Jessica Livingston: Founders at Work
Early stage startups are probably the most productive part of the whole economy.
An automotive magazine modified a “sports” model car to make it as fast as possible.
What did they do?
They cut off all the crap the manufacturer had bolted onto the car to make it look fast.
Business is broken in the same way that car was.
The effort that goes into looking productive is not merely wasted, but actually makes organizations less productive.
This book is about the Formula 1 racecar. It looks weird, but it goes fast.
Determination is the single most important quality in a startup founder.
Perseverance is important because when you are doing new things, people often reject you.
“Don’t worry about people stealing your ideas. If your ideas are any good, you will have to ram them down people’s throats.”
The second most important is that founders are adaptable.
Starting a startup is a process of trial and error. Your idea will likely change as you develop it.
Levchin’s advice: try to have a good cofounder.
It’s all about people, and if you are doing it completely alone, it’s really hard.
When you get very, very tired—up for four nights all night long; you get mononucleosis—your head gets in this real creative state and it thinks of ideas you’d normally just throw out.
- Wozniak
Its better to be young because you can spend a lot more nights, very, very late. Because you have to get things done, and there’s almost no other way to get around that.
Community matters. In a recession, instead of laying off 10 percent of people, HP cut everyone’s salary by 10 percent and gave them one day off every two weeks. They said “nobody goes without a job”
Sometimes you have to act like a big company.
Being everywhere all the time made us look bigger than we were; “Oh yeah, we’ll be in new york, we’ll be there.”
Being overcapitalized is a path to failure. The VCs want you to spend.
Reduce. Do as little as possible to get what you have to get done.
Do less of it; get it done.
That way you can analyze it kore cleanly and the UI will be easier.
When you need money, nobody will return your calls. When you don’t need money and you say, “Sorry guys, don’t need any money,” they can’t stop calling you. They just can’t help themselves.
Think like a big dog, and then find leverage to get there.
One of the most powerful marketing tools is how you structure your product.
For Basecamp they gave the software away for free for one project. Then they offered an upgrade to 3 projects for $9 a month, and the most expensive version is $99 a month.
Think about how I-house could at first work pro bono with one employee, then charge for the rest once we had an ‘in’?
Interesting: there's value in solving your own problems.
It’s good to be market driven but you can’t let your customers drive your product development.
You need to be able to innovate on their behalf, because they often don’t know what they want.
Too many companies take money when they don't need it. Having too little money is a great way of getting a great product, because its a way to get focused.
Instead of having a 1-year $1 million product cycle, rescope that idea so that it fits into one month.
Education is valuable marketing. “It seems to work as well as running ads”
We’ll teach people stuff, and some tiny fraction of those people will become customers.
Fascinating: each company has one class of stars. There’s going to be one class of people for whom it’s going to be really easy to hire more people like that.
Hospitals are a good example.
If it’s a good hospital, the doctors will be good, and it’s very easy for them to hire good doctors.
But it’s hard for them to hire any other kind of person. Hospitals don’t have really good advertising people; those people want to work on Madison Avenue.
“You’re a very capable person, and you’re going to have a very easy time hiring someone like yourself. We don’t know your business and we’d have a hard time hiring someone like you, but we have a very easy time hiring someone like me, who’s a MIT-trained computer science nerd. It’s cheaper for you to use us, because we have really great programmers, and great programmers are a lot cheaper than mediocre programmers.”
“Look our leads are normally a dollar a click, because they convert so well. But we’ll get you started at a quarter. And we’ll send you 5,000 leads, and you can test with no risk. But you know, we’re looking for an insertion order to show that you’re committed to the test.”
The biggest roadblock to the entrepreneur are the liabilities in your life.
Experience will come when you face certain problems and live through them.
And the best way to do that is to put yourself squarely in the path of those problems.
P387.
Locker 66
Sometimes you’ve got to say you are a step ahead of where you’re actually at to move to the step you want to be at.
To move to step two, people have to believe you’re already at step two so there’s no risk for them.
If you think there are three places where you can get a lease, then you have to say you have a lease so you can move to the next step.
Machiavelli said you judge a leader by the strength of his generals.