I'm the CTO and cofounder of GrantTree, Woobius, and Vocalix, a full-time entrepreneur since 2007. I previously worked at Accenture and studied Physics at the University of Oxford. Here are the current projects I'm involved in.
On swombat.com, I summarise and comment on the best articles for founders each day, as well as post my own thoughts and advice, so you can read the most useful articles while focusing on building your own startup. Want to read more about me? Try this and this.
A very short piece to end the day. I'm told that the question that Jewish mothers ask of their children each day is, "what's the most important question you've asked today?"
Whether that's true or not (I couldn't find a reference for it), it leads to a very interesting self-awareness tool for startups. If working smarter is about devoting time to meta-work, then this might be a good starting point:
What's the most important question you've asked about your business today?
Stefano Bernardi offers some advice to those who want to follow the way of the Samwers Brothers and build businesses by copying successful US startups in their country:
Please do not clone Pinterest. Do not clone Instagram. It will not work. Not matter what Pinspire and co. want you to believe. Cloning social startups is extremely hard as you face the same growth problems of the American startup, in a market with fewer early adopters and many more monetization challenges.
Instead, clone startups that have one of these characteristics:
Interesting article. Read more here.
Roger Ehrenberg, VC/angel and an entrepreneur who has had to wind down companies before, has some advice about how to deal with the final phase of a failed startup's life. Some key points:
- Thank your investors for their faith and confidence in both you and the mission, and express how truly sorry you are that it didn’t work out.
- Work hard to leave on good terms with all other key constituencies - co-founders, employees, service providers, etc. You don’t need to be best friends, but you should be civil and able to move forward with a clean slate.
After I realised that people genuinely want to help, a powerful habit I’ve developed is to always have in mind my top 3 challenges. (...) Having these three challenges easily to mind is super powerful. It means that if I happen to have the chance to meet someone, I can always get a lot of value, and make a good impression.
Sounds like a good thing to do. My three things (as of November, 2012)?
What are your three key questions? And who could help you answer them?
This article is fairly basic, but it does cover the essentials of why and how you should go about putting together a prototype (software or hardware), and also points out that you should test the prototype not only technically, but, even more important, commercially, before raising money.
Validate the customer need and opportunity. I always hate it when I see startups invest millions of dollars in technology before they validate their ideas in the market, only to find that customers seem to be looking for something slightly different. Test your idea early in a form that is easy and inexpensive to modify.
Here's a good article from Eoghan Jennings, formerly CFO at Xing and now a practicing VC.
He proposes that, to answer this tricky question from an angel or VC, instead of pulling out an excel spreadsheet with projections to year 5, you should focus on 3 key points:
This is a great point. Many startups ignore all three points. Most of the rest focus on the first point and think they have it all answered ("we will charge $40/month, therefore we will make $4000/month from just 100 customers!"). Very few have answers to all three points, particularly the second one.
It is very tempting to suggest that the CAC (Cost to Acquire a Customer) will be zero somehow, but it rarely is. Scalable customer acquisition processes cost money.
This blog post and the accompanying replies make for depressing reading, but they hammer in one key point:
Please, take a minute to think about the people you love, and be certain you're giving them everything they deserve, that you're truly there for them.
If you ignore your personal life in your quest for startup success, you may find that one day, you turn around, and there is no personal life left.
Life is what happens while you're busy doing something else.
Randall Bennett suggests, among other things, that you should not feel bad about working for what he calls a "no-shot startup" (one where inexperience meets enthusiasm and results in some kind of startup disaster), because you will still learn from those, and:
Crucially, the biggest advantage of working lower down the spectrum is that mistakes don’t stick with you. In general, mistakes don’t typically stick with you, but the further up the spectrum you go, the tighter knit the community. Make a mistake at the bottom of the spectrum, and there’s enough people making mistakes that it’s unlikely your mistakes will give you a bad reputation. On the other hand, screw up a company with $41mm in funding, and those mistakes are more likely to follow you.
That's a fair point. Conversely, I expect that most investors with $41m to swing around won't invest in a team that hasn't cut their teeth on previous ventures. And in fact, they didn't, since the colors.com team, to take the example Randall presents, is actually pretty solid and experienced.
Randall adds that after starting at the bottom, once your first hopeless venture dies out, you should work at moving up the ladder, into more and more successful startups.
I think there's a very valuable further point to make.
Once upon a time, MBAs used to be designed for people who had 5, 10, or more years of business experience, to enable them to formalise and structure their knowledge of what makes a business tick. This was before the trend became to do an MBA 2-3 years out of university, or, god forbid, right afterwards.
The key point there is that until you have some of your own experience to drawn on, most of the things taught in an MBA won't stick, because deeply, viscerally, you won't understand why they're important.
The same is true for startups, but in reverse. Until you've worked (either as a founder or as a very early employee) in a broken startup, you won't know, deeply and viscerally, why the things that successful startups do matter. There are many lessons that you can only understand by contrasting them with the failure case. That's when the insights happen... "Aha! That's how you're supposed to do that."
In short, breaking your teeth on a "no-shot startup" before joining a successful one will help you make the most out of your time at the latter.
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Alex Payne writes an insightful attack on the idea that dutifully following a process will get you a successful startup:
Process Cults form around a set of business practices that, when judiciously applied, are supposed to yield a profitable, successful business run by shiny, happy people. The startup segment of the business book market has its favorites:
- Eric Reis’s lean startup and associated book.
- Steve Blank’s customer development and associated book.
- 37signals’ methodology, as expressed in the books Getting Real and REWORK.
I have read all of the above. I don’t necessarily agree or disagree with their contents. What I disagree with is the notion that anyone should start or operate a business in the explicit mold of someone else’s experience, as reduced to a couple hundred pages padded with illustrations and diagrams.
I believe processes are in fact helpful, but only when supported by a solid set of skills backed by painfully earned experience.
Importantly, a process can help you avoid some common mistakes. Processes are like recipes, but they are not recipes - they are much more open-ended. Yes, every business is different, but most businesses fail in common and avoidable ways and following a well-tested process will at least reduce the chance you fail in a boring way (though it may not increase the chance you succeed).
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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.
