A few months ago, Eric Ries gave a talk as part of Stanford’s e-corner series (“e” stands for entrepreneur). I remember listening to the first part of his talk, but for some reason I never finished it. I finally ran across it again, so I decided to listen to the whole thing. I’m glad I did.
He described a whole range of lessons learned from the various startups he’s been part of (in fact his blog is called Lessons Learned). One lesson that I found particularly relevant to me was that all successful startups “pivot”. When a startup introduces a product to a set of potential customers, they usually learn that some of their assumptions about the market were wrong. Customers will let the founders know this by saying things along the lines of “Well this is an interesting product, but what would be really useful would be X”. This feature may only be tangentially relevant to your current product. However, if several people ask for X, there might be something there. A pivot is re-orienting your product so it can do X or building a new product that does X in a viable way. You keep one foot in your current product and “pivot” to place your other foot in the new product. If you make a series of pivots based on customer feedback, you will home in on what your customers will buy.
While this sounds easy, it’s actually very hard, in practice, for an entrepreneur to do. After all, you’ve spent a lot of time thinking about a problem and building a solution to it. When you hear someone say your product is “interesting” and ask for X, your first reaction is to dismiss this idea out of hand. You may be right; you may be wrong. It’s hard to tell. Maybe your product is too far ahead of the market (e.g., WebTV, Newton). Maybe you’ve created a disruptive technology that has to find its niche first (e.g., 2.5″ hard drives in laptops). In any case, when several people ask for X after you’ve shown them your product, perhaps it’s time to listen.
Time for Lakeway to Pivot
For the past few years, we’ve been driving very hard at developing Frontier. It’s a beautiful application that addresses key management problems that, before Frontier, have defied solution. However, for the past two years, whenever I show Frontier to engineering executives, they always seem to ask for X. After listening to Eric’s talk, I’ve thinking more seriously about how X and Frontier could live together. I think I’ve come up with something that could work. I guess it’s time to pivot and see what happens…
P.S. No, I’m not going to tell you what X is 🙂
The SDForum (which stands for “Software Development Forum — not San Diego Forum 🙂 ) has a nice program where you can meet with a VC for 30 minutes, not to pitch, but to get some advice 1-1. I went to a session last week on Sand Hill Road and thought I might share the advice I got.
Rino: How do I find customers in enough pain to try Frontier?
VC: Target potential customers more. Find customers that are similar to your current customers. Ask your current customers how they market themselves and look there. Have e-mail and phone versions of your hook and elevator pitch. Be aggressive with e-mail.
Rino: What do you mean by aggressive?
VC: Keep e-mailing people every couple of weeks. Don’t stop until they ask you to.
Rino: We’ve got a lot of depth on the software, technical and UI side, but we don’t have anyone with Marketing or Sales experience. Should we be trying to find someone to join our team?
VC: Not at this stage. Your first goal is to find a set of core customers. This is something you can do without a sales person. You need to go out and target your customers very precisely. Figure out who would benefit the most from your product. Understand the value proposition that you’re pitching.
Rino: Our product represents a paradigm shift in the way people manage projects and engineering teams. Do you have any advice on how we might find people who are willing to try something different with a tremendous upside — the people that Steve Blank calls “Earlyvangelists”?
VC: You need to outline exactly what a customer needs to change in order to use your tool. Write this down explicitly. The bigger the change, the harder the sell. If you can find a way to have the tool adapt to the way they do business right now, that’s probably your best angle.
Evidently Churchill said this. I’m not sure where or when. It’d be nice to think he said this during the darkest hours of WWII, but for all I know it might’ve been at some conference in the 50s (kind of like Eisenhower’s “Plans are worthless, but planning is everything”).
It’s an interesting quote. I think most people take this to mean “don’t give up” or “hang in there”. That was how I initially viewed this. However, I think there’s a better, more constructive way of looking at this, especially from the perspective of a startup.
Failure is active
“Going from failure to failure” is not just about enduring hardship passively. Failure is something active. It comes after actually trying to do something. It only happens after real effort. You can’t go from failure to failure by sitting around and waiting for something to happen. “Achieving failure” is real work.
Failure is also a public thing. Others can see it. In fact, others must see it because if no one sees it, you didn’t really fail—failure is a kind of social interaction. Sending e-mails to potential customers without getting responses doesn’t count as failure–maybe they were on vacation, maybe their e-mail filter stopped your message, maybe your message got lost in the hundreds of new messages they got that day. However, when you talk to someone in person and they tell you they don’t need your product, that’s the kind of failure you need to reach, the kind of failure that gives you the opportunity to go to the next failure enthusiastically. This type of failure teaches you something: your message was off, or your ROI assumptions were too strong, or the problems you’re solving aren’t important, etc. Whatever it is, you can use this to improve for next time.
When can you ever fail?
“True failure” happens when you’re too scared to try. It comes when we don’t want to look stupid or wrong. “True failure” stems from a fear of failing.
When do you ever really “succeed”?
When you go from failure and strive for the next failure, sometimes you fail to fail. I think that counts as success 🙂
I actually thought Father’s Day was last week. I called my Dad and wished him a Happy Father’s Day. Places seemed emptier than usual because (I mistakenly thought) all of the fathers must have been grilling hot dogs and hamburgers. I saw a man and his father having lunch and thought, “That’s a nice Father’s Day lunch”. Fortunately, I didn’t try getting a free Father’s Day Sundae from Burgerville (don’t worry—I got mine today :-)).
It’s funny how your assumptions color what you see. This is particularly true if you’re an entrepreneur. Because there’s so much risk and uncertainty in starting a company, you almost have to be an optimist to keep going. You have to be able to find the bright side and focus on that to get you through.
Entrepreneurial Father’s Day Movies
I checked out two movies to watch this weekend. One was “Speed Racer” on a recommendation by a commenter on my last post (I very much enjoyed the movie. Not sure why it was so badly reviewed). The other was “Night at the Museum” (I don’t remember why I checked this one out).
Oddly enough, both movies featured fathers who were entrepreneurs. I knew Pops Racer was an entrepreneur. However, I didn’t know Ben Stiller’s “Museum” character, Larry, was also an entrepreneur. As my wife and I watched “Night at the Museum”, the comical scenes involving Larry’s past attempts at starting a company and developing products hit a little too close to home 🙂
My family and I went to Beaterville for brunch the day after Father’s Day. By chance, there happened to be both a “Speed Racer” sign and an Easter Island figure (which was in “Night at the Museum”) right next to each other! What is the Universe saying to this “DUM DUM”? That I’m on the right track? 🙂
Here’s Speed and Son #2:
And here’s the Easter Island figure right below:
A couple of months ago, my 7 year old son’s school had a library book sale. We picked up a copy of “Speed Racer: The Great Plan” for my 4 year old. It wasn’t a book he could read, but it had pictures on practically every page. Perfect.
Go Speed Racer, Go!
I remember the theme song from Speed Racer as a kid, but I don’t remember any of the storylines very well. I think it’s because it was playing right before school in the morning, so I probably only saw the first part of each episode. I think it was showing on KBHK 44 (remember how awesome that station when it was independent?). It’s funny how the UHF frequencies are now being used for digital TV.
When I was a kid, I related to Speed’s character the most (obviously). Now, I relate more to Speed’s father, “Pops” (especially since my 4 year old identifies with Speed).
The Great Plan
This is a fun episode because it tells the story of how the Mach 5’s engine came to be. It also captures the feeling that every entrepreneur has when they work for another company and realize that it’s time to move on.
There’s a scene where Pops (the entrepreneur) is pitching his idea for a radically advanced engine (the invention). The management team (the status quo) says “No thank you” in that rude cartoon way (think scoffing, yelling, and finger-pointing), and Pops quits because he knows his invention is revolutionary and can change the world.
Still have 46 pages to go
It was interesting to see some echoes in the story of my company and my invention. We’re not done yet, but we’re more than half way there. I’m not sure what will happen next, but I know it will have a happy ending. “Speed” agrees. 🙂
Starting a company because you want to solve a problem you’ve personally experienced can be a great thing. Since you already know what you want, you can get started right away. You’ll have a clear vision of your product and will be able to focus your effort on important, key features instead of being distracted by the bells and whistles that don’t really address the core problem.
Of course, there are downsides. If most of your market isn’t interested in the problem you’re going after, your product will have limited appeal. Also, if you don’t really have to talk to your market, you probably won’t, and you’ll miss out on key connections and relationships that can help get things moving as you try to sell your product for the first time.
Of course, before you sell anything, someone has to try it first…
Your First Alpha Customer
Getting your first alpha customer is a huge milestone in your startup’s life, especially if you haven’t talked to your market very much. It validates your product idea. It shows that you have something to offer, that you are actually solving a problem that someone (other than you) cares about.
Your first alpha customer will give you constructive feedback. They’ll help guide your product development and tell you what’s really important. They’ll identify compelling features that you hadn’t thought to add. They’ll help you validate and revise your positioning matrix. If you solve their problems well, they’ll give you quotes for your website and point you to other potential customers.
Your first alpha customer will help you iron out the wrinkles in your product and help you figure out how to deploy and maintain it. They’ll help take your product across the finish line so it’s really ready to sell.
Getting Your First Alpha Customer
Finding your first alpha customer can be tricky. I think the only way to really approach this is to leverage your relationships. If you’ve worked for another company for a while and left on good terms, they might be an option. Former vendors and suppliers might work. If you have a board of directors/advisors, they may open up their networks to help you get started.
When you do find your first alpha customer, it may feel like you’re doing a lot of taking in the relationship (they’re giving you a chance, they’re spending time to get you going, they trust that you know how to solve their problem, etc.), but it really should be a win-win situation. They get to influence the product while it’s still flexible. They might get a (nearly) custom-built product for free. If your product actually solves an important problem, you will be solving that problem for them. In addition, one of the biggest benefits of this relationships is that they get to deal with you, not a sales rep or a field engineer or a junior consultant. They’re dealing with the guy that knows his stuff. That’s huge.
Treat Your First Alpha Customer Right
Even though your relationship should be a win-win, your alpha customer is taking the initial risk. They’re putting their faith in you. That’s worth a lot. This might be the first tangible, positive, market feedback you’ve gotten so far. Make sure you listen to them. Fix issues quickly. Always deploy high quality product. Make it run well. Streamline their experience.
Practice doing what you should eventually do for all your customers. 🙂
A few years ago, when I was just starting my startup, I asked Frank Helle (CEO of Axian) if he had any advice. He said that Guy Kawasaki was in town talking about starting companies, and that I should attend. At the time, I didn’t know who Guy Kawasaki was, and for some reason, I didn’t think google him either (I don’t think I used “google” as a verb at that time).
On the day of his talk, I paid my $20 fee to get in and sat near the front (since you can see the speaker better). Just before he was about to start, I looked around at the audience and was surprised that the whole room was full. As soon as Guy started his talk, I could see why. He was a remarkable speaker and had so much pragmatic advice that I didn’t bother taking notes — I was just going to buy his book Art of the Start. If you’re thinking about starting a company, this is something you should really take a look at.
A mantra is not a vision statement
One of the interesting points he made was having a “mantra” for your company. This isn’t a vision statement or a mission statement (which are usually lifeless and awful). This is the reason your company exists, a short phrase that sums up the ideals and goals of your company. It’s hard to come up with this, so we didn’t have one for quite a while (actually it took us over 2 years to come up with our mantra).
A mantra is not a tagline
One thing a mantra is not is a tagline. We hear taglines all the time: “What can Brown do for you?”, “I’m lovin’ it”, “Just do it”. A tagline is part of a campaign for branding a company. It isn’t the reason a company exists. Nike doesn’t exist to “just do it”. Guy came up with one possible mantra for Nike: “Authentic athletic performance”. This doesn’t have the zing of their tagline, but it is more enduring and provides more guidance.
Although a tagline isn’t a mantra, it still takes time to develop. It took my company about a year before we came up with something that worked (my wife thought of it — she’s very smart). Our tagline is “Get Your Priorities Straight.” It’s a nice tagline. It’s short, it’s accurate, and it’s a little confrontational (something key for the kind of startup we have). However, it’s not a mantra.
Over the past few weeks, I’ve had to describe my company’s product (Frontier), to a number of people in a number of different ways. One day, my company’s mantra just popped into my head: “Reduce workplace stress”. This is really at the core of my company. That’s why I came up with the concept for Frontier. That’s why I took the time to think about it and develop it.
People spend most of their lives at work. A lot of their time at work is spent under stress. Stress is a bad thing that can spill over into every aspect of people’s lives. If we can figure out how to reduce workplace stress in a real way (not just treat the symptoms), we will have done something to improve (and maybe change) the world. That’s something worth spending time on. That’s why I keep going. That’s why my company will succeed…eventually 🙂