Frontier Journal (FJ): How did Garage manage to avoid The 10 Lies of Entrepreneurs when it pitched up to VCs and angels for funding in early days?

Guy Kawasaki (GK): Who said that we did. We were relatively early in the dotcom days, so at least the lies were relatively fresh back then.

FJ: What prompted Garage to decide to fund both Kaboodle and Simply Hired, which goes quite well as of today?

GK: In both cases we liked the idea of "social shopping" and "vertical search," respectively because we could see their broad applicability. I used Kaboodle to keep track of several projects, and many people that I know have used SimplyHired. Both were cases of easy-to-believe examples that the dogs will eat the food.

FJ: You worked for Apple twice as a significant contributor to the success of Mac. As an insider, could you let us know why Apple succeeded in 1980s, failed in 1990s, and now thrive again in 2000s?

GK: Apple is a product-driven company that focuses on engineering. When it produces things that people like, it does well. When it doesn't, it doesn't.

FJ: Garage in, Garage out. From HP to Apple, from yahoo! to google, and now Youtube among other Web 2.0 stars, all started at garages, all at Silicon Valley, all from engineering backgrounds. Are there a startup pattern there, from the Art of Startup's perspective? Why made they so wildly successful?

GK: There is a pattern: Unproven entrepreneurs with unproven technology and unproven business models who are building something that they'd like to use. Ironically, most venture capitalists are looking for proven entrepreneurs with proven technology and proven business models.

FJ: With the widespread of open source software movement as well as the rapid drop of hardware costs, starting up startups in software related sector has becoming never so easy anytime in history. What is the impact to venture capital industry?

GK: Entrepreneurs can certainly get to market faster and cheaper than ever. This means that they are less dependent on venture capital. If nothing else, it means that venture capitalists will be investing in companies that are in the market, not just drawn on the back of napkins.

FJ: When you evaluate a deal, how do you distinguish between practical startups and impractical startups? How do you distinguish between practical people and impractical people?

GK: The honest answer is, "With hindsight." It's very hard to do this at the decision point. My theory is that you declare victory with successes and blame your partners for failures.

FJ: When was the most difficult time for Garage so far? How did Garage make strategic shifts those days?

GK: We were definitely smacked around by the dotcom implosion. Those were difficult times. We switched from the boutique investment banking model to early-stage investing during that timeframe.

FJ: Your most recent book titled The Art of Start, is strictly for entrepreneurs, what is the Art of Exit? Do you have plan to write a new book on that?

GK: Nope, no plans to write about that topic. I haven't had enough experience with the subject!

FJ: Through out your career so far, you have interviewed quite a few visionary leaders in industry. What are the rule of thumbs in raising questions during those interviews?

GK: You've got to do your research before the interview. Just reading their bio, the About page for their company, and doing a quick Google scan is sufficient. But you'd be amazed at how few interviewers do this.

FJ: What is your advice for those who are running their funded startups? And what is your advice for those who are running their bootstrapping startups?

GK: The most important piece of advice that I can give either type of startup is, "Sales fixes everything." That is, revenue is everything--not partnerships, not scaling, not strategies. You either make your numbers or you don't.

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