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daily articles for founders

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

The "thin edge of the wedge" strategy  

This excellent article by Chris Dixon presents a common strategy for new entrants to establish a market presence that they can build on. The strategy consists of focusing on one essential feature that's missing from the competition (e.g. Posterous' post-by-email), using that to acquire initial customers, and then building that "it's a feature, not a product" initial offering into a full-fledged product.

If that's your plan from the start, it's probably a good idea. Creating a thin wedge with no vision for how it might become a full product is a lot more risky.

Critics sometimes confuse wedge features with final products. For example, some argue that mobile photo sharing is "just a feature," or that game mechanics on geo apps like Foursquare are just faddish "toys." Some go so far as to argue that the tech startup world as a whole is going through a phase of just building "dinky" features and companies. Perhaps some startups have no plan and really are just building features, likely with the hope of flipping themselves to larger companies. Good startups, however, think about the whole wedge from the start. They build an initial user base with simple features and then quickly iterate to create products that are enduringly useful, thereby creating companies that have stand-alone, defensible value.

Work hard and get lucky  

Classic point and inspirational post, by Mark Suster, about luck and hard work:

Rapid success stories happen, true. But the reality is that most "overnight successes" come at the end of years of hard work and those witnessing the "success" part too readily assume the "overnight part."

(...)

Nothing comes easy. There are few overnight successes in life. The best companies struggle - just not publicly. And the harder we work, the luckier we get.

Do you really get luckier the harder you work? I can think of a few cases where working hard won't lead to luck (for example, if you're working on the wrong thing).

But the right kind of work on the right kind of thing will multiply the opportunities that come your way. If you are able to spot those opportunities, it will feel like things are moving your way. Couple that with better experience seizing those opportunities, and you have so-called "luck".

I'm a firm believer that we are all surrounded by countless opportunities to "get lucky" to a practically miraculous level. But we are blind to most of those opportunities and, even when we see them, we fail to capitalise on them. Feeding your mind with interesting things will teach you how to spot opportunities. Doing certain things (for me, for example, blogging) will multiply the opportunities that come your way. Finally, working hard will teach you how to seize the opportunities effectively.

Be sure to do all three.

Time-saving web design generators  

This will be useful to someone - particularly when trying to put together a decent design to test an idea quickly. Generators are listed for:

  • loaders
  • colour schemes
  • favicons
  • striped and dot patterns
  • miscellaneous backgrounds patterns
  • tabs, badges, buttons and ribbons
  • CSS3 effects.

Enjoy.

Start something small  

Joel Gascoigne:

What I'm starting to notice more and more, is that great things almost always start small. Most of us know that Branson started the Virgin brand with a student magazine, but Virgin is just one of many examples which shows that the reality is counterintuitive: actually, the best things we know and love started as tiny things.

I've found that if I look into my own life, I find similarly that some of the most important achievements I've made started as little projects. My startup Buffer itself is a great example: it started as a two page website and in addition the short blog post describing this process has now turned into a talk I've given more than 30 times.

This applies in other areas of life - programming, for example, has Gall's Law:

A complex system that works is invariably found to have evolved from a simple system that worked. The inverse proposition also appears to be true: A complex system designed from scratch never works and cannot be made to work. You have to start over, beginning with a working simple system.

Advice for a young entrepreneur  

Tony Stubblebine starts with the following (well presented) advice:

  1. Surround yourself with interesting people;
  2. Focus on the right things (which means, ironically, figuring out what the right things are);
  3. Be useful.

He ends on a little zinger:

There's basically two ways to be financially successful as a company. One, you could rely on time-tested business fundamentals. I call this the Warren Buffet model.

Two, you could rely on the greater fool theory, which is that with enough hype, smoke, and mirrors you can find a buyer who is an even greater fool than your investors.

(...)

So much of the startup world is arrayed around the greater fool theory that I felt like my best chance was to build a company that was independent of that system. I think of bootstrapping as a very slow form of raising money. But now that we've done it, I have a reliable stream of income and never have to raise money again. It's really just at this moment in time that we can switch from doing whatever it takes to survive to actually testing our ability to make a major impact.

To be fair, there are situations where you do need the extra money to grow extra fast, or else you lose. Groupon is a good example - had they not executed so brilliantly and quickly, they would have been eaten alive by the dozens of clones which emerged everywhere.

I'm a big fan of getting profitable early, but it is neither the only way, nor the universal best way.

The right kind of ambition  

A comment by Marcus Frödin pointed me to this excellent article by Ben Horowitz, that I somehow missed when it came out.

Ben offers some great advice on how to select the right kind of people to join your company, particularly when it comes to salespeople:

People who view the world through the me prism might describe a prior company's failure in an interview as follows: "My last job was my e-commerce play. I felt that it was important to round out my resume." Note the use of "my" to personalize the company in a way that it's unlikely that anyone else at the company would agree with. In fact, the other employees in the company might even be offended by this usage. People with the right kind of ambition would not likely use the word "play" to describe their effort to work as a team to build something substantial. Finally, people who use the "me" prism find it natural and obvious to speak in terms of "building out my resume" while people who use the "team" prism find such phrases to be somewhat uncomfortable and awkward, because they clearly indicate an individual goal which is separate from the team goal.

(...)

Throughout our interview process, candidates would take sole credit for landing extremely large deals, achieving impressive goals, and generating company success. Invariably, the candidates who claimed the most credit for deals would have the most difficult time describing the details of how the deal was actually won and orchestrated. During reference checks, others involved in the deals would tell a much different story.

Read the full article here.

Let your team speak!  

Mark Suster:

What occasionally happens is the CEO introduces his team giving a brief overview of who everybody is. I hate this. I want to hear everybody speak - to get to know the team. What purpose could there be to having the CEO talk on behalf of everybody?

You might say, "it's streamlined, we don't want the intro to take too long." That's an excuse. If you really believe that then just have your team practice their personal intro's and tell them the time budget they have to hit.

I have never done that, nor has anyone that I've worked with. From simple pitches, to sales presentations or big show presentations, everyone who stands by the projector should get a turn to speak. Otherwise, don't bring them along.

Behavioural change  

An earlier post on Hacker News linked to this presentation about key mistakes, and solutions, to encourage behavioural change. Summarising the points, it goes:

  1. Don't rely on willpower for long-term change. Assume willpower doesn't exist.
  2. Don't attempt big leaps. Seek tiny successes, one after another.
  3. Consider how your environment shapes your behaviour. Change your life and change your context to influence your behaviour.
  4. Don't try to stop old behaviours. Instead, seek to create new ones. Focus on action, not avoidance.
  5. Don't blame your failures on lack of motivation. Instead, make the behaviours easier to do.
  6. Triggers are a key to behavioural change. No behaviour happens without a trigger.
  7. Information does not lead do action. Reading articles (or, ahem, presentations) does not magically lead to behavioural change. Human beings are not so rational.
  8. Focus on concrete behaviours, not abstract goals. For example, "Walk 15 minutes today" is much better than "Get in shape".
  9. Don't seek to change a behaviour forever. Instead, aim for a fixed period.
  10. Behavioural change is not difficult. It's easy when you have the right process.

BehaviorWizard is a related site that guides you through different patterns and pieces of advice to effect behavioural change. Of particular interest is the linked Behaviour Grid, which is like a crib sheet for approaches to changing your life patterns.

Why is this relevant to startups? Because as an entrepreneur, your main resource is yourself. We all get the same 24 hours each day. Learning to make better use of them is crucial to success as an entrepreneur (as it is in many other areas of life).

Bait and switch acquisition offers  

Ouch. Here's an anonymous story from a founder who got screwed during an acquisition. Killer quote:

He tells me, "I'm sorry, but the CEO changed his mind. We're not moving forward with you guys." What? I was furious and trying not to panic. "Why not?" He gave me several reasons, including uncertainty about how our product would integrate into their suite of offerings (shouldn't that decision have been made back in October?) and disagreement on the roadmap we presented (remember that chaotic three hours on the second day of due diligence? Also, he's the CEO, if he wants it, he gets it, right?). The one that stuck with me the most was "Our engineers looked at what you showed us during due diligence and told our CEO ‘It doesn't look so hard, we can build it ourselves.'" Information that we had shared under NDA.

If you're getting serious about selling your company, read this first. It will save you from these kinds of mistakes - mistakes which are not only costly, but also infuriating.

Is there a peak age for entrepreneurship?  

One of our angel investors in Woobius started his first business after retiring. He then proceeded to build not one, but two successful construction-related businesses. Then he started investing, too. So much of entrepreneurship being a young man's game.

Perhaps because I'm 31 already, I don't think there's any age that stops you from being a successful entrepreneur. There are plenty of people who have started their first business late in life and done extremely well. In fact, according to the linked article by Adeo Ressi, being older seems to be an advantage, up to a point:

Older age has shown in the data to correlate with more successful entrepreneurs up to the age of 40, after which it has limited or no impact.

Conversely, I also think that you can get started very early - even before it's legal for you to do so. People like Mark Bao (18), Alex MacCaw (19, I think), and many others that I know on IRC and in other places, show that even very early in life, you can be a successful, driven entrepreneur.

In short:

  • Don't worry about age. Great entrepreneurs can get started at any age.
  • Don't underestimate people because they're too young or too old.
  • If you want to get started, just do it, don't underestimate yourself because of being too young or too old!
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