When failure is a success
You know what sucks? Failing. Being wrong. Telling people you failed.
You know what sucks more? Wasting a bunch of time and money on something that can’t be a business.
One of the biggest pieces of customer development advice I give is to try prove yourself wrong. Try to invalidate your hypotheses and assumptions.
When you hear something that validates your hypotheses, second guess your interviewee. Dig deeper. Make them prove it. Make it clear that it’s ok for people to tell you your idea sucks.
When you try to prove yourself wrong, you are less-likely to get biased responses. You are less likely to get “false-validation” that could send you down a path of wasted time and money.
As an entrepreneur or intrapraneur, you probably have a big vision for your new startup. You want to bring it to life and accomplish your goals. Maybe you’ve told your teammates, friends, and/or family about it. You don’t want to have to go back and tell them you ended up being wrong.
However, failing fast is a success because it gives you more time and money to spend on better opportunities. It’s better to fail fast than slow, because it gives you more time and money to spend on opportunities that can help you accomplish your goals and that you can brag to your friends, family, and teammates about.
There are plenty of opportunities out there for all of us. The far scarcer resources are time and money. Don’t waste those.
To motivate yourself to “fail,” remind yourself of how much it would suck to spend a bunch of time and money on something no one wants.
Invalidating an idea through customer development should not be considered a failure, it should be considered a success.
The First Step to Take After Coming up with a Startup Idea
I’ve been looking for and starting businesses since I was a kid. In middle school I even had a business wholesaling vending machine goods hah. As I grew older I began thinking of more complex and technology driven ideas. After coming up with such ideas, the first thing I would usually do is ask a few friends and family who I consider to be smart and whose opinion I appreciate.
After reading books like The Startup Owner’s Manual, and learning about Lean Methodology and customer development, I learned that’s not exactly the best thing to do after coming up with an idea. I learned that the only opinion that matters is the customer’s.
While my friends and family may be pretty smart and some even entrepreneurially savvy, they don’t actually affirmatively know if people would want what I was thinking of marketing/selling.
I learned that one of the most important factors to consider was if it’s something that people want..
Yes there are many other strategic and personal considerations, however if it’s not something people want, then no strategy or marketing angle is likely to make it work. Conversely if there is something that truly of value to customers, many of the challenges associated with building a company, including customer acquisition, partnerships, etc., may be alleviated.
So, the first step to take after coming with a startup idea is to talk to your customers. Talk to, and more importantly, listen to, the customers that your product or service would be serving to see if they like your idea. It’s a process called customer development.
Customer development is practiced to validate that you’re solving a problem for someone and that they see your idea as a viable solution.
I also learned a more effective process for coming up with ideas. A process driven by meeting customer needs by using customer development to gain insights that inform product decisions.
The key takeaway of this post is that answers to our questions about ideas come from getting feedback from customers through structured interviews and experiments. I go into specific tactics you can use to test ideas and conduct customer interviews in my book and video course. If you would like guidance on first steps to take on your idea, let me know in the comments!
Did Snapchat just make a massive blunder?
It was recently reported that Snapchat turned down a $3 billion buyout offer from Facebook. Snapchat is 2.5 years old and hasn’t earned a single dollar in revenue.
For the non-financiers reading, the valuation of any asset is as much as someone is willing to pay for it, and people generally determine how much they’re willing to pay for a given investment based on their expectation for future cash flow. In the case of a company, cash flows come from either dividends paid to shareholders (ie profit) or a liquidity event (acquisition or IPO).
Who else would be willing to pay more than Facebook in the future? I can see the logic behind Facebook’s offer. They need to prevent competition and they have a ton of cash. But how many other companies in the world would have the motivation and the budget to provide Snapchat shareholders with a liquidity event worth more than that?
(Side notes: What does this say about Facebook’s business? Do they need to spend $3 billion for every mobile messaging company just to maintain and grow their business? And was it crazier for Facebook to make such an offer or for Snapchat to turn it down?)
Not only does Snapchat need to get a higher offer for their rejection to make sense, it needs to outpace their dilution. Since the company doesn’t make money, they will need to keep raising money. More outside financing means less ownership for the team and current investors. So while future valuations might be higher, each individual will have a smaller slice of the pie. Future offers will have to outpace dilution for it to be more profitable for the team and investors.
Yes, the company could also start making money, but as Shane Snow pointed out today, it looks like that will be tough. I agree and I really like his article so I’m not going to recite it. Read his analysis. It will be especially hard to earn enough profit to make them worth more than $3 billion as a standalone company.
I actually think this might go down as one of the biggest mistakes in the history of business. I think we might look back at this in ten years and say “wow, I can’t believe how crazy things were!” Then again, maybe Apple will offer $5 billion next week hah.
Customer Development: 14 Best Ways to Find Customers to Interview
You might have the best new product idea in the world, but until you find customers, it’s not actually a business. It’s important to find customers and conduct customer development interviews so that you can be sure you’re building something that people actually want and avoid spending time and money on something that people don’t want. Listening to your customers can also help you improve your offering from something that people “kinda like” to something they “love.”
Access to customers and ability to obtain interviews can be your first test of the viability of a business. If you can’t find customers before you have a product, what will you do when you have a product? Before you go out and start interviewing people, figure out who exactly you need to be interviewing. If you’re testing an idea, think about who you suspect is most strongly affected by the problem you’re solving or who would most passionately love your proposed product.
To find customers within your target segment, go where they hang out both online and offline. Think strategically about what activities your customers are likely to be partaking in, what groups and communities they’re likely to be a part of, and what social networks they’re likely to be active on.
Most of the channels below are not scalable or sustainable customer acquisition channels. However, scalability does not have to be your main concern at an early stage. Testing assumptions quickly, even if it costs a small amount of money, can save a lot of time and even more money in the future.
1. LinkedIn groups
If you suspect your ideal customers will have certain roles, be in certain industries, etc., try using LinkedIn groups to find potential customers. There are many groups for people who have specific roles, such as marketing, doctors, etc., and for many business related topics. Once you find someone you would like to interview, you can reach out through LinkedIn, ask a shared connection for an introduction, or find their contact information and reach out directly. If your customers are sales teams, you might check out this sales group which has nearly 150,000 members.
2. People you know
If you know people that fit into your customer segment, ask if they’re available for an interview. Be sure you’re talking to people who wouldn’t buy something from you just because they like you. Try to focus on gaining insight rather than pitching your idea, because your friends will be even more likely to agree with you. Here’s an example of a script I’ve used to ask people I know for interviews:
“Hi [their name],
Hope all is well! I’m looking for feedback on a potential product to help with [problem or process]. Given your experience, it would be great to get your feedback.
I don’t have a product to sell (yet)…I’m just trying to determine if it’s a problem worth solving in the first place.
Could I buy you a coffee next week to ask you a few questions and get your feedback?
3. Ask for referrals
Ask people you know if they know anyone that fits your customer profile. If they do, ask for introductions. Ask the people you get introduced to for more referrals. If someone is enthusiastic enough about your proposed product that they want to introduce you to their friends, that’s a good sign. Here’s a script you can use at the end of an interview to ask for referrals:
“Do you know anyone else who might have this problem that you would feel comfortable introducing me to so I could conduct a similar interview?”
You could also think of specific people you think could be customers, find them on Facebook or LinkedIn, and if you have any shared connections, ask the shared connection if they could introduce you.
4. Cold call or email
Get specific about who would love your product to the point of naming specific people. If your customers are businesses, find the contact information of a decision maker and reach out to them cold. The response rate to cold outreach is likely to be well below 100%, but if you phrase it correctly, you should get some responses. Here’s an example of an email template I’ve used:
“Hi [their name],
I’m Mike [link to page with my bio]. I’m looking for feedback on a potential product to help with [problem or process]. I came across your LinkedIn profile and it looks like you have a lot of experience with [problem or process], so I was hoping to get your feedback.
I don’t have a product to sell (yet)…I’m just trying to determine if it’s a problem worth solving in the first place.
Could I ask you a few questions and get your feedback over a fifteen minute phone call?
They key components of the email are that it 1) explains I don’t have a product to sell 2) asks for feedback, to position them more like a potential partner than a potential customer, 3) lets them know it won’t take up much of their time, and 4) very briefly describes the problem or area I’m trying to help with to pique their interest enough to respond.
Meetup.com is a site where people join groups around their interest and organize offline events. It’s become quite popular so there’s a good chance there’s a group for the customers you’re looking for. If you’re targeting mothers, look for a meetup group for mothers.
Once you find a relevant group, you could attend their next event, where you’ll find a group of potential customers you can interview in person. You could also reach out to the organizers or specific people within the group through Meetup’s messaging system.
6. Conferences and events
Conferences can be a great way to find customers to interview if you’re working on an enterprise product. If your customers are publishing companies, go to a publishing conference. If your customers are young party-goers, go to a bar crawl. Eventbrite is a great place to find conferences and events.
Craigslist has many different categories of listings and gets a lot of traffic. Try reaching out to posters on categories related to your product. You can create your own listing to generate inbound. For example, if your customers are real estate brokers, search for apartment listing with brokers.
Search for relevant hashtags and phrases on Twitter. For example, if your customers are babysitters, search for people talking about babysitting. Once you find them, you could Tweet asking for feedback or direct message them after following them.
Facebook has several functions that can help you find potential customers. Using Facebook search, you can find people based on a wide range of different criteria, including interests, as shown below.
Facebook has groups for many different topics. If your customers are authors or content creators, you might check out a Kindle self-publishing group. You could then join the group create a post asking for interviews.
Running a small Facebook ad campaign to drive traffic to a landing page, can be a great way to find target demographics as well. Include a small amount of copy on the landing page briefly describing your value proposition or the problem you’re solving and include an email submission form.
10. Create a blog
Creating content that’s valuable to your customers can lead to inbound traffic. While it may take a long time to build substantial traffic, if it’s a customer segment you’re passionate about serving, creating content shouldn’t be a huge chore. Be sure to enable commenting to encourage discussion and interaction, and to have an email address submission form. Blogging can also become a great customer acquisition channel and is for many companies.
11. Offline paper handouts in public places
Go where your customers spend time offline and attract their attention with flyers and business cards. For example, if your product is fitness related, try posting on a board at a gym. Include your email address or a link to your landing page.
Kickstarter is a great way to get validation for your product. It enables you to pre-sell your product to their audience of existing users. I recommend doing some research to determine if Kickstarter would be right for your product.
13. Hit the streets
If your customers are families, go to a family-centric neighborhood such as a suburb. Stop relevant people on the street and politely ask them if you could ask a few questions related to the problem you’re solving. Most people will be happy to help. If you’re customers are restaurants, think of one in your neighborhood that you can walk in to and ask for an interview.
Quora can be a great resource for gaining customer insights. There’s nothing as valuable as in-person, one-on-one, customer development interviews, however Quora can be a great supplement. Look for questions and review pages relevant to your customers or the problem you’re solving. If your customers are human resources people or people you are hiring, you might want to read a thread similar to the one pictured below.
You could reach out to the people that are answering, voting on, or following the questions to ask for feedback, especially if they describe having the pain you’re solving for. You can use a script similar to the one described in the cold outreach section.
To learn more, check out “Customer Development for Entrepreneurs”: the book, and the video course.
The best “networking” doesn’t happen at events
Conferences and “events” can be a big time commitment, and sometimes the crowds are sub-par. Don’t get me wrong, I think there is a lot of value in going to big events. Especially if you’re building up a new network in a new industry.
Many people complain that they only meet a couple good people at events. My counter-argument is that that’s actually a great return. If you meet even one person at an event that turns into a lasting and mutually beneficial relationship, that drastically exceeds the cost of attending one or more events
However, now that I’ve built up a solid base network, I do most of my “networking” by asking for introductions. I’m now very intentional about who specifically I want to be meeting. I find them on LinkedIn and if we have any shared connections, I ask for an introduction. Otherwise I try to interact with them online, usually via Twitter or commenting on their blog, before reaching out directly. I also get a lot of recommendations about who I should meet (and introductions) from people I know.
The next biggest way I meet new people is from cold outreach. I don’t get anywhere near a 100% response rate, but I’ve been really surprised by how many new connections I’ve been able to make through cold emails. I think having a solid online presence (Twitter, blog that let’s people get to know me, etc) helps me get a higher response rate.
I really like private events and happy hours. I can be confident the crowd will be good. I try to organize them myself sometimes too. It allows me to introduce people to each other informally and to hang out with people I already know in a relaxed setting. I usually tell people they can bring people too, which allows me to meet some new people as well.
Niche events and groups around stuff you’re passionate can also be great. Even if it’s not a professional interest, it can still be a great way to “network.” I’ve found that good people know other good people, so I try to spend time with people I like rather, than just people in certain industries or with certain job titles. In addition, by engaging with people around a shared interest, you can get to know each other much better.
Conclusion: Conferences and networking events can be really valuable. You never know who you’ll meet, and meeting just one great person makes it all worthwhile. If you’re building a network in a new industry, they are a great way to get started building a new network. After building up enough contacts and a good reputation, asking for introductions to specific people is probably the best way to go. Cold outreach and private events can also be productive.
To learn more about building a professional network, check out my book.
A Tactical Guide to Customer Development
I’m super excited to announce I’ve published my second book, “Customer Development for Entrepreneurs: How to Test Startup Ideas and Build Products People Love”!
Customer development is a process for discovering and validating market demand for an idea and determining the right product features to meet customer needs. Customer development is used to help build products that customers want and avoid spending time and money on products customers don’t want. It can be used to identify problems and new startup ideas, to test ideas, and to optimize ideas and existing products. Customer development helps us learn about our potential customers so we can build products they will actually use.
Customer development and Lean Startup methodology have become quite popular with entrepreneurs. I wrote this book to be a supplement to books like The Lean Startup and The Startup Owner’s Manual. Without rehashing too much of what they’ve taught, this is a tactical guide to practicing customer development. Many entrepreneurs and corporate innovators know they need to be practicing customer development, but don’t know how to do it in a way that will help them build awesome products.
How to Get Startup Ideas Through Customer Development
How to Test a Startup Idea’s Viability Before Building a Product
How to Find Customers to Interview
How to Ask for and Get Customer Interviews
How to Gain Customer Insights to Build Products People Want
The Best and Worst Customer Development Questions to Ask
How to Optimize Ideas and Existing Products
Common Mistakes to Avoid
When I first learned about Lean methodology and customer development it was mind-blowing. I’ve been thinking of and evaluating startup ideas for as long as I can remember. It’s helped me to focus my ideas, and helped me avoid wasting a lot of time and money and products that no one actually wants. This book is a compilation of everything I’ve learned through study and practice.
It’s an ebook that can be read on Kindle, ipad, or a computer. To learn more and order it, click here.
Scalability is not always the most important consideration
Ability to scale is of course required if the goal is to build a large and profitable company. However I think there are a few situations where scalability is not the most important thing to worry about. In fact, doing things that are not scalable can be beneficial in some cases. Below are some thoughts with support from some quotes from Jason Freedman and Paul Graham.
“In the pre-product-market fit stage, you are really just running an experiment. Anything you do that allows you to test your thesis faster is worth it—even if it means doing a bunch of manual work that will have to be replaced later.” - Jason Freedman
A startup’s riskiest assumption at first is that it’s something people want. If it’s not something people want, scalability doesn’t matter. Because there will be nothing to scale. Doing things that don’t scale at first can help you test faster.
“It would be a little frightening to be solving users’ problems in a way that wasn’t yet automatic, but less frightening than the far more common case of having something automatic that doesn’t yet solve anyone’s problems.” - Paul Graham
Brand, feedback, customer support
“You should take extraordinary measures not just to acquire users, but also to make them happy.” “For most successful startups it’s a necessary part of the feedback loop that makes the product good.” - PG
Doing non-scalable things can help in getting customer feedback. I’ve noticed a lot of startup products I use are extremely attentive to my needs. When I ask a question I get quick and thoughtful responses. It improves my perception of the company and I’m sure it helps them understand how people are using their product and what they may need to do to improve it.
As an example, AirBnb flew to New York while at Y-Combinator to help users improve their listings by taking professional photographs. It was a product and user experience improvement that showed measurable growth in revenue.
“Tim Cook doesn’t send you a hand-written note after you buy a laptop. He can’t. But you can. That’s one advantage of being small: you can provide a level of service no big company can.” - PG
A business doesn’t have to be at scale, or even scalable, for it to be a great business for the founder(s). For example, angel investing and VC firms don’t scale, but they don’t need to. They just need one or two home runs and they’ll have a great business. Being an entrepreneur is even less scalable (time is less scalable than money). As another example, a small, or “lifestyle business” can provide a great return and lifestyle for the founder(s).
As a final example, some larger agencies, consulting companies, and other service firms have tons of employees and revenue and are quite profitable. Service work such as wealth management, advertising, strategy consulting, etc. is not “scalable” because of how much manual human work it requires, but these companies can still grow to be large, profitable, and by most definitions, “successful” companies. The growth may not be as fast, but what’s wrong with that?
Non-scalable growth channels can lead to more scalable growth channels. For example, Direct sales or partnerships is costly and difficult to scale, but can lead to other, more scalable channels of growth. Using sales or partnerships can prove a concept and improve “awareness,” which can lead to more scalable channels such as virality or search.
As an example, AirBnb famously flew New York to manually recruit users while at Y-Combinator. This is not scalable, sustainable, or profitable. But it allowed them to prove the concept and it’s clearly lead to more sustainable growth channels.
Scalability should certainly be a concern if the goal is to do so, however I think some people get overly concerned with it, especially early on. Doing things that don’t scale can have many benefits, and may not be necessary at all depending on goals.
9 Factors for evaluating business ideas and opportunities
Since I was a kid I’ve been looking for new business ideas. In middle school I even started vending machine product wholesaling business hah. As I’ve grown older (and wiser ha) I’ve learned to screen and evaluate opportunities more effectively. Different people will have different criteria depending on things like risk tolerance, career goals, budget, etc. Below are some factors to consider when deciding what to pursue along with my personal criteria given my short-term and longer-term goals.
Relationships. Having existing relationships with necessary customers, partners, hires, investors, etc. can be save a lot of time, reduce costs, and reduce risk. Without existing relationships the team will have to form them, which takes time and there is risk in being able to form them at all. For example, if you don’t know how to code, and you’ll need a technical co-founder for the business, and you don’t know any, that’s one more roadblock to getting your business off the ground. Which doesn’t mean you shouldn’t do it, it’s just important to consider how many roadblocks you’re going to have before you go down the path.
Access to customers. If I can’t get enough customer development interviews within a reasonable period of time, then it will be that much harder and take that much longer to get started. Conversely, if I have existing relationships with, or at least easy access to, customers I can get feedback on my product much easier. When the time is right, sales and marketing will also be that much easier, shorter, and cheaper with existing access to customers. For example, if Tim Ferriss wanted to launch a productivity related product, he would have an advantage because of all of his existing relevant blog traffic and subscribers. I’ve seen access to customers be especially important to enterprise products. Having relationships with decisions makers helps with customer development and sales.
Passion. Starting a company is hard and time consuming. If I’m solving a problem I’m passionate about and/or serving a customer segment I enjoy spending time with, my overall quality of life will be higher, and I believe I will be more successful. In starting a company, you inevitably have to ask a lot of people for help. For example, big things like introductions to key people, or for small things like to share your site with their friends. I want to be in a business that I’m proud of and passionate about so I’m motivated to hustle. Many businesses require spending a lot of time with customers, so I’ll want to enjoy that time. Lifestyle is an important factor to me.
Skillset required. If the skillset required to execute the business plays to the strength of the team, execution risk should be less. For example, distribution: I wouldn’t want to start a business with a sales distribution strategy if I didn’t know sales. Conversely, if it’s a consumer app that acquires customer through search, a team of SEO experts could be pretty effective. If I’m trying to solve a hard technical problem, I would want to make sure I have incredible technical talent on board. I would be more confident in an entrepreneur that’s started one or more ventures previously, or at least has experience in the skillsets required to start and run the business. As an entrepreneur, I’d want to start a business that requires skills that I have. Of course you can learn, but that becomes one extra cost, time constraint, and risk.
Ability to validate. How confident can I be, or quickly get, that I’m pursuing a viable business? If I can’t get 10 customer development interviews within a week, and begin to prove there’s a viable business within a few months, I don’t want to do it. I know that massively limits my upside, but again, my goals are specific. Does it require product development to get validation (ie something like Snapchat)? Do I have to sit through 10 month sales cycles to know if it can be sold? Those are risky paths to go down. That’s part of the reason I’ve been interested in companies solving known and validated problems or in existing and validated markets (second movers).
Need for financing/ability to generate cash flow. If a lot of money is required to start testing the concept, either because costs are high or because it will take a while to become cash flow positive, financing will be required either from founders or investors. If you don’t have any existing relationships to investors, or at least close connections, that’s, another time suck and risk factor. It’s certainly surmountable though if you’re good. Raising money, while glorified in the media, does have downsides. For example, you can lose some control over your business and you have to give up equity (and therefore upside). The more cash you need at the start, when your valuation is the lowest, the more equity you will have to give up.
Diversified. I never want to have all my eggs in one basket. I don’t want my life to be dependent on one customer or employer. I don’t want one trend, industry, or customer group to effect everything I’m doing. It’s easy for investors to diversify. For entrepreneurs it’s a bit harder, but possible. I personally don’t have a very wide portfolio now, but I plan to.
Size of market/opportunity. How much upside is there? If your goal is to build a massive company, you will need to be in a massive market. This item will largely depend on personal goals.
Quantity and quality of work. How enjoyable will the work be? How much time will it require? Most opportunities will require significant time investments. Overall lifestyle is an important factor to me, so I wouldn’t want to spend 100 hours a week doing something I hate. This factor should likely be considered as a ratio to potential upside (see above). For example, I would trade 24 hours of awfulness for $1M, but I wouldn’t trade 5 years of awfulness.
A lot of entrepreneurial content encourages persistence, hard work etc. “If you put your mind to it you can do whatever you want.” The reality is there are many challenges from starting to growing, and different factors that can make an opportunity more or less likely to succeed.
It’s probably pretty rare for opportunities to meet all of these criteria perfectly. Likely have to accept what I can tolerate and go for it. If it was perfect and easy, there would likely be a lot of others doing it, and therefore less upside.
These are some of the same factors I use for evaluating opportunities others are pursuing. I just put the team in the position of the above.
There are plenty of opportunities out there, it’s just a matter of choosing which is best. Everyone’s personal criteria and factors will probably be different depending on their goals.
Why I stopped watching the news, following politics, and voting
One of the most contrarian beliefs I have is that most people should stop watching the news, following politics, and voting. Almost everyone believes that you should, and I don’t think enough people have questioned their reasoning behind it. It’s been such a widely and strongly held belief that no one has thought to question it. In fact, I think it can be quite detrimental. Here are my key reasons for not watching the news, following politics, or voting:
News is all negative
The news is full of reports of crime, violence, poverty and other awful things. It makes people scared and worried. It elicits negative thoughts. I don’t need or want those negative thoughts. I don’t need to know about another of the many murders that happen all the time, or the guy that got hit by a car crossing the street. It won’t help me. I like positive thoughts.
Lack of control
Our government is almost completely out of my control. It’s tough to think about the armchair-politicians that spend so much time complaining about politicians as if they know everything and could do a better job, but are really just spinning their wheels because nothing they say will have any impact. As much as people like to think they have in impact by protesting, petitioning, voting, etc., they really don’t. Not even the president has as much impact or control as some people seem to think.
Impact on my goals and personal happiness
"I will never care about who is president. Not a single politician has ever made me happier or sadder. So I don’t care about who is elected ever." - James Altucher
I love this quote. Public policy and elected officials don’t have to have an impact on my day to day activities, mindset, or life if I don’t want them to.
Some people are good at politics
I’m not that good at it. It wouldn’t be beneficial to me or society, to spend my time thinking about politics. There are some people who are good at it and they should be participating in our political system. Surely there are people who are worse at politics than me and I don’t think it’s best for them to be actively participating either. I’m not saying democracy is a bad thing, I just don’t think it’s necessary for many, myself included, to be making policy decisions.
Almost everything in government is broken. Everyone knows the problems, so I’m not even going to cite them. It’s frustrating to watch, let alone participate in. Even the simple fact that you have to take off from work to go wait in line, sometimes for a really long time, to vote is just appalling. I worry our political system is never going to get any better.
It’s not fun for me
I know there are many people that actually enjoy analyzing and following politics. By all means, those people should knock their socks off and follow away. I personally do not get that enjoyment. So I don’t do it.
Life is too short
“I can either have a strong opinion (then I can argue(!), fight(!), sign petititons(!)). Or I can spend my time enjoying things.” “I don’t want to waste my time getting angry. Or arguing with people. Or trying to convince people they are wrong about their plans for me.” - James Altucher
One of the most common rebuttals I get to my beliefs is that it’s my “duty” to society to participate. Call me selfish, but I would rather spend my time on things that can help me achieve my goals than trying to change things that can’t be changed. In fact, I believe society will be better off I focus on what I’m better at and more passionate about.
Flawed voting system
If I’m in a swing state my vote doesn’t matter. If I vote for an alternative party that doesn’t get any electoral votes, my vote doesn’t matter. Adding to the number of people that don’t vote is as good as voting. Not voting might even have a positive impact on the problems in that people might be motivated to spend the shocking amounts of capital that gets spent on campaigns on better things if they realize it’s not having an impact.
I try my hardest to ignore politics completely because it only leads to negative thoughts and frustration. Instead of getting caught up in at all and even more frustrated, I’ve decided to focus on what makes me happy. I’m not trying to convert you, I’m just sharing my opinions. When beliefs are so commonly held and for such a long time, we can forget to question them. Think about how much you benefit from watching the news, following politics, and voting, and what else you could be doing with your time. You may find you’ll be happier and better off by not participating.
Two surprisingly essentials skills in entrepreneurship: tolerance for uncertainty and self-reliance
During my brief stint in entrepreneurship, and hanging around Silicon Alley for as long, I’ve realized there are two mindsets that extremely important. They seem to big challenges entrepreneurs face, yet not many seem to talk about them. I’m talking about the ability to tolerate uncertainty and to be self-reliant. Here’s what I mean:
Tolerance for uncertainty
Most people hate the feeling of uncertainty, or not knowing what to do or what’s coming next.
In starting a company, there’s a ton of uncertainty. You don’t know if the path you’re going down will lead to reward. “Will this deal close?” “Will this marketing channel lead to profitable customer acquisition?” You may not know if you have a viable and sustainable business for a year or more. There’s also a million different things you Could be doing at any time.
Most people don’t like to make decisions. People like having a “path.” They prefer stability and certainty in career, income, and in the ability to live a stable and “normal” life. I think lack of tolerance for uncertainty is a big reason why some people choose graduate school (and potentially even undergraduate school). It allows you to delay making serious decisions and puts you in a path dictated by someone else, where you don’t have to make as many decisions.
Dealing with uncertainty has been tough for me too, but I’ve learned to cope with it. Plus I’d hate the alternatives hah so I just try to enjoy the process. I just acknowledge the feeling, accept it, and take the action that’s needed at that time. I’ve learned that developing a strong tolerance for uncertainty can help both my personal and professional life.
In a startup, nothing happens unless you make it happen. You might have an “idea,” but nothing will happen until you build a product or get a customer. You might have a product, but nothing will happen unless you go get customers.
At a job, you’re told what to do. Work comes to you. As an entrepreneur, you must create for yourself. You’re not dependent on others. You must either sell a product or sell a service to build a business.
Being self-reliant means using one’s talents and discipline to take action and create for yourself.
Simply tolerating the uncertainty, making tough decisions, taking action, and accepting risk, seems to be what really separates entrepreneurs from the crowd. As I forge on with my “career” as an entrepreneur, I will keep these two factors in mind.
Lessons learned after 100 blog posts
After publishing my 100th blog post (!), I am taking some time to recap what I’ve learned and the benefits I’ve received along the way. Like many others, I started blogging after countless people shared with me the amazing benefits of doing so. It turns out they were right - it’s been an amazing experience. Here is a summary of what I’ve learned, the benefits I’ve received, and some advice on getting started and creating content.
Teach to Learn. After blogging and teaching classes via Udemy and Skillshare, I’m a big believer that the best way to learn is to teach. Actually sitting down to create content requires thinking through everything and helps identify the knowledge gaps on the topic. I then feel compelled to learn what else I need to. The process of teaching also helps reinforce what I already know.
Writing as Therapeutic. I’ve grown to really enjoy the process of writing. Some posts I publish just for enjoyment…not necessarily to get traffic or promote my brand.
Quantity vs Quality. I think there’s value in both frequent short posts and less frequent highly thought-out posts. Both have pros and cons. Long-form content is generally posted on my HuffPost blog and short-form content is here. Publishing frequently has been great for getting myself in the habit, however I feel I am in the habit now and I’m going transition to longer form, more thoughtful content. I will be loosening my frequency goals to focus more on quality then quantity. I’m completely impressed by people, such as Fred Wilson, who can blog every single day or close to it and still maintain quality.
Meet New People. I’ve met some great people through the blog. It’s a great way to reach a new audience and it’s a great feeling to know that people are enjoying and getting value from my writing.
Build Rapport. The blog has proven to be a great way to stay in touch with friends and colleagues and is a great way for new people to get to know me. Old friends with whom I don’t have regular contact tell me how they keep up with what I’m doing by reading the blog. There have also been multiple people I’ve met for the first time that already know a great deal about me because they’ve been following the blog. When new contacts do some research and come across the blog, its an opportunity to show that I’m (hopefully) a bit interesting and worth responding to or staying in touch with.
Hit or Miss. Some of my posts get shared a lot and get a lot of traffic and others don’t. I’m fine with that. It’s really rewarding when people feel strongly about a post. You know which posts don’t get any traffic? The ones you never publish ;-)
Traffic and Monetization. When I started the blog my goal was never to reach a massive audience or monetize in any way. It was just to help people within the startup world get to know me. However 1) I’ve learned of the great business opportunities that a blog following can create and I’ve started creating some paid content and 2) Creating great content is the best way to accomplish my original goal and to monetize. This is part of the reason why I’m shifting to longer-form content and trying to create content that’s valuable to my readers and not just helpful to me. Don’t worry, I’m not going to start getting spammy or anything, I’m just putting more emphasis on creating valuable content that people want to read and share.
Comfort Zone. Sharing my thoughts with the world has actually pushed my comfort zone. I remember the first several times I clicked “publish” it was actually a pretty big rush. I’m a big believer that extending my comfort zone and improving my tolerance for fear will help me accomplish both my personal and professional goals. Blogging has been a simple way to push myself a bit.
Writing as a Skill. I think I’ve gotten both better and faster at writing. I think writing is a valuable skill to have. It’s helpful for many jobs, and in creating content. I’m finding it much easier and less time-consuming to write blog posts and books (I’m writing another one on customer development now).
If you haven’t started blogging yet, I highly recommend you do so! Starting with short posts and pushing yourself to publish frequently is a great way to get started. For all the reason I have mentioned, I’ve benefited tremendously.
Thank you to my readers and subscribers for hanging out with me for 100 posts! I want to deliver the best content possible, so please let me know if you have and suggestions, feedback, or advice!
Startup of the Week: Skillbridge
This week’s Startup of the Week is Skillbridge. They’re a pre-seed startup that I think is tapping into a massive macro trend that I’ve written about previously. More information and analysis below.
Customers: marketplace where supply is high end strategy, finance and marketing professionals and demand is large companies seeking compatible project work
Problem: disconnected marketplace currently driven by referrals, intermediaries charging massive brokerage fees (large consulting strategy firms, recruiters, etc.)
Product: online talent marketplace for companies to find high end business freelancers for short-term strategy, finance and marketing projects
My analysis: Companies like Elance and oDesk (which are two of my favorite later-stage companies) have grown tremendously applying the marketplace model to low-end providers of technology and creative talent. Yet the biggest growth in freelancing have been in areas of financial planning and analysis, accounting and legal strategy, where only behemoth firms have dominated.
By hiring through Skillbridge, companies don’t have to pay for the overhead of a traditional consulting firm. The existing strategy consulting firms are almost like high priced brokers - connecting their employees to their clients and collecting a large margin in between. These skilled workers haven’t previously had an efficient manner to get work other than to join a firm, but Skillbridge is making it easier to do so and is saving clients the premium.
The large consulting firms are taking the premium between what they pay their employees and what their clients pay. With a more efficient means for connecting these professionals with clients, Skillbridge has the opportunity to change this industry.
One of the social trends that Skillbridge is tapping into is people’s increasing desire for flexible work arrangements. More and more, people, high end professionals included, are seeking to combine pursuits such as travel, family, social engagement, and entrepreneurship with the ability to monetize their much sought-after skills as part-time freelancers. In fact, United States’ freelancers have grown from 6 percent of the total workforce in 1990 to 20 to 30 percent now.
It’s interesting that many of the qualified consultants in Skillbridge’s marketplace are stay-at-home parents and people who either aren’t in a position to work full-time or aren’t interested, but they are willing to take on smaller projects or part-time work with flexible hours.
Skillbridge is operating in a highly inefficient market (for both sides) and is getting great traction doing so. The demand from both sides is there, and Skillbridge is eliminating the barriers keeping it from becoming a reality by making it easier for these two sides to connect effectively.
Concerns: a) How important is “brand” to both companies and consultants? That seems to be why Bain can charge such a high “brokerage fee” and why positions at their firm are so highly sought after. With Skillbridge be able to change these beliefs and behaviors? b) Can they acquire consultants and clients at a cost low enough to make for a profitable business and be competitive in the space?
Team: Raj - Wharton MBA, strategy consulting. Brett - Wharton MBA, strategy and PE at Bain. Tony - former Hunch and ebay Engineer/PM. Very relevant backgrounds for the space they’re in. They’re working with some strong technical talent expected to be full-time after next funding round.
Funding: Angel from Dorm Room Fund (backed First Round Capital), MassChallenge.
Twitter Founder on how to build great products
One of the most interesting articles I’ve read in a while was “Twitter Founder Reveals Secret Formula for Getting Rich Online.” It covers a talk Evan Williams (Founder of Twitter, Blogger, and Medium) gave about how to build successful products. Here are the points that stood out to me and my commentary:
“At a time when so many internet entrepreneurs are running around Silicon Valley trying to do something no one else has ever done, Williams believes that the real trick is to find something that’s tried and true — and to do it better.”
-This made me realize that while many products, including Twitter, may seem to be “new experiences,” they’re actually just tapping into existing behaviors and make them better. I’ve also been fascinated with “second mover” businesses lately.
“the internet is “a giant machine designed to give people what they want.” It’s not a utopia. It’s not magical. It’s simply an engine of convenience. Those who can tune that engine well — who solve basic human problems with greater speed and simplicity than those who came before — will profit immensely. Those who lose sight of basic human needs — who want to give people the next great idea — will have problems.”
-I love the idea of targeting a validated problem/use case instead of just an “idea.”
“We often think of the internet enables you to do new things,” Williams said. “But people just want to do the same things they’ve always done.”
-Interesting to see how this manifests itself in the recently successful technology companies. For example, Uber.
“The internet makes human desires more easily attainable. In other words, it offers convenience,” he said. “Convenience on the internet is basically achieved by two things: speed, and cognitive ease.” In other words, people don’t want to wait, and they don’t want to think — and the internet should respond to that. “If you study what the really big things on the internet are, you realize they are masters at making things fast and not making people think.”
-I wonder if/how this will affect people going forward.
The key to making a fortune online, Williams told the XOXO crowd, is to remove extra steps from common activities
-You can see countless examples of this in successful technology companies: Blogger, Google, Uber, Amazon, etc.
“Here’s the formula if you want to build a billion-dollar internet company,” he said. “Take a human desire, preferably one that has been around for a really long time…Identify that desire and use modern technology to take out steps.”
-He makes it sound so simple lol. That may be all you have to do, but finding the right opportunity is still pretty hard. The first example that comes to mind of a recent product that supports a human desire is Snapchat but there are many including Twitter.
“[Agriculture] made life better. It not only got people fed, it freed them up to do many more things — to create art and invent things.”
-While the automation and “disruption” going on right now may be destroying jobs, I do believe in the long-term it’s creating opportunities at an exponential rate for good entrepreneurs.
The rub is that we often take convenience too far. “Look at a country full of people who have had such convenient access to calories that they’re addicted, obese, and sick.” He likens this agricultural nightmare to our unhealthy obsession with internet numbers like retweets and likes and followers and friends. The internet wants to give them exactly what they’re looking for. And people who understand how to channel that tendency will be disproportionately powerful.
-The converse of the conversation from the quote above, is that people can get spoiled. I think we’ll see an increasing wealth gap between creators and consumers. It will be interesting to see how this plays out.
Everything you ever wanted to know about networking
After realizing the massive importance of building a strong professional network, I began scouring the web, Amazon, and bookstores for resources.. I found there were resources on related topics, such as interpersonal communication, but not many great resources on business networking specifically.
I began asking everyone I know who has had a successful career, built a successful business, or simply knows a lot of people for their advice on how to build a professional network. After compiling the best advice I received, studying every relevant book and resource I could find, experimenting, and practicing, I learned a lot about how to effectively make new contacts and build relationships.
I’m excited to announce that I’ve self-published a book, sharing all of my knowledge gained from years of studying and practice!
I’m running a free promotion starting today (10/04/2013) and ending on Tuesday (10/08/2013).
To learn everything you ever wanted to know about networking for free, click here to view my newly published book on Amazon.
Startup of the week: Hublished
This week’s startup of the week is Hublished. I met one of the Hublished guys a while back and it sounded pretty interesting. After hearing their pitch at NYC SeedStart’s demo day it sounded way more interesting. Here are the cliffnotes:
Customer: B2B content marketers - webinar creators
Problem: Distributing and managing webinars
Solution: Life cycle management and automations tools to create optimized landing pages, track results, and improve demand generation
Market: Small but growing
My analysis: The value of content marketing is no longer a secret. However the value of webinars specifically seems to still be. Data shows webinars are one of the most valuable marketing channels for b2b companies. Because it’s a relatively new market, many essential tools and solutions have not been built and content markets are still “hacking them together.” Enter Hublished. One of the things I like most is the market they’re in. I think this will be a great customer base to serve for the long-term. It’s a new market ripe for solutions and Hublished is solving essential problems of time and distribution. It seems small now but I would be willing to bet that it will grow enough to make Hublished an extremely valuable company.
Concerns: 1) Young team, 2) Trying to solve many different problems, most of which have some competition, 3) Good traction, but only with relatively small disparate customers.
Funding: NYC SeedStart + Angels
Note: the product they pitched was a little different than what’s on their website. Seems they have pivoted a bit.