Seven and a half years ago, in August of 2001, the economy was still struggling with the fallout of the dot.com bubble bursting.  I had been running a successful consulting business, lots of clients, as much business as I could deliver on time, and it was crashing and burning around me.  All my clients were cutting back on expenses and eliminating consultants left and right.

As I watched my last two contracts wind down, I got a call from a stranger, asking if I would be interested in a business opportunity.  Thinking this was an opportunity to meet a new potential client, I set up a meeting to discuss it.

When the meeting happened,  I learned that I was being pitched to become a founder of a VC-funded startup.  I was quite surprised.  We discussed the concept for the company and what I could contribute to its success.  At the end of the first meeting, I left to think about this giant step into the unknown and the risk it would entail.

Within a week, I had signed on as a founder of Airespace (well, Black Storm Networks at that time).  Here is what I considered then, and what I would consider today if the opportunity came around again.

The first thing I considered was whether my experience and expertise would be enough to deliver on the technical aspects of the product we envisioned.  If we couldn’t deliver the product, everything else was irrelevant.  My part in the company was to make the 802.11 (Wi-Fi) part of the product work, and, oh yeah, be unique and innovative.  Be brutally honest with yourself.  If you wouldn’t hire someone with your own resume to do the job you need to do, you probably aren’t up to it.  I was very confident that I could deliver my part of this project.

The second thing I did was to get advice from a number of friends and colleagues, a couple of whom were now VCs.  That advice was to be sure the company was solving a problem that our potential customers were facing every day.  There are untold numbers of startups built around a neat idea or cool product that have never become successful.  Success is measured by revenue, profit, and loss.  The chances for success are much higher when the company solves a widespread problem economically and smartly.  As my VC friends put it, “it’s easier to sell an aspirin than a vitamin.”

The third thing I considered was the state of the economy and how that would interact with the introduction of our new product.  This took a lot of thought and quite a bit of faith.  At the time I was considering this decision, the dot.com bust was in its second year, information technology purchasing was very slow, and purchasing budgets for the next year were predicted to be flat to only slightly up.  I anticipated that it would take 12 months or so to bring our product to market and another couple months to close our funding.  All the research I had been able to do indicated that, after 2-3 years of slow purchasing, the IT budgets would be increasing at about the same time we would introduce our product.

The final thing I considered, and perhaps the most important, was the people, the other founders.  This is where trusting your gut is paramount.  If this doesn’t feel absolutely right, the startup might still be successful.  But, the experience will not be one that you remember fondly.  You will be making some of the most important decisions of your career with your co-founders.  Make sure these are people you trust.

So, is now the time for a startup?

For the right product, solving a real problem, in particular a product that saves your customers money, with a great founding team… Yes, now is a great time to begin a startup.

Of course, if you happen to get a fortune cookie with “Now is the time to try something new” in it the day before you make your decision, pay attention.

I have the good fortune to have met up with three brilliant colleagues in 2001 to start a wireless LAN system company, Airespace. We built the company from a pretty rocky start to about 200 wonderful people and nearly $100M in annual sales. It was some of the hardest work and most fun I have ever had.  Cisco came around in 2005 and paid us (and our investors) very well for the company, folding it into their Wireless Networks Business Unit where the Airespace products quickly expanded to account for more than 65% of the sales for the business unit.

I stayed at Cisco for nearly three years after the acquisition, leading some work in standards development (802.11/Wi-Fi and IETF), continuing the work with our WLAN system, and working to develop new products in the WLAN space.  When friends asked how I liked it at Cisco, I told them it was a lot like trying to teach an elephant to dance.  I finally decided that being at a large company was not the thing for me, at least not in the long term.  While the elephant got the waltz and the nightclub two step, it was never going to do the samba, cha-cha, or salsa.  It was just not an up tempo kind of place.

Before Airespace I spent five years as a successful consultant, helping companies to develop standards and understand the strategy involved with standardization.  Standards are a very important part of success in technology.  That’s a topic for a different blog, though.

Before that, I spent 12 and a half years at AMD, where I got introduced to wireless LANs and 802.11 and managed the product planning and applications group in the High Speed Networks Division.  Unfortunately, AMD was a place where there was a tremendous amount of talent and very little management foresight.  Essentially, if it wasn’t attached to making the processor beat Intel that quarter, it wasn’t important.

Back in the mists of prehistory I was also a jazz musician and cut a record (yeah, the vinyl kind), I worked in the aerospace industry as a defense contractor designing the precursor to the USB thumb drive, got an engineering degree, told a professor I didn’t need an MSEE bad enough to let him get away with changing my thesis topic after he had my first draft in his hands, and saw much of a top secret project I worked on described in Tom Clancy’s “Hunt For Red October”.

So, that’s me.  If you choose to leave a comment below, I hope you will introduce yourself, as well.

Update (Nov 2010): Agito Networks was acquired ShoreTel, Inc. in October 2010 for approximately $11M.  I am no longer advising them.