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daily articles for founders

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

Anatomy of a landing page  

Very good overview of key elements of a landing page. Don't mistake the visual representation of it for the guideline. This link is useful because it highlights 10 key principles of a good landing page, which, in conjunction with the AIDA principle, will help you design an effective landing page.

Four kinds of entrepreneurial contexts  

Context is everything when it comes to startup advice. It's not enough for the giver of advice to provide context, however. The receiver must also understand his or her own context.

Hidden in this article (superficially, a criticism of the Startup America initiative announced by the US government recently), is a list of four primary "entrepreneurial contexts":

  1. Small businesses: businesses which do not aim to scale to huge sizes, do not get venture funding, and whose success criteria is to "feed the family and make a profit".
  2. Scalable startups: businesses which shoot for the moon, have a chance of getting huge, tend to be disruptive, hire the best and brightest, and often attract venture investment. Their purpose is to search for a repeatable and scalable business model and then pump money into it to scale it up.
  3. Large companies: businesses have existing competitive advantages, are already making a lot of money, but are looking to innovate either because their cash cow is eroding, or they are being disrupted by competitors (startups or other large companies) or even are looking to be the disruptors themselves).
  4. Social enterprises: businesses, non-profits, or hybrids whose purpose to make the world a better place (rather than to take market share or create wealth for the founders).

Each of those is a unique entrepreneurial context, and advice that works in one may not work in another, or not without significant adaptations (which the best startup mentors understand and provide). Make sure you know which context you're operating in and understand whether advice being offered to you fits in with that context.

For example, E-Myth is a great book for the small business contexts, but its suggestion to design your business to be operated by the "least skilled operatives possible" will sink your scalable startup like a stone.

Unintentional plagiarism - your ideas belong to everyone

"Ideas are worthless, execution is everything!" It's the mantra of the modern entrepreneur. And yet we all do feel quite possessive of our ideas - at least of our best ideas.

Great ideas do seem to float around. Sometimes, they seem to do so magically, bridging gaps that seem uncrossable. But the reason why it looks magical is not because other people are telepathically stealing your thoughts, but because they weren't your ideas to begin with - at least not in the way we usually think of the concept.

Allow me to illustrate with two examples.

Stealing an article without knowing it

Accusations of plagiarism fly around every once in a while on the web. Sometimes they are warranted, sometimes not, but they are always emotional. And sometimes, things look like one party is clearly culpable, even though that's not actually the truth!

On Friday afternoon, Dan Shipper tweeted me the following message:

@swombat I really admire your blog and I wrote a post I think you might like. Would love your thoughts: http://bit.ly/wiyxaj :)

It was Friday afternoon, I was busy, out and about. I clicked on the link, had a quick glance through the article, and mentally filed it "to read later". Sometimes I get back to these articles, sometimes I don't (but my intention is actually to reply to people who tweet me!). It went out of my mind, I went about my day.

In the evening, I was trying to think up of an inspiring topic for the following Tuesday (my current plan is to structure my postings so that Mondays are practical advice, Tuesdays are inspiring, etc.). I wracked my brains. I thought about it while falling asleep... a title emerged... "Write your own story".

This morning, as I thought more about it, I liked the title. I saw a direct connection with this Paul Graham article, which states:

This leads us to the last and probably most powerful reason people get regular jobs: it's the default thing to do. Defaults are enormously powerful, precisely because they operate without any conscious choice.

I felt I could write a good, solid and at the same time inspiring article around this theme, of figuring out what your own "defaults" are, and changing them, and achieving improvement in your life patterns this way. Bingo. I started writing. I felt inspired. The idea was powerful, good, worth sharing.

Then my how to register a company in the UK article suddenly took off, and I took a break as someone called Oliver Cross engaged me with useful feedback about that article. While I was looking at my Twitter replies, I reopened Dan Shipper's article. My jaw dropped. Let me quote you an extract from his (rather good) article:

Default settings are all around us. Why do we go into work at 9 AM instead of 8 AM? Why do sales people work on commission? Why do we have an 8-hour work day?

The fact is that very often there are no good answers for why these default settings exist, they just do. And not only does that create a great deal of waste in a business environment, it also leads people to certain misconceptions about what is and isn’t possible that are simply false.

Given the existence of our default settings, one of the most important questions in our lives then is: Why do we do the things that we do?

Holy shit.

If I'd gone on and written this article, and published it, then by today I would have been accused of plagiarising his article (that I hadn't even read all that carefully). And it would have looked very much like I was completely guilty - even though I was completely unaware of it. I read something like 50 articles a day (including the quick skims). There is absolutely no way for me to track every idea in my subconscious and where it came from.

Obviously, knowing that now, I won't finish writing it. Instead, I warmly encourage you to check out Dan's article, titled Why we do startups.

Subconscious pick-up

I watched a second example of this on TV a few days ago. Derren Brown, the famous hypno-showman who likes to play with out minds, gave a striking example of how actively our brains suck clues from our environment.

He took two advertising professionals, and asked them to draw up an advert, in half an hour, for his idea to start a chain of taxidermy (aka stuffed animals) stores. Before leaving, he placed an envelope containing "his ideas" under a stuffed cat, then let the pros get to work.

In half an hour, the pair wracked their brains and came up with a clever concept involving a bear playing a harp, with a logo of angel wings, the name "Animal Heaven" and the strap line "The best place for dead animals". Derren then pulled out his own "ideas", and they were, of course, strikingly similar.

How did two creative professionals do something so predictable? Well, it turns out Derren had peppered their environment, particularly on the cab journey to the shoot, with repeated cues that ended up in the advertising concept. He had basically primed their subconscious to generate those ideas. Since they are competent creative professionals, their subconscious is probably very efficient at picking up all the best ideas from their environment, and using those in their work.

Critically, the two victims were completely unaware that they had been so duped. If you'd asked them, they certainly would have claimed they came up with the ideas on the spot - and they did. The interesting experiment that Derren Brown didn't do would have been to take two pairs of creatives through the process simultaneously, and see how they reacted to finding out that they had come up with the same ideas. Would they have accused each other of plagiarism?

Your ideas

Of course, not all the ideas in your head are similarly arising in other people's heads.

However, the best ideas in your head, the ones that have the best potential for making a great startup, or project, or other venture, are probably there because your environment contains cues that lead to those ideas. And since you're not alone in that environment, they're not going to be just in your head, but in the heads of a great many people.

There are two takeaways from this.

First, if you see someone with an idea that's uncannily similar to yours, don't automatically assume they actively stole it from you. They may have been working from the same set of cues, or even have glanced at your idea and forgotten about it, and later imagined it again "on their own". Chances are, you did exactly that, too - so you have no moral right over there, even if they were inspired by your idea.

The second is, if you have a great idea, an idea whose time has come, chances are there's a million people who have had the same idea, a thousand who are actively planning how to implement it, and a dozen who have started the project already. This doesn't mean the idea is worthless, but it does mean that any great idea will face stiff competition. So don't worry about "keeping your idea secret". It was never a secret to begin with.


How Andrew Plotkin raised $24k on Kickstarter  

A surprisingly informative article, for CNN, by Andrew Plotkin describing how he raised $24k via Kickstarter. He proposes some tips to access this innovative way of raising funds (and not losing equity features in the process):

  • Say up front what you want to do with the money
  • Have a great video
  • Break down your audience into key groups and be sure to give them all something to satisfy them
  • For a game project, include a demo
  • Don't be afraid to plug yourself and your CV
  • Don't be a jerk - actively. Say thank you to everybody, early and often.

He also actively promoted his project by contacting interactive-fiction-related publications and getting them to help.

In short, raising via Kickstarter will take a lot of effort if you want to succeed, much like any other fundraising method. If you can raise via Kickstarter rather than traditional funding routes (or if traditional funding routes are closed to you), it's certainly worth considering.

Picking technologies on the right side of history

When we started Woobius back in 2007, we believed (rightly or wrongly) that we needed to be able to provide a relatively complex, "UI-heavy" front-end to make things simple for our non-technical users. For example, one of the key screens in Woobius is an explorer-like file browser, loved by users, and only possible because of the technology we picked.

We surveyed the field in 2007, which was in the very early days of jQuery, Dojo and other rudimentary toolkits, and came to the conclusion that it would be very hard indeed to use them to deliver our vision (particularly since IE6 support was not optional for us).

So we picked... Adobe Flex.

Based on our perspective, it was the right choice. But our perspective was wrong. There was a factor which we didn't take into account, though we knew about it. It was clear to us that, because of the greater dynamicism and wider community behind javascript toolkits, they would eventually surpass Flex's power, flexibility and speed (and indeed that is what has happened). We knew Flex was on the wrong side of history, we just didn't realise how much it mattered.

As a technology cofounder, one of your unspoken functions is to be a visionary. Businesses are long-term endeavours (or should be). When you make fundamental technology choices for a business, they are there to stay. The longer such a choice is made and not changed, the longer it will take to change it. So, when we chose Flex, we chose it not for the short term (as we may have thought), but for years to come.

And, in hindsight, that was a mistake that cost us.

The cost of using Flex

Adobe (perhaps seeing for themselves that the writing was on the wall for Flex, though I think it was probably sheer laziness) never stood behind Flex the way they should have. They let ridiculous bugs and limitations fester over the years, and in the meantime, the chaotic horde of Javascript toolkits advanced, took over, became superior, better, and became the standard.

All the community effort that took the web into the design-centric UI richness that we know today went into Javascript, not Flex. Flex is now a relic that must be extirpated at great cost to guarantee a future to the Woobius collaboration product. And this is only 4 years after starting development.

When Kublax (a Mint clone) closed its doors in February 2010, articles mentioned there was an alternative called Money Dashboard. I went to check it out. I signed up. I went to the login screen, and I felt this sinking feeling in my stomach. Money Dashboard uses Silverlight. Oh woe! In 2010? Sure enough, within a year, Silverlight was doomed by Microsoft themselves (followed, a year later, by Flex itself). The anonymous tech cofounder of MoneyDashboard made the same mistake we did, though even more flagrantly. I never even bothered to log in, in the end, put off and saddened by the choice of Silverlight.

The history test

When you're picking what technologies to use in your brand spanking new startup, your responsibility as a technology cofounder is not just to make the best choice for today, but to look 3 to 7 years into the future, and make a choice that will be sustainable for at least that long, if not longer. Don't lock your startup into a technology path that is a dead end.

Yes, technology changes rapidly and somewhat unpredictably. That is precisely why you need to make sure that the fundamental, critical pieces of technology that your company depends on are there for the long haul, not dependent on a single vendor, and, most importantly, pass the "history test".

Every time you choose a critical technology to lock yourself into, ask yourself: "Is this technology on the right side of history?"

If it's not, think again.


How to fire an executive  

Here's a very informative article by Ben Horowitz, about how to go about the complicated and painful task of firing an executive. Some key points:

While it’s possible to fire an executive for bad behavior, incompetence or laziness, those cases are rare and relatively easy. Unfortunately, unless you have a horrible hiring process, those are probably not the reasons why you got to this point. At this level, almost every company screens for the proper skill set, motivation, and track record. Yes, the reason that you have to fire your head of marketing is not because they suck; it’s because you suck.

(...)

But keep in mind that your choices are: a) alarm the board or b) enable an ineffective executive to remain in her position. While choice (a) is not great, it’s a heck of a lot better than choice (b). Leaving a failing leader in place will cause an entire department in your company to slowly rot. Let that happen and the board will be more than alarmed.

Worth reading the whole article carefully, and hoping that you won't need the information inside too often.

Get better at UI design  

UI design is essential to any startup, but it's often something that's a secondary skill for startup founders, who have either a business focus or a technology focus, and who tend to treat UX as just another task on the list (if it's even there at all).

Of course, UX makes and breaks startups, whether consumer-based or B2B, and should be a central discipline. This list of books is a good starting point to improve your skills in that area.

Doing more by doing less

An article today from Jeff Atwood bemoans the plethora of todo apps and presents an argument against todo lists:

Here's my challenge. If you can't wake up every day and, using your 100% original equipment God-given organic brain, come up with the three most important things you need to do that day – then you should seriously work on fixing that. I don't mean install another app, or read more productivity blogs and books. You have to figure out what's important to you and what motivates you; ask yourself why that stuff isn't gnawing at you enough to make you get it done. Fix that.

I'm a big fan of that idea, and in fact have been toying with it practically for a while now.

It started with the decision to implement a limited size todo list, using my iPad and the Bamboo app to write tasks manually (and manually copy them over onto future days if they don't get done). I started with 10 tasks per day at most, with the idea that if I have to add another task to a day that already has 10 tasks, I have to move one undone task to a future day.

It worked relatively well, but I still felt swamped. So I reduced my task count to 5. And, strangely enough, I felt more productive.

See, the reason why we're not productive most of the time isn't that we're not doing stuff. I spend my whole day doing stuff, but that doesn't make me productive. The reason why we're not productive is that we spend most of our time doing the wrong things.

The pareto rule applies to the task selection as well as to the work itself. In fact, it applies even more harshly: you're an incredibly productive person if 20% of all the tasks you do actually are the right things. But most of the tasks we do are "busywork" - whether that's answering emails, chasing people for unpaid invoices, or, irony of ironies, keeping track of the status of things.

I'm not saying these tasks (e.g. chasing invoices) are not important in some fashion. They need to happen, certainly. But chasing invoices is unlikely to be the most important thing you could do today to achieve your life's goals. And that's assuming you even have life goals. If you don't, then 100% of what you do is aimless busywork.

Jeff's article prompted me to write out my thoughts on this topic, and so I'll finish with this thought that I've been ruminating for a while:

If you can, every week, figure out and do the one most important thing that you can do to achieve your life's goals, you will be one of the most successful people on this planet.

And yes, that's true even if you forget to do some menial tasks like chasing invoices or renewing your driving licence.


Build relationships, don't send PR releases  

This is almost common knowledge in the startup world, and yet, even I (who don't cover any startup releases on swombat.com) still get emails from people looking to get some coverage for their startup's new product.

Nicholas Holmes:

Clearly showing that you understand that a journalist doesn't just exist to publicize you is one of the fastest routes to his or her heart. It’s literally the difference between drunkenly hitting on someone in a club and taking him/her on multiple dates to the restaurant you can’t afford. Hell, you'd be unlikely to start a sales pitch without knowing your customer, or begin discussions with an investor without finding out exactly what they were interested in -- so why treat the media differently?

The closest relationships journalists build are with people who can provide long-term value to them by offering something that isn't just self-promotion. Conversely, these tend to be the names you see cropping up again and again in the media.

The age of the one-way exchange with journalists is over. Even Apple cultivates strong, two-way relationships with journalists and bloggers.

Every bit of (worthwhile) news coverage I've had for my startups has come out of a valid, two-way exchange. Sure, there are "news organisations" that will republish press releases without thinking twice - but nobody reads those anymore.

Three years to build a business?  

Jacques Mattheij explains that it takes three years to build a successful business, so new entrepreneurs shouldn't be surprised that the first couple of years are really tough:

Typically it goes like this: - in the first year you lose money. Earlier on more than later in the year - somewhere during the second year you break even. - in the third year you finally make back all the money that you had to add in the first

The reason why it works this way is simple enough (even if that doesn't explain the timing). Customer acquisition is a time consuming process and a new business does not have several things that help a lot in gaining new customers:

  • a reputation
  • a network
  • existing customers

I have a slightly different viewpoint on this, based on my own experience and observations. Since we work with quite a few tech businesses at GrantTree, and I've been part of the startup community for some years now, I think I've got a reasonably wide cross-section of sample businesses and entrepreneurs.

Here, then, are my observations:

  • A lot of new entrepreneurs (myself included), do take several years (2, 3, 4, it depends) before their business starts taking off (as in, making enough money to pay the bills from sales rather than funding). Some people never get through that initial process, and that's not always because of lack of perseverance.
  • Once that first period is out of the way, though, the time it takes for them to build a functioning business seems to change dramatically. I know people who regularly build functioning, highly profitable businesses in a span of months. GrantTree itself has had a highly profitable first year (though the first few months were ... interesting.
  • The only shortcut for that process seems to be either tremendous luck, or an existing client base before the company is founded. Some of our clients jumped straight from corporate job into running a profitable business - but the previous employer was the main source of income at the beginning.

My conclusion, then, is that it doesn't take three years to build a business, it takes three (or some number higher than 2 in most cases) years to build an entrepreneur.

Being a successful entrepreneur takes more than a client base, a network and existing customers. It takes experience, sales/hustling skills, the ability to focus on what matters to the business and drive it forwards despite a million distractions and no one to tell you what you should be doing, to make mostly correct entrepreneurial decisions quickly, the ability to make do with extremely limited means. It also requires a network (something most new entrepreneurs don't have) and a personal reputation, very often, but those are far from sufficient.

So, my way to look at this is that what's being built over the first three years is not a business. It's a person, with personal assets like a reputation, a personal network, experience and knowledge, and so on.

Once the entrepreneur has been successfully constructed against all odds, businesses can and do get built much, much faster - even services-based businesses like GrantTree.

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