Tag Archives: Entrepreneurship

Five Simple Rules for the Successful Entrepreneur

13 Mar

Stanford professor Tom Byers knows a lot about starting companies. His expertise is in high-technology ventures and serves as the faculty director for the Stanford Technology Ventures Program and the prestigious Mayfield Fellows Program (MFP). As an early employee of both Go Corporation and Symantec and an expert in what works and what doesn’t when trying to start a company, Byers offers the following five rules as essential for would-be Zuckerbergs:

1. Show up on time

2. Be nice to people

3. Do what you say you’ll do

4. Deliver more than you promise

5. Work with enthusiasm and passion

These five rules won’t give you all the answers for how to be a successful entrepreneur, but they are essential and elegant.

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How Flickr Went from Online Game to Photo-Sharing Giant

5 Feb

The following is an excerpt from the book The Start-up of You by Reid Hoffman and Ben Casnocha.

Flickr is one of the most widely used photo hosting and sharing websites, with an estimated five billion-plus images on its servers. But the company wasn’t started by photography pros. In fact, its founders, Caterina Fake and Stewart Butterfield (who teamed up with Jason Classon), didn’t even set out to start a photo-sharing service at all.

Their original product, rolled out in 2002, was a multi-player online game called Game Neverending. Most gaming platforms at that time allowed one or at most a few people to play the same game together at the same time. But Caterina and Stewart wanted to create a game that hundreds of people could play at the same time. To this end, the plan was to build something they saw less as a game and more as a “social space designed to facilitate and enable play.” To attract and retain players to this social space, they pumped out social features like groups and instant messaging, including one add-on to the instant messenger application that allowed players to share photographs with one another. As with most features of the game, the photo-sharing add-on was developed very quickly – it only took either weeks from idea to implementation.

When photo sharing was first added to Game Neverending in 2004, it was no big deal – photographs were just another thing players could trade with one another, like the objects they would collect during the course of the game. However, it didn’t take long for the photo-sharing capability to eclipse the game itself in popularity. As this became increasingly apparent to the leadership team, they were faced with a decision: Should they try to expand their new photo-sharing platform while sticking to their long-term plan and continuing to develop Game Neverending, or should they put the game (and its twenty thousand avid users) on hold to devote the majority of their precious resources to photo sharing? They decided to deviate from the original plan and focus exclusively on building the photo application and the photo-sharing community that went along with it. They called it Flickr.

Flickr soon became the photo-sharing service of choice for millions of Internet users. Its social features – tagging and sharing – grew naturally out of the social DNA that defined the original online game, even as they differentiated the service in response to market feedback. In 2005 Yahoo! acquired the company, making it a Web 2.0 poster child. But more than just a Silicon Valley success story, the evolution of Flickr is a case study in smart adapting: its founders were in constant motion early on, tried many things to see what would work, and nimbly shifted their plans based on what they learned.

– Reid Hoffman & Ben Casnocha (The Start-Up of You, Chapter 3, “Plan to Adapt”, pages 52-53)

Why You Don’t Need a Business Plan

13 Jan
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You might not know where you’re going, but you have to keep moving.

One of my favorite topics of conversation, much to the dismay of my dinner companions, is the tension between making plans and taking action. As the name of my blog suggests, I subscribe to the “act first” philosophy, but I certainly understand the need for detailed plans. Especially when the goal you want to achieve will take a long time and will involve lots of people.

However, most of the time we use planning as an excuse. It becomes a rationalization to keep us from acting and this is particularly true when trying to start a business. Any good expert on entrepreneurship will tell you to start with some market analysis and a strong business plan. I think they’re wrong. Here is my alternate approach: start with inspiration.

The famous screen-writing coach Robert McKee has useful definition for a “hack.” He says a hack is a writer, “who second-guesses his audience.”  Instead of using his muse to drive his work he asks himself what the market can support. He condescends. He may make some money by selling some snake oil, but at what cost to his reputation and his soul. Steven Pressfield expands,

“The hack is like the politician who consults the polls before he takes a position…it can pay off, being a hack. Given the depraved state of American culture, a slick dude can make millions being a hack. But even if you succeed, you lose, because you’ve sold out your Muse, and your Muse is you, the best part of yourself, where your finest and only true work comes from.”

“That all sounds nice in theory,” you might say, “but there are practical considerations. No one is going to hand you money without a solid business plan.” Of course. I would never argue against this point. It isn’t wrong. But it is incomplete. The entrepreneurship process doesn’t start with a business plan. It starts with your passion. It starts with a compulsion to solve a problem.

Steve Jobs was quoted saying, “…often times the customer doesn’t even know what he wants until you show it to him.” So, how far can market research take you when the markets don’t even exist yet? If you truly want to be an innovator then you need to consider that the mechanical models of business development are lacking. No one can predict the future so if you want to succeed then you’ll have to do something scary and profound…you’ll have to make decisions in a fog. Incomplete information is the playground of the leader and the entrepreneur. Learn to enjoy the gray. Learn to embrace it. All creation is born in it.

10 Reasons Your Business Isn’t Working

17 Dec

The mechanics of creating and growing a business are not that mysterious. There are plenty of resources out there to help you. In fact, there is so much out there for you to learn from that if your business isn’t working, then the problem is YOU. In the spirit of telling you the truth so that you can turn things around, here are my top ten reasons why business leaders fail.

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1. You’re trying to screw over your customers. You think that getting them to pay $100 for a $10 product is doing good business. You’re wrong. They’ll see right through you and your fancy sales tactics. Give them more than they are paying for and they’ll beg you to sell to them.

2. You’re lazy. In the end, successful businesses are all about the hustle (and I don’t mean tricking other people). If you want $10,000 then you’re going to have to put in $100,000 effort. If you want to be good, then put in great effort. If you want to be great, then put in outstanding effort. Accept it and get to work.

3. You aren’t thinking creatively. You love to “think outside the box,” but you really aren’t. You’re in the same old box and you’re just climbing deeper and deeper into it. Get out of your comfort zone and ask the big questions, “If I could do that would it virtually guarantee my success?” Chances are there are a few Hail Mary plays up your sleeve if you just had the guts to try them.

4. You haven’t failed enough. The biggest hurdle to overcome on your way to great success is to have a little success. Think in terms of a season and not each game. Just because you won last week doesn’t mean that you will this week, so you need to keep switching things up. Sometimes you’ll lose. Good. Learn from your mistakes, but never stop making your services and your people better.

5. You’re doing too much. John Donne once said, “No man is an island,” and believe me, no one with their own island tried to do everything himself. Leadership is about influencing others toward a common vision. Delegate your work, trust the people around you, and share the rewards. Ask for help. Set the vision and then get other’s to work towards it.

6. You’ve got too much of an ego. You’d rather be a 20 pound fish in a 5 pound lake than a 100 pound fish in a 200 pound lake. So what if you’re not the biggest? So what if they’re are people out there better than you? Focus on your own results and stop worrying about what everyone else is getting.

7. Your product and your market don’t match. If you’re in the luxury market, then your products better be luxurious. If you’re in the common market then your products better solve everyday problems. Don’t over complicate things. Don’t try to cheat the system. The house always wins. Test your prices and figure out what you’re worth (not what you wish you were worth).

8. You don’t have a business plan. Is it better to be smart or to be lucky? In business, it’s better to be smart. You can’t plan for luck and you can’t make your payroll with luck. Don’t play dice with other people’s lives or your own. Think through all the angles, write them down and make a plan. Then stick to it.

9. You’re too clever. You already know how most people go about running their company, but you’re a lone wolf and you’re going to change the world!! Sorry to burst you’re bubble, but don’t try to out think the market. Trying to create a new market with your first business is like saying that you’re retirement plan is to win the lottery. Learn the mechanics of your business and your industry and perfect them.

10. You’re delusional. I’m a big believer in positive thinking (see When Positive Thinking Doesn’t Work), but sometimes the market just doesn’t support your product and you don’t know it (you would if you did #8). Should you give up and focus on something else or are you on the verge of a huge success? I’m not saying that I know the difference. I’m saying that if you’re in that business then you better.

Again, there is absolutely no excuse for ignorance. There is too much information and too many people out there right now dying to help you with your business (feel free to send me an email – consults are 100% free). If you aren’t succeeding then there is something wrong and more importantly there is something that YOU can do about it