The opening ceremony is tonight. The London Olympics are upon us.

So I thought it would be fun to talk about everyone's favorite Summer Olympic sport.

For me, it's men's boxing. I really enjoy amateur boxing at the highest level. The athleticism of boxers always impresses me and there's a primal thing to the sport. So when men's boxing is on the next two weeks, I will do my best to tune in.

What is your favorites Summer Olympics sport?

I have written about this topic before but it's important and I want to say it again.

Investing in startups is risky. If you make just one investment, you are likely going to lose everything. If you make two, you are still likely to lose money. If you make five, you might get all your money back across all five investments. If you make ten, you might start making money on the aggregate set of investments.

The math behind this is pretty simple. If you assume that the average startup has a 33% chance of making money for the investors, a 33% chance of returning capital, and a 33% chance of losing everything and that only 10% will make a big return (>10x), then you can model this out.

All the profit in that ten investment portfolio comes from the big winner. If you don't make that investment, you would have made nine investments for a total of $450,000 and you would have gotten back $450,000. You would have been better keeping the money in the bank.

So you need to make enough investments to be confident that you will get at least one big winner. And so that means making enough bets.

There's another important aspect of this. You should invest roughly the same amount in every investment. Don't try to pick the winners at the time of investment by putting more in the ones that are "sure things" and less in the ones you are less sure about. The only sure thing about startup investing is that there are no "sure things."

Let's look at the same portfolio with a set of random initial investment amounts.

You can see that even with the same set of outcomes for each investment, the amount invested in each one has a big impact on the total return of the portfolio. It really all comes down to how much you have invested in your big winner. And since I do not believe you can predict which one will be your big winner, my view is you want to be as consistent as possible with your investment amounts.

When you are an investor, there are days when some of your investments are doing great and some are doing badly. If you are broadly diversified, those days are easier to take. If you are all in on one investment, then those days are brutal. Entrepreneurs go all in and are rewarded accordingly when they hit it. Investors should not go all in. They should be diversified.

I did an interview yesterday in Buffalo, NY where I was the past couple days for the launch of the Z80 incubator. Grove Potter, the Business Editor for the Buffalo News, interviewed me for something like an hour. It was a fun talk.

At one point he asked me about the issue of entrepreneurs giving up control of their companies to VCs. It's an interesting issue and one that I think is not well understood.

In theory, control of a company rests with the ownership split between the founder and the investors and how the Board of the Company is set up. If the founder/entrepreneur owns more than 50% of the company and controls more than half of the board seats, then he or she has "control" of the Company.

But in reality I have found things are very different than that. And it all comes down to two things:

1) How well the Company is performing

2) Whether the Company needs more investment capital and where it is coming from

I like to think about it this way.

An entrepreneur or hired CEO can own as little as 5-10% of a Company but they can control it like a dictator if they are doing a great job running the business and the company is making a lot of cash flow and has no need for additional capital.

An entrepreneur can control 95% of a company and all the seats on the board but they can easily lose control of the business if they company is floundering and they need more money and the only investors who would consider putting up money are the existing investors.

This extends to the idea of who sells companies. My friend Dave Winer put up an interesting discussion thread a few days ago talking about the sustainability of social media platforms. It is an interesting discussion and one very much worth having. In the post that kicks off the thread, Dave suggests that VCs are behind the decisions to sell/exit companies.

I left a comment on that thread and at the end of my comment I made this point:

I would be remiss if i did not take a minute to point out that you are missing the person who is the most important part of this discussion and that is the founder. In big successful companies, the founder, founders, and the teams they hire to help them run their businesses, are really the ones in control. The VCs are often "along for the ride".

VCs have control when things don't work. Entrepreneurs have control when they do.

That last line sums up my point of view on control and that is why I used it to headline this post. If you want to maintain control of your company, focus on running it well or find a team to run it well, and make sure you have plenty of cash to operate your business and that you never find yourself in a position where you are running out of cash and have nowhere to go but your exisiting investors. Do those two things well and you will be in control for as long as you want to be in control.

As the world moves from web to mobile (our theme this summer), the idea of one click to do something becomes more powerful.

Did you know you can apply for a job with one click?

There are two services that make such a thing possible, LinkedIn Apply and Indeed Apply. In the spirit of full disclosure, Indeed is a USV portfolio company.

If you have your resume on LinkedIn or Indeed and you come across a job posting where the service has implemented the LinkedIn Apply and Indeed Apply buttons (think tweet and like buttons), then you can apply for the job with one click.

It turns out this is pretty popular. ZipRecruiter, a site that lets you easily post your job broadly across the web, put Linked and Indeed Apply buttons on their service and saw an almost 22% increase in job applications as a result. It makes sense, people will do more of something they can do easily.

So what does this mean for the job seeker? It means you should get your resume on LinkedIn and Indeed. What does it mean for the employer? It means you should put these one-click apply buttons on your job postings.

Some other interesting things came out of that ZipRecruiter blog post:

1) they get 3x the one click applications from Indeed vs LinkedIn

2) Indeed's resume database is growing at over 1mm resumes a month

3) Indeed is better for most job types other than management and executive

The world of recruiting has changed a lot in the past ten years and companies like LinkedIn and Indeed are driving much of that change. One click job applications is yet another example of this.

Angela is SVP of People and Client Success at Return Path. She joined Return Path over five years ago to focus on the People job and she has added responsibilities since then. I asked Angela to write one of the guest posts in this series on People because she and Matt Blumberg have built one of the most impressive cultures I have seen and I asked her to tell us how they did it.

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Just Say No

When Fred asked me to guest blog, I asked if there was a particular topic he wanted me to focus on. Fred replied “write about the single biggest move you and Matt made at Return Path to impact culture, teamwork, and development throughout the organization.”

For me, the biggest shift that we made was when we decided to stop trying to be like every other company and to instead actively resist changes that would not make sense for us. We started saying no, regularly and forcefully, to policies, systems and procedures that many companies adopt as they grow.  

Return Path was on a path to becoming a standard, if better-than-average company, with fun perks and all the systems and programs that you’re supposed to implement as you grow. However, that also meant that there was a demand for more policies and rules, it was getting harder to make decisions and people were often frustrated with the pace at which things got done. Collaboration was sometimes confused with consensus and creativity was getting stifled. There was a better way forward where people make good decisions without a phone book of instructions.

The day we committed to no, we were at an executive team offsite and trying to figure out how to implement some changes that would give more power to individuals to get stuff done. We kept getting caught up in the inevitable “What if someone screws up or makes a bad decision?” discussion. But then we stopped because we realized that we’d spent enough time on problems and exceptions. What if we turned the entire conversation around and focused on managing to the top? What if everything we do is focused on our top performers, the people we trust, the people who make great decisions, the people who can think critically and creatively and as a result can handle a bit of ambiguity? We set out to say no in four key areas.

Just Say No to Useless Brilliance

We’ve all worked with that brilliant person that the organization thinks it cannot live without. Unfortunately, that brilliant person can’t communicate or work on a team. So, most organizations put them in a box in an attempt to minimize the damage they inflict on the organization. But it never works because the boxes pile up and so do the silos.  And no matter how well constructed the box is, that brilliant person can simultaneously demotivate 20 co-workers AND usually doesn’t contribute much in the silo. It’s not worth it. We don’t tolerate brilliant assholes.

Just Say No to Policy Paralysis

Policies and rules are created to guard against people doing stupid things to control time and resources. Examples: paid time off, sick time, expenses, work hours, comp, social media, dress code, discipline and — my favorite — “the code of ethics.” The reality is, with clear direction 99% of our people make great decisions every day. The couple of misses we’ve had have been quickly resolved after a clarifying conversation. Instead of locking things down, we set them free. We’ve said no to creating a policy for every situation we might encounter.  Instead, we have unlimited vacation and sick time.  We have a common sense expense reimbursement philosophy (“spend the money as if it was your own”).   

Just Say No to Values Dilution

This is the toughest category and the one that requires the most courage. Saying no to things that conflict with your organization’s values is essential to ensuring your culture is alive and thriving. Not paying attention will quickly lead to meaningless values posted on the wall. For example, we value transparency which means we share the good, the bad and the ugly openly (and often). Our commitment to transparency was dramatically tested when we decided to spin off part of the business and needed to decide if we should alert staff ahead of a formal sale. We did what most companies wouldn’t – we told the staff. It was such a unique approach that we got written up in Inc. magazine (see article).  Our value – up there, on the wall – is that we say no to secrecy and withholding.  If we hadn’t told the staff about the transition we would not have been living that value. And everyone would have known it.

Just Say No to Executive Dysfunction  

We’ve all seen the all-important and all-knowing executive team. The team that has all the answers and yet isn’t able to execute. I’ve seen too many executive teams where personal relationships and politics are the real business drivers behind-the-scenes. Business is done over cocktails, after hours and not in broad daylight. Personal agendas trump team goals. People smile and nod politely in meetings, then leave the meeting and corner the CEO to say what they “really think.” At Return Path, we are fiercely committed to the health of the executive team.  We check in with each other on our individual and team development and are rigorous about giving each other feedback and holding each other accountable.  We work with a team coach (Marc Maltz) to work through the 5 Dysfunctions of a Team and develop our ability to be Multipliers within the organization. We are brutally honest with each other and exhaustive about looking in the mirror. We say no to executive dysfunction, personal agendas and being too busy to live our values. And it is the best team I’ve ever worked with.  

A new world of work is being born around us. Most traditional HR practices are ineffective and irrelevant. The courage to say no to the status quo has given us the freedom to blaze a new path of freedom, flexibility and creativity.  And it’s a competitive advantage for us. Our turnover is lower than nearly any other company – in our industry or any other industry. Most of our new employees come in as referrals from existing employees. And our application to hire percentage is about 1.5% — meaning Return Path is harder to get into than Princeton.

My advice to you is to set your people free to focus on important, high impact work and solve challenging business problems. That’s how companies will win now.

There are all sorts of wellness apps for mobile. Some record how much you workout. Some record how much you eat. And so on and so forth. In the aggregate, I think wellness is a great category for mobile. Your phone is a watchdog and a reminder and recommender. I think wellness apps can and will make a difference in living healthier lives.

But there aren't many wellness apps that are focused on the impact of mobile phones on our health. There are a number of things that mobile phones bring into the equation that may not be good for us. Listening to loud music on our headphones may be harmful to our hearing. Texting while driving, biking, or walking may be harmful to us and others. And then there's the issue of the radiation that mobile phones produce.

This last issue is where Tawkon has been focused. Tawkon is a bunch of smart Israeli scientists and engineers who have built algorithms that run on a mobile phone and predict the amount of radiation your phone is emitting in real time (and over time). They've been around for a few years and they have correlated their algorithms with real laboratory testing to insure that their predictions are accurate.

I met with the founder, Gil Friedlander, last week and during our meeting I downloaded Tawkon to my Android phone. I've been using it since. Most of the time it just runs in the background and I forget it is there. But every once in a while, it wakes up and alerts me to take the phone away from my head, put it on speaker, or put on a headset.

On friday afternoon, I was in my apartment where I get poor reception, and I was doing a few conference calls. In each case, Tawkon alerted me to the fact that I should not do the call without a headset and I took  the advice.

Tawkon also aggregates my radiation exposure and phone activity over time and keeps a record of it. This is what last week looked like for me:

You can also track family members so you can be a nagging spouse or parent. I suggested that the Gotham Gal download Tawkon for that exact reason.

Unfortunately Tawkon is not available on iOS. Take what you want from that fact. So I can't get my kids on Tawkon as much as I'd like to. I really can't understand why Apple would not approve a wellness app like this but iOS is Apple's world and they can decide who gets to play in it and who doesn't.

As with any app that runs in the background, I've been concerned about its impact on battery life. I look at what apps are using battery regularly and have not seen Tawkon on that list and I also have not noticed any difference in battery life since I have installed Tawkon. Of course, I've only been using it for a week so I can't say with 100% confidence that this is not an issue.

Here's a picture of me in the meeting with Gil practicing good cell phone hygiene. I have one of those handsets in my office and my home. I use them all the time.

Tawkon is available on Android and most Blackberry phones. You can also put it on jailbroken iPhones. Give it a try and let me know what you think. 

I have been working with a high end audio video installer for over a decade. They have helped me put entertainment systems into a few homes and offices over the years. They have taught me a lot and I have taught them some stuff too.

A few years ago, when iPad came out, they started pushing the idea that you could use a tablet to control your entertainment system instead of expensive and proprietary controllers. So we started using iPads and iPod Touches to control our audio and video in our home and office.

It works well and you don't have four remotes on every coffee and conference table. One tablet does the trick.

Recently, we did an overhaul of our beach house and it was time to get a couple controllers. I had just gotten my Nexus 7 and the idea that I was going to go out and purchase a couple $399 iPads bugged me. I asked them if I could use a Nexus 7 instead. We did some research and indeed all the apps we needed for our various equipment were on Android. So we went with the Nexus 7 instead.

Yesterday I saw one of the partners in the audio/video company and he had my Nexus 7 in his hand. I said, "how does it feel?" he replied "it's fantastic, the form factor is perfect". The iPad works as a controller but it is a bit bulky for that use case. And a phone is a bit small for many remotes. A 7" tablet can be held comfortably in one hand and the screen size is really perfect for remote applications.

I am not going to swap out all the iPads we have for Nexus 7s because the larger tablet works well enough, but for all future situations like this I am most certainly going with a 7" tablet. It's yet another example of where the 7" form factor is better than the large and small mobile form factors we've been dealing with for the past few years.

My all-time favorite feature on Android is the way sharing works. I like this feature so much I am concerned that this might be a repeat of a prior Feature Friday post. But I searched on gawk.it and did not find any posts so maybe I haven't done a Feature Friday on this. Hard to believe.

When you are looking at content in Android, a web page, a blog post, a picture, a video, a venue in foursquare, a tweet, etc, etc, you simply hit the share button and all the apps that are installed on the phone that can take an object like that show up.

This is what the screen looks like on my phone when I share out an AVC post:

This is not the entire list of apps that are available to share the blog post with, this is just the first set of apps. You can scroll down to see more but I could not capture that with a screen shot.

This sharing feature is available to any app that is built for Android. Foursquare has implemented it for its venue pages with a "send to a friend" call to action. (this screen shot is from the USV venue page):

This ability to share data between apps is super useful. I would like to see Google and Android developers do even more with this. Think about the way bookmarklets work on the web. If web bookmarklet functionality (like the Tumblr share bookmarklet for example) could be replicated on mobile devices, that would be a huge step forward for mobile.

In any case, this is probably the number one reason I use an Android phone and if you haven't experienced the joy that this feature provides, I suggest you get your hands on an Android phone and check it out.

Last night the Gotham Gal and I went to one of our favorite local spots, sat at the bar, had a glass of wine and a nicely cooked mediterranean seabass. As we sat down, I checked in on foursquare and was alerted that there was a special. Spend $10 or more and get $5 off. So I clicked on the special, loaded it to my card with one click, and when we paid our bill, we got the $5 discount on our credit card bill.

It was simple.

Mobile commerce is simple. Because you have your payment credentials stored in the web service (in this case foursquare). But the same thing could have happened with a direct checkout in the Etsy mobile app. Or in the eBay mobile app.

According to this post on AllThingsD, both eBay and PayPal will transact over $10bn this year on mobile devices. That's a 100% increase over last year.

I've been talking a lot about mobile here at AVC lately. That's because I am seeing the same kinds of things in our portfolio companies that eBay is seeing. Mobile is exploding. And that doesn't just mean mobile browsing, mobile gaming, mobile social networking. It also means mobile commerce.

If you are a transaction driven company, a marketplace, a retailer, or some other transaction oriented business, you had better be investing big time in mobile. Because if you aren't, your competitors surely will be.