Transparency – It’s Bigger than Boardrooms Bits

Reinventing the board meeting may offer angel-funded startups that don’t have formal boards or directors (because of geography or size of investment) to attract experienced advice and investment outside of technology clusters (i.e. Silicon Valley, New York).

— Steve Blank, Why Board Meetings Suck – Part 1 of 2


Watch live video from Startup Lessons Learned on Justin.tv

Retrospective

In the spirit of Agile, here’s my retrospective on Transparency.

When the Boardroom is Bits

Steve Blank made a great case for changing the traditional, scheduled, physical approach to startup boardroom meetings by facilitating on-demand communication and transparency with the founders blogging about their activities. That way board members, advisors, investors, basically anyone with the right credentials can get up-to-speed at their own convenience.

But if;

A startup is a temporary organization formed to search for a sustainable*, repeatable and scalable business model.

– Steve Blank (*Ash Maurya helped me with “sustainable”)

then we have to think bigger than the boardroom.  We have to think about transparency throughout the startup’s life cycle. Not just for board members but for the Founders and everyone else involved – to some degree.

Transparency

Imagine a new stakeholder comes aboard. Whether they be an Internal Stakeholder – like an advisor, or, an engineer, or, an External Stakeholder – like a customer, or, business partner, they’ll have to get up to speed. Having crucial decision-making data hidden in scattered “My Documents” folders, personal Calendars, or, email just doesn’t scale. Attachments, CC & BCC lists are error prone & disasters waiting to happen.

And it’s not a matter of who to blame. It’s not a matter of what was right, or, wrong. It’s a matter of knowing what decisions were made, at what point in time and with what available resources.

Collaboration Tools

Integrated collaboration tools like blogs, wikis, discussions, events, videos, audios, shared images, bookmarks, files & yada yada yada have been around for years. Personally, I’m a big fan of Cynapse’s cyn.in suite and that’s why I became a Business Partner. I use it for AnotherSocialEconomy.com and even in my daughter’s elementary school and high school. (See edu)

But more important than the tool themselves, is their content.

Content Rules

In my past eLearning-Labs CTO life, my CEO & President – Rick Felt, who came from the publishing business, had one rule – Content Rules. So while the tools are nice the real Lesson to Learn is content is everything. Whether it be as deceivingly mundane as meeting minutes, an advisor’s feedback, or, a Customer’s user experience, it’s imperative for it to be all searchable & accessible to those with the right credentials.

One more thing….

The only thing better than having an integrated suite of collaboration tools, is having that content linked to your Business Model, your Agile project management software and your source control. In AnotherSocialEconomy‘s case, we link our Ash Maurya’s Lean Canvas, cyn.in, Pivotal Tracker and github sites. So we not only offer Transparency but, Traceability & Accountability as well.

Wouldn’t it be great if..

EricRies' Validated Learning Cycle, cyn.in, Ash Maurya's LeanCanvas, PivotalTracker, GitHub

Imagine if accelerator and incubator programs sublet virtual collaboration Space to each of it’s portfolio members. Then not only, do those startups benefit but so do the all of the Internal and External Stakeholders – well beyond the calendar limits of those programs. Now that would accelerate the validated learning cycle & extend Boardroom Bits.

 

To Pivot, or, Not to Pivot

Sometimes when you swing at the ball, you simply miss and create a hole in the ground.

Lessons learned from entrepreneur by Demian Entrekin

Retrospective

In the spirit of Agile, here’s my retrospective on Pivoting.

The Yin & Yang of it All

Eric Ries defines the concept of a Pivot as:

… the idea that successful startups change directions but stay grounded in what they’ve learned. They keep one foot in the past and place one foot in a new possible future. Over time, this pivoting may lead them far afield from their original vision, but if you look carefully, you’ll be able to detect common threads that link each iteration.

Why would you Pivot? Well, in our case, we felt we achieved Problem/Solution Fit – we think we have a problem worth solving. Granted, we’re working a little backwards here because we feel we have the Minimum Viable Product (and more) before running any Experiments. (That “MVP Feeling” could very well be an issue.) Nonetheless, you start thinking about Pivoting when you’re not getting any traction – people just aren’t adopting your solution. So at one point you’ve got to wonder if it’s your message, your target audience, or, simply you & your ingenious idea?

If they aren’t ready to listen, it doesn’t matter what you say

Don Dodge posted:

Don’t waste time trying to convert someone who isn’t ready to listen. Move on to the next prospect. Go back to the doubters later with a fistful of customers or partners. Or better yet, let them come to you…when they are ready to listen.

Personally, I love that! If I understand correctly, that means you’re just not targeting the right audience. But that also means, at some point after trying other audiences and still without traction, you have to rethink the root cause.

Pivoting comes to mind, but unless you have enough data from previous Experiments, or, a Minimal Viable Target Audience (MVTA) to Experiment with, then you’re exposing yourself even more to the dreaded “W” word:

Waste is any human activity which absorbs resources but creates no value.

— Womak/Jones, Lean Thinking (Thanks Ash)

Pivot or Divot?

Demian Entrekin brings up an interesting image.

One unfortunate aspect of the term “pivot” is that it sounds like “divot.” If you are a golfer, you know what a divot is. It’s a hole in the ground where you missed the ball.

So what happens if you think you’re not getting traction because your new fangled ingenious idea changes the status quo? We consistently get good feedback from Consumers because we save them time & money trying to find What they want from local retailers/merchants who actually have it in stock. However, the retailers/merchants we interviewed & Experimented with don’t really seem to care about saving anyone time & money.  Not even their own! I just don’t get it.  If you, as a sales rep in a store could reply to a simple message  – like email, Twitter / text, or, instant message that you have something in stock, doesn’t that make your life easier? Didn’t you just close a sale with Minimal Viable Effort (MVE)?  Most sales reps we encountered share the attitude that if the customer wants it they’ll find me. Don’t they even know their ABC‘s? What ever happened to Always Be Closing? I hate status quo!

Lesson To Learn

So unless I completely missed the boat on our Problem/ Solution Fit, I have to plot a course towards a more fitting Minimal Viable Target Audience (MVTA) to run the next Experiment, to gather more metrics, before even thinking about the next Pivot.

It’s A Pirate’s Life For Me

Not just the Spanish Main, love. The entire ocean. The entire wo’ld. Wherever we want to go, we’ll go. That’s what a ship is, you know. It’s not just a keel and a hull and a deck and sails, that’s what a ship needs but what a ship is… what the Black Pearl really is… is freedom.

Jack Sparrow, Pirates of the Caribbean: The Curse of the Black Pearl

Source: http://pirates.wikia.com/wiki/File:Jack_Last_Scene_COTBP.jpg

Light Bulb!Light bulb!

Last week the family & I went out to see Pirates of the Caribbean: On Stranger Tides and the very last lines made me think about life as a Startup.

Gibbs: Jack, I have to ask. You had the chalices, the water, the tear, you could have lived maybe forever?
Jack Sparrow: The fountain does test you Gibbs. But better to not know which moment maybe your last. Every morsel of your entire being alive to the infinite mystery of it all. And who’s to say I won’t live forever, hey? Discoverer of the fountain of youth. I have no say in it, Gibbs. It’s a pirates life for me. Savvy!

Savvy?

That’s what it’s like living the life of a Startup.  Even the Pirate Code – which crew members sign, entitling him them to vote for “officers and on other affairs of moment, to bear arms, and to his share of the plunder”  bear resemblance to some startup structures.

Lessons To Learn

Whether you be a captain/founder, or, an employee/crew member, you always have to think like a Pirate. The startup is your ship and your ship is your freedom.

The wind’s on our side boys! That’s all we need!

Gibbs

It’s better to be a pirate than to join the Navy.

Steve Jobs

My Sustainable, Repeatable, Scalable Startup Lessons Learned

A startup is a temporary organization formed to search for a sustainable*, repeatable and scalable business model.

Steve Blank (*Ash Maurya helped me with “sustainable”)

My Prezi Startup Lessons Learned - #1 Lesson
My Prezi Startup Lessons Learned - #1 Lesson

Mantra

This is my #1 lesson learned. Regardless of the situation, the first questions that come to mind when considering any course of action is

  1. Is it sustainable?
  2. Is it repeatable?
  3. Is it scalable?

Used Car Pivot Scenario

For AnotherSocialEconomy’s used car vertical, we experimented using Google Adwords for our used car Customer Channel. We had a daily budget of $10 for our English Campaign & $10 for our French Campaign, both set to the greater Montreal area. Initially, our Cost Per Clicks were around $2 but after some tweaking & some special sauce we got them down to $0.72. (Read the documentation. It’s all in the Quality Score!) And within 10 days, we actual “sold” a car. Not bad, eh? That’s the good news.

Based on our Customer Interviews, we wanted to validate our hypothesis that car dealers would be willing to subscribe to our lead generation service, once we proved we can deliver leads – despite spending one tenth (ultra conservative) of what they’d spend on their monthly advertising.

Business Model

Revenue

The beta would be free but with the understanding that dealers would pay a monthly subscription of $250 – which includes 25 free Proposals.  After that, it would be $10 a Proposal.  Since many managers also were skeptical of their sales reps being able to deal with the emails, we’d also offer a Managed Service for double the price.

Costs

We were spending less than $600 a month on creating Demand. But there were hidden costs. Each new Consumer’s email address had to be validated. Then each new Demand had to be qualified since most of them were for something like “BMW 335i”.

From the car dealer’s perspective, we wanted more than a URL and “Have your customer call me” response. We wanted them to take advantage of the situation and offer some incentive for the Consumer to contact them.  We wanted them to think like a “Nordie”.

Lesson Learned

Is it sustainable?

No. The Car Dealer Pivot Customer Channel was simply too expensive to sustain with the current Revenue Model. However, while none of the dealers wanted to pay subscription fees, most were willing to pay a finder’s fee which could justify the Adwords expense.

Is it repeatable?

No. The Car Dealer Pivot was simply too complicated. Our original idea was to go after Consumers looking to buy something more precise – like a “Wii Super Mario game”. Something that a retailer either has in stock, or, doesn’t. There’s just too many variables in used cars to repeat the process in another vertical.

Is it scalable?

No. The Car Dealer Pivot required a lot of manual intervention on both the Consumer side, as well as, the Retailer side.

Bad Pivot?

No. The Car Dealer Pivot was not a bad move because we learned a lot. For example:

  1. Customer Development: We should have interviewed more dealers. Although we did have enough Early Adopters to launch the beta, we should have qualified them better. We didn’t want to take any money until we knew we could deliver qualified leads. And when it came time to “sign” they crapped out.
  2. Customer Channel: We learned a lot about Google Adwords and I think we got pretty could at it even after only a few weeks.  I still think it’s a good channel for us to find Consumers. Our biggest oversight was the dealers’ unwillingness to participate.  We still don’t understand why someone making commission on a used car won’t reach out to a local prospect.
  3. Unique Value Proposition: We should have stuck to our original vision of connecting Consumers who know exactly what they want – like a “Wii Super Mario game”, to local Retailers who either have it, or, don’t have it in stock.
  4. Get Out of the Building: We definitely got out of the building. We definitely exercised our bits.
  5. Problem/Solution Fit: Every Consumer we spoke to outside of the Building can identify with the Problem/Solution. However, that’s not the case for used car dealers (Retailers). Their Solution requires the Managed Service which, unless funded by the car Manufacturers, is simply too expensive for us to pursue. And while we have a Pitch for that, even “validated” by a few insiders, we already learned our lesson and choose to move on.

Up next

Stay tuned as I drill-down into my My Prezi Startup Lessons Learned.

Startup Lessons Learned 2011. Has It Been a Year Already?

You can’t connect the dots looking forward, you can only connect them looking backwards.

– Steve Jobs’ Stanford University Commencement address (2005)

 

 

Garr Reynolds' "Career Advice '08"

Background

I was preparing a Prezi presentation on my startup Lessons Learned, looking back to my blog and and our Cynapse cyn.in social software suite for help in tracing my steps and it hit me.  OMG! It’s been two years since I posted about this Steve Jobs quote & Garr Reynolds’ images are still stuck in my mind’s eye. It’s been one year since I posted about my first Pivot – inspired by Startup Lesson Learned 2010 conference and the Retrospective (Agile) has simply compelled me to blog about my dots and where they have led me.

My Lessons Learned Sprints

My Lessons Learned Prezi may still be a work in process but the dots seem to be in place.  Trying to blog about the entire Retrospective is just too daunting. So in the spirit of Agile, I’ll break the Prezi up into dot-size sprints and will change the posted dates accordingly.

In the meantime, you can read about my favorite part of  Startup Lessons Learned Conference 2011Steve Blank’s Lean Launch Lab beta, as chronicled by Morgan Linton.

 

Lean Lectures #1 with Ash Maurya

Systematically iterate your product from Plan A to a plan that works.

Ash Maurya, Running Lean

Background

My first encounter with the Lean startup movement was last April at the Startup Lessons Learned. (BTW, according to Raymond Luk, Montreal had the greatest number of attendees!) I was amazed to say the least. It was Agile software development for startups! And while Dom & I practice an Agile approach to developing AnotherSocialEconomy, we weren’t doing so from the business side of things. To be fair, I’ve already lived through the highs & lows of a startup life back in the dot com days, so I do have a few of my own Lesson Learned, plus I’m a big fan of Guy Kawasaki. This time around, things are different. But now the question begs to be asked; “Are they different enough?”.

Lesson #1

Last night I attended the first in a series of presentations to be hosted by YearOne Labs on the Lean Movement – this one presented by Ash Maurya. Ash’s presentation is based on his book Running Lean, where he describes the systematic approach he’s learned and practiced over the years. (You can download the first two chapters which help explain the slides above.)

I won’t try summarizing Ash’s content since you’d be better served by visiting his site those he mentions like Eric Ries and Steve Blank. You can watch a few of their interviews on Vator TV Eric Ries and his ‘lean startup’ awakening, Entrepreneurship: a faith-based endeavor and What is the job of a CEO?.

Customer Development from Day 1?

OK, we didn’t do that. However, we did not completely live in a vacuum either and have actually Pivoted several times. And with each Pivot, we stayed true to the underlying value proposition: Save both consumers and retailers time, aggravation and money by connecting those who shop online and purchase locally offline.

I Regret Not Asking

The one question I should have asked Ash when I had the chance was: “How do you balance Customer Development with Defensibility?”.

Anyone care to suggest any answers?



Can You Spot My Reeses Peanut Butter Cup Moment? Part 2

#7. PRACTICE THE ART OF COLLISION

The Reese’s Peanut Butter Cup is a metaphor for life. What seems completely new is often just an unexpected combination of the familiar but previously disconnected. This is Innovation 101, but too often we forget, and think the one asset we have is the answer, rather than asking what we can bundle it with to transform its value.

Mark Payne on Blogging Innovation: The Ten Tenets of Transformation – Innovation blog articles, videos, and insights

Background

In my previous post, I described how I was struggling with my lean start-up sales and marketing efforts on seemingly two separate fronts. In keeping with my perseverance theme, here’s how I combining these two  into one complimentary offering, yet still affording me the possibility of either one, or, better yet both launching a business.

Ingredients

  1. My peanut butter – AnotherSocialEconomy: A service that anonymously connects consumers – who already know exactly what they want with local retailers – who actually have it in stock. It’s like Google Local Shopping only way simpler and more accessible for small and medium-size businesses (SMB).
  2. My chocolate – edu.cyn.in: A social software platform enabling collaboration not just within the class, school but across geographies. It’s like Facebook, YouTube, Flickr, MSN, Twitter, Blogger, Wikipedia, iTunes, Digg, Google Calendar and more, all in one integrated and monitored web site.

Directions

  1. Offer limited edu.cyn.in membership to local schools and organizations providing extra-curricular activities for free.
  2. Offer limited edu.cyn.in education and mentoring services to students, teachers, staff and parents on how to get the most of the platform with regard to sharing, commenting and rating content – for free.
  3. Offer limited edu.cyn.in education and mentoring services to students, teachers, staff and parents on how to get the most of the platform with regard to self-organizing projects and events thereby reducing phone calls and oodles of emails with attachments.
  4. Add AnotherSocialEconomy Widget to edu.cyn.in.
  5. Offer those edu organizations free local Sponsor links in edu.cyn.in.
  6. Offer those edu organizations the opportunity to become AnotherSocialEconomy Retailers, InfluencersResellers and/or Referrers.

(Should) Yield

Our Reeses Pieces should consist of a hyper-local (thanks Flack Maguire) online community of consumers and retailers/merchant/service providers. If we succeed in educating and mentoring are target edu.cyn.in audience, we could have one, or, two adult pair of eyes for every student pair of eyeballs. So one class of 25 students could yield anywhere between 2 and 50 additional eyeballs on edu.cyn.in. The better we educate and help folks adopt the social software, the greater chances we have of increasing those hyper-local eyeballs. The more eyeballs, the greater the chances we have of getting folks to use AnotherSocialEconomy’s Widget. More local consumers, more local merchants.

Additionally, since we’re also Cynapse Reseller, we’ve also introduced a whole new crop of highly qualified prospects into our sales funnel.

Stay Tuned

Please feel free to comment below and let me know your predictions. Will our ingredients yield another Reeses Pieces, or, is this plan going to curdle? Just remember, the alternative approach could be to pay Google AdWords $7500 a month for pay-per-click search engine marketing (SEM) and pray that’s cheaper than the time and hosting frees we’re currently investing.

Welcome to Google Local Shopping

This year, 46% of retail sales will be influenced by the web – but more than 90% of total retail transactions will occur in-store, from small neighborhood boutiques to national chains *. No matter where our users are shopping, we want to help them find your products.

Google Product Search

Google Product Search
Google Product Search

OMG this is amazing. I’m now competing with Google!

Just when I was killing myself with how to market AnotherSocialEconomy, I find this beta service from Google. Do you know what that means? Yes, Google already has all the eyeballs in the universe and yes, they could blow me out of the water at will.

But what that also means is that I no longer have to worry about finding my target audience. You see AnotherSocialEconomy brings retailers’ available supply to consumers’ demand. Pretty vague, eh? Try finding a good mix of AdWords keywords for a local buying network like that. It’s nuts. More importantly, it’s hugely expensive. Most importantly, customer cost of acquisition is astronomical.

With Google out there now, all I have to do is set my Google Alerts and other social media listening tools to “Google Local Shopping” and “Google Product Search”.  I could follow their Buzz  in the wake of their Wave & target my pitches.

For Starters

Not being a Merchant, I highly doubt I’ll ever manage to infiltrate their beta service. No matter. There’s plenty of others out there willing to share their experiences and opinions, such as, Google Local Shopping Tells Customers You Have It In StockGoogle’s Local Shopping Feature Now Open to Small Businesses and Google Local Shopping: cool new tool | OregonLive.com.

And that’s just cherry-picking. Plenty for me to research & plenty for me to post comments on.

Details… details… details…

As Lisa Barone says about Google Local Shopping:

It does seem like a small amount of work to get listed; however, anything you can do to make your products more available and searchable is a good thing.

AnotherSocialEconomy’s barrier for adoption is an email account and optionally, a modern browser with an Internet connection. That’s it! No multiple Merchant Accounts. As a matter of fact, registered Retail Sales Associates could also use their Twitter account / text messaging (SMS), Jabber Instant Messaging (IM) – like Google Talk, as well as, an Androida app. Basically, anyone with a smartphone is literally in business. There’s no XML data feeds to set up. No inventories to maintain.

Just details? Maybe, but the feedback I’ve gotten so far is that small/medium businesses (SMB) are living on smaller and smaller margins.  So the fewer details, the less investment in the service, the greater the return on investment. And vice versa.

AnotherSocialEconomy is not free

Consumers pay a token fee for requesting goods/services – Demand. And Retailers pay a token fee, as well, for proposing their Supply. Why? Well for starters, we hope to reduce the signal-to-noise ratio. Less noise going to the Retailers, means higher quality sales leads. Higher quality sales leads means higher quality Proposals going back to the Consumers. Higher quality Proposals, results in greater probability of closing sales.

But wait there’s more…

Ok, so AnotherSocialEconomy isn’t free. But it is another social economy. That means that it shares with its community members through its the Influencer, Reseller and Referrer programs.

Stay tuned

Be sure to come back & visit as I ride in the wake of Google’s Local Shopping wave trying my best to compare our competing services. Please feel free to share your own experiences, opinions and comparative thoughts.