daily articles for founders

Here are 10 quality posts from the Founder's Library:

Luck, talent, positioning  

Michael Wolfe wrote this inspiring article answering the debate of luck versus talent in startups.

Successful people usually point to talent...they tell stories of unbelievable execution, insight, and clever pivots from great entrepreneurs who they feel would have succeeded under any circumstances. Many of those founders go on to multiple successes.

Team Luck points to people they know who are wealthy and successful but just can't seem to get anything done. They must have stumbled onto the right idea at the right time, caught a wave, got someone to overpay for their company, and laughed all of the way to the bank. People say, "geez, if he could have done that, I could have."

In a debate like this you can either pick a side or split the difference with an "it depends." Instead of doing that, I'll propose a third option: I'll call it "positioning."

An actionable take-away from this is to figure out what actions put you in the way of luck, in places where your talents can be both enhanced and put to use, and do it more often. What can you do in the coming year to multiply your chances of success?

How to become an online influencer  

Being an online influencer is not usually the goal of startup founders, but it is something that can help. Influence is a distribution model, and if you have a working distribution model you can often build some kind of business or startup around this means of delivering value.

Here are some thoughts about becoming an online influencer, courtesy of David Spark:

  1. You must create content
  2. Go after a niche
  3. Create a regular series
  4. Request to interview other influencers
  5. Offer yourself up for interviews too
  6. Contribute, for free, to well-trafficked media outlets
  7. Go after your industry's "whale" publications (i.e. the biggest publishers in your niche)
  8. Connect your story with a current trend
  9. Connect your brand with a much bigger brand
  10. Engage with your audience

There's no reason you can't become an influencer as well as starting a startup. The two definitely play on each other. But you'll have to remember that consistency is key to being a successful content producer (whether a performing artist, a writer, a singer, etc), and that is often difficult to achieve with the hectic schedule of a startup.

Another interesting link around this topic, if you're inclined to read more, is Merlin Mann and John Gruber's panel on obsession + topic + voice (transcribed here).

How to email busy people  

As a founder, you will find yourself emailing busy people on a regular basis - investors, potential clients, actual clients, actual clients who haven't paid their invoices... and so on. Hopefully not too many of the latter.

Here are some good advice from Jason Freedman of FlightCaster on the etiquette of emailing the kind of ultra-busy person who literally gets a thousand personal, non-spam emails a day. In short:

  • Keep the subject line concrete and very descriptive.
  • Use your company email address.
  • Remind the receiver of the context.
  • Limit your mail to five sentences - or, ideally, three.
  • Make it clear and explicit what you're asking for.
  • Respond immediately if he answers.
  • Include a short, professional signature with the relevant details.
How VC firms are managed  

Here's a great article by Jo Tango, that starts off as a description of the way in which VCs are paid (which is relatively common knowledge), and proceeds to explain some interesting facts about the way VC firms are managed (which is not so common knowledge):

The existence of the management company has a few implications. First, the Chief Partner cannot be fired without his/her consent. Every other partner at a VC firm can be, including the ones who have worked hard to earn pieces of the management company. So, a partner at a venture firm is usually an employee-at-will. They can be fired at any time.


Now, a VC firm's culture varies from one to another. The Chief Partner may delegate authority so that all partners have a voice in an investment decision-or, he may allow input from others, but in reality, is the one making the decisions. Entrepreneurs need to know that when they pitch a firm. Who is the Chief Partner and do the other partners have power?

Read more here.

A system for following up after conferences  

Good follow-up discipline is an essential business skill. Relationships are crucial to almost every business out there, and if you don't follow up effectively, you miss out on a lot of potentially extremely helpful relationships.

We've covered the topic before, but it's good to get different points of view and approaches.

Alex Moore proposes a systematic approach to following up:

  1. Have a canned message for the conference.
  2. Sort the business cards you collected into VIP, Useful, Marginal, and Unhelpful.
  3. Follow up on the VIPs first, heavily customising the canned message to personalise it more and include something that you want to ask them. Set yourself a reminder to follow up again 4 days later.
  4. Go through the Useful cards, and do more or less the same thing, but without always asking for something explicit.
  5. If you have time, go through the Marginal cards.
  6. Throw out the Unhelpful cards. Decline invitations to have coffee (harsh, but helpful if you're very busy).
  7. After 4 days, follow up again on the VIPs who didn't get back to you.

Alex also proposes some tools, like Boomerang (Outlook-only) or CardMunch to help with these tasks.

Be specific in your requests  

Jason Freedman proposes an approach for people who are looking for job referrals:

Whenever you talk to someone about job search stuff/career advisory stuff, give them a very specific interest. For instance, tell me that you're interested in joining a seed-stage team focused on mobile payments. Or a post-Series A startup doing social discounts. Or a high-growth startup in advertising optimization. Whatever! Just make it very specific.

This is spot-on for job referrals, no doubt, but perhaps Jason is applying his own trick there in being so specific to that field.

Whenever asking someone for help, or for a sale, or for almost anything, being specific about what you want is almost always a great thing.

For example, when doing business development, you can approach it two ways:

  1. Approach lots of interesting people, have meetings/coffees/discussions with them, and let a cooperation emerge.
  2. Figure out what kind of business deal you want, draw up a list of people who might be able to help, then approach them with this plan in mind and let the goal drive the discussion.

Method 1 will certainly yield you more meetings - but guess which method will get you more deals?

Be specific: know what you want, and ask for it clearly.

Paid iPhone apps vs in-app purchases  

Tony Wright investigates the economics of paid apps vs in-app purchases, and finds that IAPs are where the money is.

So why are free apps outperforming paid apps? That deserves its own post. In brief, it comes down to ARPU (average revenue per user). Farmville-style games can pull in an ARPU $5 or more per month. In fact, there are reports of $13 ARPUs. Per month! Per user! Average!

How is this possible? Virtual goods elegantly fill up the demand curve for an offering. In other words, they accommodate customers who can happily spend hundreds or thousands of dollars ("Whales", in Vegas parlance) without having to give up mainstream users (who can still be valuable as evangelists beyond the fact that they give the whales someone to play with).

This shouldn't be a huge surprise. After all, there's a good reason why SaaS is such a popular business model: a low monthly price tends to generate more revenue than a higher up-front price (for most types of products). IAP's throw in the advantages of an app-store like model where people can keep buying more without entering their credit card details.

In conclusion: if you can make your app charge via IAPs (but that's not always possible or advisable), do so, because it will make a significant difference to your revenues. In particular, as Tony suggests, try to ensure that if a customer turns up who, for whatever reason, feels like blowing $500 on your app, give them a way to do so.

The Startup resume  

If you're applying to work at a startup, particularly if you're applying for a junior or internship position, you'd do well to read Justin Kan's article about what to put on your CV:

Overall, startups are looking for employees who are exceptional in the one key thing that they will be doing, whether it is scaling the backend system or doing the visual design. In your resume you need to 1) demonstrate that you are exceptional at the thing you do, and 2) not be disqualified by seeming crazy or imbalanced. A simple rule: if something on your resume isn't achieving one of the aforementioned two things, leave it off.

Having reviewed numerous CVs in the past, I can't agree more. Another point I'd add is that, if you're applying for a junior position and do not have significant work experience (summer jobs in fields that are completely orthogonal, e.g. retail, do not count), then make sure you mention those hobby projects which can actually give your CV some value. All too often, I see CVs where, for example, the applicant will mention that they are highly proficient in PHP or Ruby but there'll be no mention of what they actually did to become proficient. "I built an stargazing GPS-enabled app in my spare time" should definitely appear on your CV, no matter how rudimentary the app may be or whether it is "serious".

Large companies may not care about such "icebergs" of experience, but startups definitely will.

Using LinkedIn for Cold Calling  

Martin Grönberg from myGengo has some advice for those who still need to rely on cold calling for some of their marketing:

Use our company's extended network, and particularly LinkedIn, to an extreme. We flip the standard target prioritization process around: We make the people in our extended network (within 2 degrees of separation) the starting point and ask ourselves "how can myGengo help this person and company better do business". Then we go ahead and prioritize those contacts based on common business metrics (value potential, strategic fit, etc) and use the network that initially lead us to the target for reaching out.

Not much to add to this, other than to link to a post which appeared here earlier, by Iqbal Gandham, about Generating B2C and B2B links systematically.

Why your startup shouldn't hire a Marketer from Microsoft  

Most startups already understand this instinctively, and it has been drummed in by a fair few horror stories from the dot-com-boom era, but it bears repeating.

Large corporation skills often don't translate well to a startup situation, which requires more of an enterprising "let's try this and see if it works" approach and an ability to work decisively with very few resources.

The key points from the article:

  1. Large company executives are often over-specialised.
  2. They struggle with small/inexistant budgets.
  3. They don't know much about how to create early traction and develop a market from zero.
  4. They need other people to delegate to.
  5. They can be very good at selling ideas, internally, that are very bad for a startup.

Conversely, the author points out that he'd consider a big company hire if:

  1. They are active in social media outside their job function.
  2. They are active in their local startup community.
  3. They can clearly and thoughtfully articulate why they want to work for your company.