3 Startup Principles Every Early Stage Founder Needs To Know

I recently gave a talk to early stage entrepreneurs at a weekend hackathon in Bellingham, WA.  It was fun, challenging and educational for all.

Given these individuals were just starting on their journey, I chose to focus on things they should be considering coming right out of the gate.  Below are the three things I addressed with them and what I feel every founder needs to think about as they hack together their team and build out a first version of their product or service.

Cofounders

cofounders

The very first thing you must think about is your team – whom should be on it and whom shouldn’t.  Get it right or pay the price later.

Especially when you are starting something at a weekend event like a hackathon or Startup Weekend, it’s tempting to just grab abled bodies from anywhere so you so you can fill empty seats.  This is not advised, since the wrong person on a can bring down the entire ship.  It’s very important to fill specified roles within the team to put your company in the best position to succeed.

Here are the three positions I feel need to be filled if you are considering forming a team to build a software/app based startup:

The Developer.  First – and especially if you are starting something in tech – you’ll need a technical person.  This individual is the one who architects the product and who writes the code. Great engineers are able to balance pragmatism and perfectionism, are not averse to debugging and bugfixing, and employ a healthy skepticism of their code and the world around them. This is the engineer.

The Designer.  Second, you’ll need someone who makes the code look pretty, readable to the layman allowing for a great user experience.  Great designers understand that 90% of good design is not about the pixels, they understand basic coding and have a well rounded view of other sciences of the world.  This is the designer.

The Hustler.  Lastly you’ll need someone who can sell your product, or the one who understands how to get it in the market and found by people.  This is generally the business person, the CEO, and the Hustler.  To quote Fred Wilson, CEO’s really need to just focus on 3 things.  They set the overall vision and strategy of the company and communicate it to all stakeholders. Recruit, hire, and retain the very best talent for the company. And lastly, make sure there is always enough cash in the bank.  That’s the Hustler.

Fill those roles first, or deal with the consequences later.

Customer and User Validation

interview

The second thing early stage founding teams need to think about is finding out who will actually use the product by doing customer discovery and validation.  The knee jerk reaction of most founders is to believe they are so genius they can think up an idea in the shower, grab a few developers to build the app and then sit back and enjoy millions of downloads from all over the world.

NOT-GONNA-HAPPEN.

It’s imperative to get out of the door and talk to actual people who YOU THINK would be your end users.  You need to interview them, asking questions about what problems they are encountering, why they are having those problems and how are they trying to solve them today (they usually just piece together a few random tools to solve it until something better arrives.)  Figure out how they are doing it now so you can offer a solution 10x what is available on the market today.

And rather than trying to plan the entire thing out before talking to customers – like sitting in an office and writing a 30 page business – just start with a hypothesis, do some interviewing and testing on a few good ideas on how to solve it, and then adjust and pivot with the results you observe.  You will learn more in a week or two of testing hypotheses than months/years of preparing a well written business plan full of (mostly) wrong assumptions.

Do your customer interviews now or learn later no one wants what you just built.

Product Simplicity

tip

The last one is a biggie!  It’s paramount a founding team understands their vision, know what they are trying to change in the world and then break it down into approachable pieces to start with.

As a founder you need to think about your entire vision as a large iceberg. The challenge is to find the tip of the iceberg and only release that as the first version. The rest of the iceberg is under water and very large, just as your entire vision is in your head and not visible to the rest of the world. Some think of this as an MVP (minimum viable product) and I concur, I just like the illustration better.

Most founders make the mistake of not finding (or determining) the tip of the iceberg and thus end up building the whole iceberg, resulting in lost time, a bloated product and a lost value proposition.

For every Uber – a very simple and easy to use app – there’s thousands of apps that get it wrong and initially build a too complex product. They end up confusing users and not even getting to the point of an exponential user growth curve.

Twitter was simply a status update and following what others were updating. That’s it and people could easily talk about it and share it with their friends. Snapchat was pictures you could send to friends that disappeared after 10 seconds.  YO was absurdly simple, yet at least it was simple enough where millions of people got it and downloaded the app to mess with friends.

The key is to break down your complex problem into its essence. Know the end game and the large vision but find the simple starting point where millions of people will understand what to do with the app. Find the least amount of features and code possible to solve your initial problem.

These three principles are essential to a successful product launch.  If not paid attention to they will hinder a startup team from building a product, launching it successfully and achieving any traction in the market.

The #2 Founder Sin is Getting Married On The First Date

Would you ever consider marrying someone after the first date?

Thought so.

Since we are on the topic of Founder Sins (you can read my first one here) let’s talk about the second one real quick.  Another very common thread I see fraying from the rookie founder sweater is how quickly they are considering whom to choose as their cofounders.

“I met this developer at a networking event and I think we’re going to build something together.”

“Do you know anyone who codes?  Do you think they could help me with my idea?”

“The six of us started a company at a Startup Weekend!”

I hear these all the time.  It’s not a bad idea that people are “hustlin” and looking for skilled people to build out their team.  It’s just that it ain’t easy.

Just as dating the right person takes time for the relationship to develop into a marriage, so does a business partnership.  I am not saying you need to “court” the person for years on end, but I am saying it takes more than one event, one week or a few short meetings to grant a random person a large stake in your future company, basically legally binding the both of you.

Las Vegas Welcome Sign 3/30/11

Here’s why I know.  I have lost a cofounder myself.

In the fall of 2011 I was approached by an awesome developer – whom I didn’t know at the time – about joining the founding team of his newly forming startup.  He read an article I had written, emailed me and said we should meet.  When we met for coffee he showed me the prototype of the mobile ordering/payment stystem he was building and said he was looking for a CEO.  I was impressed and intrigued.  We booked another meeting or two and within 2 weeks we were talking “marriage”, better known as personal responsibilities, founder equity and company formation.  Before I knew it I was CEO of a tech startup (Seconds) and diving into leading a founding team I did not know two weeks ago.

But unfortunately, 6 months after that initial meeting he was on a plane moving down to SF to do contract work, leaving me to find another CTO.

What happened?

I am forever grateful for Jacques to have sought me out and single-handedly placing me on this path I am today.  Yet, in hindsight it’s clear we jumped in too quickly.  We were excited, thought time was of the essence and needed to get to work today!  Within a week or two of knowing each other we were having the “how much percentage of the company do you get and how much do I get” conversation.  I was immediately in charge of estimating product timelines, leading a team of developers, laying out our fundraising strategy, talking with the media and figuring out how we’ll make it to the next phase of the company.

All this and I didn’t even know who these people were!

I didn’t know how they handled stress (although I found out pretty quickly!)  I didn’t know how they had performed in the past on other teams and projects.  Did they run from challenges quickly or where they the ones to stick it out and find a solution?  I was not aware of their tell-tale signs of when things weren’t going right.  And I hadn’t learned how to best approach them to talk over difficult situations and touchy subjects.

In the end, I didn’t know them at all.

And now I know why investors ask about the backgrounds of the founders and how long they have known each other.  It’s very important you take the time to get to know people you want to work with in the future.  If you have a long view on your career – your entrepreneurial journey – you will see there’s decades of time for you to work on various projects and many different people you will work well with.

The thing is it’s very hard to determine that after one or two meetings.

Take it from me, it’s best to start laying the foundation for your future cofounder relationships now so that when the time comes for you to form your dream team you will already know who you will pick.

That, or get used to signing divorce papers…

The # 1 Founder Sin Is So Damn Easy To Avoid

I have noticed a trend recently as I help founders wrap their arms around their ideas and how to best get started.

They come to me with an idea – a problem they have observed in the world – and are devising a unique solution and hopefully in the process attach a kick ass growing business to it.  The problem starts when they try to get too tricky – maybe even too complex – and add all these extra functions and features to their solution.

They create Product Bloat.

This is not good.  It’s the number #1 founder sin.  Yet it’s so easily avoidable.

Why?

It’s the number 1 sin because people think too deeply about what they are trying to do.   Thinking to deeply is not actually the problem; implementing too much and attacking the entire vision right out of gate is.  They also want to be different than others in the market, so they think “well, what if we put this into the app?”  Or “such and such is doing X so we’ll just do Y so we can be different.”

The issue with that type of thinking is it takes you farther and farther away from “problem solving” thinking and puts you closer to “creating something new” thinking.  This is wrong because trying to launch a successful product without solving a clear problem in the world is very difficult, if not impossible.

iceberg

But back to simplicity.  As a founder you need to think about your entire vision as a large iceberg.  The challenge is to find the tip of the iceberg and only release that as the first version.  The rest of the iceberg is under water and very large, just as your entire vision is in your head and not visible to the rest of the world.  Some think of this as an MVP (minimum viable product) and I concur, I just like the illustration better.

Most founders make the mistake of not finding (or determining) the tip of the iceberg and thus end up building the whole iceberg, resulting in lost time, a bloated product and a lost value proposition.

For every Uber – a very simple and easy to use app – there’s thousands of apps that get it wrong and initially build a too complex product.   They end up confusing users and not even getting to the point of an exponential user growth curve.

Twitter was simply a status update and following what others were updating.  That’s it and people could easily talk about it and share it with their friends. YO was absurdly simple, yet at least it was simple enough where millions of people got it and downloaded the app to mess with friends.

The key is to break down your complex problem into its essence.  Know the end game and the large vision but find the simple starting point where millions of people will understand what to do with the app.  Find the least amount of features and code possible to solve your initial problem.

And then release it and gain users.

Once you have your users you can then figure out the next few things to place in the app experience.  But take it from me, don’t commit the number 1 founder sin right out of the gate.

What It Means To Be A Hustler

lego_pete-roseHang around the startup community long enough and you’ll no doubt hear a saying like “oh yea, that guy?  He’s a Hustler.”

What does it mean?  And is it a good thing?

Some may have a negative connotation to the word since it can be used to describe a shady character.  To me, being a hustler is a good thing since I think about it in terms of action, of doing things each day and of getting results.

To fully understand what a hustler is and why it’s important, I’ll quickly describe a well rounded startup founding team:

First – and especially if you are starting something in tech – you’ll need a technical person.  This individual is the one who architects the product and who writes the code.   This is the engineer.

Second, you’ll need someone who makes the code look pretty, readable to the layman allowing for a great user experience.  This is the designer.

Lastly you’ll need someone who can sell your product, or the one who understands how to get it in the market and found by people.  This is generally the business person, the CEO, and the Hustler.

All three are important in their own way but today I want to address what it takes to be an authentic Hustler.

Hustlers simply get things done.  They are not satisfied with just sitting around, they must be moving – and moving forward.  They get up each day knowing that they have things to accomplish, fights to win and deals to close.   They subscribe to the JFDI mentality.  (go ahead, click it and read all about it!)

They also are very social and tend to “know a lot of people”.  This important because at its core, business is simply a collection of random people interacting and transacting with each other (hopefully) for benefit of all parties involved.  Given that, it’s important a Hustler knows a lot of people in a number of different industries so they can sell their product or service to them, or conversely, so they can buy from others.  It’s also important a Hustler understands how to treat people right, meaning they are genuine in their dealings with them and unequivocally treat them fairly.

If you know a Hustler, you’ll find they are confident in their dealings with people.  They understand Alpha is the one who generally leads the team and determines the outcomes of meetings and thus, for better or for worse, they tend to take control of the situation.

Hustlers are never satisfied.  Although that statement can be taken as “I never have enough” I tend to think about it more as “never rest on your laurels.”  The pursuit of perfection for the sake of working to get better each day is what being a Hustler is all about.

Although the above comes naturally to me, I am intent on working to become a better Hustler.  Why?  Well, I am not a coder.  And trust me, I can’t design websites or apps.  But I am pretty damn good with people, business and product markets, and intuitively understand my future success will be determined by how much better I can be in those areas.

But good is not Great!  I want to be great at these things and I am now paying close attention to improving my skills with people, business intelligence, leadership and how to market a company.

If you are non-technical I hope you are paying attention to those areas as well.

A Few Thoughts On Friendship, Authenticity And Creating Awesome Experiences

A few months ago my friend Kyle announced he was moving himself and his company to Las Vegas.  It was a sad day for us here in Seattle – since we were losing a staple of the Seattle startup community – but he received a huge outpouring of support for his decision and ultimately made the move down in September.

Kyle recently sent out a message saying he was going to be in town this weekend and was planning a brunch gathering, and of course I jumped right on it.  It was great.  Here we are as a group…

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Although I could write much more on this topic, I want to touch on what I have observed (learned) from Kyle and his approach with the people in his life.

Friendship

Friendship is not simply treating people the way you would want to be treated, it’s also being genuinely interested in them and present when you are around them. Kyle does an amazing job of treating each and everyone in his life with authenticity and respect.  It isn’t fake or half-hearted.  He is genuinely interested in you, your life, your company and the people you are sharing your life with.  I admire this about Kyle and actively try to live this way in my life as well.

Do yourself and your friends a favor and treat them with the love and respect you would wish to be treated, and genuinely work towards being present when with them.

Awesome Experiences 

Creating awesome experiences is Kyle’s Modus Operandi.  He isn’t just concerned with seeing you, he’s all about experiencing life WITH you.  Earlier this year, Kyle started sending emails to a large group of his friends simply stating “Brunch this Sunday at such-and-such diner, first 12 that respond get a seat!”  How cool is that?   Things as simple as organizing a group brunch on a Sunday takes an average drizzly November Sunday morning and creates long-lasting memories for everyone involved.

Do yourself and your friends a favor and start creating unique experiences to share with others.  It’s better than sitting on a sofa by yourself!

Rose Colored Lenses

If you follow Kyle on any social media, you will see he has an incredible eye for photography and uses a lens to capture life’s beauty to share with his network of friends.  I admire this quality and talent since I am not the most creative and talented in the world of visual art.  But what I can do is start to view the world like Kyle does, keenly observing its uniqueness and beauty from every angle imaginable.  Ya know, it’s kind of our generations “stop and smell the roses” perspective, except the difference is today we pretty much don’t ever stop for anything anymore, and just snap it and send it off to our friends without blinking an eye.  Kyle’s approach is a lot more meaningful, introspective and thought provoking.  I like that.

Do yourself and your friends a favor by taking a breath, looking at the world’s details from a slightly different viewpoint, and fully appreciate its beauty.

Sometimes it takes a good friend visiting from out of town to remind you how to (better) live your life each day.