The Secret To Launching A Successful Startup

What’s your secret?

In his book Zero To One, Peter Thiel asks the question “What one thing do you know that no one else in the world knows?  What’s your secret?”

The answer to that question is the secret to starting a successful company.

downloadWhat Thiel is suggesting is there are things in this world you observe, intuitively know and understand more than anyone else.  By peeling apart those layers and understanding where there could be value creation you will find the golden nugget.  Then it’s as simple as creating a new company, building the product and releasing it to the world.

What he is also illustrating here is that success comes from ingenuity and uniqueness, not copying others.  The world doesn’t need another anonymous messaging app or social network.

It needs your secret.

Do you realize there are things only you know about the world?  Most likely there things you continually notice about your everyday life, the city you live in or the technology you use that keep bugging you.  There are problems you continually encounter where you might be wishing someone fixes them.  Do you maybe see a better way to do them?  Do you keep getting frustrated at the same places and times each day?  There might be something you can do about it…

Once we come to grips with the magnitude of this reality starting a company becomes a lot different.  You now realize each and every one of us have the ability to create successful companies.  All it takes is a little focus and observation of the world around you, and then having the fortitude to create a scalable solution.

Today, think about what might not ever be created if you don’t build it?

When A Founder Crosses The Line Towards Godlike Hubris

I recently noticed a frightening trend with certain founders in the tech industry.

–> Have a great idea.  Get a few key people to join you and build it.  Launch the product and raise money from investors.  Experience massive success.   Raise more money.  Gain hundreds of millions of users. Raise billions of dollars and fight off regulators.  Have unfiltered access to billions of people’s data.  Exploit it.  Believe you are the second coming of a God.  Act like an uncaring, immoral capitalist.  Care only about your wealth and not what you are doing to everyday citizens.  And so on…

With the recent Uber misteps and observing the resulting outrage which ensued, it has come to my attention that we, as an industry, need to take a long look in the mirror.  Founders need to take full consideration in how they are running their company, the culture they are creating, the data they are generating, and the ultimate consequences of their actions.

I hope Uber realizes they are doing to their users exactly what they were furious (I assume) about the government doing to them as citizens when the Snowden files were revealed last year.

We all need to understand we are standing at an unprecedented time in the history of business and technology.  Everyday Joes now have the opportunity to create an app or platform that one day might just become indispensable to mankind.  With its use, Joe will collect billions upon billions of data points on everyday citizens – like where they are currently, where they are going, who they talk to, what they typed, to whom, what they viewed on their phones, whom they connected with socially, etc..  With all this happening, Joe will find himself directly in the middle of our society, holding a treasure trove of personal data and a devil on his shoulder just waiting for the right time to temp him into exploiting it.

I mean, it’s like big brother!

But surprisingly it ain’t the government doing these things.  Imagine what Facebook knows about you.  Couple that with your Uber or Lyft usage data.  Toss in your twitter clicks, Instagram photos, Gmail history and Google Chrome browser history.

We are doing this to ourselves.  We are the ones creating this new world of massive data collection which is resulting in unprecedented spying, snooping, breaches of security, cloud hacks and the like.

This is your fault.  And mine.  It’s all of our faults.  All in the name of making more money.

I am not here to end the data analysis, in fact I believe in it and when done correctly it makes for a better end user experience.  I also know data collection is only going to get more prevalent with the expansion of categories like the Internet of Things and connected homes.

Yet, I am urging us to start thinking about things using a different filter, or scope of perspective.  Start asking yourself these questions:

Recognizing all possible data about myself and every other person is now being collected, how to I structure my platform to preserve mankind and the humanity inherent within our society?

How do balance personalization of my technology with personal security of my users?

How do I proceed when I know I CAN do something but unsure if I SHOULD do something?

Where’s my “do not cross line?”

How can we best usher in a new era of technology applications where security is inherent within the structure of the product, not an afterthought when plugging holes after launch?

How do I shift my perspective from making the most money possible with my application towards making the world a better, more secure and protected society?

Please start thinking about these questions and more…  It’s time we call a spade a spade – WE are the ones creating the exact surveillance society we were deathly afraid of growing up.  We just thought it would be the Big Bad Government or another foreign country, not ourselves.

Please understand hubris will sink anyone who thinks they are immune to it.  You – as a founder and someone desperately wanting to change the world – can now no doubt do just that.  You and your technology can alter the history of humans here on earth.  Just make sure you know what change you are putting in place.

What I Learned Launching A ‘Crazy’ Bitcoin Startup

The months leading up to the announcement of our new company was chock full of lessons learned.  We launched Coinme on May 1st at Spitfire in Belltown during a well attended launch party, complete with our first Meetup and an entertaining expert bitcoin panel.

It was the culmination of many long days, phone calls, emails, re-designs, re-brandings, and all sorts of other seemingly frustrating things.  Below I have detailed three of which helped me realize a few things – namely the biggest risk of all is not taking a risk.

Setting a deadline is essential

Setting yourself a deadline – be it a launch party, a internal team milepost or some other marker – is the single best thing you can do to push yourself and your team to execute and actually complete what you set out to complete.  We set May 1st as our launch party, and determined the machine needed to be there, dressed in its new costume and ready to take live transactions in front of more than an hundred people.

photo (9)We also – very importantly – needed to get passed through the State of Washington as an officially licensed money transmitter business before this date.  You have no idea what was required for all these pieces to come together, and before we began this process I didn’t either.  But given we had committed to launch this company, we held ourselves to the deadline and pulled through right at the end.

I have painfully seen it time and time again with other startups in Seattle… they never release their feature or finally launch their company.  Crazily, they just keep working on things.  In the end, they simply don’t set themselves a deadline to stick to so they just remain in startup purgatory. This is not the right place to be as a startup – trust me.

Being early is both good and bad

One big thing I have learned is it’s very early in the bitcoin world, probably too early for most consumers.  Most people still have no idea what it is, why they should purchase it, and why they should use it for payments.  Although the answer to those questions will be left for future posts, suffice it to say the entire world is still trying to figure it out.  Coinme, as a company, believes in the transformative nature of the technology and feel it can influence not only financial transactions but many more industries.  And again, it’s way too early to tell.

But we feel our opportunity to influence such an early industry was/is too great to pass up.  We see areas where we can help educate and inform people about the positives, negatives and in-betweens of this new cryptocurreny world.  We’d rather be early to the party than too late.

Being early to the market can be good for a startup, but it also can be not so good.  If you are too early to the market you risk spending all of your available capital without generating enough revenues (assuming at some point you need to run on revenues, not invested capital) which will ultimately end the business.   Successful businesses are able to time the market in a way where they achieve both early mover advantage and customer adoption.  One without the other spells doom for any high growth company.

Calculated risk is worth it

I touched on this last post but I feel so strongly about it I think its worth addressing again.  Taking a calculated risk – hopefully a number of them – is one of the best things entrepreneurs can do to accel their careers.  Doing what no one else is willing or ready to do places a person in a very select group of people, a group where things are created, companies are sold and millionaires are made.  Even if the venture ultimately fails, the business (or tech) community will consider the founder a leader, an innovator and a healthy risk taker.

And you know what?

That’s exactly the person investors want to invest in.  That’s who others want to follow when they take their next job and join their next company.  That’s who the media wants to cover when they write about the next generation of business leaders.

No imagine if you don’t take that risk…

Trust me, what I learned over the last few months is that the biggest risk of all is not taking a risk.

 

Okay Founders, Stand Up And Take A Risk

As it turns out, I was indeed part of the group who brought the first bitcoin machine to the State of Washington and the greater Pacific Northwest.   We launched Coinme on May 1st at Spitfire in Belltown during a well attended launch party, complete with our first Meetup and an entertaining expert bitcoin panel, including Charles Fitzgerald , (angel investor), Patrick Murck (General Counsel for Bitcoin Foundation) and Will O’brien (CEO of BitGo).

We had a great time and it was an awesome way to ring the new venture.

Interestingly, one of the most asked questions I get now is “So, why bitcoin?”  What is it about bitcoin that made you jump at this opportunity?”

My answer may not be what you expect, but if you are a founder – or thinking of becoming one – it’s what you need to hear.

I jumped at this opportunity because I sensed something seismic rattling under my feet, I felt the inevitably of it becoming such a transformative force in our world I knew I would kick myself later if I or Seattle didn’t get involved now.  I had this crazy notion that we are now experiencing a tremendous change in the way we relate and interact with money/currency/privacy/data and wanted to be a part of it.  I noticed the most common way people were perceiving this new technology was with ignorance and confusion, stating things like “bitcoin is a Ponzi Scheme”, which tells me they just need to be educated.  I realized we are watching an industry mature right before our very eyes, growing from a child into a gangly teenager, struggling with growing pains along the way.  With a little luck maybe I felt I could guide that teenager in the right direction.

It was a risk I simply couldn’t pass up.

The media likes to cover the “downfalls” and the “catastrophes”, mostly because shock media drives more page views than intelligent and analytical dissection of challenging topics.  But along with all the negative press bitcoin has received, there are golden nuggets of wisdom one shouldn’t turn a blind eye towards.  Look hard enough (and follow the right people) and you will read bitcoin analysis that will blow your socks off.   Please follow Fred Wilson, Marc Andreesen and Naval Ravikant for such nuggets of the wisdom I am referring to.

It’s fascinating.  You’ll read things like bitcoin is the new internet of money and will soon power machine to machine (droid to droid?) payments, opening up a whole new part of our daily economy.  It has the opportunity to transform many different industries outside of finance, it could become the new domain/identity protocol for online citizens, it will aide in calming identity theft and consumer privacy, allow for more efficient commerce and transactions across the web, maybe even help media outlets collect micro-payments from readers for access to their posts, and many, many other things.  Simply put, this ain’t your daddy’s financial system.  These and other reasons played into my decision to be a part of Coinme and help grow the crytpocurrency in Seattle.

So with all this crazy “Bitcoin” (air quotes) coverage and other startups making questionable business decisions around the cryptocurrency, why the heck would I decide to start a bitcoin business?

“The only thing necessary for the triumph of evil is for good men to do nothing.”
― Edmund Burke

I acknowledge the above quote can be quite overused, but in this instance I think it fits perfectly.  We started Coinme because we saw an industry taking shape but yearning for more quality leadership from the innovators and executives of those companies.  We made a pledge to ourselves to be one of the good men (or women) leading this new industry.   The bitcoin economy desperately needs innovators, entrepreneurs, legal advisors, regulators, politicians, consumers and business owners to all work collectively for the advancement of our society.  Not just for the advancement of their own selfish interests, but for the betterment of the world.

Who knows, Bitcoin might drop through the floor and Coinme might fall flat on its face as a result.  But by taking this risk I will have learned A TON about a new and emerging industry (and myself) at a time when everyone is still trying to figure out what it is. I will have laid the groundwork for my next 10 – 20 years as an entrepreneur and established myself in a small but growing industry.  I will have looked uncertainty in the face and chosen to proceed when the path is not exactly clear, teaching me to acknowledge my fear of the unknown but move forward anyway.

And that is what I encourage you with today.  Seattle has tremendous leadership in the technology space and is home to many recognizable and industry leading companies, yet, we need more leaders – the future of our local economy depends on it.

You may not be launching a bitcoin startup but you do have an opportunity to be influential and guide your market in the right direction.  You have an opportunity to take a risk, to put Seattle on the map – or more aptly allow us to become even more attractive for both entrepreneurs and investors and hopefully put to rest the whole Valley vs. Seattle argument.   We hear it all the time from the investment community here in Seattle – Swing Bigger.  Well, here’s your chance.

You have right in front of you a choice: take the easy road and solve a derivative of an existing problem, making things just a bit easier for the few that may experience it.  Or choose the hard road and take a larger risk to do something no one has ever done before, with a greater reward waiting for all of us at the end.

In speaking for the greater Seattle tech community, I urge you to choose the latter.

The Road Ahead

I have often said being an entrepreneur feels like you are a circus clown on a unicycle, riding on a tightrope and juggling 5 different things at the same time.

Yep, that’s pretty much what I am doing right about now and it feels a bit crazy.  My hope is that it settles down a bit as we get these things in motion.

Below is a glimpse into the road(s) I am looking down right now and if all goes as planned it will be most of my career focus.  They might be general – on purpose – but they are the trends of the next 20 years and industries I am both interested in and feel are at inflection points historically.

Payments – mobile and otherwise

road

Most of you know I have been in the mobile payment space for a few years now.  Our first try with Seconds payments didn’t go as smoothly as we had hoped.  BUT, we learned something really valuable – remote mobile payment/billing is going to be huge.

We learned this from realizing the act of forcing someone to make a payment with their mobile device while standing in line at a coffee shop/target/local market/etc actually takes more time and is more complicated than giving cash or card.  The end solution just has to save all parties valuable time.  It will be years before this becomes commonplace and who knows how much it will take (billions invested) to make it happen.

But, you know all those letters you received (or still receive) from utility companies, munipalities and other entities basically telling you 1) here’s the total you owe and 2) here’s where you send the check or 3) log in at this url to pay?  Well, we can save people a lot of time and hassle with a new direct mobile billing experience.  That can all be achieved by a simple notification on your mobile device informing you of a balance due, should you opt into receiving it.  And with your payment credentials already in the system all you need to do is simply respond with “pay” and it’s all taken care of.   Business gets paid, consumers account is cleared, no re-entering payment credentials… Simple.

Yep, we got that in the pipeline.

Cryptocurrencies – Bitcoin

Since I am in the payment/financial space I have been watching the rise of Bitcoin for some time now.  It’s very interesting to say the least and everyone has an opinion.

Here’s mine: the world needs a new mechanism for payments to flow around the world and Bitcoin feels like it’s the one.  As both a currency and a technology, it will not only transform money as we know it is but also its place within this new digital/mobile/worldwide economy.  As a speculative commodity, no one knows if the value will hold ($500), massively increase ($100k) or completely tank ($1).  We’ll have to see, but my guess is that its value will not be the greatest impact Bitcoin will have on our world.  As for regulation, the government will have to figure out how to play nice and guide it towards positive impact on our country and world.  I don’t see it completely taking the role of the U.S. dollar so I think that argument is flawed and used politically to take a side, similar to the silly spat between Republicans and Democrats in this country.

So please remember today’s incarnation of Bitcoin will not be tomorrow’s…  merely turning your head and shushing the noise is the wrong answer.  Just as there were many naysayers in 1994 and 1995 about the web, we are seeing something truly transformative take shape and I don’t want to look back in 10-20 years and kick myself for not getting involved in the movement.

That being said, yep…. the road also includes some things around Bitcoin.  It should be an interesting year.

Internet of Things – API’s of life

Another interesting phenomenon starting to take shape is the so-called Internet of Things.  I am not sure I like that term but we’ll agree it means a world where everything is “smart” and “connected” to everything else via the web and sensors.  Just imagine what can be automated or programmed when devices and objects – previously “dumb” and non-economic actors in our world (tables, chairs, driveways, houses, bikes, cars, etc…) are brought online and provided an identity.  Then include an economic identity (hhmm like using something like bitcoin…. now are you are starting to get it?) and allow humans to communicate with and pay and be paid by machines.  The possibilities are endless.

Even more basic is the ability to start automating things in your life.  If you have heard of IFTTT (If This, Than That) you know what I am talking about.  Basically, it means you can set triggers in the world, that when activated, will result in an action you previously determined.   These triggers are offered by various web based components in the form of API’s (Application Programming Interface) which allows you to tap into and easily integrate with other technologies.  For example, if I leave the house (known because my GPS on my mobile) then lower the temperature in my house by 5 degrees.   If Bitcoin falls below a certain price ($300), purchase X more for me.  You get the picture.

Yep, something like that’s in the works as well.

Health Technology – Wearable devices

An amazing area for innovation using connected and wearable technologies is health care.  We are wondering what is possible once people wear something(s) that are able to monitor and collect up to the second data regarding our vital heath?

Given my background in health I am immensely interested in the future of preventative health tracking, and we are in the process of laying out our first attempt at it.  Imagine wearing a small device that, when it senses a certain vital sign has fallen out of the standard deviation for this specific individual, sends a notification to family and medial team with actionable instructions?  Imagine how many heart attacks could be prevented if we knew the second someone was “about to go there”?  Now, I know this vision could collide with the scary notion of Big Brother NSA, but I have a feeling the pendulum will swing back toward a better equilibrium of personal safety and information security.

Yes, although it might be a bit on the horizon this is down the road for me as well.

Content Creation – Founders RAW

The last one is video.  We are starting to see more online video created and watched each day, month and year.   And it’s easier than ever to create and distribute video, especially through social media.  I intent on continuing my work on Founders RAW and experimenting with online media.   Founders RAW is a great playground, since it falls inline with entrepreneurship and founding of technology companies.  My goal is to continue to talk to founders and put out high quality content for all of us to enjoy and benefit from.  It will be interesting to see how content and video grows from here, how we all can take part in it.

So there you have it.

If you are tired from simply reading it, how do you think I feel?  My mind is spinning with all these possibilities and opportunities.  While it may seem like I have some random form of ADD (might be true) it’s more like all these opportunities came to me in the last few months.  Some are being built as we speak.  Some are on their way.  Some are in brainstorming and prototyping stages.  Some might not make it into production, but all are well thought out and well positioned to become something great in the future.  I hope to be a part of them all.

It’s never been a better time to be an entrepreneur.

Image by Flickr user oatsy40.

What To Do When You Don’t Know What To Do

I remember it was a rainy, cold and downright depressing winter day in Seattle. The gray skies, piecing wind and nasty looks on people’s faces didn’t help what I was dealing with at all.

That was the day I realized I didn’t know what to do.

I had worked my ass off for almost 2 years on my mobile payment startup Seconds, but too no avail.   The writing was on the wall.  Yes, we had customers and yes we even had revenue.  But no, we weren’t growing and no we weren’t able to raise money to continue forward as a team.

The thing was I didn’t know what to do.

Do I simply shut it down completely?  Quit cold-Turkey?  What about our existing customers?  What about our reputations?  What would others think if we “failed” at our startup?

I was also broke.

I had gone 15 months without pay, barely living off credit cards and other things I scrambled together.  It was terrible.  Some days I didn’t have enough money to eat.  Some days I struggled to buy a ferry ticket home and so I slept on a floor in the office.  I was riding the ferry to and from the office each day because I had no way to pay rent,  so I chose to stay with my sister and her family – an hour and half away across the sound from Seattle.   Graciously, my family and friends helped out when they could which to this day I am ever grateful.

I was definitely worried for myself, not “OMG will I ever be successful” worry but more like “holy crap, I am really on a sinking ship here.”

I didn’t want to admit I needed to jump ship before it sank, I wanted to ignore the holes and guide it to smooth waters.  Why?  Because that’s what “winners” do, right?  But I knew the holes needed patching, and meant getting another job.   I just couldn’t admit to myself the dream was over.

But I just didn’t know what to do.   Then it finally hit me.

It all changed when I re-thought what the dream actually was.  I realized my dream wasn’t about what I was working on at the time, but more about the person I was becoming in the process.  The dream is about being an entrepreneur – the adjective – not the noun.

Entrepreneur – noun.  A proprietor who owns their own business.  A title.

Entrepreneur – adjective.  A person who embodies the qualities of being Courageous. Innovative.  Persistent.  Agile.  Intelligent.  Savvy. Strong.  Personable.  Creative.  Excellent. Fighter.  Winner. 

Once I realized all I needed to do is change the horizon I was gazing towards, everything changed.  I removed myself from the echo-chamber of my head and finally understood, “YIKES, YES THIS BOAT IS SINKING AND I NEED TO GET OFF!”

So I jumped out, found something part time that would plug the hole (support me finically) and was able to live another day.  I started to understand entrepreneurship is a life-long game and to win you need to embody the adjectives, not the nouns.  Once I took that heavy financial burden off my shoulders everything started to get better, my head got clearer and my smile got wider.

I got my mojo back.

Being an entrepreneur is not a title, it’s a person.  Or a persona.   Or a set of characteristics that allow you to dig out of any shitty situation you’ll inevitably find yourself in.

When I found myself in a situation where I didn’t know what to do I simply changed my mindset, which allowed me to see the world in new ways.   Sometimes simply looking at things from a different perspective is all it takes to change your own world.

Great Founders Learn To Toe The Edge Without Falling Off The Cliff

19_20120115feet-cliff032That statement emerged from a conversation I was having recently with a founder friend of mine.

This individual is struggling in their current situation – not far enough along to support themselves with their endeavor but not wanting to let go (if only slightly) to do other work which would pay the bills.   They said it feels like being between a rock and a hard place, and it’s painful.  I felt it was more like a cliff.

I simply said:  “Great Founders Learn To Toe The Edge Without Falling Off The Cliff “

I know this spot really well because I was there for quite a while and I remember almost falling off more than a few times.

What I learned through the process was how to toe the line – balance on the edge if you will – without falling off the cliff.  I realized entrepreneurship is balancing the risk of great rewards with the risk of detrimental actions.

How do you know which is which and what to do when you find yourself getting weak knees as you get pushed towards the cliff?

You have to look deep inside yourself and ask “what do I gain from staying here?  Do I really only have one option, which is to stay here and not evaluate my other options?”

Notice I said “gain” not “lose”?  There’s a big difference between those two perspectives.  When you are standing on the edge looking far down the cliff, you have much to lose.  So much in fact it’s hard to pinpoint exactly what you are doing and why.  Founders face so much challenge and adversity they can easily lose their perspectives and clarity of thought.

I told my friend he needs to look inside and ask what he gains from staying there.  He needs to look out for himself first and foremost.  He needs to take care of his basic needs – be it money, food, shelter, stress relief, relationships – and only them will the company stuff  work itself out.

I said, “trust me, it won’t get any better if you don’t step away from the ledge.”

Stepping away from the ledge is exactly what I did and I am so much better for it.  Yes, I had to swallow the pill and realize my “first” attempt at building my company wasn’t going to end like I dreamed it would just a few short years ago.  But as I backed away from the ledge and got my priorities/basic needs back in order, things started happening I never thought possible.

You would be amazed what happens to your business life when you remove self inflicted pain and stress from your personal life.

Talk To Enough Successful People And Patterns Emerge

I am truly grateful for what have the opportunity to do each and every week.

We started Founders RAW a few months ago and are almost to our 10th full conversation with entrepreneurs here in Seattle.   For those who aren’t aware, Founders RAW is a new multimedia property where we showcase videos of casual conversations with other startup founders.  When I realized I was having great conversations with my founder friends at local startup events I decided we need to record this stuff and push it out to others.  Maybe you can learn something as well.

Check it out for yourself >  Founders RAW.

I typically sit down with one person each week, grab a beer and dive deep into what it’s like to start a company.  One of the big things I have taken away thus far is how patterns emerge during these conversations.

Founders RAW behind scenes

Sitting with Simon Crosby during our Founders RAW conversation at the WTIA TechNW event in Seattle.

What do I mean by patterns?

By patterns I mean in how these founders identify the challenges they face and how they dealt with and overcame them.  Not to say all entrepreneurs experience the same things, but as I peer deeper into my conversations and read between the lines, certain characteristics or principles seem to be emerging.

The founders also seem to allude to similar experiences of company near-death and despair – yet they continued forward when all seemed lost.  So yes, no one is immune to the inevitable challenges and tough times ahead.

Benind scenes 2

Sitting with Carlos Guestrin during our conversation at the WTIA TechNW event in Seattle.

Vision

Each founder I talk with embodies a strong sense of vision – they know where they are going and what they want to accomplish.  Vision is what sets them apart from their competition and allows them to navigate changing waters when their market matures and shifts with the times.  John Cook had a vision of digital media even when he was working  as a reporter for a traditional newspaper.  Amazingly, he pitched them on rolling out a whole new concept involving the web and digital properties, only to be shot down my management.  So he left and started it himself!

We know now who had the vision and who was stuck in the past.

Strength

The founders I have spent time with all have the quality of strength, meaning they are able to endure and deal with the challenges ever-present in entrepreneurship.   Whether it be dealing with co-founder issues, standing up to advisors and investors when their business model is challenged, or when push comes to shove they determine to out innovate the competition.  Adam Lieb, founder of gaming social network Duxter, displayed a strong sense of character as he detailed out his experience raising money from angel investors.  It’s not easy for startup founders to raise money, especially here in Seattle vs down in the Valley.   The lesson I took was investors want to invest in strong, vision oriented founders, not weak leaders who will bend at any sense of difficulty.

Flexibility

Lastly, as market forces change the tech landscape founders must be flexible and change with it.  Advancements in technology are only speeding up and drastically influencing how we build our companies.  Just a handful of years ago AWS/Amazon was nowhere to be seen.  Now, because startups can now host in the cloud using services like AWS and Heroku, startup costs have dropped dramatically and thus have allowed a founder to launch a company in under $5K initial investment.   Bob Crimmins made a huge point regarding this as he spoke about what he is seeing with the TechStars companies he mentors.  “They act quickly, test frequently and iterate often.”  That is why the successful ones are growing – the lowered cost to start and grow has allowed for more/quicker iterations of web products and services.

It’s been fun thus far and I can’t wait to see what happens next.  And I think you should do this too!  No, you don’t have to record your conversations like we are but I think Mark Suster was onto something when he says you should take 50 coffee meetings this next year.

John Cook

Chatting with John Cook of GeekWire during our Founders RAW conversation.

Thinking Without Interruption

By chance have you noticed how often you are interrupted each day?

I am sure every minute or two you are dinged or buzzed with a new text message, IM, email, phone call or Facebook message.   If you are not dinged you are probably grabbing your phone incessantly and checking it yourself, thus breaking from the normal pattern of thought.

In a one word, it’s annoying.  I know life has to continue and we need to communicate with each other but the ever increasing pace of interruptions is definitely becoming more obvious.

I wonder if this Is this good or bad for us humans.

I recently read how Paul graham viewed this phenomenon, as he tied it into the larger addiction conversation.  He ends by saying:

I used to think running was a better form of exercise than hiking because it took less time. Now the slowness of hiking seems an advantage, because the longer I spend on the trail, the longer I have to think without interruption.

…We’ll increasingly be defined by what we say no to.

photo 2

I fully agree.

I recently went on a weekend excursion into the Cascades with a group of friends, spending 3 days with my hiking boots, pack and tent.  We hiked 10 miles into glacier lake and set camp for two nights,  We hiked a total of 26 miles in 3 days – all without checking our phones once!

It was refreshing.

I believe we need to schedule into our lives a few days/weeks every so often to be off the grid, just so we can remember what it’s like to not be interrupted every few minutes.   And just so we can be taken back to what a long, winding and challenging conversation with another person feels like without grabbing a device a solving the argument by “googling” the answer. I cannot tell you how great it was to be on the trail, talking with my friends about anything and everything we wanted, without interruption or having to pause because one of us was responding to a text or grabbing a quick phone call.

Remember, technology is there to augment our real world relationships, not replace them.  The nuance is in how we gracefully use technology to enhance our world, not negatively impact it. I was beautifully reminded this on my weekend backpacking trip and then again today as I read Paul Grahams words.

Do yourself a favor and plan off-grid experiences, your health and sanity will thank you later.

photo 1

photo 3

Who Makes Seattle? We Make Seattle.

A cool new project about the Seattle creative community hit Kickstarter recently.  It’s called We Make Seattle.

Given the fact I am an entrepreneur, founder of a Seattle startup and now founder of a site that helps other founders tell their  startup stories, I am very excited to see something like this come out of our community.  Seattle needs more exposure to put to rest the “Seattle vs Silicon Valley” arguments.  We are not SV and never will be; we are Seattle.   We are unique, different, but also a land of huge opportunity.  Films like this allow us to tell our stories to the world and show them we know a thing or two about creating great products and companies.

They are more than half way to their goal of raising $28,500 to get this thing in production, so go on and help them achieve their goal!  Below is more about the short film.

Screen Shot 2013-08-07 at 12.12.17 PM

This short film is a celebration of what makes Seattle the best place in the world for entrepreneurs and creatives to live. It tells the story of the vibrant and supportive community we have for starting companies, betting on dreams, and chasing big ideas.

Despite being named the #1 tech city in America by The Atlantic, and consistent top rankings on the list of the world’s most livable city, we’re frequently overlooked as the place to go for people with big talents and ideas. This film will change that.

The film has three goals:

1. Celebrate the creative community.  We have all personally benefited from the Seattle community, and the film will be a reflection back to the community itself on how many amazing companies, events, and projects are based here. In our daily lives we rarely step back to see the entire city, and We Make Seattle will inspire by telling the story of how many great things happen around us.

2. Help recruiters and entrepreneurs attract talent. NYC, LA and even Portland have produced short videos to help local companies tell the story of their city. Seattle has no such film, until now. The film will be the perfect one link to send to convince ambitious creatives, potential business partners, or top candidates from around the world to bring their passions to the northwest.

3. Have the community tell its own story. Everything about this project is built by the Seattle community itself, and led by well known leaders who have benefited from our creative city and want to give something back. We’ll be inviting people to contribute in various ways throughout the production of the film.

All funds beyond our budget will be used to promote the video, as PR and reaching a wide audience is as important as the video itself.

Here’s My New ‘Current Projects’ Page, So Y’all Can Keep Tabs On Me

I am noticing a trend forming in my life.

I’ve been more open to starting a few new projects lately and so I decided to update this blog and create a spot where you can go to at any point in time and check out what I am working on.  You can find the link at the top right of the header menu bar on this blog.

Current Project page.

Below you can see a snippet of things I am up to right now.  More will probably come soon but this is what is happening at this point in time in my life.  Given the fact I am currently also doing some outside contract work for other companies, I am only listing the projects/companies I have founder or equity stake in.

Enjoy.

And reach out to me if you are interested in partnering or getting involved with any of them.

Current Projects

Seconds logo

Seconds is a payment system allowing you to swiftly complete transactions via the desktop web, mobile web or text message. It shouldn’t matter what method you use, the payment experience should be as quick, simple and intuitive as sending a text message.  Realizing how important ongoing relationships are between customers and merchants, and also realizing the main point of entry into our world is now through our mobile device, we see an incredible opportunity.

 

Callin'it logo 2

Callin’it is a mobile web based real-time sports prediction and data analysis platform.  Using Callin’it, people are able to test and share their sports knowledge by publically predicting – or calling – stats, plays or outcomes of an upcoming sporting event.  For instance, right now I am calling the Miami heat will have more rebounds than the Chicago Bulls in tonight’s game.  Using real time sports data, we then compare the specific call with the actual result to build out a score for each user based on the accuracy and difficulty of their calls.  If Twitter and the ‘SAT’s for sports’ had a baby, Callin’it would be their lovechild…

 

Founders Raw logo2

Founders Raw is my newest project, a video blog with conversation style interviews focused on bringing out  raw stories early stage founders experience in their rough and tumble entrepreneurial journeys.  I invite founders to talk openly over a beer or a coffee about the “truth” of how they survive and grow their companies.  We intend on slicing up the conversations and sending out daily videos no more than 3 or 4 minutes long so we all can receive daily nuggets of the entrepreneurial truth.

 

Published Books

The Agony and Ecstasy of Entrepreneurship

The Agony and Ecstasy of Entrepreneurship has been adapted from this blog, So Entrepreneurial, and placed into book format.  They are my thoughts and musings on all things entrepreneurial, meant to help you understand what it takes and how to think like an entrepreneur in today’s world.  Far from perfect and by no means the only way to go about the journey, they represent my lessons taken straight from the trenches.  Since my thoughts originated as blog posts it’s best to take them piecemeal, maybe even digesting just a few topics each day. You will find my main perspectives are around mobile, digital and internet technologies but the principles can be applied to any other entrepreneurial focus.

When Your Startup Feels Less Like A Hockey Stick And More Like A Hip Check

We all love to talk about the hockey stick moment for a company, referring to the moment when users and usage really starts to take off.  It’s fun.  It’s exciting.  And  it’s so elusive we all want to dissect what the specific company actually did to achieve the stratospheric growth.

But what about the hip check?

What’s that you say?  Never heard of the startup hip check?  Well, take a look at the image below and I think you can get an idea of what I am talking about.

3HipCheckPretty scary huh.

This head-over-feet-over head-over-feet feeling can happen at any moment of a company founding experience.  Sometimes it happens within the first few months of a new idea as the honeymoon wears off and founders realize the pieces don’t fit and they don’t have a starters chance of even putting something together.  Other times (like mine) you get up and running – even get some initial customer wins under your belt – and then it hits you when you least expect it.

BAM – “what the hell was that!?”

In any regard, getting hip checked throws you and your company completely off your feet and off course.  There is a good chance an injury has occurred and you may never recover.  It feels like what I imagine the hockey player above must have felt as he was brutally checked right onto his a**.

And you know what?  It happens to EVERYBODY.  All athletes.  All entrepreneurs.  everybody.

So what do you do once you shake the cobwebs out of your head and realize you just got taken to town?

Pause

Simply pausing and taking account of your status is the first thing you should to do.  At this moment do not let tempers or emotions get the best of you.  Athletes ask themselves questions like: Do I have all my limbs?  Are my legs situated in the right direction?  (Anyone watching this years NCAA basketball March Madness tournemant will know know you should now check all your limbs after a bad fall.)

Rather than get emotional and retaliate, athletes need to assess why it happened.   Was I too slow?  Did I make the wrong move?  Was he just flat out better than me?

Entrepreneurs need to ask similar questions:  Why did that just happen?  What did we miss?  And what is our financial status, how much money do we have in the bank?  What do the others on the team think and feel about our situation?  Are they hurt and need to go recover, or can they keep at it?  Also, who else knows we just got hip checked?  Was it reported in the media and did we take a PR hit?

Through these questions you will determine if the company can and should continue, or if indeed it’s best to step off the ice.

RICE

Rest.  Ice.  Compression.  Elevate.

My education taught me RICE was the simplest injury treatment protocol, basically placing it in a state of limited movement and maximum preservation.  Same for a startup.  If continuation of the company is desired, I am suggesting taking a similar approach with your startup.   You have to stop the bleeding (financially) and start the healing process (working) as quick as possible.  If needed, go get a paid gig as quick as you can so cash starts flowing into the bank once again.  I waited way too long on this one and can tell you it wasn’t pretty.  Cash really does solve many problems and helps to open back up the creative process since a huge pressure valve is released.

Open the communication lines with your team, have long discussions about why the hip check happened so you can start the healing process.  Through these discussions the weaknesses will be revealed and the ways forward will emerge.

Elevate yourself.  A strange (albeit predictable) thing happens when founders get hip checked – depression.  Since it takes a certain chutzpah to start a company, namely audaciousness and ego, I have noticed those also work against the entrepreneur once they find themselves face first on the ice.  Of course this isn’t what you expected as you started out and most definitely how you didn’t want others to see you.

But there you are.

You must get up.  You must inflate that ego (figuratively speaking) back to where it was before, when you believed in yourself and your team.  A positive and forward looking perspective is the only way to recover from the hip check.

Skate Again

If you watch a hockey game it doesn’t take very long to notice how often hits and checks happen to all players.  And you know what?  They get back up and shake it off.  They try again.  It’s quite the same in the startup world.  Everyday, founders are getting hip checked to founder hell and back.  Yet, the ones we end up reading about are the ones who got back up and tried again.

Elon Musk has probably been checked more than most other successful entrepreneurs out there.  Did you know there was a time he was literally broke as he was building Tesla and SpaceX?   At one point he put the last of his millions he had made previously into his companies so they wouldn’t go under – personally financing them and risking everything he had worked for  – and then lived off loans from his other millionaire friends.

Yes, and now people say he has it too good as a billionaire and CEO of two incredibly innovative technology companies.

Hmm, well there’s a reason Musk refers to founding a company as “it’s like eating shards of glass and staring into the abyss of death.”

Because it’s true.

I simply say: Just get up and keep skating.

Earth To USA Today and JP Morgan – There Are More Startups Today Than Ever Before

A recent column in the U.S.A Today makes the bold claim that there are less startups today than compared to the 1980’s, during the Carter administration.

The rationale:

At any rate, the latest data indicate that start-ups are becoming rarer, not more common. A new report from JPMorgan economist Mike Feroli indicates that employment in start-ups is plunging. New jobs in the economy tend to come from new businesses, but we’re getting fewer new businesses. 

I am going to guess Glenn Harlan Reynolds, a professor and the author of the post, is not an entrepreneur and has never been one.  If he was one he would know basing innovation metrics and the quantity of “startups” solely on the amount of people they employ is an incredibly flawed argument.

Screen Shot 2013-05-06 at 8.00.44 PM

Diving deeper into the JP Morgan study, they lay claim to a few reasons on why we are seeing an apparent slow down in startups:

Hudson’s possible suspects for the slowdown: a) higher business taxes, b) Obamacare, c) an IRS crackdown on US employers that hire U.S. workers as independent contractors rather than employees, and d) a steady barrier erected to entrepreneurs at the local policy level.

But whatever the cause of the entrepreneurial decline, two possible impacts: 1) A less productive and innovative economy, and 2) higher profits for big business thanks to fewer upstart competitors on the horizon.

Here are a few observations on why I feel this assessment is off the mark:

1) Assuming Obamacare is a factor completely misses the point, since Obama wasn’t even in office when the decline in jobs started (see chart above).

2) Although a local policy issue may influence certain industries – since we’re talking the entire nation here it’s irrelevant to include local policies because they vary state to state.  I, for one, can tell you it’s quite easy to get going in your own new venture.

3) The IPO market really cooled off over the last decade, suggesting a rise in mergers and acquisitions.  Simply stated, startups are being bought by bigger companies before they beef up their workforce, which also will affect overall startup employment numbers.

4)  If anything, they miss the most obvious reason why people would choose employment at a larger corporation rather than a startup: job security and dependable paycheck in a shaky economy.   Although this also doesn’t apply since the economy didn’t tank until late 2008 and beyond, so again, not a very high correlation.

5) The largest omission in this report can be seen by evaluating technological progress and the resulting drop in computing costs.  Comparing the chart from the JP Morgan article and a graph of Moore’s Law (which is exponential) you now realize using a simple number like the number of employees of startups is probably the wrong approach when determining the current status of innovation.  Moore’s Law states the computing power is increasing at the same time the cost is dropping.  So, it is easier to start a business than ever before. The cost of computing, virtual work environments, AWS, instant and free communication tools, and the proliferation of the web have coalesced to create a startup nirvana.  Looking at two charts from the same timeframe you will notice the stark drop in jobs at the same time a drastic increase in computing power?  Coincidence?  I don’t think so.

So am I missing something here?

Maybe if they simply stated “startups are employing less people” I wouldn’t have a problem with the report.  But they didn’t.  They claim (in fact lead with) the idea that there are less startups and innovation than in the 80’s and 90’s, which I feel is wrong – or at least how they came to that conclusion is currently flawed.  They go on to make a few solid points regarding higher taxes and government regulation and how those influence an early venture hiring but lack any real depth for their argument.  Maybe they should have consulted an entrepreneur or two who could help them sift through the chaff a bit further.

Moore's Law of Computing Power

Moore’s Law of Computing Power

My take: it takes less people to achieve more today.  What once took a team of 10 to accomplish now only takes 2 or 3 people and a wifi connection.  So I am claiming the exact opposite of the USA Today and JP Morgan.  We are seeing more products, apps, and startups created today than ever before.  Ask any VC or startup founder and I guarantee they will say the same thing.

Hell, Instagram and their entire team of 12 employees was sold for almost $1 billion to Facebook in 2012.  So whatever you do, do not believe there is a lack of innovation and startups out there.  If anything, there’s more innovation and startups created each day than ever before because we can do more with less.

One just needs to look closer and use the right measuring stick.

An Intriguingly Utopian Vision For The Future Of Technology

You may have seen this two-year old video but I saw it today and thought it’s worthy of highlighting.   It puts together a quite intriguing vision of how we’ll interact with the web and technology in the future.

Entrepreneurs, you might want to look for ideas of how you can get involved building some of these things starting today.

More Humanity, Less Technology

A few recent experiences have spurred my thinking on the subject of humanity vs technology.  Some of this will seem inevitable and some of it will seem commonsense to you.  Some of it might even go against the grain of what you are currently working on right now.  My purpose is to get you thinking about how you go about your life using technology – by yourself and around others.

I am not sure if it’s just me but I feel we are starting the upswing on what will be viewed as the turning point in our society.  We will never have a “slower” life than we do today.   Cell phones allowing us to talk to and message anyone in the world was just the beginning of this movement.  Now, we have really powerful mobile computers in our pockets which basically bring the entire world to us – instantly – with a touch of a finger.  In a not so distant future we will be wearing these computers on our wrists (I hope not) or our faces with such innovations like Google Glass.  Will brain implants one day do away with any device or hardware required to access all the worlds information?

Fashion faux pas aside, I think these technical advancements are inevitable yet at the same time very scary.

What seems to bother me is what will happen to our humanity as all these technical advancements come into our lives.  We already deal with the quick “phone, text and email check” at the dinner table or during a conversation with someone else.

Is it lost on our society that this action is actually quite rude to the other person you are sitting with?  I know I am guilty of frequently swiping my iPhone and seeing what I missed over the last 5 or 10 minutes.  In reality, it simply says to the other person, “you are not very important to me and I am wondering what other bits of information I can quickly scan to keep my attention.”

What will happen when we were a pair of glasses with a screen ever-present right in front of us?

I am afraid we, as a society, are not prepared for this use of technology.  Socialogically, we are trained to observe people and gauge them via non-verbal cues as to how we are connecting with them.  Are they threatened, scared, turned on, tuned out, distracted, interested, ect…   The human eyes/mind/body instantly calculates all these millions of inputs and tells us what is going on within this specific human interaction.  We live our lives on non-verbal human cues.

These thoughts hit my mind the other day as I read an interesting article in the New York Times with the idea that Friends don’t let friends lose their capacity for humanity.  It raises the same alarming points I am mentioning here.

Ironically, as tech advances to help us “connect” with others we seem to be moving farther away from actually connecting with them – on a human level.  Does a text message saying “hi” do more than a slightly extended eye-gaze between two interested individuals?  Absolutely not.  I can learn more in 2 seconds looking at woman than 100 text messages sent from her iPhone.  All those text messages just create more questions and uncertainty between the two people.

The second experience happened yesterday as I was chatting with friend.  She mentioned how she was a natural introvert and she really needed to get out more, get away from her monitor and into social situations more often.  According to her she has a tendancy to lose track of time when she gets into her work and feels more at home in front of the screen.

I understand what see is saying but I also counter with the fact that she actually feels more at home across the table from me looking into a human eye and enjoying a face to face chat.  That is why she said she needs it more often.  There are just certain things we see/say/do which will never be replaced with technology.  Even Skyping with others doesn’t actually feed our appetites for human connection.  Like it or not you are addicted to dopamine – a chemical released when you interact with other human beings – and you will withdraw from society if you do not get enough on a consistent basis.

All this has me thinking deeper on what technology means for us humans and how we should use it in our daily lives.  More interesting is the fact that as time goes on and technology continues to move us “forward” we will actually desire more of these authentically human encounters.

Our society depends on it.

As I continue my path in the technology sector and build experiences around the web and mobile devices I make sure I keep one foot firmly planted in the area of Humanity so I don’t end up losing it.  I hope others do too, it would be a shame if we all just ended up always looking down at our mobile devices tweeting about the fact that we are feeling alone in a crowd.

The Stubborn, In Search Of An Open Mind

Why do we do the same things each day?

Why do we think about things in a certain way, taking certain stances and dismissing others?

I became aware of my open/closed mind recently as I ponder my own situation and life direction.  For a stubborn founder type it can be difficult to not look at things with a very narrow mind, only focusing on the business at hand.  And even then, with all the talk about laser focus and “being great at one thing”, one can quickly fall into a dangerously narrow view of the world.

Please pardon my philosophical and existential tonality.   The day, given its early in the new year, is met with a renewed sense of observation and analysis of my current thoughts and actions – both personally and professionally.  I think it’s healthy to frequently step back and evaluate your thoughts, feelings, words, actions and directions in life.  I, too often and probably like you, stay narrowly focused on what is two feet in front of me.  And I am starting to realize its to my loss.

salvador-dali-three-sphinxes-of-bikini

The danger of a narrowly focused individual can be staleness of perspective and a stagnation of progress.  If we are not careful, what we call “the daily grind” will actually do just that – grind away and remove the excess layers.  The problem lies in what layers are ultimately removed.   Remove layers that provide a fresh view of the world and we become intrenched in sameness, staleness, and stagnant environment, with no regard to anything different.  Not to get too off subject but I would be remiss if I didn’t mention this type of viewpoint has a large affect in racism, religious dogma and other societal problems.

To get around the trap is to first realize you might be narrow minded.  You can do this by consciously observing how you go about each day, each month and each year.

Do you mostly frequent the same places?  Same coffee shops, restaurants, theaters, stores, parks, roads, cities, etc..?

When was your last big vacation?  Where did you go?

What are you currently reading?  Fiction or non-fiction?  What about movies and art?

When was the last time you simply pulled up YouTube and found a talk given on a subject you knew nothing about, so you could be introduced to it and possible start a new study?

Who have you spent the majority of your time with lately?  How many different people have you spent time with talking and experiencing life?

Do you venture out on weekdays and weeknights?  Or do you normally stay in?  Why?

How many different cities and communities have you lived in over the course of your adult life?

If the number is quite low… over an extended period of time… for one or more of those questions you may be embracing a narrow minded perspective in life.

Is that such a bad thing?  No, I don’t think so.  But I do think a narrow minded stance hinders ones ability to fully experience the world, as well as discover unique insights one would otherwise discover.

It is both these – to experience life and discover insights – I am yearning for right now.  For some time now I have sensed my life narrowing into a frustratingly tight viewpoint and I am now looking to do something about it.  I want new perspectives on my current business.   I want new insights for future business opportunities.  I want a refreshing new take on the world and how technology can improve it. I want new perspectives on where to live.

I want, for lack of a better term, a more exotic life.

I am not sure where these thoughts are coming from.  I don’t exactly know why but for the first time in my life I am sensing we just recently crossed over the technological threshold and maybe this is how I am responding to it.  Technology, mobile devices and their apps, constant connectivity and the like… is now mainstream and something we all must have.  It’s no lie when most people in our society believe being without their mobile device feels like they are naked.  That’s quite startling.  Before, it was early adopters with these gadgets and ideas for new uses.  But now, it’s everywhere you look and go.

This is both exciting and frightening.

Maybe I am overly aware of societal changes and the feeling things are continually speeding out of my control.  This is worrisome to me.  Part of the worry is in the irony that even though we have access to more information than ever it seems we tend to stay within our comfort zones of products, people, places, reading material and thoughts.

So I am making a conscious intent to open my mind.  I want to look at things with a different lens, seek out new people and new places in the world, accept different stances on things I wouldn’t normally accept.  I also want to do more things WITHOUT the entire focus on my handheld mobile device.

I am going to do this because I believe it will make me a better person.  I also think it will put me and the company I lead in better place, and to hopefully bring something materially better to the world.

Valuable Lessons Learned In The First Year As A Startup CEO

About a year ago I was approached by a stranger and was asked to join a Seattle startup.  This stranger, my soon-to-be-cofounder, asked me to take the CEO role in the startup, which unfortunately was named Order SM but eventually became Seconds.

I remember it clear as day.  We met at a coffee shop in the Greenlake neighborhood in Seattle and chatted about our similar ideas on local and mobile commerce.  We both believed all the current options on the market were missing the boat, releasing bloated products and not making the mobile ordering/payment experience any easier than it was online or over voice on the phone.

I was much obliged and we immediately got to work, paving the way to release our first product.  It has now been more than a year since this fateful day and I feel it’s as good of time as any to review some lessons I have gathered through my first year as CEO of a fledging startup.

You will be underestimated

First thing to understand as a rookie – your peers, the media, investors and the rest of the industry will underestimate you.  This is a fact of life and was nothing new to me.  “He’s just a guy who was a personal trainer for god sakes.  What does he know about technology?”  Better get used to these types of reactions if you are trying to do anything out of the ordinary.  I don’t fit the traditional mold of a tech startup’r.  I look different than the rest.  I my degree doesn’t align with what we are doing.  To them, I a lost bet.  Although it’s frustrating at times to hear this, I have no problem being the underdog.  I would rather be doubted and exceed expectations than be heralded and ultimately disappoint.

It’s tougher than they say

Starting a company is definitely one of the most challenging things you will ever do in your life.  It’s especially difficult if you did not study at an IVY league or Stanford university, graduate with a CS degree, come from a family of great wealth, get hired early on by Google, Facebook or Microsoft, have a sizable exit from a previous company or any other notable event investors look for when evaluating startups.  No, my team and I have none of the above.  Yet here we are a year later, still creating great products and building an exciting company.

Be prepared to be challenged more than you ever have in your life.   You will be challenged physically.  You will be challenged mentally.  You will also be challenged psychologically more than you ever thought possible.  You will ask yourself why you are doing this and to what cost is it worth.  Challenges technically, socially, professionally and financially will string you out way past what you ever thought you can deal with.

You will also give up more than you ever thought.  Going without pay for pretty much the entire year has been humbling, to say the least.  You might even come face to face with the very things you take for granted each day – the roof over your head, the car you own, public transportation just to get to the office, enough food in your stomach so you don’t starve.  imagine what I think when I walk past beggars and the homeless nowadays.  Not only do I not have $1 in my pocket to give them but also, why would I give them a dollar when they are just sitting there asking for a handout?  Maybe if they were offering a service or working towards something positive for society I might think differently.  I understand the harshness of my thoughts but it’s the same standard I hold for myself.  Add value to get value back.

This is the road less traveled and indeed it’s much tougher than they say.

VC’s and Investors will lie to you

Unfortunately, investors will lie to you.  They will tell you straight to your face they are interested, want to learn more and actually want to invest.  This, most likely, is a lie.  Why?  Investors want access to the most information possible for the least expense, and will lead you on for months before they let you down with a “you’re just a little early for us but stay in touch.”   This is bullshit and you don’t have to take it.  Just cut to the chase as early as possible, tell them what you are looking for and that you are not going to put up with any BS.  Let them know you call the shots in these conversations, and it’s a privilege they are talking with you.  Ask them to get on the train or risk being left behind.  In fact, not cutting to the chase as early as possible shows investors you are naïve, at which point they will exploit the fact for all its worth.  Trust me, I did this too much and now regret wasting my time and energy on something that was not going to happen at the time.

Remember – if you are the one approaching your odds are slim to none.

Leadership is required from day one

The day I agreed to cofound this company and become CEO of Seconds I told my then cofounder:

“If I am CEO than the buck stops at me.  There will be no power struggles, disagreements and other crap that breaks up promising startups.  The CEO is the ultimate decision maker and will have final say, no matter if I hold the position or anybody else.  Agreed?”

I believe this initial conversation set the tone for the company, a tone that has remained solid to this day.  Clear leadership, from the CEO onto others in different roles within the company (technical, design, product lead) has been established and follows a predictable path.  If an issue or disagreement forms, we talk it out as a team and determine what feels like the right decision.  Ultimately, when all perspectives have been heard heads then turn to the CEO where everyone believes the right decision will be made.

Building a great team takes time

I wrote about building teams previously, focusing on filling complimentary roles within the team.  The way things tend to happen in a startup could be summarized by the words “controlled chaos”.  People come and go.  If your vision is intoxicating enough, you will attract people that want to help out.  Problems arise when people realize it will be harder work than originally thought, so some will split.  At that moment, you will find out who is serious and who isn’t.

It takes time and energy to find the right talent for the right job.  The initial founding team helped prototype the concept and get an initial product into the market.  A full year into existence, Seconds now has a whole new team (besides myself and Brent) working on the next phase of Seconds, which requires slightly different skills and talents.  I have never been more confident about our team – as well as more proud of the work we have done in the last month.  It’s okay to have a fluid team if the product is moving forward.  At some point stability will be found.

Building a great product takes time

Just as building a great team takes time, building a great product takes time.   You must be comfortable with timely, constant iteration and waiting patiently as your tests reveal valuable results.  Recently I commented on our evolution of Seconds:

“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.

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.

It’s more fun than they say

I am sure you are thinking to yourself about how crazy and interesting of picture the above paints.  All in all, I am having the time of my life and I believe any startup founder needs to be doing the same.  Why on earth would put yourself through such madness if you didn’t enjoy the process?

I though I was just working hard on starting a cool payments company, yet I have learned more about myself in the last year than in the past 30 years of my life.  Deep down in the founding core of any company you will find a root motivation within every founder called personal discovery.  Of course they want to make worldwide impact and maybe even create great wealth for themselves and their shareholders.  But what they don’t talk about is the journey of personal discovery the are currently on, the one that takes them deeper into their psyche and will only make sense decades later.  I find my current journey fascinating simply because most people don’t have the courage to dive this deep.  I consider myself one of the lucky ones.

Are we a little crazy?  Yes.  But as a classic Apple commercial so adamantly starts:

Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes…

 

It’s Amazing How Much Technology Negatively Affects Our Leaders

As a lifelong student of Leadership, I’m sure I look at certain people and situations a bit differently than my peers.  When observing those at the helm of large or small tech companies, others might think genius or insanely wealthy where I tend to look for greatness or Leader.  All too often, and to my disappointment, I end up with something like “hmmm leader… not so much”.

The current state of Leadership in the tech sector has recently come to my attention as mini-crises seem to occur daily.  Wall Street this, tech companies that…  the rising turnover at executive levels of various companies.  These all definitely point to something not quite right at the top and everyone’s pointing fingers and playing the blame game.

And as it is with everything, it all comes down to leadership.

Look no further than Groupon and Zynga for real life examples. They are perfect studies of what happens when there is a clear lack of leadership.  Both companies are in free-fall with no end in sight, and both are now seeing early investors, shareholders (even founders) cashing out before it craters to rock bottom.

Coincidence?  I don’t think so.  Surely I don’t blame a founder for wanting to secure their future after years of hard work, but based on recent actions the lack of faith is clear as day.

Why all the focus on Leadership?  Well, I recently stumbled across one of the most incredible articles on the subject, Solitude and Leadership, originally a lecture given by William Deresiewicz to a class at the United States Military Academy at West Point in October 2009.   I can only imagine what it must have been like in the room that day, reading it now still yields a strong sense of how important leadership means to our military.

But as I read the article something unsettling occurred to me: are we, as an industry, giving Leadership its due respect?  Are we adequately preparing individuals to lead organizations, some numbering in the tens of thousands?  Or are we inadvertently focusing on the wrong skills and placing the wrong people at the front?  These individuals may be highly intelligent, top of their class, technically oriented and gifted with the ability to communicate with machines, but do they embody basic abilities to connect, communicate and lead others on a human level.

Accomplishment doesn’t necessarily mean people are adequate to lead.  Highly qualified people can have a CS degree from a top school, be a grifted engineer, and had the foresight to be a co-founder of a startup or previously earned millions from a well placed bet.  All those things make for a successful individual, but they have nothing to do with understanding the principles of leadership.  High tech and human interaction are pretty much opposite sides of a broad spectrum.

To put it bluntly, are we appointing the wrong people only to see the ship go sideways?

To viscerally grasp quality Leadership, one has to have a deep understanding of human motivation, psychology and sociology.  Basically, a leader must inherently know what makes people tick, and why.   The dynamics of human nature is one of the most challenging arenas to master, its more art than science.  There’s no formula or equation to use when approaching another person in the heat of the moment.  It takes awareness of the situation, yourself and the other person – all at the same time – to best handle a tense or high pressure situation.  Some people naturally posses such talents and can handle things with ease and grace.

And some don’t.

I believe this is where well intentioned but misplaced individuals fail promising companies.

The entire article gripped me, full of lessons and anecdotes on how we need to review the basics of human nature and leadership.  But a few things jumped out at me I want to share with our community in hopes it can help get our leaders back on solid ground.

Solitude is true leadership

It’s quite interesting how Deresiewicz refers to solitude as true leadership. How can time alone bring clarity to thoughts and ideas, leading to better leadership?  To find out, a simple glance around will give some perspective.  If you look around you will notice most people tend to be excellent sheep.  They flock around, listening to and following others, and are ultimately way too distracted “climbing the greasy pole of whatever opportunity they are after at the moment” to actually think clearly.

In short, rarely does anyone actually take the time alone to think for themselves.

“I find for myself that my first thought is never my best thought. My first thought is always someone else’s; it’s always what I’ve already heard about the subject, always the conventional wisdom. It’s only by concentrating, sticking to the question, being patient, letting all the parts of my mind come into play, that I arrive at an original idea. By giving my brain a chance to make associations, draw connections, take me by surprise. And often even that idea doesn’t turn out to be very good. I need time to think about it, too, to make mistakes and recognize them, to make false starts and correct them, to outlast my impulses, to defeat my desire to declare the job done and move on to the next thing.”

Leaders would do themselves (and their followers) justice by simply taking more time alone to think independently.  Only by letting all parts of the mind come into play will they arrive at an original thought.

Deresiewicz believes we have a crisis of Leadership in this country.  “What we don’t have is Thinkers.  People who actually think for themselves – independently, creatively, flexibly, strategically.”

And he is absolutely right.  What we need is better thinkers, independent thinkers.  True leaders are able to take the time to think things through for themselves, and then have courage to make decisions even when those decisions are not popular but in fact the right thing to do.  Courage to think and act independently – for the right reasons – is what Leadership is all about.

Learn to think for yourself

To think clearly and independently a Leader must remove themselves from distraction and influence.  And when I say distractions, I mean all of them.   Today, more than ever, leaders are so bombarded with interruptions via email, texts, social networks, employees, bosses, media, etc… it’s no wonder they can’t gain any clarity of thought.  And studies have proven people do not multitask effectively – at all.   In fact, multitasker’s pretty much suck at everything they are doing when they are engaging in numerous activities at once. Various studies have shown multitasking only further distracts the individual and can actually impair ones ability to think clearly.

This is why I believe Twitter and Facebook, fascinating as they may be in our world today, are killing our ability to actually think clearly and independently, taking with them our uniqueness and innovation as collateral damage.  We’re now all dopamine feigns, searching for the next high pumped directly into our veins via short tidbits and chunks of useless information.  It’s like we are all now thinking in short tweets…  And according to Deresiewicz, this is not good:

“Here’s the other problem with Facebook and Twitter and even The New York Times. When you expose yourself to those things, especially in the constant way that people do now—older people as well as younger people—you are continuously bombarding yourself with a stream of other people’s thoughts. You are marinating yourself in the conventional wisdom. In other people’s reality: for others, not for yourself. You are creating a cacophony in which it is impossible to hear your own voice, whether it’s yourself you’re thinking about or anything else. That’s what Emerson meant when he said that “he who should inspire and lead his race must be defended from travelling with the souls of other men, from living, breathing, reading, and writing in the daily, time-worn yoke of their opinions.” Notice that he uses the word lead. Leadership means finding a new direction, not simply putting yourself at the front of the herd that’s heading toward the cliff.” (Emphasis mine)

A.  Constant.  Stream.  Of.  Other.  Peoples.  Thoughts…  No wonder we are having problems thinking for ourselves.

When was the last time you found yourself in the solitude of concentration?  How about being lost for hours because you were so damn focused on working through a challenging task you forgot about time?  It’s probably been a while due to all the chiming and dinging of gadgets stealing from you any time alone or peace of mind.

Maybe unplugging for a certain amount of time each day or week is exactly what you need to progress your life.  It’s amazing to realize that without solitude—the solitude of Adams and Jefferson and Hamilton and Madison and Thomas Paine—there would be no America.

Quality Leadership and technology are inversely correlated

As a society I fear we have become too distracted by the “efficiencies“ of technology we have lost sight of how to actually lead effectively.  The problem is the more we use technology the less we actually communicate with people.

Great leadership requires mastering humans, not machines.  It requires face-to-face communication (not Instant Messaging or emailing) so the leader can gauge a person’s non-verbal cues and adjust their delivery accordingly.  Leaders must be able to read an individual simply by looking into their eyes, studying their facial and body movements to decipher what that twitch or brow raise might mean.

To become a better leader, simply use technology less and spend more time with your people.  But beware, it takes an all-encompassing person, someone who is emotionally stable and can handle being outside their comfort zone as they address challenging issues with someone possibly less stable.  During a though conversation, you must be able to hear them out and handle their objections in a way that, in the end, results in saving the face of the company and everyone involved.

One of the best ways to determine if you are cut out to lead is to ask yourself “do I actually like talking to people?”  It’s a simple question but the answer tells a lot.  Indeed, intelligence is required to be a leader, but it’s people’s emotional intelligence that makes them great leaders.  Daniel Goleman, in his industry-leading work on emotional intelligence and leadership, writes:

” My research, along with other recent studies, clearly shows that emotional intelligence is the sine qua non of leadership. Without it, a person can have the best training in the world, an incisive, analytical mind, and an endless supply of smart ideas, but he still won’t make a great leader.

To be sure, intellect was a driver of outstanding performance. Cognitive skills such as big-picture thinking and long-term vision were particularly important. But when I calculated the ratio of technical skills, IQ, and emotional intelligence as ingredients of excellent performance, emotional intelligence proved to be twice as important as the others for jobs at all levels.”

It’s obvious by now the above description of a leader naturally fits certain people and naturally dismisses others.  My suggestion is two-fold.  First, as leaders we do a better job of identifying naturally gifted individuals and place them in their appropriate positions – be it a leadership position or not.  And second, we realize the slippery slope of technology on which we are currently standing, how it affects our interactions with others and understand if our leaders fall they will surely take us down with them.

Disclaimer:  It took me a number of attempts to finish this article, as I had to check my email, send a few tweets and see what my friends were up to on Facebook.  I know… I’m working on it too!

Why Twilio Will Kill AT&T

Can AT&T remain the 20th century communications powerhouse we came to love (and hate)?  Or will they eventually relinquish their throne to an up-and-comer with a better grip of today’s communication technology needs?

This question can be heard reverberating around the business world like a never-ending echo throughout the grand canyon.  If there is one company that can displace the conglomerate with respects to providing a basic communication platform for the general public, I think it could be Twilio.

Twilio provides infrastructure APIs for businesses to build scalable, reliable voice and text messaging apps.  They provide all this so cost effectively they are seeing massive growth and are a powering a new class of startups, ones that extend their technology to touch almost every part of our society.

To realize my words aren’t mere blasphemy, it’s paramount to grasp the difference between two types of innovation: sustaining and disruptive, these types being best described in The Innovators Dilemma by author Clayton Christensen.  Sustaining innovations are improvements that make the product better, but do not threaten its market.  Disruptive innovation, conversely, threatens to displace a product altogether.  It’s the difference between the electronic typewriter, which improved the typewriter, or the word processor, which supplanted it.

AT&T is the Typewriter.  Twilio looks to be the Word Processor.

The history of AT&T is well documented in the book The Master Switch by Tim Wu.  He describes how the great telephony company, started by Alexander Graham Bell, navigates an incredible path towards dominating the communication wires for most of the 20th century.

What strikes me interesting when I read the great history of AT&T is the repugnance of anything innovative on top of their communications platform.  Was being protective and narrow minded regarding innovation just en vogue thinking of the times?  Or was this perspective so ingrained in the company culture led by visionary (and monopolist) Theodore Vail that it grew stronger as decades past?

They exhibited classic sustaining innovation characteristics.  According to Wu: “AT&T, as an innovator, bore a serious genetic flaw, it could not originate technologies that might, by the remotest possibility, threaten the Bell system.  Disrpuptive technologies, those that might even cast a shadow of uncertainty over the business model, were simply out of the question.”   

More interesting is to wonder if this still the case today?  AT&T is hard at work protecting their lot – cell phones, digital TV, Internet, and the traditional phone service.   So hard at work they are, they fought to acquire close competitor T-Mobile, just another chapter in the centuries long monopolistic story.  Losing the acquisition places AT&T at an interesting crossroads, where they must look in the mirror and choose what type of communications company they should be going forward.   They also seem to be backpedaling on data usage, specifically text messaging, at a time when messaging seems destined to become our main mode of communication.

The real question is are they embracing the new way of business, opening up and encouraging disruptive innovation, from themselves and also from others?  Or are they still about sustaining innovation and stifling anything would that attack their own den?

Twilio, on the other hand  was created to be built upon.  They have innovation running through their veins and pouring out their ears.  Why?  Because they understand the new rules of business – better in the long run to open up, provide basic communication technology to the masses and empower innovative ideas as a platform rather than remain closed and stifle anything that might attack their business model.  They understand technology moves faster than they do so the best position to be in is as a platform.  They understand they will touch more end users by encouraging innovation using their service.  An even better way to think about Twilio’s business model is it’s all about disruptive innovation.

How did Twilio get traction in such a challenging communications ecosystem dominated by the likes of AT&T?  According to  Quora:

One answer points to how developer friendly they are and how much they are ingrained  in the emerging startup culture. “Twilio’s API is beyond awesome. It’s light, it’s fast, and there is no shortage of documentation. They’ve built this from the ground up with developers in mind.  

Also, Danielle Morrill is everywhere, all the time, and doing everything. It seemed like every event I attended she would be there preaching the Twilio gospel. If she wasn’t speaking at the event she was probably in the crowd hacking with other attendees, giving out Twilio account credits, or showering people with Twilio merch (stickers, shirts, etc).  There’s no doubt in my mind that without her contribution to the company we would be looking at an entirely different Twilio today

Even investor Fred Wilson mentioned in early 2010 the unique nature to Twilio and why they have grown so quickly.  “We believe that one way to build a large network of web users is to build something that makes developers’ lives easier. And Twilio does exactly that. It masks all the complexity of telephony into a finite number of API calls that web developers can use to build apps quickly and easily.”  

USV partner Albert Wenger takes it a step farther,  “Twilio has accomplished even more. It has made telephony a bona fide citizen of the Internet, by working on the basis of URLs. This is a profound transformation. Not only does it mean that web development skills can now be applied to telephony. But more importantly, telephony is changing from a closed to an open system in which adding new capabilities now becomes as simple as chaining together web service requests.”

The stance about being developer friendly is exactly why I believe the future is shining brightly for Twilio and particularly cloudy for traditional communications companies like AT&T.

Imagine if AT&T would have realized it’s not enough to just provide people the ability to communicate, but the opportunity to build communication platforms on top of their own platform?  I can only imagine if they were empowering thousands of small and large companies to embrace and extend their technology for the sake of innovation.  Supporting such things as offering $20,000 cash prizes at Hackathons, like this one happening at the upcoming CES, helps get the ball rolling but AT&T’s reluctance to embrace the disruptive technologies and attitudes is classic innovators dilema in action.

New companies building on top of Twilio’s communication functionality have the opportunity to bring communications to the masses for incredibly low cost – if not free.  Seconds, the startup I co-founded last fall is offering messaging functionality to merchants so they can quickly communicate with customers and transact through their mobile device.  Merchants and businesses, the other half of society, have yet to experience the tremendous benefit of messing and quick text communications, and it’s ripe for disruption. I’m not seeing AT&T offering text messaging to local businesses the way the offer it to mobile subscribers.

Twilio even has a small investment fund to encourage startups to expand using their platform.   The startups receiving investment from the first fund include:

Magnolia Prime, which delivers voice messages to elderly patients, as configured by the patient’s clinician or caregiver. Callyo, also quite practical, aims to offer multifaceted crisis, emergency and tip line options for police departments. knockknock, targeted at businesses and consumers, routes phone systems to put consumers in touch with the customer service reps at the companies they want to speak with. FastCall411 aims to be the aide of the local salesman with call recording, analytics and lead scoring, while Volta serves as an A/B testing framework for outbound phone calls. And WorkersNow expedites the hiring process around contract construction gigs. Less practical, but more fun is applying Twilio’s texting capabilities to the sexting fancies of teens and young adults. Qwipd, for instance, can be used to convey flirtatious, albeit controlled, text messages with choose-your-own-ending flavor.

A major Twilio success recently came from GroupMe, born from TC disrupt in 2010 and purchased by Skype for a reported $85 million a year later.  They were powered by Twilio.

Twilio recently raised a $17 million Series C round of funding to maintain momentum after a big year, and continue hiring aggressively. The San Francisco-based company grew from 25 employees to nearly 100 in 2011, and increased its customer base by 400% to reach 75,000 developers.  Their usage has be nothing but astounding; notice the growth chart to the right.  After a few price drops in 2010 Twilio saw volume skyrocket and hasn’t looked back since.  They also recently announced an international expansion, to Canada and Europe so by no means will this trend slow down.

My question is:  What does Twilio look like in 5 years if they keep attracting young, innovating startups to leverage their communications platform for dirt cheap to bring radical change to our society?

The end goal for Twilio is to “open the black box of telecom, and move the world away from the legacy of Cisco and Microsoft’s big expensive [hardware] that you put in your closet and watch age. We’re reinventing with the cloud, and it gets better every time we deploy code.”

And what does AT&T look like in 5 years if they don’t do the same?  But what if they do?  Something is going to have to give…

@jnickhughes

If Facebook And Twitter Are Today, Is This Tomorrow?

Real time communications are increasingly seeping into our world and the era of ubiquitous web is upon us.  Twitter allows us to disseminate comments and links at the speed of bits, creating a whole new way of discovering information.  Facebook keeps friends and family updated with the latest thoughts and images from our life.  Yes, even the use of email is changing.   We still send emails and that will not change for a while, but how many times do you engage in an “instant email” conversation with a friend or co-worker.

This begs the question:  What will we be using tomorrow?  What new types of technologies will disrupt new industries to create unthought ways in which we will use the our devices?  Here is my quick thinking on four emerging ideas as I gaze into the web tonight.

Real Time Local Information Platform

Imagine a twitter like experience, including relevant informational updates from around your local city/town/village, from people and places you chose to stay connected to, delivered to your mobile device in real time.  This will happen sooner than you think…  Some might say “well Nick, that sounds a lot like Twitter, I don’t believe another platform will replace Twitter.”  Great, me neither.

I think Twitter will continue to grow and mature into a different set of protocols and essentially replace certain information hubs we still use today.  But Twitter cannot be ubiquitous worldwide and at the same time incredibly strong on a local level.  What I think will be different is exactly how the “local” community uses technology to disseminate information.  I am hedging my bet on it not being Twitter proper as we use it today.  I believe a new player will emerge with specific value propositions set for the local merchant/community/consumer.

Social Search and Discovery

I have written extensively on the concept of Social Search, you can find them here on Business Insider.  My main theory is around the fact that in the not-so-distant future we will discover and find relevant information not from a traditional Google search but from leveraging our network of contacts.  Think about how much information your network of twitter followers, Facebook friends, and linkedIn contacts interact with on a daily basis.  I believe new platforms will be built to collect, organize and disseminate this information to you exactly when you need it.  No more 10 links per page with 1,000,000 results crap.  If you think about it, why do  search engines even tell you about a million results anyway?  That doesn’t mean anything to us as users.  Whatever….  My point is the forefront of social search and discovery will come from some surpassing players, no doubt.

Mobile Commerce

In less than 5 years, there is no doubt your commercial experience – especially around your local community – will be tremendously different than it is today.  Paying with cash… gone.  Calling in an order on the phone… forget it, so last century.  Waiting in lines to be seated… a thing of the past.  Being called Sir or Madam from the restaurant owner…. probably not any more when they now can identify you.  With the use of new mobile commerce technologies, all this will be unified within a local commercial network, encompassing orders, payments, communications, social sharing opportunities, offers, marketing messages, etc… and all this will be personalized to the individual so no two people have the same experience.  It will be amazing and all driven through your mobile device of choice. Someone should be work on this…

Auto-web

What if cars could talk?  No, not to us… to each other.   Web enabled cars will fundamentally transform our world.  I am not referring to cars having internet screens in them, which some do today and will in the future as a standard feature. More specifically, Google is not too crazy to be working on a self driving car.  If an automobile is connected to the web and in constant communications with all the other “devices” on the grid, theoretically there shouldn’t be any more accidents or fatalities due to automobiles.  Each car would travel at a certain speed, maintain a certain distance from another, roll along on a set route and never veer from the predetermined destination.  It will be transportation 2.0.  I believe that day is not too far off the radar and would be a great time to invent or invest in this area.

These are just a few of the things I thought of tonight when I asked myself… man, if Facebook and Twitter are today, what is tomorrow?

@jnickhughes