Five years ago I resigned from an “integrated” multi-national agency to work for a startup. At the time, I was told by a manager that they’d be happy to keep my job for me. I was after all going to a startup… so who knew how long it would last. Ironically, that startup was so successful it was bought out by another multinational. But that’s a whole other blog post. A few years on, and with startup success stories flooding our feeds, larger organizations are starting to pay attention.
Like many of you, I like startups. And I like reading about them. Look at WooThemes, a South African company that creates premium themes for WordPress. Unlike the obvious success stories of FourSquare and Twitter, they’ve proven that you don’t need to live in California, get funding and go to the hot conferences to succeed. According to co-founder Adriaan Pienaar, the company makes about $2 million every year from theme sales. Not bad for a couple of designers with a dream. Woo and other successful startups may be the new kids on the block, but they are quickly becoming a source of inspiration for larger companies who have realized that they don’t have to necessarily be a startup, to think like one.
Now before I launch into it, please note that the below is a collection of stories, tips and truths from those who have lived to tell the tale. We, by no means consider ourselves experts on this, but rather want to share some learnings.
So let’s start with some reality checks brought to you by Joel Nielsen, founder of MediaShark
1. Startups are hard. Really, really hard.
2. Getting rich quickly is an oxymoron. Don’t be one.
3. You will be the founder, receptionist, IT guy and cleaner.
4. Fanciful things like annual leave and weekends don’t apply.
5. Most fail.
Still interested? Well before you run up to senior management with your groundbreaking idea or remortgage your house, here are some wise words from the trenches.
Some may call it bravado, ego, perhaps even stupidity, but no great ideas were achieved by being safe. The startup mentality of having nothing to lose leads to open, experimental and brave thinking. So put on your Superman or Wonderwoman suit and get in there.
Don’t hire your mum
.. Rather find people who are hard working like you, who roll up their sleeves and just “do”. Also learn to take on more yourself by re-organizing your staff and resources to match more immediate needs. A good place start is with tech support. Research by seed accelerator, Blackbox, has indicated that startups without a technical co founder are likely to scale prematurely, experience lower growth rates and need longer to reach product market than startups with a technical co founder. Geek it up people.
Shut your “but”
Its natural to act with caution and trepidation, after all this is probably your livelihood and resting on other people’s money. That said, fear can be a tranquilizer, stopping us from acting before we even get started.
Recognize these voices from your head?
• But.. we don’t have the capital
• But.. we don’t have the right staff
• But.. what about my day job?
Stop thinking your but and start thinking HOW.
As independent web analyst Joe McKendrick says, “Start with the future in mind. If you start with the current state you immediately constrain the innovation process for future state.” In fact he recommends starting with a blank sheet of paper and ask “If we were a startup and were starting business today, what would the future state look like?”
Now is not the time for pretty, so don’t spend months finessing things like your logo without actually making anything. And this goes for your suppliers too. “Look for smaller firms that are more interested in accomplishing things quickly vs. gold plating everything”, says Steve Furman, Founder and President of Expedient. As we all know by now, apps and platforms are constantly updating and improving, and consumers have adapted to this behaviour. Don’t be scared of not being perfect for launch. Befriend the “phase 2”.
Be the tortoise
With so many startups around these days, it was only a matter of time before someone created a system to help entrepreneurs assess themselves. It seems that Blackbox have been the first to release such a thing which they have titled the Startup Genome Report. It aims to provides a comprehensive map of factors beyond dumb luck, talent and cash that makes startups successful. It was developed through surveys and interviews with a thousand startups and provides a framework to help startups assess and understand their performance.
One of the key foundations of the the project was based on the foundation that startups evolve through four, top-level stages of development, (discovery, validation, efficiency, scale) and each stage can be measured with specific milestones and thresholds. The research found that startups that skip these stages perform worse as they tend to lose the battle early on by getting ahead of themselves.
Shameless self promotion – on a budget
Ok, so you have the idea and you think its brilliant. But now you need other people to think so too. The ad budget is tight to non-existent and you don’t know where to start. Its time to think context and audience. Who are they? “Every Australian” is just crazy talk. Make up personas if it helps. You’ll be surprised how much you’ll learn from them.
Where are they? Location, Location. Its time to get specific, like really specific. If you want to maximize impact, you don’t have many chances, so think smart.
Look at FourSquare for example, who started building in late 2008, but launched at SXSW in 2009. According to co-founder Naveen Selvadurai, “we really kicked things into gear in early 2009 so we’d have something ready to launch at SXSW — it gave us a deadline to shoot for. We weren’t sure if people were going to embrace us or laugh us out of the room for features like badges and mayorships, but everyone in Austin really seemed to get it.”
The startup raised its first round of funding six months after its SXSW launch.
One thing at a time
According to Scott Heiferman, founder of Meetup, a good company asks itself one question when it’s getting started: “What puzzle am I solving?” It’s important to stay focused on one task at hand, even when other stakeholders aspire to create a product that will offer a variety of services.
Be in love. Desperately.
More important than anything else is to create a product that you love and that people will love and want to use or be part of. Ensuring you have a strong user base first is critical to success. “If the product is good, and if it taps emotion and it taps a feeling, and it taps needs — hopefully it spreads around,” says Heiferman.
Make, test, iterate, test again
Focus your time on sketching, prototyping and testing. And hard as it may be, try and put business development, investors, partnerships or public relations out of your mind. Knowing your product thoroughly, from conception to launch will help the final outcome.
As Heiferman puts it, “You’ve got to be a maker and builder of the product”.
Turn left at the next intersection, then turn again.
You may have heard the term “pivot” being thrown around a bit in this space lately and essentially its all about not being afraid to change direction. According to lean-startup guru Steve Blank, “Startups that pivot, or change a major aspect of their business/ product one or two times raise 2.5 times more money, have 3.6 times better user growth and are 52 percent less likely to scale prematurely than startups that pivot more than 2 times or not at all.” In essence, be flexible and open to change.
Beg, borrow (don’t steal. Its not nice)
Talk to everyone you can about what you are doing and ask for help. Don’t be guarded with your idea. You need input from everyday people as well as more experienced entrepreneurs who can help point you in the right direction. According to Blank, “Startups that have helpful mentors and learn from thought leaders raised 7 times more money and have 3.5 times more user growth than those without mentors.” So start hitting your networks and get the word out there. And be grateful. Always.
So, there you have it, a collection of advice from those who have tried, failed, tried again and succeeded. And it doesn’t matter if you’re working out of your garage or a schlepper in middle-management with a dream, the above tips all apply. That said, it’s by no means exhaustive and there are truckloads more out there. And if you come across an interesting or inspiring article, please pass on.
Dave: BTW, Lee-at’s official job title on her contract is ‘Wonder Woman’. True.