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daily articles for founders

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

Old and new ideas  

John O'Farrell, General Partner at Andressen Horrowitz, on ideas:

Some great ideas work spectacularly the first time around, handsomely rewarding the original entrepreneurs. Others fail or flounder initially, sometimes multiple times, before a combination of the right entrepreneur and the right market and technology conditions unlocks their true potential.

He goes on to give two convincing examples, and follows up on the next day with another. Great read.

How to choose your startup idea  

A good set of question, by Amir Khella, about how to probe a new startup idea:

  • Which one excites you the most?
  • Which one can you do something about right now?
  • Which one can you get feedback about sooner?
  • Which one can you get done with the least amount of outside help?
  • Which one solves your own pain points?
  • Which one aligns the most with your purpose?
  • Which one would you like to work on for the next 10 years?
  • Which one is likely to remain significant a few years from now?
  • Which one do you not mind killing?

Do you really have to choose just one though? Pick several, and apply Hypothesis Driven Development to all of them at the same time, in parallel (a lot of the process is waiting time anyway). Whichever one gets to the point where it takes over your whole day first, is the one that wins.

Basics of selling your company  

Fred Wilson, as part of his "MBA Mondays" series, provides this great article explaining some basic terms involved in sales of companies.

He covers: price, consideration, reps, warranties, escrow, integration plan, stay packages, government approvals, breakup fees, and timing.

If you don't know what some of those terms mean, this is worth a read.

Power blogging hour: an approach to startup blogs  

Robert Laing proposes a method for encouraging people at a startup to blog regularly:

Every week on Tuesday morning at 11am, all permanent staff pick their blogging topic from a list and complete a blog post on that topic within the hour. We then post the output staggered throughout the week.

That's a great approach, and Robert is right that an active blog is an invaluable asset to a budding startup, in terms of generating visibility and opportunities.

Robert also proposes some key elements to make the blog posts successful:

  • Write as yourself
  • Avoid regurgitating news
  • Have an opinion
  • Stay relevant
  • Keep the rhythm
  • Finish on time (if doing the power-blogging hour)
Focus on one thing  

Jason Cohen and Noah Kagan arrive at the insight:

[Noah] said: "A startup can focus on only one metric. So you have to decide what that is and ignore everything else."

Jason proceeds to apply this idea to WP Engine, his current startup, via an insightful socratic discussion between himself and Noah.

It's a very worthwhile article, worth your time. One of the conclusions:

Little incremental things can come later, when you have the extra time. Today, it's just big needle-moving things.

Does that mean no A/B testing, no tweaking of AdWords copy, no landing page optimization? For Noah, yes that's exactly what that means. I'm not as disciplined, so for me it's not so spartan. We've all heard stories about little tweaks resulting in 15% lift in revenue. Fine.

But remember you're deciding between spending hours iterating to a 15% lift, versus spending all your energy, time, emails, social media, creativity, new features, marketing efforts, ads, measurement, trying to get a 2x or 3x change in the Most Important Number, that's an order of magnitude better. And you can still do the 15% thing!

Is that always true in all contexts? Well, I don't think it necessarily is. For those things which aren't going to move the needle, there's always consultants and other subcontractors. If the ROI is there and it can happen with minimal input, it might make sense to do it nevertheless, so long as it doesn't cost you attention.

As the amount of cash in the company increases (through sales), it makes sense to start looking at those peripheral items and seeing if you can get someone else to do them for a price that works.

The MicroPreneur Manifesto  

Rob Walling of SoftwareByRob has just published a "MicroPreneur manifesto". In it, he presents some principles for building microbusinesses online - not the kind of business that will sell to Google for $10m or even $1b, the kind that will make a steady income for its owners, and grow slowly and organically, and enable its owners to eventually have a relaxed, pleasant lifestyle with enough time to focus on other things that they also enjoy.

It's a good overview of an online business philosophy, which is different from the typical Silicon Valley approach, but certainly works for some people (and, possibly, it works for more people than the so-called "startup lottery").

I'll list the headings here, but please do have a read to get the full text.

The headings:

  1. It's much harder than it looks.
  2. There is power in working alone.
  3. Focus on your strengths.
  4. Freelancing is dangerous.
  5. Seek leverage.
  6. Stay away from moonshot ideas.
  7. Product last. Market first.
  8. Charge for your product.
  9. Passion isn't all it's cracked up to be.
  10. The pressure of freedom.
  11. Become a black belt internet marketer.
  12. Think human automation.
  13. The more you do in public, the faster things will move.
  14. Failure is an option.
  15. Live like a pauper, treat your business like a king.
  16. Reject growth.
Startup or big company after university?  

Jean Hsu discusses the pros and cons of both choices. As she points out:

Despite articles that claim otherwise, I don't think either one is the right choice for everyone.

If you're facing this choice, read on for her informed perspective on the topic. Then make up your mind based on what you want out of the next few years of your life, not based on what other people are telling you, with no context, that you must do.

Send your (wrong-fit) customers to your competitors  

The UserVoice blog makes a good point that you shouldn't keep customers at all costs:

If you wrangle a wrong-fit customer into continuing to use your product, they will cost you in:

  • Time you spend answering their emails asking for things you can't do
  • Reputation damage via their public complaints about how your product isn't satisfying them
  • Even more reputation damage when they finally announce they're moving to a competitor

Instead, they suggest sending wrong-fit customers to the competition, which should bring a number of benefits, such as having them talk about how nice you were to them even though they didn't purchase your product, and perhaps getting them as a customer later, if your product becomes right for them.

It's worth clarifying that in this case we're not talking about toxic customers, who are actively noxious and never desirable, but merely "wrong-fit" customers, who are desirable but simply not right for your business right now.

Appsumo's failed A/B tests  

This article by Noah Kagan once again makes the point that if you cannot fail you cannot learn, and gives up, as examples, some failed A/B tests that AppSumo conducted.

Only 1 out of 8 A/B tests have driven significant change.

(...)

All of these were a huge surprise and a disappointment for me.

How many times have you said, "this experience is 100x better, I can't wait to see how much it beats the original version?"

A/B tests are one of the most effective implementations of actionable metrics, but make sure the measurement boils down to a change in a key performance indicator. Noah finishes with some tips:

  1. Focus on one priority per week, with 1-3 tests focusing on that goal.
  2. Be patient - it may take a few thousand visits or 2 weeks for a test to be conclusive.
  3. Be persistent - most of your tests will fail, but that's ok.
  4. Focus on things which are likely to get you big results.
More about pricing books  

Sacha Greif comments on a series of guest posts, starting with his own earlier effort:

All three are great reads and well recommended for thoughts and experiments about pricing. Different books, different desired outcomes, different approaches, all analysed in some level of detail. Worth poking through over a break for ideas about how to test and refine pricing.

The articles focus on pricing ebooks (and additional materials), but the ideas and methods apply to other products too.

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