swombat.com

daily articles for founders

How to ask for introductions  

Elad Gil on how to ask for intros:

One of the key things you learn when building a consumer product is to make things as easy, streamlined, and friction free as possible for your users. When asking an angel, advisor, or other person to make an introduction for you, the same rule applies. The structure below saves a lot of pain & back and forth for you, as well as for the person being asked to make an introduction on your behalf.

(...)

By spending a little bit of time up front you can make life dramatically easier for the person doing you a favor / offering an introduction. It also increases the likelihood dramatically that an introduction will actually occur and yield a follow-on conversation.

Elad rips into a couple of templates (good and bad intros) to show how it should be done. As someone who has frequently both been asked to make intros, and asked others for intros, I can only agree with his approach.

Make it easy for people to help you, and they're much more likely to do so! Worth also consulting this article, this presentation from Founder-Centric, and the "Reaching Out" section of this article for additional perspective (thanks Sal for the suggestions!).

Where does the customer's story actually begin?  

Des Traynor at Intercom, wrote a great guide about how to onboard users with stories and addresses a common problem in customer interviews, misunderstanding the customer's true motivation.

When conducting your interviews, try to keep the participants focused on their actual actions and feelings when making the switch [into an active user of your product]. People are notoriously unreliable at predicting their future behavior and attitudes, so framing everything around what really happened (not what usually happens, or could have happened) during their onboarding experience keeps your emerging story tethered to the realm of reality.

Asking for specifics also helps transport people back into the actual moment, which brings up lots of super valuable accessory details. Rather than asking them if they had an easy time with setup or not, get to specifics by asking which part was the trickiest, and deeply explore that moment. By way of a real-world example, while someone might not have a lot to add to “are you a safe driver?”, asking them to specifically recall the last time they were pulled over would immediately thrust them into a story rich with emotional details.

Also, be sure to track every story’s breadcrumb trail as far back as you can get your interviewee to remember. The narratives that lead up to our decisions can be surprisingly long — much longer than the surface would show. A journey to a car dealership may at first seem to begin with seeing a newspaper ad, but after even a little bit of digging it could turn out to have really started with a funny noise in the engine two months before. Onboarding always begins with the motivation to change, which always takes place before the user ever pulls up your site.

In customer interviews, it's helpful to look for particular triggers in their life. Des describes a motivational trigger here, but there are others like:

  • awareness triggers: when and how they became aware of new, possible alternatives
  • decision triggers: what happened in their life that actually got them to start shopping

Together, these provide you with key landmarks in the users journey toward being a customer. With this knowledge, it's much easier to figure out how to attract, onboard and keep customers.

In addition to Des' post, Mckinsey's Customer Decision Journey elaborates on this, and it's relationship to your brand and competitors, and Rob Fitzpatrick's The Mom Test elaborates on customer interview techniques.

The choices we make when we build startups  

Joel from Buffer on the impact of his strategic choices to the success of his company:

They have absolutely shaped what Buffer is today. However, if you were to try and attribute these choices purely to success (maybe take revenue as the metric), then I think we could probably be just as successful with different choices:

  • being a distributed team
  • not raising a Series A
  • doing retreats 3 times a year
  • choosing to not have a sales team and instead focus on self-serve
  • serving small businesses rather than large enterprise customers
  • establishing cultural values early and being disciplined about living to them

He contrasts this with another founder whose controversial values included creating a fun workplace, yet grew the business to $8 billion in revenue:

I kept saying that our values were not responsible for the run-up in our share price and should not be blamed for any downturns in the future.

Which leads Joel to:

I can't say that creating a company where everyone is happy is something that will make us more successful, and I can't say that being fully transparent about revenues, user numbers, salaries and other details helps us grow faster than other companies. The point is that our values should hold true in either case, and we should stand by them.

Values aren't independent to the key choices though. Principled decisions connect values to choices, and speed up decision-making.

For example, when Buffer was hacked, they responded quickly and transparently, and they were lauded for it. Joel refers to Buffer's core cultural values: Happiness and Positivity; and Defaulting to Transparency.

In my experience with Founder-Centric, our startup training business, our consistent values have always been Do The Right Thing, Make Founders Better, Be Intellectually Honest, and Choose Work That Makes You Happy. We started by teaching for free, then when we wanted to teach full-time, we only charged for big workshops. By keeping a free option, we stayed true to Do The Right Thing. But we started to burn out from all the travel, so moved into curriculum design. Choose Work That Makes You Happy. This also made more time for the right workshops, conference talks, deeper research, and making our content freely accessible.

We can navigate our business through various stages because we stay true to our values. This hasn't been simple, because four partners need to agree each time! But each decision is far faster and easier because we refer to what we stand for.

Take responsibility for your company’s actions  

Brad Feld writes about the responsibility of running companies:

I started noticing that many of the strong CEOs I work with owned whatever was going on at their company. There was simplicity in this - no blame, no excuses, no justification. They just took ownership.

He was clear minded. He knew what was working, what wasn't working, and what he needed to change. And he took responsibility for it.

There's a growing culture of founders to abdicate their decision-making, especially among first-timers. They either abdicate to processes and methodologies, or to advisors and investors. Since they don't own their decisions, they feel they're not to blame when things don't go as planned. It becomes a vicious cycle.

Experienced founders aren't afraid to ask questions, but they're usually looking for information rather than instructions. They realise that nobody knows more about their business than they do, so they've got to make the calls.

Taking responsibility is a key characteristic in any leader, not just a startup founder.

Lumosity spiked active users through complexity, not simplicity  

Sushmita Subramanian - director of product design at Luminosty - finally has some data which support a novel UX pattern:

When Lumosity launched in 2007 to help people strengthen their brains with mental games, it exercised a common theory: The easier your sign-up process, the more users you’ll bring in, the faster you’ll grow. And for the most part, they were right. But what happened next surprised them: As they made registration more complex, users actually became more valuable.

By adding friction to the on-boarding process, people who complete the registration flow are likely to be aligned with Luminosity’s target customer. The flow not only collects data from the user, but educates them how the product is valuable to them. If they don’t make it through, they probably didn’t want it. It’s auto-segmentation.

Good looking emails are killing your customer conversations  

Giuliano Iacobelli writes:

[U]sing Intercom and triggering 4,500 automatic email with a personal message for a specific segment of user and triggered on specific conditions: 1% replied.

Same logic, but only 110 raw text email with the same kind of personal message sent from my personal Gmail account: in less than 24 hours later I got 26 replies and established conversation ready to take off. 23% of replies. That’s quite a good improvement, isn’t it?

It's easy to lose sight of the point of regular customer conversations, which don't have to be over scheduled calls or meetings. Email automation and niceties can seem helpful at first, but not if they get in the way of actual learning.

Guiliano describes how he learned from more customers over email, just by emailing his users manually and in plain-text. The human touch goes a long way.

Customer Development is not a Focus Group  

Steve Blank notes:

Any idiot can get outside the building and ask customers what they want, compile a feature list and hand it to engineering. Gathering feature requests from customers is not what marketing should be doing in a startup. And it’s certainly not Customer Development.

In a startup the role of Customer Development is to:

  1. test the founders hypothesis about the customer problem
  2. test if the product concept and minimum feature set solve that problem

Collecting feature lists and holding focus groups are for established companies with existing customers looking to design product line extensions

Startups are short on time. Serving multiple customer segments requires more features and pricing plans and support and marketing and everything. That's tough for a young startup to bear and few would intentionally choose the extra work. Still, we can fall for the trap accidentally as Steve described.

By consenting to every feature request, you end up serving multiple customer segments. But focus means saying "no". Part of the early goal of talking to customers is in determining which of the many available segments you really want to focus on. Then you can say no to everything else.

Swombat.com: a new beginning

Every once in a while, I meet a startup founder who tells me that he or she spent time reading through the Founder's Library and got a lot of value out of it. It helped them get up to speed with many essential startup concepts, it gave them ideas, it helped them avoid mistakes, and so on.

This makes me feel great, obviously - every one of my blogging efforts has been to help people, and swombat.com was explicitly designed to help early founders to avoid the obvious mistakes that we all tend to make in the early days. I'm happy that it's done that for at least some people.

I am not, however, happy that I have frequently neglected the site.

I posted the first post on swombat.com on November 30th, 2010, a respectable 1283 days ago. Over this time, swombat.com has grown into a useful resource for new startup founders, but it has definitely had some extended dead periods. If it had had sustained attention for that period, it could be an order of magnitude more useful.

Time and success

Unfortunately, I have come to realise that it is entirely impossible for me to consistently spend time to update swombat.com, for months or years on end. No matter how many times I have deluded myself into thinking that, reality has ultimately won again: I just don't have the time, energy, attention to keep up the promise of this site all by myself.

I have good reasons for that: GrantTree is a successful, growing business. This is really awesome - it's fun, rewarding, interesting, challenging, etc. It's also a ginormous time-sink, and something that ultimately will continue to drain my time and energy on such a scale that I simply don't have the time to do this site justice.

Swombat.com is useful, but it's ultimately always been more of a hobby. As such, whenever there's been a time squeeze (and these days I feel like I'm always in a time squeeze), GrantTree wins and swombat.com loses.

To make this even worse, my interests in terms of writing topic have shifted somewhat (towards more advanced matters of culture-building, for example), and I don't read Hacker News nearly as much as I used to, so this all compounds to make swombat.com's future gloomy to say the least.

But this site is valuable and helpful to people, so I don't want to just let it languish, unupdated, uncared for, unloved, forgotten until the millennia pass and it is unearthed by archaeologists and... erm, I digress.

In short, I want swombat.com to continue - and perhaps even to do much better than it has under my spotty stewardship.

A plan for the future

There are two essential things that make swombat.com, and the Founder's Library, useful:

  1. A good selection of quality articles that provide useful, actionable insight, tools and techniques
  2. The additional insight of having an experienced startup founder comment on these articles to provide an additional perspective

I don't have the time to do both, but I do know people who can help. I've called on my good friends at FounderCentric, Rob Fitzpatrick, Salim Virani, Devin Hunt and Jordan Schlipf, to help with this noble task, and they've answered the call.

Each of them is an experienced serial entrepreneur, they're just as opinionated as I am about bad startup advice, and they in fact have even more insight than me to add, since they spend most of their time teaching and mentoring startups all over Europe, so they've had the chance to gather even more first-hand data about what advice is useful and what advice is harmful.

In short, I am opening up swombat.com to more contributors, and seeing if there's some merit in the idea of swombat.com being more than just my own platform.

Next steps

This isn't going to be an instant transition, of course!

The first step has been to, quite simply, build multi-user support into swombat.com, and rejig the site to support that better. That, I think (along with some housekeeping like getting Resque to actually, erm, work) is now done.

The second step is obviously to get the process of us posting collaboratively working. Please bear with me while I figure this out.

Eventually, this new beginning for swombat.com may open new opportunities that aren't visible yet.

As ever, if you have feedback, suggestions, or other comments, please feel free to email or tweet me - or Rob, Sal, Devin or Jordan!


How to work as a CEO/COO team  

Sometimes, the best solutions are the simplest.

Joel Gascoigne:

I asked Leo to become COO in November last year. (...) The problem we found, was that it was almost impossible to clearly separate these two processes. If Leo was working with someone to try and set goals and keep to them, he inevitably had to make decisions which affected our direction.

It felt like with the new structure we were suddenly both involved in every decision. The goal of the new role for Leo was to speed things up, but with both of us discussing every decision, things were sometimes grinding to a halt, especially in cases where we didn’t immediately agree.

The solution? Split the CEO responsibilities across the two roles, with each doing what they do best!

This may seem really simple in hindsight, but it's the kind of solution that's just not all that obvious when you're first going through it. The article is well worth a read.

Hacker News transparency  

dang, HN's new official moderator:

Right! Let me try to set you at ease, at least a little. Yes, we will make an effort to make moderation more transparent.

(...)

there's no one on the team arguing for secrecy. The question is not whether to be more transparent, but how.

Great to see! That's a move in the right direction. I completely understand that the previous... opacity... was due to Paul Graham not having the bandwidth to deal with HN properly - but the result was the same: an arbitrary, fickle, un-transparent, unpredictable community site that feels like it's at the whim of a mostly benevolent dictator.

This new move is a great step forward towards making HN worth continuing to invest time in, imho. I know a number of old HN regulars who stepped away because they were frustrated by the secrecy of the moderation. Perhaps this will bring them back.

Either way, good luck to the new team!

An easy way to increase startup success rates  

Mike Thomsen writing for Forbes, about the culture of working ridiculous hours:

The irony of this increase in working hours is that it usually comes in service of extraordinarily bad ideas, the majority of which end in failure.

Yep. This is not a new point, unsurprisingly for such an endemic problem.

A study in Sleep, the journal of the American Sleep Disorders Association, found significant declines on “divergent” thinking, a category of mostly creative brain functions.

Sounds a bit like Modafinil's effect on me then.

Here's a constructive and effortless suggestion if you want to easily boost your startup's success chances by what, in my opinion and experience, will be a significant margin (more than double I reckon):

Sleep 8 hours a night minimum, and enforce a half-hour walk through a park every day. And a two-hour walk on Sunday.

Your best ideas will come during that walk, and they will make a very tangible difference to your business's likelihood of success.

Mutual Respect and the barking of dogs

Yesterday, I got involved in a little twitter spat where someone attacked Dave McClure to try and censor his company. The conversation is not important, nor is the person who was attacking him and 500 Startups. I won't link to them to give them greater attention, because they don't deserve it, but if you're very curious and you're reading this shortly after publication, you can look through Dave's tweet history and see parts of the sad excuse for a "discussion" that occurred.

In short, it involved someone getting terribly offended at what someone else was doing on the internet, and lashing out with all the verbal violence they could muster (which wasn't all that much, but was vitriolic enough to be quite sad to look upon). Swear words were used and reused and abused (on one side only), and there was a general lack of respect for Dave or his calm, measured, polite responses. Dave came out looking like a hero of good behaviour compared to his somewhat animalistic attackers.

What I find very interesting is that I got very upset at all this. I was clearly angered by part of this discussion. See, I find abhorrent the idea of a person trying to forbid another from doing something just because they find it offensive. It's deeply, deeply repugnant, scary, and ignominious. It brought to my mind this response by Philip Pullman about his book titled "The good man Jesus and the scoundrel Christ", where he responds to one critic who declares himself offended by the title:

No one has the right to live without being shocked. No one has the right to spend their life without being offended. Nobody has to read this book. Nobody has to pick it up. Nobody has to open it. And if they open it to read it they don't have to like it. And if you read it and you dislike it you don't have to remain silent about it. You can write to me. You can complain about it. You can write to the publisher. You can write to the papers. You can write your own book. You can do all those things, but there your rights stop.

That response made me buy and read the book (which was not all that amazing, though intriguing). I felt it was inspiring, and was a very measured and civilised response to a topic which, in me, provokes red, stupid anger. To me, the attempt by one person to censor another based on what they find offensive is a kind of intellectual violence akin to rape (yes, I use the word deliberately - bear with me) - why is it like rape? Because it is the (usually intellectual, but, in some parts of the world, frequently physical) violent imposition of your way of seeing the world on another person, and it is a violation of someone's mental integrity.

Some of you may think that my use of the word "rape" was excessive. In fact, I know that some people will react to this word emotionally, seeing red, feeling very angry that this is desensitising people to rape, and so on. If you feel like that, great - I apologise for making you feel this way, but this is exactly how I feel about the mob censorship described above. So now we understand each other, let me withdraw the misused word "rape", and please forgive me for using this device to rouse your feelings.

This kind of bigoted censorship is like someone stepping into your head, declaring ownership of your thoughts, and deciding what you're allowed to express, marking some kinds of thoughts as improper, others as allowable, and, fundamentally, imposing their way of thinking on someone who is not them, by force or by threat. To me, this is a straight path to the thought police and the kind of 1984-style world which I do not ever want to set foot in.

Here's the kicker then: because I really care about this topic, I found myself getting angry, and had to make a conscious effort not to devolve into the kind of uncivil, frothing-at-the-mouth nonsensical verbiage that I was deploring in these very attackers!

The line between man and beast is oh, so fine.

Thinking about this further, and looking back at my own history of posting and arguing with people (particularly on the internet, where intellectual violence comes easily since you do not typically get kicked out of internet circles for being an asshole like you would in real life), I have myself descended into this sort of behaviour. I can't even claim it was rare: I'm quite certain it was very frequent, and even recent. Some subjects just get my goat and manage to make me see red, and want to fight, with words, to hurt the other side. It's as deplorable to observe this in myself as in anyone else.

I think it takes supreme self-control to be civilised at all times, even in the face of a heinous lynch mob who wants your blood based on a misunderstanding (often deliberate) or downright fraudulent misstatement of facts. I take my own hat off to the man with 500 hats, for his impeccable behaviour in this particular instance.

Mutual respect

But there's a reason for writing this article beyond getting this off my chest and handing Dave a medal. There's a lesson for everyone here, I think, because I really doubt that I'm the only one who feels the lure of the beast in all of us from time to time.

Here's a thought: beyond the fairly advanced disagreement hierarchy proposed by Paul Graham, or beneath it, rather, there is a more fundamental principle at play: conversation between civilised individuals should always begin, proceed and end with mutual respect. Without this, there is no discussion, no argument - merely the noise of dogs barking at each other.

So here's my challenge, for myself and for any others who lack the buddha-like peacefulness of a still pond, which can never be disturbed by the barking of dogs or wolves nearby:

When someone challenges you by engaging you on a subject which really gets you, which makes you want to hurl words at them for no productive purpose other than getting your anger out - take a deep breath, calm down, and find a respectful way to proceed.

Even if the other side is not being respectful, you owe it to yourself to be so. After all, a gentleman remains a gentleman even in the gutter.

If I ever fail to do so in the future, please do call my attention to it.


Read advice in between the lines  

Dustin Curtis:

When I watch experienced people talk today, I catch the little subtle notes in between the obvious pieces of advice, and I find myself constantly thinking–oh shit, yeah, I experienced that, and this person knows what they’re talking about; I wish I had known that two years ago! How is it possible that I missed all of these things in the past?

Bingo. And this is why I think giving lots of context is essential for good startup advice article. Most of the value is not actually in the advice itself ("Hire for culture fit!") which anyone could write, but in your own, personal, deeply useful experience that you brought to bear in a specific way, on a specific problem, in a specific context.

Games with IAPs should be regulated like gambling  

This article by Thomas Baekdal resonated with me. Most of my gaming now happens on iOS, and I generally avoid games with In-App-Purchases, because they are generally designed for idiots, and have very shallow gameplay with constant monetary hurdles that's more akin to a slot machine than a modern game. I watch with a concerned eye as many games switch to the IAP model.

Back when I was a kid and had no money, I spent most of my savings on computer games. Prices of 89 CHF (that's a whopping £70 inflation adjusted) were common. I spent lots of money on games.

More recently, I have happily shelled out £10-20 for an iOS game (I'd recommend X-Com for iOS as an excellent example of the genre. I still spend money on games - less, because I have less time to play them.

Yet I will not pay even one penny to buy "gems" in some stupid "free" game. I suggest you also don't, and advise everyone you do to do the same... but even that's not enough:

What EA has done here has nothing to do with gaming, and the same is true for pretty much all other 'free-to-play + in-app purchase' games. We don't have a mobile gaming industry anymore. We have a mobile scamming industry.

The mobile slot-machine industry won't be defeated just by intelligent people doing intelligent things, much like the gambling industry is not defeated by intelligent people staying away from slot machines. Apple has no interest in clamping down on IAPs.

I'd push for a stronger move than what is suggested in the article:

Games with IAPs should be regulated in a similar way to gambling. They are games that are addictive, can suck up ridiculous amounts of money from people, and generally add nothing in proportion to the time and money they suck up. Like gambling, they are a symptom of a bug in the human psyche that is greedily exploited by some unsavoury companies.

And like gambling, they should be heavily regulated.

The gaming industry will not self-regulate this mess unless threatened with heavy regulation from the governments of the world. So the threat needs to exist, and possibly be carried out.

Don't let me know how I can help  

Robert Williams from letsworkshop.com:

The single phrase (and every variation of it) that time and time again repels clients away from us and hurts our credibility in more ways than one:

“Let me know how I can help.”

When I said this I honestly thought I was being helpful.

Read on for Robert's explanation of what to do instead.

It's amazing how many little quirks of language can have a pretty significant influence on conversation. Two "power tricks" that I like are the use of the words "reasonable" and "fair".

When ending an email about a suggestion that you're not sure will be accepted, it helps to end the email with "Does this sound reasonable?" - because this question somewhat demands a yes. Even the recipient disagrees, they will typically start the answer with "Yes, that sounds reasonable, but I disagree because of XYZ". Saying "no, that doesn't sound reasonable" would force them to escalate the conversation in an unpleasant direction.

This is not a trick to be abused, but it can act as a tiny little nudge in the right circumstances, to help someone who would otherwise hesitate forever to actually make a move. "If it sounds reasonable," their internal monologue hopefully goes, "then let's do it."

"Fair" (and her evil twin brother "unfair") is an even more powerful word. Despite the fact that everyone knows "the world is unfair", people have a strong desire to be perceived as fair (whether or not they are). So, for example, when I feel like a sales situation is drifting out of control, and I'm tempted to simply end the sale completely, instead I give it a firm chance to get back on track by bringing "fair" into the mix. "I believe we're not being treated fairly in this discussion, and I'm not willing to do business on terms that I perceive to be unfair. I'm happy to start the conversation again if we can agree on terms that will be fair on both of us."

I wonder if there's a collection of these conversational power tools (and their brethren, the conversational limp handshakes like "Let me know if I can help") somewhere.

Count your fingers  

One of the unfortunate realisations when you start to be involved in giving money to people is that there are some people who will do anything to get their hands on that money, including build elaborate fantasies with just enough documentation to convince you that it's all real: in other words, con-men.

Just as bad, there are people who are conning themselves, and who are passing that delusion on to you when they meet you. Those are more common than the former (perhaps that's a good thing!).

What this means in practice, as Mark Suster points out in this article, is:

Always assume the worst. Always question the motives of those sending you dealfow – regardless of how nice they are or well meaning. I’m not saying all dealflow is bad or all referrers are hucksters. I’m just saying that you need to look at it through the lens of the motive. I always ask when somebody sends me a deal, for example, are you already a shareholder in the company?

If you've done your due diligence and the opportunity checks out, then go for it... but always question things that seem too good to be true and that magically land in your lap. Being just the right amount of suspicious is an essential business skill.

Guide to customer growth  

I generally don't like to link to slides, since they miss a lot of substance that is present in a real presentation or in an article, but this one by Sean Johnson is pretty excellent. Click through for a solid guide to customer growth with many useful and actionable tips and bits of information, such as this 90-second guide to Facebook Ads:

Images are the most important factor. Test 50 images. Test orientation (looking right, looking left). Test colour and shape of borders.

Use country targeting when testing conversion. US costs 5-10x other countries. Use Canada, New Zealand, etc.

Focus on conversion, not just on clickthrough rate. It's not uncommon to have 40-60% conversion rates if it's targeted well.

The guide is shallow, but provides a good overview with lots of starting points and links to further information. Worth a read through, and some clicks.

Firing yourself, again and again  

I often quip that my job as founder of the business is to get myself out of a job. Here's Joel Gascoigne's rather lengthier, better supported argument for that idea:

Having thought about the concept of firing yourself further in the last few weeks, I’ve come to a key realization: if you’re doing something yourself as a founder of a post-product/market fit startup, you’re probably not doing it well.

The way I see it is that if you are doing a task yourself alongside juggling all the other duties you naturally have as a founder, you have to make compromises. To put things into perspective, the areas we’ve identified as key tasks at Buffer currently are: Product (web and mobile), Engineering, Marketing, PR, Customer Support, Partnerships/BD, Admin, Growth, HR, Recruiting and Investor Relations. There are probably more, too. As CEO I have to have all these things in my head, and oversee half of them directly. As COO Leo oversees the other half.

With this much to think about, anything Leo and I are doing directly ourselves right now has to be done only ‘partially’. We both look for the 20% of the work which will get us 80% of the benefits, and can’t do much more than that for everything we’re working on.

That's exactly how I function, and that's exactly why I try to pass anything I do with to someone else in the company as soon as I'm aware that I'm doing it more than once: because as long as I'm the one doing it, it'll always be a 20% rush job.

Four misconceptions about Lean startup  

The Lean Startup methodology is frequently misunderstood, unfortunately. This article by Jim Kalbach is one more attempt to clear up some of the more common misconceptions, namely:

  • Lean startup is not an engineering process, it's a method for building startup, so it won't make your developers happy.
  • Lean startup doesn't mean "let's just shoot from the hip without overanalysing things."
  • An MVP is not a lightweight version of the product, it's the answer to a question, the resolution of your next most pressing uncertainty. More on this here.
  • User testing will not "slow you down" - it's the heart of the Lean Startup method: do stuff only to learn about what your customers need before they can give you money.

Read the whole article here.

What to look for when picking a VC  

Mark Suster:

So finally, how do you know if your VC will stick by you in good times or bad? How do you know if they’ll intervene in a positive way in conflict? How can you tell if they really are good at intros and follow through on what they say they’re going to do.

The best way – of course – is to reference check. Here’s how you reference check a VC (link to post with longer version)

  • look at their portfolio list
  • subtract out the super, crazy successful companies. a) they have no time for you & b) everybody who has a super successful out-of-the-gate company loves their VC because there was no conflict.
  • call the companies that are doing well but not yet household names. Ask about the criteria above.
  • more importantly, call the companies that struggled. You’ll learn most about VCs when you find out how they handled themselves in tough situations. Make sure to call 3-4 members of the management team to avoid one person’s bias

The list of criteria to pay attention to is great, very useful. If your business does require you to take investment from VCs, this is a very helpful article

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