Category Archives: Founder Stories

Bootstrapping to Success

Rob Walling, from Micropreneur Academy, has a great post about successful startups that bootstrapped their way to becoming profitable. It’s a great list and nice tales that gives us bootstrappers more incentive to keep on going!

Check out “Ten Highly Successful Bootstrapped Startups” for the full article.

 

The Secret Language of Entrepreneurs

Dictionary by jwyg @ flickrThis is a pretty funny (and true, I have to admit) list of terms used in the startup scene, be it Boston, New York, or Silicon Valley.

Stephanie Kaplan, Co-Founder & CEo of Her Campus Media, tells us what commonly used phrases really mean, so that next time you think you got that VC interested, think twice. For example:

  • We’re swamped right now: 1. I can’t deal with you right now; also: You’re annoying me (See: “Check back with me in 6 months”) 2. (In rare cases) We’re actually super busy right now.
  • This week is crazy for a call, so why don’t you just shoot me some ideas via email?: You are not worth taking the time for a phone call.
  • That sounds really interesting: I have no idea whether your offer is good for my company or not, so I’m going to say the most neutral thing possible for now until I talk to my advisors.
  • Our web team is slammed right now: My technical co-founder is really busy.
  • Let me check with legal: Let me put the phone down for a minute and ask my co-founder.
  • Let me check with accounting: Let me put the phone down for a minute and ask my co-founder.
  • Let me check with the web team: Let me put the phone down for a minute and ask my co-founder.
Check out the full article, “Entrepreneurese 101here.

Now I Feel Old! List of Young Entrepreneurs by Inc.

As if I haven’t already been thinking that the grey hairs on my head have been taking more space than usual, Inc Magazine just published a list of “30 Under 30“, telling us that a lot of the startups we know, use, and love have founders who are (ghasp!) under 30 years of age!

Some of the companies you undoubtedly have heard of:

  • 99designs (Matt Mickiewicz, 27)
  • Dropbox  (Arash Ferdowsi, 25; Drew Houston, 28)
  • Foodspotting (Alexa Andrzejewski, 27; Soraya Darabi, 27; Ted Grubb, 29)
  • Grasshopper (Siamak Taghaddos, 29; David Hauser, 29)
  • Hipmunk (Adam Goldstein, 23; Steve Huffman, 27)
  • inDinero (Jessica Mah, 21; Andy Su, 20)
  • Instagram (Kevin Systrom, 27; Mike Krieger, 25 )
  • Onswipe (Jason Baptiste, 25; Andres Barreto, 24; Mark Bao, 18)
  • Quora (Adam D’Angelo, 26; Charlie Cheever, 29)
That’s quite a list. Check out the full listing of all 30 companies at Inc’s website

What Makes a Successful Startup?

An interesting post from Steve Blank talks about how he met the guy who went on to found The Startup Genome Project and just released their first report on what makes a startup successful.

Key findings are:

  1. Founders that learn are more successful
  2. Startups that pivot once or twice times raise 2.5x more money
  3. Many investors invest 2-3x more capital than necessary in startups that haven’t reached problem solution fit yet
  4. Investors who provide hands-on help have little or no effect on the company’s operational performance
  5. Solo founders take 3.6x longer to reach scale stage
  6. Business-heavy founding teams are 6.2x more likely to successfully scale
  7. Technical-heavy founding teams are 3.3x more likely to successfully scale with product-centric startups with no network effects
  8. Balanced teams with one technical founder and one business founder raise 30% more money
  9. Most successful founders are driven by impact
  10. Founders overestimate the value of IP before product market fit by 255%
  11. Startups need 2-3 times longer to validate their market than mostfounders expect
  12. Startups that haven’t raised money over-estimate their market size by 100x
  13. Premature scaling is the most common reason for startups to performworse
  14. B2C vs. B2B is not a meaningful segmentation of Internet startupsanymore because the Internet has changed the rules of business
It’s worth checking out. Get the Startup Genome report here.

What Office Hours at YCombinator Looks Like

If you ever wondered what would be like to chat with Paul Graham about your startup, here’s your chance to take a peek at what’s like to be questioned, contradicted, and enlightened during YCombinator‘s famous “office hours”.

At TechCrunch Disrupt, they asked Paul to give a few startup founders some on-stage advice as if he were talking to his own incubator companies. The result is pretty entertaining and makes you think about the questions he poses and what you would answer.

The two key questions that came up during every single interview, are “what problem are you solving” and “who needs your product desperately”. Think about that for a moment and write down your answer. Now watch the video and see how others tried answering these same critical questions.

Click the image below to watch and enjoy!

TechCrunch Disrupt Office Hours

The Founder Conference 2011 Recap

Having attended The Founder Conference in 2010 with a great lineup of speakers, great venue (Microsoft Campus in Mountain View), and good networking opportunities I was looking forward to this year’s event. Unfortunately not all went well this time around, but there were some positive things. The conference was held on 05/03/11 at the Mountain View Center for Performing Arts.

Here’s a quick recap for those who weren’t there.

Morning Sessions

Guy Kawasaki was the first speaker and focused on his new book, Enchantment. Guy is a really great speaker, but for someone that is supposedly in tune with the startup world I felt his standard powerpoint deck about his book could have been tweaked a bit to better relate to the audience (i.e. startup founders). Using examples like Ford, Apple and other big names work well for a mass audience that his book is trying to reach but how about bringing it closer to home and using some startups as part of the Enchantment story? Guy has delivered this same talk many times, so you can watch it online and judge for yourself.

Second up was Naval Ravikant, talking about The Rise of the Angels. Naval’s presentation was basically a repeat of a previous talk he gave at the Hackers&Founders meetup a few months ago. You can watch that presentation and judge for yourself. 90% of people I met said they had attended the meetup and so there was nothing new this time around, but others that had seen it for the first time enjoyed, especially knowing how AngelList is becoming a successful venue for raising capital.

Then there was a panel discussion with Loic Le Meur and Robert Scoble on “Building Traction with Social Media”, that had a few interesting insights, such as:

  • Think big. According to Scoble, some founders think only about reaching the local or national market and forget to go abroad, world-wide. That’s where European founders suffer, because they tend to create solutions for their specific countries instead of the whole continent or world.
  • The best way to make your idea/product viral is to tell a good story. Make it easy for people to spread the story.
  • The key metric to show investors is “how many people are actually using your product”.
The discussion also touched upon how to get press, how to recover from bad PR, and a few other topics. I expected more action items related to social media in particular based on the topic of the panel, but it was entertaining to listen them share their stories.

Afternoon Sessions

I liked the afternoon presentations better. Phil Libin, CEO of Evernote, had a great presentation where he shared all metrics he uses to track customer acquisition and customer engagement. For example:

  • Evernote has 9M registered users to date
  • 28K new registrations daily
  • 3.2M active users in any given 30 day period
  • Users that sign up for the free account and stay with them for 1 year have a 8% conversion rate (end up paying for the premium account), while users that have been using for 36 months convert at a 23% rate.
  • 38% of their active users come from the US, but Japan is the second highest market with 28% of active users.

I also credit Phil for the best quote of the day, saying:

Phil Libin’s Law: The number of things that will go wrong multiplies over time

That’s what every entrepreneur should have in mind, according to Phil who says you have to multiply Moore’s Law by Murphy’s Law and be prepared for bumps along the road.

Another panel came on, but this time it focused on founder stories of how they launched their companies. The questions were mostly about their experiences with the incubator programs they participated in, the conferences they used to launch, and lessons they learned from their experiences. Participated Jared Hansen, of Breezy, Aviv Grill, of Misomedia, and Olivier Desmoulin, of Supermarmite.

After that, twelve companies had the chance to deliver 1 minute pitches and to be critiqued by Brian Wong, in what was a really funny and engaging discussion. Most pitches sucked, which always makes me wonder why founders don’t come prepared for events like this, but I guess this can be a separate post. Companies pitching were (hyperlinks for those who seem to have a site):

Note: let me know if I missed any company and if there are sites for the ones I didn’t link to.

The next session was an interesting presentation by Tim Young, founder of SocialCast and About.me, talking about his now famous Magic of 5 Slides that ended being picked up by TechCrunch and generated 10,000 emails within 1 hour hitting his inbox, including some angry VCs for him disclosing his ideas on how to build a killer pitch deck. 

A few key points he raised during this presentation are worth repeating:

  • Think about the traditional deck versus telling a story. Tell a story, don’t give a presentation.
  • It’s not a pitch, is a religious conversion. Make people believe in your vision.
  • Don’t confuse idea with product or company. VCs fund companies.
  • Use only 30% to 40% of your alloted time to present your story.
Next up was Tommy McClung, talking about how he started CarWoo as the 2008 recession began hitting car makers and dealerships nationwide. Great story of how you can succeed and the importance of timing.
The final session was a pitch feedback panel with Rebecca Lynn, Jeff Clavier, George Zachary, and Tim Young. Some companies (don’t remember how many) had 4 minutes each to do a pitch (with slides) which were then picked apart, I mean, critiqued by the panel. Although I didn’t jot down their company names they were part of the original group of 12 that had presented earlier in the day. The best of any live pitch session like this, is to hear the feedback of the panel, and learn from the presenter’s mistakes how to better prepare for when is your turn on the spotlight.

Conference evaluation

Comparing to last year’s event, The Founder Conference 2011 was very weak. Some sessions were good but overall I was expecting much higher quality, especially not being the first time of this event or the organizers. Here are a few things that I hope they read and take as constructive feedback:

  1. Venue was horrible. Parking, for instance, was terrible and the staff wasn’t helpful in telling us where to find parking. And there was no Wi-Fi.
  2. No Wi-fi. Come on guys, a startup conference without Wi-Fi? And don’t blame Gooogle.
  3. No food. I’m not talking about lunch, but at least some cookies or something during break is not much to ask.
  4. No questions during sessions. This was perhaps my biggest issue, you listen to great people talk and can’t ask them questions?! Wow.
  5. Panels too weak. I was hoping for more insightful questions asked to the panels. Next time, I suggest opening up for attendees to ask questions so it’s more interactive.
  6. A/V sucked. There were many problems with sound, microphones, and slides. Some testing beforehand is in order.
On a scale from 1 (horrible) to 10 (outstanding) I would give the conference a 6. There were some good speakers and the networking, which is one of the most important aspects of the event, was good (I met several great people). The lesson is to learn from the mistakes and put on a better show next time.

Learning from Failed Product Launches

Remember the Pepsi Edge? Dr. Pepper Berries & Cream? How about Coke C2? They all have one thing in common: complete failures.

Despite market research and more money than we startup founders can ever dream of having, the big guys are also prone to disastrous product launches. A recent HBR article “Why Most Product Launches Fail” sheds some light on why this happens. Here’s what they say:

The Five Causes of Flops

  1. The company can’t support fast growth
  2. The product falls short of claims and gets bashed
  3. The new item exist in “product limbo”
  4. The product defines a new category and requires substantial consumer education – but doesn’t get it
  5. The product is revolutionary, but there’s no market for it

What About Startups?

A product launch is different from a company launch, but especially for web and software startups they are typically one and the same. So although the five elements HBR outlined in their article, startup founders should also lookout for other indications of potential failure in the horizon. In “18 Mistakes that Kill Startups“, Paul Graham covers the basics. If you’re going to read only one article about startup failures, you can’t go wrong with Graham. 

For a VC perspective on startup failures, David Feinleib at Mohr Davidow Ventures has a good list. And ChubbyBrain posted a nice analysis of startup failures post-mortem. Read, learn, avoid death. Good luck!

Startup Success: What Can We Learn from Balsamiq

The Business of Software Conference is one of the best events I’ve attended. It’s not a startup themed conference, but most people attending are either working for one or starting one. Is a software conference at heart and a place where you learn what to do and mistakes to avoid.

I didn’t go to last year’s conference but they are now releasing some of the videos for BOS 2010. This one from Peldi Guilizzoni, the founder and CEO of Balsamiq, is especially interesting. I’ve been following Peldi’s blog for a while and he’s a truly remarkable guy. Not only was he able to get $2M revenue in 2 years with 2,800 customers but he did that in  a market that already has a couple of really strong competitors. How he did it? There’s a quote from Steve Martin he says is a key component to success:

Be so good they can’t ignore you

Listen to the talk and learn from his story.