Jan Kubr

Posts Tagged ‘entrepreneurship’

A book read: My Startup Life by Ben Casnocha

In Uncategorized on December 18, 2008 at 11:19

This book is a story about Ben Casnocha‘s experiences with starting a software startup. He was very young when he started it (13), but that is not at all why you should read this book. It is full of valuable advice on how to get a company off the ground and is especially valuable for someone who is more on the technical side of things – like me.

What to build

How do you choose what to build? Ben has an interesting observation:

“Some problems require ‘vitamins’ – that is, a product that’s ‘nice to have.’ Some issues require ‘antibiotics’ which means they’re mission-critical problems. Most profitable businesses solve mission-critical problems, or the ‘must-haves’.”

Sell, sell, sell

Ben focused on selling their product from almost the day one, although it was only a “beta” written by a cheap programmer.  He didn’t want to wait until the product was “perfect.” If it provides good value to its customers, try to sell it to as many people as possible. Generate revenue that you can then invest back to the product to make it better.

Sounds cheesy. But many people are ashamed of early versions of their product and don’t want to offer it to customers (or to charge them for it) until they finish this feature. When that’s done, there is another crucial piece of functionality that needs to be added. And that goes on until the company disappears because there is no money to keep it alive. Sell what is good enough and make it better over time. In Ben’s words:

“Isn’t developing software the core competency of the business? It’s actually not that simple. In the early goings, it can be better to ship less-than-perfect software and focus on selling, selling, selling, rather than making perfect software.”

“Good enough is a key principle in entrepreneurship. If your aim is ‘perfect,’ the future is so far away it may be hard to get going.” 

However, you can’t be only “good enough” in everything, then you end up being mediocre. The trick is to choose in what you need to be great and where “good enough” is – well – good enough! Making these decisions will also help you decide when to save money and buy something cheap (maybe a desk) and when demand fine quality (business cards, chairs for programmers).

Good programmers are hard to find

Creating a software product is everything but easy. As Ben noticed, “Do you want it cheap, fast, or good? Choose two, says the old engineering adage.” And a related observation: “Technology start-ups take note: when a programmer isn’t on the founding team, it is difficult to find engineers who are both high quality and affordable.”

What to charge?

How much to charge your customers? Think about how much the customer’s problems you are solving are costing. If you replace one person’s week of work, then her salary for that week is about what you should charge.

B-plan or not?

Should you write a business plan even you don’t need it for any investors? Interesting observation by Ben: “The best business plans do more for you than for others by clarifying your own thinking.”

Get out of your office!

Ben says it is critical to get face time with (potential) customers, especially in the beginning. You need to learn as much as you can about your customers’ problems and generally about the market you are in. Also they will trust you more if they see you in person. He encourages you to get out of your office and talk to people! (And by the way: “The two best moments to receive high-quality feedback from people are when they are hired and fired.”) But beware: “True innovation rarely sprouts from customer feedback, but good products must be informed by it.”

How to become better

And what Ben thinks you can do as a person to become (more) successful with your company?

“People who get stuff done think about the short-term feature. (…) People who get stuff done ‘dream’ and ‘talk’ as much as the next guy, but they share these dreams and ideas with others. (…) People who get stuff done begin. Taking that first step can be the hardest. Act now! (…) Do you want to be known as a doer or a talker? Do you want to start businesses or just talk about starting businesses?”

Don’t let failures stop you:

“Ups and downs are the definitive indication that you are doing something entrepreneurial. If your records is spotless, then you haven’t been an entrepreneur. If the only mistakes you’ve made are on school papers or in mishandling a report in a big corporation, those aren’t spots. It’s the spots from the school of hard knocks that matter. (…) With practice you’ll learn to see failure as just feedback for improvement.”

Maximize luck by exposing yourself to randomness:

“Attend conferences no one else is attending. Read books no one else is reading. Talk to people no one else is talking to.”

Trick yourself:

“Self-deception is essential for high self-esteem. It’s OK to take more credit than you deserve, in you own mind, for successes. It’s OK to think that you can outwork and outpassion anyone who competes with you. It’s OK to attribute soaring victories to a tireless work ethic. It’s OK if these are slight exaggerations. After all, how many people attribute ‘good luck’ to their wins? Far fewer than those who attribute ‘bad luck’ to their losses! Stay humble, especially on the outside, but consider yourself (privately) as unstoppable.”

Founders at Work quotes part 1

In Uncategorized on February 1, 2008 at 22:27

I have been reading this great book Founders at Work which consists of interviews with many startup founders about their beginnings. I’ve read a little bit over a half and realized I’ve bookmarked too many quotes already. So I decided to put them up here in two parts instead of doing the traditional one “A book read” post.

Max Levchin, Paypal

Livingston: “What can big companies do to preserve a startup culture?”

Levchin: “I don’t know. Less PowerPoints. (…) As you grow larger, you need more structure and organization and meetings. My theory is that you sort of subdivide, and you make smaller units and you give them a lot of power and responsibility. You let them make it or break it. But I have no practical knowledge as to whether this works or not.”

“I think we didn’t know what we were doing. I think the hallmark of a really good entrepreneur is that you’re not really going to build one specific company. The goal – at least the way I think about entrepreneurship – is you realize one day that you can’t really work for anyone else. You have to start your own thing. It almost doesn’t matter what that thing is. We had six different business plan changes, and the the last one was PayPal.

“‘We’re trying this, this week.’ Every week you go to investors and say, ‘We’re doing this, exactly this. We’re really focused. We’re going to be huge.’ The next week you’re like, ‘That was a lie.'”

“‘We changed our business plan.’ And these guys were like, ‘What?’ They just put down $4 million to see something happen, and we said, ‘Sorry, we’re not going to do that; we’re going to do this.'”

Joe Kraus, Excite

“You never know anything. The hardest part in a startup is that you wake up one morning, and you feel great about the day, and you think, ‘We’re kicking ass.’ And then you wake up the next morning, and you think ‘We’re dead.’ And literally nothing’s changed.”

“Even up to the time when Excite was several hundred people and we were the fourth largest website in the world, it didn’t feel real. It doesn’t feel like you’re really doing something huge. On some level it feels like you’re fooling people – like, are we really doing this?

“It’s the whole sausage and sausage factory problem: when you’re outside and you only see the sausage coming out you think, ‘That’s pretty tasty.’ When you’re on the inside and you know how it’s made, it’s terrifying. (…) It’s never, ‘We set out this well-orchestrated plan, we’re executing it, it’s going exactly according to plan.'”

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If you miss Venture Voice, try this (great podcasts)

In Uncategorized on January 25, 2008 at 14:40

If you are interested in entrepreneurship, you must know the Venture Voice podcast, the best podcast on Earth. Unfortunately there haven’t been many episodes of it lately.  I know the old ones are so good you can go listen to them again, but if you want some fresh stuff, you might try iinovate or From Scratch, both having smart hosts interviewing great people.