Aren’t We All Startups?

Maybe you should stop introducing yourself as a Startup and simply say what you’re business is successful at delivering.
John Kobel

Background

In my last post – Start Hanging Out With People Who May Have Your Solutions, I reiterated the value of Steve Blank’s “Get Out Of The Building” and Mark Suster’s post “Why You Need to Take 50 Coffee Meetings”. Here’s an example of the my Return On Investment (ROI).

Aren’t We All Startups?

After watching me pitch over the last few Westmount Networking Breakfasts, John Kobel offered me some friendly advice. He suggested that people may avoid doing business with a Startup because it sounds risky. People want to do business with successful people with a proven track record.  So when it came to my turn to pitch, I shared John’s advice & dropped the “Startup” from my opening 🙂

But as I listened to everyone else’s pitches, I couldn’t help but notice that we’re all Startups – in one form, or, another. Yes, some have established businesses behind him and some have been at this longer than I have. But in the end, we’re all pitching. We’re all searching for the right words to connect with someone listening & open the door to building a relationship.

The problem with networking meetings in general – not just our’s, is that we’re usually pitching to the same crowd with a few visitors.  Now I understand these meetings are more about developing long-term relationships that typically pay off over the years.  But there are lessons to be learned from all these Coffee Meetings (and other events) and no reason they can’t deliver an earlier Return On Investment. That’s when I had my Light Bulb! “Ah Ha Moment”. All I had to do was start listening to the customer & find early adopters who, not just want the service, but truly need it.

One-Liner

Nearly All Consumers (97%) Now Use Online Media to Shop Locally, According to BIA/Kelsey and ConStat, March 2010. How many are finding you? Give us your sales pitch and we’ll connect them with you, right from your Inbox. Forget about managing search engine marketing campaigns, web sites and even qualifying the leads. Our metrics prove we can do it all for a fraction of what it would typically cost you. We are ReverseTheSearch.co.

I need to work on our true customer – the supplier, landing page but that’s the big idea. From a Pivot point-of-view, there’s really no change to the core principle. In fact, we’re actually trimming away a lot of the Waste and starting over with the Minimum Viable Product.

Next Up

I’ll fill in some blanks with the Elevator Pitch version coming soon. But in the meantime, feel free to contact me with any thoughts.

Start Hanging Out With People Who May Have Your Solutions

Stop staying around people who have your problems and start staying around ones who have your solutions.
Jeffrey G. Allen, Instant Interviews

Background

About a month ago, I was at local Startup Drink night and met Mohd Shahnawaz. Crying in my beer about my inability to get traction for my startup, Mohd recounted Jeffrey G. Allens’ quote & suggested I try finding events where people may actually have the skill-sets I looking for.  Oddly enough, my favorite Startup Lessons Learned is Steve Blank’s “Get Out Of The Building”. Unfortunately, my myopia equated it with Customer Development & not recruiting. But as luck would have it, I had just received an email inviting me to the weekly Westmount Networking Breakfast & figured that’d be the perfect place to start.

Westmount Networking Breakfast

With about a dozen people in attendance, we went around the room giving our respective 60-second “info-mercials” (or, “Elevator Pitch” in geek-speak) and concluded by describing the perfect new contact we’d like to meet.  Being the week after the International Startup Festival, I figured my pitch was in fine form. I figured wrong! It was met with confusion. However, it did validate that I definitely needed someone in Marketing.

During the meeting & over the next week, I met with some & gathered more & more feedback.  As each week went by, I tweaked my Pitch & tried my best to come up with something that not only resonated with the audience but had potential to even help some.

Going For Coffee is Not a Waste

This morning, I was reading Mark Suster’s post “Why You Need to Take 50 Coffee Meetings” & posted the following Comment:

As a techie startup, not every challenge can be resolved writing code – like Customer Development (Steve Blank).  Instinctively, going out for coffee seems to align more with Lean’s definition of Waste (“Any human activity that absorbs resources but creates no value”, Taiichi Ohno, Toyota Production System.) But nothing can be further from the truth. Providing you’re not going out for coffee to listen to yourself pitch, or, drink your own Kool-aid, getting out offers  huge opportunities to save precious time & resources.

 

Recently, I started attending a weekly business networking breakfast of 10-15 regulars where we all take turns presenting what we do (Elevator Pitch) & the ideal contact we’d like to make. And while I’m the only Techie Startup, everyone else in the room is pretty much a Startup, whether they’re a Small Medium sized Business (SMB), or, an agent for a larger organization.  Personally, I love presenting/pitching, so I look forward to every meeting where I could tweak & tune my Pitch, hoping it aligns better with the audience’s needs. It’s a lot cheaper to change a 60-second Pitch than to keep cranking out scalable code that customers will may never execute.

 

For those who shy away from presenting, there’s no better place & forgiving audience to practice in front of, week after week.  (Steve Jobs doesn’t wing it.) Going for coffee is not a Waste – it’s a opportunity. Blowing a face-to-face potential stakeholder (employee, business partner, customer) meeting, now that’s a Waste.
Thanks Mark for drawing those thoughts out of me. I feel a blog post coming on 🙂

Lessons To Learn

Read Mark’s post, join a local business networking group, go beyond “Getting out of the building” and “Coffee Meetings” and “Stop staying around people who have your problems and start staying around ones who have your solutions.”

Pivoting for Profit

Just build a _____ profitable business!

David Heinemeier Hansson, This Week in Startups #46 (1:10:45)

My Lessons Learned - Make a Profit
My Lessons Learned - Make a Profit

Reflection

In the spirit of Agile, here’s my retrospective on when we realized the primary objective is to build a business & not to get funded.

Inflating Our Own Bubble

TechCrunch50 2009

Back in June 2009, I read about the TechCrunch50 2009 contest & while we barely had any running code, submitted an entry. My collaborators thought it was a bit of a stretch, but we all agreed it’s nice to set goals. So while trying to get a grip on what was required of us, I immersed myself in TechCrunch stuff. From what I understood, there was a common theme emerging – get funded & get out. And making it to the semi-finals only encouraged me.

I Think Our Bubble Has a Leak

Signed Copy of Guy Kawasaki's Reality Check
Signed Copy of Guy Kawasaki's Reality Check

We thought we had something that was so paradigm shifting, yet so simplistically obvious at the same time, that we’d have no trouble bringing on a CEO to help us reach Jason’s Promised Land. But it wasn’t happening like that. And as time passed, we realized that if we wanted to see our dream change the world then we couldn’t wait on someone else to make it happen.

Paradigm Shifting

That primed us for This Week in Startups #46 with David Heinemeier Hansson | ThisWeekIn.  Fast forward to 1:10:45 and there you have it.  It was paradigm shifting, yet so simplistically obvious. Just build a profitable business and the problem will be solved. Read his and Jason Fried’s Rework and you’ll get it too!

Trolling for Customer Development

The other day I was perusing Twitter when I saw Ben Yoskovitz’s

BeanSprout – a dating website for Business Development Partnerships: http://bit.ly/ivLRyf

A few tweets later, I was signed up and working with one of BeanSprout‘s founders – Artie Patel. I told him “Ideally, we’d like to hook up with someone like Localeze“. To which Artie responded; “They’re a customer of ours. Let’s see what we can do to help.”

Lessons To Learn

I’m actually planning on meeting Artie next week when they present at International Startup Festival – Montreal, Canada, July 13-15th 2011 where I’ll be volunteering for my Starving Startup ticket. Stay tuned for more details about how another startup delivered an awesome experience & whether it can help us learn to build a ______ profitable business.

(Thanks to Greg Meyer for tuning me into  experiences that @delivertheawsome.)

Related Links

Go out there and make some money!

Dan MartellTo Raise, Or Not To Raise | @MapleButter

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?