realize that they don't have all the answers.

Ultimately, downturns in the economy reinforce the fact that good companies survive, and flaky companies get weeded out. At the end of the day, if your company can show that it can create value for investors, people will put their money into your business -- no matter what ups and downs the economy brings.

Frank S. Greene has worked in private venture capital since 1986 and was founding CEO of two information technology companies, Technology Development Corp. and ZeroOne Systems, from 1971 to 1989. Previously, he developed high-speed semiconductor computer-memory systems at Fairchild Semiconductor R&D Labs. In addition, he served as assistant chair of Stanford University's electrical engineering department. Started in 1993 as a fund to assist minority entrepreneurs, New Vista Capital assists startup companies in business planning and in raising capital.