Don’t start with an apology. You’re late, your equipment malfunctions, you don’t have your materials, or whatever. You apologize in advance for how this might affect your presentation. This is a mistake because an apology sets a negative tone that may affect the entire meeting and makes you seem like a victim. Nobody wants to do business with a victim. Instead, start on an upbeat note, as if nothing is wrong. This communicates that you’re cool under pressure–the opposite of being a victim.
Don’t make personal excuses. You downgrade the audience’s expectations by offering an excuse in advance for your poor performance. (E.g., “I’m so tired”; “I got in late last night.”) This is a mistake because you’re giving yourself an excuse so you won’t feel so bad if you fail. Plus, nobody wants to hear you whine about your problems. Instead, regardless of how you’re feeling, show enthusiasm for being there and make your best effort.
Design is a multi layered process. In my experience, there is an optimal order to how you move through the layers:
1. Outcome. Start with the intended outcome. What will the thing you’re designing make easier or better for people? Most projects without a clearly defined intended outcome don’t end well. At Intercom, we work with Clay Christensen’s Jobs framework for product design. We frame every design problem in a Job, focusing on the triggering event or situation, the motivation and goal, and the intended outcome: When _____ , I want to _____ , so I can _____ .
2. Structure. Next, design the system. Work out the required components to meet the intended outcome, and map the relationship between them.
3. Interaction. After the outcome and system are figured out, design the interaction details. What are the microinteractions? The sequence of behavior and events? What are the UI components, and how will people interact with or manipulate them? How will things move, change or animate? Revisit the system, evolve it to match the interactions. Keep iterating.
4. Visual. Once the outcome, system and interactions are well defined and working (ideally prototyped), design the visual details. Make it look and feel beautiful, enjoyable. Now it’s time for beautiful grids, color, typography, iconography.
I see designer after designer focus on the fourth layer without really considering the others.
(1) Re. “Outcome” as the first stage of product design: see Why product managers should frame every product task as a Job To Be Done.
(2) Re. “we frame every design problem in a Job”: see How to describe your customers’ “Job To Be Done” using a Job Outline.
(3) Cf. Five questions to ensure product designers focus on the Job To Be Done.
Edited excerpt from The Problem With Flat Design, According To A UX Expert by Kelsey Campbell-Dollaghan:
Kate Meyer, a user experience expert at Nielsen Norman Group, examined how different users approach flat interfaces. Younger users liked flat websites a lot more than their older counterparts. Older users said the flattest website designs were “boring,” while younger subjects described them as “professional.”
However, while young people seemed faster at navigating the designs, they also indicated they didn’t really understand the UI intuitively. For the most part they seemed to have pretty much no idea what they were doing. “It’s hard when you think something’s a link and it’s not. And you have to figure out how to get it another way,” one user said. Young people didn’t necessarily “get” flat designs. They were just better at quickly testing where and how to get what they wanted in the face of click uncertainty.
Paying attention to the older users might help to solve flat design’s usability issues sooner. Some technology companies are moving to “inclusive design”, the notion that by designing for ignored or underserved users—including the elderly or disabled—products will become better for all. It has quietly spurred some of the biggest technological leaps of our time. The typewriter, email, and even the telephone evolved out of designs for the blind and deaf.
(1) Kate Meyer argues here that focusing on older users improves user experience for everybody. Perhaps that’s because older users are less able to tolerate “click uncertainty” and other user interface failures.
(2) Older users are also becoming more important in their own right, as demographic changes raise the percentage of older people in the population. And some services — such as investing sites like Seeking Alpha — appeal disproportionately to older users.
(3) The most obvious way to reduce “click uncertainty” is to ensure that what is clickable is obvious and differentiated from what isn’t clickable. (The most common error is to present links in the same color as non-clickable text.)
(4) See also Web design for seniors.
Excerpt from How To Tell If Someone Is Lying: 5 Research-Backed Secrets by Eric Barker:
Your brain is wired to respond to stories. Neuroscience research shows nothing beats a story when it comes to convincing you of something.
Keith Quesenberry at Johns Hopkins reviewed over 100 Super Bowl ads to see what the most effective ones had in common. The answer? They told a story.
(1) Contrast this with the more functional approach to public speaking — focus on the change you want to catalyze, keep presentations tight, and avoid “and’s”.
(2) Story telling has greater emotional resonance; cf. By the end of your talk or presentation, you should be talking love.
Edited excerpt from Product Thinking isn’t the next big thing in UX design. It’s the only thing by Mark Maloney:
You need to actually understand the problem before you look to solve it. And you need to solve it with a distinct point-of-view.
(1) Although this was written for UX designers, I think it applies more broadly to early stage startups.
(2) Seed stage startups need to get three things right: (i) Ensure there’s a real problem (= Job To Be Done). (ii) Be clear about the unique focus, approach or insight you bring to solving that problem. (iii) Ensure you have a basic business model that will generate profits, based on what works in other businesses.
(3) What seed stage startups don’t need to get right immediately, because this is what you’ll be working on for the next few years: (i) You don’t need to nail down all the details of your product. (ii) You don’t need a detailed financial forecast, including pricing and margins.
(4) Re. “you need to solve it with a distinct point-of-view”: See the questions about competitive advantage in Six simple questions to test product-market fit and competitive advantage (from Y Combinator’s application form).
The final slide from an investor deck sent by a startup founder:
Raising: $1.5 million
Deliverable: MVP and 10,000 delighted beta users who would recommend the product.
(1) Love the clarity: “Here’s how much we want to raise, and here, in one short sentence, is what we’ll deliver for that budget.”
(2) Note that the key deliverable is a product of demonstrated quality — an MVP with high net promotor score, validated by a sufficient number of users.
(3) Setting net promotor score as an explicit goal stops the company from trying to scale before the product is good enough. See The most fatal mistake to avoid as a startup.
Short answers are best.
When taking questions about your product answer questions shortly. This is a very challenging thing for many people–including myself–to do. If you’re like me, you’ve probably thought out your startup’s issues a thousand different ways. Answer the question with the most concise answer.
(1) In Nick Morgan’s words, “Too many speakers dump way too much information on the audience. Restraint is key.” See: For speakers: three tips to avoid tiring your audience.
(2) For more on demos to VCs and investors, see: (i) How to demo your startup, and (ii) A better way to demo your product.
(3) For more on demos to potential customers, see: (i) Demos can win sales if you do them like this, and (ii) How to demo your product to a potential customer.
We’ve been using group chat at 37signals/Basecamp for 10 years. I’ve seen the distraction, anxiety, stress, and misunderstanding group chat can cause. Those are things that can really damage people and an organization.
I believe attention is one of your most precious resources. If something else controls my attention, that something else controls what I’m capable of. I also believe your full attention is required to do great work. So when something like a pile of group chats, and the expectations that come along with them, systematically steals that resource from me, I consider it a potential enemy.
That said, I still think group chat is an important tool in the communications toolbox. I just don’t think it’s the go-to tool. I think it’s the exception tool.
(1) In the full article, Jason Fried demonstrates why group chat leads to constant distraction and shallowness. If you use (or are thinking of using) Slack or Hipchat as your startup’s primary communication tool, you’ll want to read it.
(2) Cf. Samuel Hulick’s critique of Slack in What happens when you mistake user engagement for customer success.
(3) Cf. If you want to get more done, stop doing these things.
(4) Note the extreme contrast between group chat and this approach to email.
Edited excerpt from Five things I will do different for my next startup by Jeff Haynie:
Automate and outsource everything. OK, maybe not everything, but everything that is possible — which is a lot more than you probably think. We did a great job at Appcelerator with this — but we could have done better.
You’ll want to spend all your calories on things that you do best, different, uniquely and the thing that makes you and your business valuable. Trust me, that’s not your website (which of course, is not to say that’s not important). Sure, maybe your dev can do the corporate website by herself over the weekend much cheaper than finding an agency to do it or a contractor. It will seem and be cheaper (and maybe faster) in the short-term. But it will really cost you in so many areas.
Same with systems. Maybe one of your devs could just setup Gitlab on your own server and that’s a little bit cheaper than paying for the $7/month for a small plan at Github. But trust me, it’s not. It’s just not worth it.
Try and automate and outsource things that aren’t core to your mission. Keep your calories focused on activities that will create muscle — and don’t do anything (if you can avoid it) else.
Now, like other recommendations, this isn’t an absolute and sometimes this can conflict with “burn less”. But generally, if it seems cheaper in the short-term, make sure you consider the long term ROI and other non-financial metrics (such as distraction).
(1) For practical advice about how to outsource, see How to hire someone to handle outsourcing for your startup.
(2) Cf. Saying “no” to good ideas.
Edited excerpt from 23 Ways to Protect Your Positive Mood from Negative Co-Workers by Laura Tong:
1. Take the lead with upbeat topics. By going first you’ll have more control to ensure the tone stays positive.
2. Avoid eye contact during negative conversations. You’ll make less connection with them and their words will carry less weight.
3. Don’t gossip. Talking about people behind their back has been shown to lower your self-esteem, even when you are not being overly critical.
4. Laugh in the face of negativity. Smile and diffuse that negativity. Refuse to take them and their gloomy view of life or your workplace to heart.
5. Read them the riot act. Explain to negative co-workers that you have a serious allergic reaction to negativity.
(1) On the damage of negativity and why you should avoid it, see Why venting and complaining are bad for your health and the health of your company.
(2) Cf. You can train yourself to think positively.
(3) An excellent, positive question to ask to people: The right question to ask to motivate people.
I try to never hire someone who has been a product manager before. I’ve never seen a correlation with past experience and future success when it comes to product managers. Instead, there are a set of patterns we look for when hiring product managers:
1. Are they truly a product junkie? Are they the first to be playing around with new products? Are they telling me about some product I don’t know about? Do they know about more products than me? And do they have passion around this? I love to have candidates show me their phone or desktop to see which apps they are using, which new products they are testing.
2. Are they curious? Are they settling for yes or questioning why? Do they want to learn from others? What ideas do they have for products? How would they make them better? Pick a product on the spot and ask them to show you how they use it, what they’d change and how they would improve it.
3. How do they work everyday? What do they use from a process standpoint? Trello? Evernote? ProdPad? The best PM’s are always trying new things and finding ways to improve when it comes to process and organization.
4. Do they have a customer-driven mindset? It’s the PMs job to understand the customer better than nearly everyone else. PMs should be talking to the customer the most at your company other than support. Can they help engineering and design get closer to the customer?
Two things don’t matter: Technical ability, and dashboards, slide decks and Excel. Looking at data all day is not what being a PM is about.
(1) Cf. The ideal personality type for product managers.
(2) Re. “I’ve never seen a correlation with past experience and future success”: cf. Don’t hire based on past experience.
(3) Re. “Are they curious?”: cf. How to test job candidates for “learning agility”.
(4) Re. “Do they have a customer-driven mindset?”: do they focus on the Job To Be Done?
(5) Re. “Dashboards don’t matter… looking at data all day is not what being a PM is about”: Do you agree with that?
Edited excerpt from Complaining Is Terrible for You According to Science by Jessica Stillman:
Not only do repeated negative thoughts make it easier to think yet more negative thoughts, they also make it more likely that negative thoughts will occur to you just randomly walking down the street. Being consistently negative starts to push your personality towards the negative.
Hanging out with negative people does much the same. When we see someone experiencing an emotion (be it anger, sadness, happiness, etc), our brain ‘tries out’ that same emotion to imagine what the other person is going through. And it does this by attempting to fire the same synapses in your own brain so that you can attempt to relate to the emotion you’re observing.
“When your brain is firing off these synapses of anger, you’re weakening your immune system, raising your blood pressure, increasing your risk of heart disease, obesity and diabetes, and a plethora of other negative ailments,” Psych Pedia author Steven Parton says.
The culprit is the stress hormone cortisol. When you’re negative, you release it, and elevated levels of the stuff, “interfere with learning and memory, lower immune function and bone density, increase weight gain, blood pressure, cholesterol, and heart disease.”
(1) Cf. “I think the mind is like a forest floor: the more you walk paths the deeper they get and the easier it is to walk them again.” — from You can train yourself to think positively.
(2) Cf. Ideas spread inside a company due to positive energy; 8 ways to increase it.
“Simple” is just one of the many qualities we can use to evaluate products, and it is by no means the most important. Simple is overrated!
Here are but a few qualities I’d take over simple: Useful. Clear. Fun. Satisfying. Inspiring. Endearing.
(1) Cf. Frictionless vs. minimalist product design.
(2) Cf. Minimum viable product vs minimum acceptable product.
Most organizations are capable of maintaining a consistent level of exceptional performance through a year, or five years, maybe ten years. Very few are able to do it over multiple decades. How have we done it?
1. Yesterday is irrelevant. The best leaders want to make sure that their product is fresh, that it changes with the times; that they never rest on their laurels, or get complacent; that they always have an element of insecurity about feeling that they can always get eaten by a competitor, and that past successes don’t mean all that much. All your past success is yesterday, and it’s irrelevant to the future.
2. Maintain a fresh team. You have to focus on the team. Field the best team at any one time, no matter how long people have been with you. Don’t be unfair, or ruthless, or harsh; but detached, objective and clinical about the performance of each individual. No matter how well they’ve performed in the past, if their heart is no longer in it, if they no longer have the burning desire to compete, it’s time for them to move on. Bring in young people who have zest, ambition, energy.
3. Change with the market. Stay alert to market opportunities. When we started a long time ago we were just here in Menlo Park, but the world of technology has changed, because of what’s happening principally in China. So about 12, 13 years ago, we started a business in China because we felt that, over time, it was going to be increasingly important for Sequoia, for the companies that we have investments in in Silicon Valley, to really understand the Chinese market because of what was going to happen there.
(1) Re. Maintain a fresh team — for practical advice, see: How to hire – drill a well before you need a drink.
(2) Re. Change with the market — contrast that with The question that Amazon answers to set its strategy.
Edited excerpt from This Is How You Identify A-Players (In About 10 Minutes) During An Interview by Mitchell Harper:
I sat down earlier today and thought about all of the A-players I’ve been fortunate enough to hire over the years at my five previous companies, and came up with seven questions you can use in your interview process to give you a much better chance of finding and hiring them:
Q1 Have they been promoted at least once in a previous role?
Q2 Have they had to lead a big project in a previous role? How did they handle it?
Q3 Is this the same role as a previous job or is it somewhat/completely different?
Q4 Can they speak about your company and tell you what they like and what they might change?
Q5 Are they confident without being cocky?
Q6 Are they committed to continual learning? Can they prove it?
Q7 How would you rate the quality and quantity of questions they ask YOU during the interview?
(1) The rationale behind each question is provided in the full article.
(2) Re. “Are they committed to continual learning? Can they prove it?”, see How to test job candidates for “learning agility” and 5 testable qualities that determine a candidate’s potential.
(3) Cf. Mark Zuckerberg’s hiring rule.
Edited excerpt from How We Got off the Addiction to Venture Capital and Created Our Own Way to Profits by Rafat Ali:
We became obsessed with the idea of our utility value to users who swear by us. This is a two-step test, which essentially says this: How much of a personal or professional utility value do your users ascribe to your brand? And how indispensable are you to the ecosystem you exist in? While media companies focused on scale-for-scale-sake talk about unique visitors to their sites, we talk about unique residents.
There are people who build media companies for valuation, then there are others who build media brands for value. Internalizing that difference has made all the difference to us.
All of this hides an ugly unspoken truth about media in general: that it is disposable, in so many ways. The key is to move towards making yourself non-disposable, by adding enough value.
(1) Focusing on genuine value creation creates a pathway to subscription revenue. It’s what we did at Seeking Alpha — started free while focusing on genuine value creation for investors, then added subscription products. See: Charging for content will only be successful if this condition is fulfilled.
(2) Cf. The content business: Entertainment, or helping users make decisions?
Edited excerpt from Why Product Thinking is the next big thing in UX Design by Nikkel Blaase:
A product has a core user experience, which is basically the reason the product exists. It fulfills a need or solves a problem people have. By doing so, the product becomes meaningful and provides certain value. If the problem is non-existent, or the solution doesn’t fit the problem, the product becomes meaningless and people won’t use it. This in turn leads to the failure of the product.
Wrong solutions can be fixed, but non-existent problems aren’t fixable.
So when thinking about products, UX designers should first answer the following questions:
1. What problem are we solving? (User problem)
2. For whom are we doing this? (Target audience)
3. Why are we doing this? (Vision)
4. How are we doing this? (Strategy)
5. What do we want to achieve? (Goals)
Only then does it make sense to think about exactly what we’re doing (Features).
(1) Re. For whom are we doing this? (Target audience): The Job To Be Done framework avoids defining target customers other than as people who have that Job To Be Done. Who those people are and how to find them is more important for marketing and growth hacking than for product managers or UX designers. So I’d replace this question with: How do we find people with this Job To Be Done? See “Inception”, in A framework for growth hacking using Job To Be Done.
(2) Re. How are we doing this? (Strategy): What unique capabilities do we bring to the table? How will they be expressed in the product?
(3) Re. What do we want to achieve? (Goals): Ensure we’re sufficiently ambitious. What would success look like? Define a metric, and make sure it’s a real metric, not a vanity metric. Then, set a stretch goal, rather than what we think we can achieve.
(4) Cf. Why product managers should frame every product task as a Job To Be Done.
I think the mind is like a forest floor: the more you walk paths the deeper they get and the easier it is to walk them again. When I wasn’t doing so great, there was a path falling into unhappiness, and the more I walked on it, the deeper that path got. It’s important to learn how to tell yourself, “No, I’m not thinking about that right now. As a matter of fact I’m never thinking about that; we’re done here.” Eventually, if you let it, that darker path will get covered up with leaves; the leaves will disintegrate over the winter and by spring there will be new dirt covering it. The path is still there but it’s shallow and small and you don’t have to fall into walking it. In the meantime if you build more positive paths they will become easier and easier to find.
One of the biggest realizations I had is that happiness isn’t something that happens to you. It’s a choice.
(1) Lydia was describing her experience getting out of depression, but her insights (“the mind is like a forest floor”) are equally applicable to negative and positive thinking generally, particularly for startups where vision and optimism are so important.
(2) On positive thinking, see also: (i) Ideas spread inside a company due to positive energy; 8 ways to increase it, and (ii) By the end of your talk or presentation, you should be talking love.
(3) The excerpt is from Soulstrong, a site containing photos and interviews about depression at MIT. The interviews are moving, thought provoking and beautifully written.
(4) Cf. (i) The psychology of startup founders, (ii) Startup founder psychology: Between euphoria and terror and (iii) Finally, someone understands: What it’s like to be a CEO.
(5) I’ve put this post in a new section on Work Skills and Lifehacks in my thematic index of best practices for startups.
Edited excerpt from How to Be On Time Every Time by Dustin Wax:
A lot of the time we let ourselves show up late because the event we’re showing up to isn’t all that important to us. Try this: don’t schedule events that aren’t that important to you. Use that time for things that are important to you.
I know, there are a lot of things in your life that feel obligatory, like the weekly status report meeting at work, or dinner at your spouse’s or partner’s parents. Either make those things important to you, or figure out how to cut them from your calendar.
(1) The article then lists some useful suggestions for how to be more punctual, such as: not checking your email or voicemail right before you leave; adding 25% to your time estimate to get anywhere or do any task; getting everything ready for morning meetings the night before; and entering appointments 10 mins early in your calendar.
(2) But I think the insight quoted above is more important. We’re often late to events because we’re ambivalent about whether we really want to be there (or whether they justify the time including travel). Dustin Wax’s solution is to force ourselves to decide: either attend with a full heart and arrive on time, or say “no”.
(3) Reasons to “do it right or not at all”: latecomers hurt the productivity of everyone who has to wait, and demoralize the people who turn up on time and make them feel disrespected. And in Dustin’s words, “people who are habitually late (or are late even once, when it counts) project incompetence, self-centeredness, and even a lack of integrity”.
(4) Related: How much of other people’s time do you waste?
Edited excerpt from How One SaaS Startup Reduced Churn 71% Using “Red Flag” Metrics by Alex Turnbull:
We decided that, if we were to systematically reduce churn, we’d need to systematically study it and find its source. What I found was illuminating. There were very strong differences in the behavior of users who had abandoned Groove and the behavior of those who stayed. These are our “Red Flag Metrics”, and we use them to identify churn before it happens.
When we looked at the numbers, there were two metrics that seemed to be the most significant in the first 30 days after a user signs up – length of first session and frequency of logins. (There was a difference in total number of logins as well, but it wasn’t as disparate as the other two.) The average user who did not quit after 30 days spent three minutes and 18 seconds using Groove in their first session, and logged in an average of 4.4 times a day. The average user who quit spent 35 seconds using Groove in their first session, and logged in an average of 0.3 times per day.
So we began to send targeted emails to users who spent less than 2 minutes on their first session, as well as to those who (regardless of first session time) logged in fewer than 2 times a day in their first 10 days. We reduced our churn from about 4.5% to 1.6%.
(1) The full article includes the text of the emails sent to “at risk” users. They’re excellent.
(2) Re. “length of first session” — see The first ten minutes of a customer’s experience are crucial.
(3) Cf. How to reduce churn and How to reduce churn — a process.
Building an incredible product is definitely about optimizing it for the people who use your product the most. But when it comes to driving growth, people who are already using your product are not the ones you have to worry about. What you need to focus on is the marginal user. The one person who doesn’t get a notification in a given day, month, or year.
We looked at new users, resurrected users (people who weren’t on Facebook for 30 days and came back) and churned users. For pretty much every product I’ve ever seen, the resurrected and churned numbers dominate the new user account once you reach a sensible point of growth a few years in. And all those users who are churning and resurrecting had low friend counts, and didn’t find their friends so weren’t connected to the great stuff that was going on on Facebook. So the number one thing we needed to focus on was getting them to those 10 friends, or whatever number of friends they needed.
So when you’re thinking about growth, think about the user on the margin.
(1) Thank you Aaron Frazer for the article tip.
(2) “Focus on the marginal user” — Josh Elman says the Twitter team similarly focused on the lowest four steps of user engagement — see Identify your engagement ladder.
(3) Re. “For pretty much every product I’ve ever seen , the resurrected and churned numbers dominate the new user account once you reach a sensible point of growth a few years in… So the number one thing we needed to focus on was them” — Cf. A simple metric to measure the quality of your user growth.
Nothing slows down a startup like bad hiring — except when you keep those bad hires around for longer than you should. The key to firing lies in 4 principles:
1. The employee should see it coming – they should know in advance that being let go is a real possibility if they don’t improve.
2. They should be given a chance to improve — they need to know exactly what you expect of them and should agree to meet that one key, measurable goal within a specific time period.
3. Their ego should never be damaged — help them transition out of the role by providing a reference, reaching out to your network and providing 1-4 weeks of severance; most people can find a new job, but they have to break the bad news to their partner, kids and friends.
4. Never lie to your other employees about why the person was fired — be brief, but make it clear they were fired for performance reasons. This helps set a culture based on performance, not politics or tenure.
(1) Re. “Nothing slows down a startup like keeping bad hires around for longer than you should” — see Five bad excuses to avoid firing poor performers, and why you should “expose the pain”.
(2) Re. “help them transition out of the role by providing a reference and reaching out to your network” — I’m not sure how you can do this if you fired them for poor performance. Advice, anyone?
(3) Re. “Their ego should never be damaged” — listening to their feedback helps; see Exit interviews.
Edited excerpt from Diligence at Social Capital Part 1: Accounting for User Growth by Jonathan Hsu:
Quick Ratio = (new users + resurrected users)/churned users
(This should not be confused with the normal finance quick ratio that measures the ability of cash and near cash assets to pay off liabilities.)
This ratio needs to be greater than one if the app is to be growing, otherwise churn is overwhelming growth.
Most consumer applications don’t have a very strong mechanism to bring users back month after month and so the quick ratio tends to be just above 1. The dynamic for each month in a consumer app is typically to add a bunch of users and to simultaneously lose a bunch of users with a small additive piece on top from resurrection yielding overall small positive growth.
All else being equal, a company with the same growth but a higher quick ratio is more attractive company to us because it is starting from a better base. With high retention, it would be worth trying to push harder on the top of funnel with new users to drive growth (more aggressive sharing/referral mechanisms, paid acquisition, etc.). If a company has higher churn, it’s harder to justify pushing on new users as you would end up losing many of them. It’s easier to fill the top of funnel than it is to fix some underlying churn problem.
This accounting can be done on time-frames other than calendar months. Indeed, several of our portfolio companies implement it on a rolling 28 day basis (to remove day-of-week effects).
(1) Thank you Guy Cohen for the article tip.
(2) Cf. Why retention is the key to growth and Sustainable growth vs. growth hacking.
(3) Practical advice on how to reduce churn: (i) How to reduce churn — a process, (ii) How to reduce churn by winning back cancelled customers, (iii) How to think about churn.
Edited excerpt from The Twelve Rules of Good Public Speaking No One Tells You About by Dr. Nick Morgan:
You get attention by identifying a problem and playing it up. Look at the current American presidential candidates; you’d be pardoned for thinking that Armageddon was around the corner if you took them seriously.
But by the end of the talk, you should be covering what it is that you love and what’s working in your world. Long-term careers are based on positive trajectories, not negative ones.
One piece of feedback we received was a feature for a user to get an email every single time a specific event occurred for one of their campaigns. Our user wanted to know every time a campaign started, ended, was performing poorly, hit the halfway mark, was off to a bad start, had little traffic, or reached its spending limit.
Now, imagine having 20 mobile campaigns running on any given day and receiving 20-30 emails all within a short time frame. Despite what the user wanted, this would have overwhelmed their inbox with non-actionable items in a non-organized way.
So I set up a handful of video chats and in-person interviews. We distilled all our findings and discovered the user’s one basic need: they simply wanted to know if their campaigns are doing okay.
Getting user feedback is the most important thing any UX designer, engineer, business owner, and product manager could do. But don’t just take that feedback and design a solution based on what the user says. Dig deeper to figure out your user’s root problem.
Don’t try to figure out what the user wants. Try to figure out why they want it.
(1) “The user’s one basic need”, “your user’s root problem”, and “Why they want it” are all other names for: your customers’ Job To Be Done. See A brief summary of Job To Be Done, with 3 takeaways for product managers.
(2) Another technique to uncover the Job To Be Done from a (possibly misguided) feature request is to keep asking “Why does that matter to you?” or just “Why?”. See 5 Whys.
Edited excerpt from Meet the man who re-designed work: WeWork’s Miguel McKelvey by Will Reynolds:
What are the secrets of WeWork’s design? How does the physical space itself contribute to productivity, inspiration and positivity?
WeWork co-founder Miguel McKelvey, a trained architect and interior designer, highlights two key aspects: glass and natural light. “We like to ensure that there’s lots of natural light. We intentionally seek out properties that are on a corner or that have a lot of light, and then we make interior walls out of glass, or if that’s not possible, we’ll plan out where to place solid walls so we don’t block people’s access to daylight. Another benefit of glass walls: it adds an element of transparency and accountability. When you’re surrounded by other people who are working hard, you’re more likely to work hard, too.”
(1) At Seeking Alpha we learned that there are three key factors in successful office design. First, you want to give people a sense of privacy, cosiness cosiness and quiet, so they can concentrate on their work. Second, you want to maximize the amount of natural light. And third, you want to provide opportunities for unscripted interaction.
(2) The problem is that the need for quiet and cosiness conflicts with the need for natural light and unscripted interaction. At Seeking Alpha we built interior glass walls, used large plants to provide cosiness without blocking out light and interaction, and created inviting common areas.
(3) See (i) How to create a healthy office , (ii) Office design: two tips to get seating right, (iii) The problem with open offices, and (iv) Startup office design: Time to reconsider cubicles?
Edited excerpt from Two Quick Exercises for Creating a Winning Product Strategy by Jerry Cao:
Before you begin to define the features and details of your product, imagine what users would say about the final version:
Write a tweet from the perspective of future user. You’re trying to capture the core essence of the product. What will users like or dislike about the product? How enthusiastic are they, and what can you modify to increase their enthusiasm? This activity forces you to focus on the single differentiator that defines every memorable product.
Write a fake press release. Conceive the ideal product in your head and write an announcement to prospective users about it, listing out the problems it solves, a summary of how it works, a catchy title, instructions on the first steps, and even a call-to-action. You can even write pretend testimonials about what you want customers to say.
(1) Amazon product managers start new initiatives by writing a press release, according to Ian McAllister. See his detailed description of how to do it.
(2) In Ian’s press release outline, he includes Problem, Solution and How To Get Started. Compare this to Josh Elman’s categories in A framework for growth hacking using Job To Be Done.
Edited excerpt from Building your growth model and Ladder of Engagement by Josh Elman:
As you think about your product and what it takes to become an expert, I like to break this down to steps into something I call the “Ladder of Engagement”. You should be able to break down your product into specific skills or tasks someone needs to understand to get the most out of your product. Not all users will (or need to!) make it to the top of the ladder to get value out of it. But you should understand what tasks in your product require more understanding of your product.
This might be easier with an example I created for Twitter when we were just starting the growth team. This was the Twitter Ladder of Engagement: (1) Understand what a Tweet is, (2) Start following people you are interested in / friends with to make a basic timeline, (3) Start checking and reading your timeline to see what’s new, (4) Make sure you have mobile apps installed so you can go back and forth with the web app, (5) Begin to engage and participate — @ reply, retweets, favorites and even Tweet yourself, (6) Run your first searches and see what other people are saying on Twitter. (7) Learn to build your following (we didn’t expect most users to get here, but we expected power users would care and want to).
This ladder was valuable for us as we built the growth and onboarding flow. We focused primarily on 1–4 to get people going, and then step 5 as users were more prepared. It helped us decide which areas of the product to focus on, and helped us explain the product to users in a more stepwise fashion.
When there was all the talk of you [Slack] killing email, I have to admit I thought it was the email problem you were attacking, not just the email platform. Which is to say, I thought you were providing some relief from the torrential influx of messages, alerts, and notifications I was receiving on a daily basis. “Me + Slack = Fewer distractions and more productivity,” I thought at the time.
I have to say, though, that I’ve since found it to be the opposite. I’m finding that “always on” tendency to be a self-perpetuating feedback loop: the more everyone’s hanging out, the more conversations take place. The more conversations, the more everyone’s expected to participate. This really lowers the bar for what’s considered message-worthy to begin with.
Even your summaries of each week — the ones where you remind me about how our relationship is going — are all predicated on its volume of messages, which was kind of the opposite of what I thought you and I were all about.
(1) This is a poignant example of a company mistaking user engagement for customer success. Samuel adopted Slack because he thought it would make him more productive. But Slack measures its success by user engagement (the volume of messages), which conflicts with its users’ goal to become more productive.
(2) This problem is widespread. The tech industry has mastered how to maximize user engagement, but we often lose sight of the real goal — to empower users to achieve something worthwhile. Scientific studies show that Facebook, the most successful consumer product ever built as measured by daily users, makes people less happy. We’ve made content consumption irresistible with bite-size snacking and alluring headlines, but have dumbed down content in the process. And we’ve developed addictive games which, after extended periods of usage, leave people feeling empty and purposeless.
(3) How can product managers avoid mistaking user engagement for customer success? (i) Research the Job To Be Done and articulate it explicitly. This provides a definition of customer success. (ii) List the key requirements for users to get the job done. (iii) Even if you can’t measure customer success directly, and need to use a proxy for customer success such as user engagement, ensure that every product decision is justified in terms of the Job To Be Done and customer success.
(4) Cf. The key metric for your startup must satisfy these 4 criteria.
A CEO friend called me yesterday with the following question:
“A senior manager in my organization has strong domain knowledge and is in some ways highly effective. But he demotivates his team members, for example by taking tasks from them because he says he can do them better. I also personally find him hard to work with: he tries to stop me from handling key negotiations where I have a better relationship with the other party, and fails to deliver on my requests. My options are: fire the manager, split his role into two and put him in a newly defined role where he doesn’t manage people, or try to work with him to improve. Which should I choose?”
What would you advise?
I tried to help the CEO make her decision by sharing my experience with this sort of situation generally. Here’s what I learned running Seeking Alpha:
- The happiness of the team really matters. Sometimes you need to fire strong people because they are not pleasant to work with.
- Don’t redefine a job description because of the incumbent’s deficiencies. When you eventually hire the right person, you’ll be surprised that you can in fact have everything, particularly if you give smart people time to learn.
- Shunting people around from role to role rarely works. CEOs sometimes do it because they can’t bring themselves to fire someone. But if you can’t bring yourself to fire, you’ll end up not being able to hire.
- Demoting people rarely works. Even if they are initially relieved at no longer having to do something they aren’t good at, in the medium term the demotion saps their self esteem and they leave.
- As CEO, make sure you like working with your senior managers. If you’re unhappy, your company will feel it.
- Good interpersonal skills are intrinsic to a manager’s job.
- If you decide to keep the manager, make sure you have clear metrics for him. That way you’ll get out of subjective evaluation of his skills.
(i) Cf. The best thing you can do for your team.
(ii) Cf. Laszlo Bock’s eight steps to being a good manager.
(iii) Cf. Managers and metrics.
(iv) Cf. Five bad excuses to avoid firing poor performers, and why you should “expose the pain”.
My father and mentor shared a great sales truth with me many years ago. He said: “Most people use the relationship to get the deal but the reality is the relationship is the deal.”
I often work with clients, coaching and mentoring them through a large deal. Sometimes we get to celebrate together, other times it’s more of a post mortem. In several cases recently the answer to “why?” was the would be big deal closer didn’t get the subtleties of the relationship and one-to-one communication. They got the features, advantages and benefits of their solution. They even identified client needs, pains and specific outcomes desired. What they didn’t get, which was the deal killer, was the person and what approach, type of communication, and behavior was appropriate with the prospect or prospects.
(1) See the first of the questions in Geoffrey James’ The 5 questions every customer asks themselves before buying from you.
(2) See also: Seth Godin’s Overcoming the biggest barrier with a first-time buyer.
(3) Cf. What do customers care most about?
Edited excerpt from Five things I will do different for my next startup by Jeff Haynie:
Burn less. This is directly related to “monetize earlier” and “scale slower”. The faster you monetize and the slower you scale, the chances are you’re going to burn less.
Burn less is about optionality. And the one thing you want as a founder of a startup are options. You’re going to die much much faster because you ran out of options. Options are really what it’s all about. Options give you a chance to control your own destiny. When the times get tough, if you have options, you can use them. Without optionality, you’re screwed.
Burn is more or less an indicator of your optionality. If you burn less and have more runway, you have options (or at least you can create options with enough time). If you burn more, you reduce your options while reducing how long you can exercise them. And this is one of those things that it’s very easy to convince yourself otherwise. Spending money is fun!
Trust me, your board and investors will likely not agree with you. When you are nervous and want to go slower, they won’t always agree and will push you. Not everyone, but most. And it will always be much more fun to burn faster, not gonna lie. Burning less takes a tremendous amount of self-discipline and organizational priority and restraint.
When things are looking up and to the right, everyone around you, including your investors, will be saying “go go go”. But if you slip up, they won’t be there to admit that they themselves pushed you in that direction.
Remember, you can always increase spending — that’s very easy. Reducing spending is very, very hard and takes so much longer than you realize.
(1) I’m blessed to have wonderful VCs on the Seeking Alpha board. Nick Pianim of DAG Ventures, who is thoughtful, modest and insightful, would say exactly this: One of the key factors in startup success is time. So give yourself time.
(2) Cf. Reach versus monetization and Get to profitability — here’s how.
Edited excerpt from What people really want — Focus on the job, not the customer by Nikkel Blaase:
People don’t want to buy products. They want to hire products to get a job done. Or as Harvard Business School professor Theodore Levitt puts it: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!” People do things because they find themselves with a problem they would like to solve — such as overcoming a boring commute, recovering from a stressful day or hanging framed photos on the wall. When people struggle they look out for solutions to achieve progress in their lives.
The Job-To-Be-Done framework has become popular in product design because it uncovers what causes people to hire products or services. Rather than understanding people by their demographic or socio-economic attributes, such as income or level of education, the framework focuses on satisfying needs by understanding the jobs people want to get done. Uncovering these jobs makes it easier to build the right solutions.
1. Focus on understanding the job people want to get done and find out how the product fits into people’s lives.
2. Sell the product’s outcome, not the product itself: Beautiful, cut grass — not lawnmower or GM seeds.
3. Don’t care about direct competitors. Think about alternatives for achieving the same job and do the job better than any other solution out there.
(1) In my experience, product managers may think they have successfully adopted the Job To Be Done framework simply by describing their project as a Job To Be Done. But unless you devote meaningful time and effort to investigating the Job To Be Done, for example by creating a Job Outline and conducting switch interviews, you’re kidding yourself. In Nikkel’s words, “Focus on understanding the job people want to get done and find out how the product fits into people’s lives”.
(2) For another description of Job To Be Done, see Build your product to explicitly address a “Job To Be Done”.
(3) Re. “Sell the product’s outcome, not the product itself” – cf. Steve Jobs’ approach to marketing.
(4) Re. “Don’t care about direct competitors” – cf. Your biggest competitor may not be who you think it is.
(5) For more, see the section on Job To Be Done in Best practices for startups — a list by topic.
The problem with User Stories as a framework to think about product is that they make too many assumptions and don’t acknowledge causality. When a task is put in the format of a user story — “As a [type of user], I want [some action], so that [outcome]” — there’s no room to ask ‘Why?’. You’re essentially locked into a particular sequence with no context.
A far better framework is what I call Job Stories, an idea from the really smart guys at intercom. Frame every design problem as a Job, focusing on the triggering event or situation, the motivation and goal, and the intended outcome: When _____ , I want to _____ , so I can _____ . For example, “when an important new customer signs up, I want to be notified, so I can start a conversation with them.”
The Job Stories framework is great because it makes you think about motivation and context, and de-emphasizes any particular implementation. Often, because people are so focused on the who and how, they totally miss the why. When you start to understand the why, your mind is then open to think of creative and original ways to solve the problem.
(1) As Alan Klement shows above, whenever you specify a Job To Be Done, the emphasis is on what the person is trying to achieve, not performance of a task. So it’s easy to ask “Why does the person want to achieve that outcome?”. This question frequently leads you to a better solution than the one you’re considering.
(2) Framing every product task as a Job To Be Done can be powerfully combined with Joe Natoli’s framework for clarifying what your users care about. First, ask what the user is trying to achieve with this page, interface, feature or task (= Job To Be Done); then ask what information they most care about to get that job done (= information architecture).
- Get the internal stakeholders to list the categories of information they think users of the product care about, in order of importance.
- Then, ask users what categories of information they care about. Don’t anchor them with the categories you’ve come up with — ask open ended questions.
- Present the results in a three-column table: Column 1: information category. Column 2: how we thought users ranked it. Column 3: how users actually ranked it.
- Benefits: “It shines a light on the fact that what the people in the room think is important and what users or customers think is important are often not the same thing. It forces everyone in the room to step outside their preconceptions and inherent biases and put themselves in the shoes of users and customers. And it’s the quickest way I know to develop a clear, simple model for Information Architecture, saving everyone a tremendous amount of time, debate and headache.”
(1) Thank you Daniel Riedler for the tip.
(2) It’s worth watching the video — it’s short, well produced, and informative.
(3) If you yourself are a typical user of your product, it’s easier to get user-centric design intuitively right. But if you’re not a typical user of your own product, forcing yourself to write down what you think users care about is critical. It uncovers your assumptions, opens them up for discussion, and makes them easy to test.
(4) This can also be useful within the Job To Be Done framework: once you’ve stated your users’ Job To Be Done, list and rank the requirements for performing the job successfully, and then validate them with users.
1. Be nice and be respectful. It may sound obvious, but I often hear the words “I just want him/her to be nice to me.”
2. Don’t take one another for granted. Remember to express appreciation for even the most mundane tasks.
3. Be curious, not defensive. If your partner seems upset, anxious or depressed, and snaps at you, don’t assume he/she is angry with you. Staying non-reactive and curious will allow you to provide the space to really listen.
4. Provide empathy. When your partner is feeling down, you may be tempted to judge, analyze, provide a solution, or try to rid your partner of his/her negative emotions. The best thing to say may just be “I am sorry you’re upset” followed by “What can I do?”
5. Fight fair. All couples fight, but it’s how you fight that matters. Do not threaten or blame. Try to be specific rather than use words such as “always” or “never.” Express remorse authentically and make sure to recover from the dispute with words of affirmation.
6. Be honest and authentic. This helps to create safety and security in the relationship.
7. Be direct. Don’t hesitate to invite your partner to hear what you want and what you need.
8. Be aware of each other’s triggers. Be sensitive to your partner’s sensitivities and what may make her/him reactive.
9. Stay un-enmeshed. Healthy boundaries, autonomy, and the space necessary for developing outside hobbies and friendships keep the relationship infused with vitality and interest.
10. Spend quality time together. Turn off your devices. Take walks, and talk.
(1) Talli wrote her article for couples. Look what happens if you apply this to work relationships.
(2) Cf. (i) Genuine praise, (ii) How to resist emotional triggers, (iii) A better way to view people, and (iv) How to deal with anger at work.
Today I gave a brief presentation to the team at IT Central Station, as part of their “Lunch and Learn” series. Here’s the deck, configured for stand-alone reading:
(This is the second presentation deck I’ve published. The first was The most fatal mistake to avoid as a startup.)
Never ask a busy person to lunch. Busy execs hate lunches. They are time sucks. Sure, they like to occasionally meet good friends or important contacts for lunch, or do group lunches. But somebody they don’t know? Not so much. Same with dinner — a dinner out is a night I don’t get to spend with my kids and family.
So what can you do? “Hey, can I bring you a coffee and get 30 minutes of your time at your offices next Tues or Wed? I promise I won’t overrun my time.” And don’t. You become an easy second date to accept.
(1) If you want to get a meeting or call with someone, make your request specific, attractive and convenient so they can accept it immediately:
- Time: Suggest at least three possible times in your initial email. This maximizes the chance that one of them will be convenient, and they’ll be able to say “yes” without further iteration.
- Location: Suggest a location that’s convenient for them. In his suggestion above, Mark uses “at your offices”.
- Duration: Specify how much time you want, keep it short, and don’t overrun.
- Agenda: Be specific about what you want to discuss by listing questions.
- Appreciation: If you can show your appreciation by offering something for them, do it. In his suggestion above, Mark suggests “Can I bring you a coffee?”.
(2) Cf. (i) How to request a meeting — Steve Blank, (ii) How to request a meeting — Scott Britton, (iii) How to request a meeting — Aaron White.
(3) On specifying an agenda: Why you should demand an agenda for meetings, and how to do it — nicely.
Because personas are a mashup of assumptions and attributes, they can have a destructive effect on product design. They can give a false sense of knowing the customer and can thereby lead to gaps in design. For example, you can’t ask a persona about their anxieties, why they chose Product A vs Product B, what else was going on when they chose Product A vs Product B, or that when they first opened your app they didn’t know what to do first….
Specication of a Job To Be Done can only come from real customer interviews. Before designing a feature or new product, you must talk to real people and uncover all the anxieties and contexts which were in play when they used your or a competitor’s product.
(1) Early stage startups often describe their product as meeting a “market need”. But markets don’t have needs; real people have needs. Just as Alan Klement shows that personas, “a mashup of assumptions and attributes”, can have “a destructive effect on product design”, so too the abstract concept of “market need” can have a destructive effect on your startup’s positioning.
(2) Job To Be Done is a powerful framework for startup positioning, not just for product management. When you think about a Job To Be Done, you are forced to think about a concrete person (= target customer). You can then ask (i) How many other people share this Job To Be Done (= market size)? (ii) What solution do these people currently use to get this job done (= competition, including surprising competition)? (iii) How did the user find that solution (marketing and distribution)? (iv) Does the user currently pay to get this job done (= proven monetization potential)? (v) How valuable is this Job To Be Done for the user (= pricing potential)?
(3) To get to the right answers, clarify what your users ultimately care about. To do that, keep asking “Why does the user care about that?”, until you get to the point where the answer is completely obvious. (Cf. 5 Whys.)
(4) Cf. Documenting your product-market fit hypotheses.
Edited excerpt from Five things I will do different for my next startup by Jeff Haynie:
We delayed monetization way too long, using venture capital to extend the time to create a sustainable monetization engine for our business. We always had a plan for monetization, but we waited way too long to get focused on it.
The conundrum that a lot of companies face — in fact most of them — is the balance between reach and revenue (or in another way to frame it: the conflict between the two). The further you maximize reach the harder it is to scale revenue — or at the very least, more friction is introduced in capturing it.
Everyone loves something for free. However, I would prefer to have fewer dedicated power users that get enough value and can’t live without it that they are willing to pay for it, than a lot of users that like it only on the condition that it’s always free.
We learned that it’s never too early to charge (something, anything) if you want to eventually have a business that is sustainable. Even if you have to risk reach in some regards. That won’t always make you the most popular startup but maybe you’ll be around when others fail.
(1) It might be OK to delay monetization if you know exactly how you will generate revenue, and you want to optimize for reach over monetization at this stage. The problem is that most startups that delay monetization haven’t figured out how to generate revenue successfully. Revenue generation is core to building a company — it impacts the product, the target customer base, the distribution channels, and the HR structure of the company. So figuring it out shouldn’t be delayed.
(2) Re. “we delayed monetization way too long, using venture capital…”: cf. Why you should bootstrap your startup before raising money.
(3) Cf. Get to profitability — here’s how.
Looking back, we feel that we made the best decisions with (and hopefully provided the most help to) businesses displaying strong network effects. This brings us to our refocused thesis: we like to invest in businesses with potentially large network effects built around people and/or data.
We think that network effects can provide a long-lasting competitive advantage and can be very capital-efficient. Connecting people and data over the web and mobile also creates something that wasn’t possible before – the end result is new and unique, not just something faster, cheaper, or better. Network effects can be found in many categories, from marketplaces, to (social) platforms or SaaS, and in many products built specifically around (big) data.
(1) This explains why Seeking Alpha, where insight is generated by a community of contributors and commenters, is so much more powerful than finance sites where content is generated by paid journalists. Community has network effects.
(2) Cf. Why the best products don’t always win, AKA how to build a moat around your business and Reverse network effects, and how to combat them.
(3) See also: How to stress test your strategy.
Indulge in some generosity. Compliment your rival. Give something away. Offer free help. Share the spotlight with an audience member. Give credit to others. There are many ways to be generous from the stage, and few speakers remember to be as generous as they can be as often as they should. You are the hero of the hour, but heroes play nicely with others. It’s part of how we define them.
Edited excerpt from Building your growth model and Ladder of Engagement by Josh Elman:
As you are building a growth model for your company, here are the key questions to answer:
Purpose: What is the core purpose of the product?
Users: Who will care about that core purpose?
Inception: How can I get people to hear about this product for this purpose?
Adoption: What does someone need to do to get the product to fulfill this purpose for them?
Habit: How frequently should the person use the product, and how can we get them to adopt the habit?
(1) Cf. Ben Yoskowitz’s framework — (i) Marketing/Growth, (ii) Onboarding, (iii) First User Experience and (iv) Ongoing Engagement — in How to set priorities in product development.
(2) By identifying the product’s Purpose before its Users, the impact is the same as using the Job To Be Done framework: what job does this product do, who wants to do that job, and (once you’ve ascertained that the job is valuable enough and enough people want to get it done) how can we improve our product to better do this job?
(3) This contrasts with the standard customer development framework, where you first identify your target users and then ask what is most valuable to those users. The problem with this is that it’s too unconstrained — your users may care about a lot of things, but many of them have nothing to do with your product. This may create tension between feedback and vision in product management, and lead to premature pivoting.
(4) Due to its importance for product management, I’ve created a category for Job To Be Done. You can also find the posts in my list of startup best practices.
(5) “How frequently should the person use the product, and how can we get them to adopt the habit?” — see (i) The relationship between frequency of habit and customer retention and (ii) How valuable is your product? Google’s “toothbrush test.
The weather just took a turn for the worse and the storm is moving in fast. If you’re a startup founder, what do you do?
1. Take a hard look at your finances. Immediately freeze all planned future increase in spending. Stop. Spending. Right. Now. You and your CFO should immediately assume that you will need to live with whatever you have in the bank for the next 12 months (at a minimum, ideally longer) — assuming conservative revenue assumptions. If you don’t have the runway with your current burn (excluding all the new spending you just cut), then you now need to take immediate action. The primary goal is a flight to safer ground. Screw this up and your startup will not survive.
2. Take a hard look at your priorities. What can you stop doing that you are doing right now? If it’s not core to the mission and not going to drive immediate short-term revenue (less than 6 months), stop doing it right now. Make sure everyone now clearly understands that revenue is going to be the priority over everything else. Growth at all costs doesn’t work right now, it’s now about survival.
3. Take a hard look at your people. Based on the past 2–3 years, you’ve likely got extra resources doing things that have now been deemed not a priority in the interim. Make a priority list. Rank each team member by the following: (1) must have or we cannot run the business, (2) really need to have them or things start to get difficult, (3) nice to have but in a worse case could live without, and (4) extra. What you do the list will greatly depend on your situation — mainly your burn rate, cash in the bank and your financing plan. With this list, you’re going to be able to have a rational and financial way to evaluate your situation with the least amount of emotion doing it.
(1) Cf. Rafat Ali’s advice in Get to profitability — here’s how and “We simply can’t cut costs without hurting our growth”.
(2) If, after looking at your finances, you think you won’t survive, read: (i) There is always a move, (ii) One way for startups to gain time.
The smartest companies in the market that I know are working aggressively to lower burn rates through pragmatic cost cutting, knowing that the next fund-raising cycle may be unpleasant. This prudence is smart and welcomed.
I’ve heard enough companies say “we simply can’t cut costs as it will hurt the long-term potential of the business” for them to get a wry smile from me. We entrepreneurs have been spinning that line for decades in every boom cycle. It’s simply not true. Pragmatic cost cuts are always possible and often productive.
Start early. Give yourself enough runway by controlling costs.
(1) Mark’s entire post is a timely must-read for startups and VCs. Typical of Mark; it’s outstanding.
(2) Practical advice, from Rafat Ali: Get to profitability — here’s how.
(3) The context, from Ben Horowitz: Profitability = control of your own destiny.
(4) An extreme case: One way for startups to gain time.
Edited excerpt from Resolving the Paradox of Group Creativity by Andre Walton:
When advertising executive Alex Osborn popularized brainstorming in the 1953 book Applied Imagination, he predicted that it would double the number of ideas that a group of people would generate in response to a problem or challenge. However, it proved not to live up to his expectations. As later research showed, brainstorming actually reduces the number of ideas a group produces when compared with the number of ideas that can be generated by those same individuals on their own.
So if you can’t rely on brainstorming and teamwork to elicit more creative ideas, what can you do? One remedy is to make sure that individuals have plenty of space for individual contemplation and input. In our everyday work environments, this ability to find personal time and space to think is crucial to enabling creative thought.
(1) Thank you Hana Abduljaami for the tip.
(2) Cf. The problem with collaboration, and why goals should have single “owners”.
(3) On how to create time to think, see: (i) How to clear time for deep thinking, (ii) Creating time for reflection, and (iii) If you want to get more done, stop doing these things.
(4) On office design to enable creative thought: Startup office design: Time to reconsider cubicles?
1. Tell the audience something it doesn’t know, but don’t tell it everything you know. Audiences love to learn a little insider knowledge, or a factoid that adds a bit of depth and complexity to a well-known story. But we only crave a little extra knowledge. Too many speakers dump way too much information on the audience. Restraint is key.
2. Keep track of where you are. One of the kindest things you can do as a speaker for an audience is to let it know where you are in the presentation. Number your points. Tell the audience what it is in for. Make your progress clear.
3. Finish two minutes early. The key to finishing on time is rehearsal. Only with a real rehearsal can you know precisely where you are in the presentation and how long it will take. As the old saying has it, no one ever hoped that a speech would go longer. But you also don’t want to undershoot in a big way.
(1) Re. “Tell the audience something it doesn’t know, but don’t tell it everything you know” — I love this advice. It seems obvious, but it addresses our insecurity of wanting to prove ourselves by showing how much we know.
(2) Re. “Keep track of where you are” — Audiences usually know how long a presentation is supposed to last. If that’s not the case, make sure you tell your audience up front how long your talk will be. Same applies to meetings and phone calls. An easy way to do this: “My time frame for this presentation / meeting is 45 minutes. Does that work for you?”
(3) Re. “Don’t tell your audience everything you know” — cf. How to keep presentations tight.
One of VoloMetrix’s services is a personal dashboard that shows employees how much of other people’s time they consume by sending e-mails or holding meetings. The tool attempts to estimate how efficient each meeting is, based on measures like how many people attend and how many e-mails are sent during the gathering—a sign of low engagement. The dashboards reportedly free up an average of about two hours a week for each employee.
Edited excerpt from How We Got off the Addiction to Venture Capital and Created Our Own Way to Profits by Rafat Ali:
I focused on revenues and revenues alone. That meant doing things today that brought in revenues today. That meant media, branded content, subscription reports, a conference. We knew how to do this from experience and our team knew how to wrap their heads around it.
We learned to focus on the efficiency of our effort. It meant doing one big thing a year that brought in big revenues in one go, instead of four small things which took almost 4X more effort but perhaps all added up equal in revenues to that one big effort. That meant we would only do one big multi-million dollar franchise conference a year, not 10 one-day smaller conferences like I did in my previous company.
I learned to say no, again and again, to anything that deviated me and our company from the focus. It meant we would only entertain the enquiry if it brought us direct revenues, or emails to build our newsletter list.
It meant saying no to going to random media or startup conferences for us founders. I created a rule that if we didn’t have any customers at a conference (which for us meant the travel industry), we wouldn’t even consider it, and even then we would only go to if we could see direct revenues coming out of spending time there.
(1) Rafat focused on growing revenue and profits so Skift wouldn’t be dependent on outside funding. See Profitability = control of your own destiny.
(2) There’s more to it than that, though. Many startups are struggling to achieve dramatic user growth, for two reasons: (i) search, social and other user acquisition channels work less well now than they did a few years ago, and (ii) many companies — I’d include Seeking Alpha in this — aren’t willing to dumb-down their product or generate link-bait to attract a mass audience. Since growth rate in revenue or active users are the only metrics that matter, this has pushed high quality companies to focus on revenue growth, ie. to deepen value for their current users and target users.
(3) For the case against focusing on revenue as opposed to user growth, see Is revenue a good metric for early stage startups?
(4) Even if you focus on revenue growth, Don’t be satisfied with sales, seek love.
Research on unconscious bias has shown that information like a person’s name can affect how they’re viewed and subtly prompt managers to make unfair decisions.
So-called “blind hiring” redacts information like a person’s name or alma mater, so that hiring managers form opinions based only on that person’s work. Companies invite job candidates to perform a challenge — writing a software program, say — and bring the top performers in for interviews or, eventually, job offers.
Bosses say blind hiring reveals true talents and results in more diverse hires.
(1) Thank you Persha Valman for the tip.
(2) “Unconscious bias” — cf. How to avoid hiring someone just because you like them.
(3) “Form opinions based only on that person’s work” — see (i) The best way to find out how good a candidate really is, (ii) How to run a job interview and (iii) How to test job candidates for “learning agility”.
(4) However, there are pitfalls in testing and looking at past work — see The limits of trying to test people when you’re hiring and Don’t hire based on past experience.