Startup Growth Requires Making Your Own Luck

Great things don’t just appear out of thin air.   You have to nurture and cultivate them over time into what you envision as your dream company.

That, my friends, is the secret to startup success.

Yes, you have to build a solid product.  You will need to attract great technical talent.  You also need to have enough user engagement and financial capital so you don’t end up in Startup Death Valley.  But even if you have all that in your favor, luck is still required if you want to succeed.

Luck gives you the breaks you desperately need to go from a no-name into household name.

Seconds has been given an amazing opportunity to drive payments for a nationwide holiday event.  I will provide more detail as the event nears but suffice it to say this lucky opportunity is only possible because of what we have done over the past year.

It definitely didn’t appear out of thin air.  Day by day over the past year we made it happen.

Launch early

We launched the earliest version of Seconds about a year ago, under a different name and clearly aimed at a different customer segment.  The product was buggy as hell and to be honest, a bit embarrassing.  But that’s the point of an early release, isn’t it?  It does you no good to have an idea without a product others can touch, taste and see.  We knew we needed to get something into end-customers hands ASAP if we were going to receive any feedback – feedback that actually led to our next iteration.  I consider it lucky we were able to have a team willing to quickly put out a buggy product and gain much needed feedback.  In fact, we created that luck by committing to releasing immediately and listen to the feedback.

Speak loudly

Not surprising, I like to write.   Also not surprising, I like to write about Seconds and payments in general, on this blog as well as others more well known.   For a number of reasons, I believe this is why we are in the position we are in now given we have only been around 12 months.

If you search Seconds, we come up fourth, above the fold, right below a Wikipedia entry for the time interval and a few links to a movie also titled Seconds.   This is huge, as early feedback on the name was something akin to “great name, but how are you going to be found in Search?  Pretty tough huh?”  Well, that’s where writing comes in…. the more links to a website the more “relevant and valuable” it is in the search index algorithm.   I have no idea how many links are pointing to Seconds but it’s quite a few, based on how many articles I have written as well as how many others have written about Seconds.  This tactic also has helped Seconds gain media attention a lot earlier than other startups in the same situation.  At least we had something written about us and our vision the media could go off of, even if it’s from the founding team.

Founders need to speak loudly about what they are doing.  If you don’t, why should the media?  Getting your word out and better positioning your product are a few ways to create your own luck.

Spray widely

Discovering product market fit is probably the most challenging task for an early stage startup.  It’s one thing to sit at the white board and determine your products are meant for __(whatever)___ market; it’s a whole other ballgame once you get outside the office and try to grow a customer base in that market.  Not so easy…

Seconds is a payments system, a mobile focused one at that.  Amazingly, almost every industry and market vertical handles payments in one way or anther.  This poses both a great opportunity and a large problem.  The fact that our larger market is HUGE is quite the opportunity.  The challenge is trying to serve everyone right out of the gate, which is pretty much impossible.  So we spent the last 8 or 9 months spraying our message quite wide, gaining attention from a number of customer bases.  Some turned out well.  Some did not.  But the incredible thing is we have continued to learn from each and every customer discovery conversation, resulting in refinement of our pitch, company positioning and – at times – the very essence of our product.  Ultimately, this practice led to a few very promising markets ready and willing to run with Seconds.

We refused to be boxed too narrow in the beginning, and it has paid off tremendously.  A year ago, we were a text ordering system for local restaurants, struggling to fit our solution to their non-obvious problems.  This winter, possibly millions of people will be using Seconds to make donations to an important cause with a few quick swipes of their finger.  Everyone wants their payment experience be easier and more enjoyable, especially when making a quick donation.

Are we lucky?  I would say yes.  Did we create this luck?  You bet. You can’t sit on your butt and think the world will come to you.  If you want the world, you need to go out and get it.

Startup Death Valley: What It Is And How To Get Out

I’m sure a large number of teams reading Techcrunch or other tech blogs right now are in the same situation my company found itself recently.  It probably goes something like this: you have a startup, a product, users and a maybe little revenue.  You are growing month over month but really you aren’t where you want to be.

Most likely you are answering questions with reflexive responses such as “well, we are just testing some assumptions right now” or “we’re heading in the right direction, just need a few more engineers on the team.”  Or, how about this one, “oh, we’re still in stealth, you could call it alpha…”

Give me a break.  Quit lying to yourself.

To put it bluntly, you are in Startup Death Valley.  And you need to get out as soon as possible.  If not, your startup will certainly die.  It might make you feel better knowing Death Valley is where most startups end up – not quite done but definitely not making anything happen.  If you do feel better thinking you are not alone, you are most certainly destined to fail.  Finding yourself in Death Valley is scary and should result in only one question: “how long until we’re dead?”

You and I know it wasn’t always this way.  Not too long ago your team was driving forward toward a goal, excited as hell to be at the office until midnight or later hammering away to the launch your latest concept.  And you absolutely knew, once you launched, millions of users were going to flock.  Revenues were supposed to grow.  Investors were most definitely going to call you back.

And then… Crickets.

Now, it’s become a lot more difficult to get out of bed.  You’ve noticed it’s not as exciting to load up the email or go into the office, and definitely not as fun to field questions about your startup.  Reading all the media out there you just wish you could be on the other side, reaching milestones and attracting investment dollars at record levels.  But you’re not.  You get up each day wishing things would be different instead of actually doing anything about it.  In a word, you are complacent.

If this is how you are feeling, you are currently in Death Valley and have little time left.   So, how do those select few companies – the ones gaining all the attention and money – get out (or stay out) of Death Valley?

First and foremost, they make their own luck.  They pick up the dice and roll them again – quickly.  They get out by putting it all on the line and betting the company, just as we did recently.  Oddly, when faced with inadequate growth too many startups just keep heading blindly toward danger only to drive right off the cliff.   This is, quite literally, insane.  They are not self aware enough to sense what needs to change, when, and how fast.  The ability to sense market shifts and adjust accordingly is an incredible skill that can be found in all of the successful founders, especially ones the ones you don’t find in Death Valley.

Without going into detail about my startup, here’s the playbook we just used to redesign and deploy a brand new product within a month’s time, reviving our company and paving the way for a whole new market opportunity.  If you are a founder or early employee of a stagnant startup, maybe this playbook will help you too.

Make a commitment to change
The first step is to determine what you are going to do and how you will go about it.  To get clear on those issues, you need to take an account of what you have or have not accomplished up to this point.  This requires a long and painful look in the mirror by the founding team, revealing truths that will hopefully save the company.

Has your vision changed since the last big development?  What has the larger market and your existing user base told you since your last product release?  What features are engaging users on the existing product?  What is not engaging and not being used.  Point blank, what’s not working?   What assumptions were proven true and what didn’t pan out?

Then it’s pretty simple – keep what is working and throw away what doesn’t.  Really, just scrap it.  In our experience it was smarter to cut the fat and trim features rather than just add new ones we thought might work.  For a number of reasons we actually decided to rebuild rather than make additions to existing codebase.  Contrary to popular belief, this is more challenging than it sounds.  Why? Inherently, humans tend to be scared and freeze when making drastic changes on things they spent long periods of time working on.  It all comes down to our natural fear of change.  This is no truer as an employee of a Big Co. than as it is as a startup team reviewing their V1.0 product.  The reason is we fear change.  Yet, this is exactly where we found ourselves with our product – growing but not growing very fast. Ultimately, we decided we weren’t scared of the consequences since we knew if we did nothing, nothing would change.  Actually, that’s not true.  It would have been the end of the line since “good enough” is actually not good enough in the big leagues.

State it VERY publicly
Almost nothing gets done until there’s a deadline.  Although dates set internally are the start of it, they are only as good as your team’s integrity.  Unfortunately, it’s way too easy to fudge on commitments when they are loosely agreed upon between a few team members in a private meeting. Fully committing to a new product release required establishing a public event and trying it to our new product.  To make it even more drastic of a commitment, we also stated this publicly and promised a large group of people they would be using our system, the very product that wasn’t yet built. This was really the only way to move the needle.  Similar to launch parties, larger public commitments set solid deadlines teams must respect.  In fact, DEADline is a great word since that is what you will be if, in fact, you don’t meet it.

Do whatever it takes to deliver
Staying at the office until wee hours of the morning, having intense discussions of where buttons and other little details should be placed, and not spending time with friends or family because a deadline is fast approaching, these are all signs you are doing whatever it takes to make things happen.

The biggest sign: you are more afraid of not delivering and failing in public than anything else in the moment.

We found ourselves performing at levels we hadn’t reached in quite some time, if ever.  The last few weeks were a blur, and we didn’t sleep at all the night before our release, not because we were excited like Christmas Eve, but because we HAD to deliver.  Although not amusing at the time, the moment media was suppose to go live (6am EST) announcing our latest release, our site was actually down.  How fun!  Even more challenging, throughout the entire launch day our system was incredibly buggy due to a DNS change and other small issues.  Yet I was as proud as any startup CEO could be watching our entire team set aside all other distractions, doing whatever it takes to push out a successful new release.

The lesson here is simple – without a predetermined public commitment connected to a larger event we would never have pushed ourselves as hard as we did.  We would have stayed in Death Valley, remaining complacent like the other 90% of startups out there.   We smartly made a commitment others outside our organization could hold us accountable and expect us to deliver on.   It was very risky.

Yet, through the very late nights and stressful moments an awesome feeling started to emerge:  Damn right, we will most definitely make this happen.

image via Flickr user Michael Ransburg.

Is TechCrunch Too Big? Or Is Quipster Too Small?

It’s tough to be a startup today.  It’s even more difficult to be a youngster looking to run with the giants.  I admire young startups like Quipster, who is dodging the giants right now.

Looking at Twitter, Facebook, Foursquare and Google we think they are indestructible.  It’s understandable.  It’s easy to be armchair critics, Monday morning quarterbacks or Negative Nancy’s when it comes to seeing a new startup attempting to play on their turf.  But the reality is a King’s reign does not last forever, and it’s usually replaced by the one we never expected.

Quipster recently launched to mild criticism, especially from one of the media Giants in the startup industry, TechCrunch.  I respect TC and their reporting, but not exactly their take on Chiding the Child.

“Do we really need another mobile check-in app? Newly launched startup Quipster seems to think so.”  They go on the provide a brief overview of how Quipster is really no different than all other checkin apps.

Is TechCrunch too big for Quipster?  My guess is yes, so big they didn’t even care to give the startup a fair shake.

The three paragraph post – which probably took 1o minutes to complete – does little justice in finding the pearl within the oyster that is Quipster.   If they would have looked a little closer they would have discovered Quipster came from three Thai engineers in Palo Alto led by CEO Krating Poonpol, who has always dreamed of being an entrepreneur and fought for seven months to gain an H1B visa just for the opportunity to build a company here in the US.   Krating – a former engineer at Google who became a bestselling author in Thailand for penning a book on his experiences at Google –  also won two medals in international mathematics competitions, taking home the gold for Thailand in physics.

Needless to say, these aren’t 3 frat dudes sitting around looking to get rich by riding the bubble of copycats. Even ReadWriteWeb does a better job reporting both the positives and the negatives of Quipster as well as questioning the tactics of TechCrunch.

By taking more time, TechCrunch would have also been able to share how Krating started Quipster to simplify and unify social check-ins, an category fragmented and ripe for simplification and a problem worth solving.  His goal: to be the driving force behind the next wave of geolocation.

According to Krating “Geolocation is not really about the check-in, it’s about sharing a context of what you’re doing as well as where you are with a single click and no typing.  He continues …we are creating a fun and fast way to share what your doing and what you like about certain places.”

The ” too many checkin apps ” reaction misses the point about Quipster.  Although check-ins apps are abundant, most lack any context.  Receiving a Foursquare update that reads “John Smith just checked in at Joe’s Bar” really doesn’t tell me anything, and leaves a lot to be desired.  Others are taking notice of the problem.

Krating, like any good innovator, is seeing an area where improvement is needed.  “we are seeing at least 5 or 6 responses resulting from each quip, giving a basis of interaction between users which goes farther than just a “here I am”.  This lowers the barrier of interaction among friends and strangers within a city and also gives users a chance to see what is hot in the city.”

I see apps like Quipster emerging with visions going way past the basic checkin feature and on towards making our everyday life easier and more enjoyable.  And for a possible business model, Krating did not to go into details, but he did say “Like Google – building out the interest graph, adding location and targeting meaningful marketing” seems like a good place to be.”

Am I saying Foursquare or Twitter won’t continue to reign in this space?  Not exactly, they are powerful horses for sure.  Do I think Quipster is the new Foursqare at this point?  No, I think they have a few obstacles to overcome.  But I am impressed with early startups looking to move the needle forward.

An Unfriendly Startup Trend

While I was doing my research to cover Quipster, I started to take notice of a new trend in tech media.  Coverage of young and emerging startups is falling behind at a frightening pace.  I am not the only one to notice.  Recent research found Ten companies now account for 30% of TechCrunch coverage.  The image below illustrates the heavily weighted coverage of late seed or large companies, increasing each year.  It is understandable why major outlets cover Apple, Facebok and Google more often, indeed they drive many more pageviews. But it begs the question: Is this raw startup journalism or have Techcrunch (and the like) really become the “New” Old Media?  Has it become all about more page views?

I am a long time Business Insider and TechCrunch reader, but these trends are cause for worry if you are an early stage founder.  Below are a few observations, straight from Guest contributor Mark Goldenson:

1.  Companies funded by a prominent investors get covered twice as much

2. TechCrunch writers do play favorites

3. TechCrunch’s long tail is now 14 times longer but the fat head is 24 times bigger

Guide The Child

My view of the purpose of media is to be a guiding light in helping emerging technologies and companies acheive top of mind with the general public.   Covering young startups with facetious mocking does not do those numbers any justice or help pull startups forward.  Media outlets such as TechCrunch (as well as this one, Business Insider) influence the general public more than they know, and covering a new company with a 3 paragraph Chide probably does more harm than good for an early stage startup.

TechCrunch, Business Insider and the entire startup community – pay attention to small startups like Quipster and remember Twttr was once is the same position.

Here’s the Best Way to Increase Your Company’s Value

Have a co-founder.

On stage today at TechCrunch Disrupt NYC, prolific Angel investor Ron Conway spoke on what makes Great entrepreneurs Great.  They interviewed almost 500 CEO’s from their portfolio companies and found some interesting nuggets of wisdom.  Here is a big one: having a co-founder greatly increases your exit.  Companies with exits (or the potential of an exit) in the $25m range, single founders made up only 16%.  Even more interesting, exits of $500m+ (or the potential of an exit) , single founders only made up 11% of the group.  A full 89% of the group were companies with 2 or more founders.  This does not surprise me.   Larry and Sergey (Google).  Steve and Steve (Apple).  Bill and Paul (Microsoft).  Jerry and David (Yahoo).  David and Bill (HP).

Founders – life looks better with a friend along for the ride.