101 Lessons Learned for Startups

101Lessons LearnedforStartupsAndy Harjanto

Collected from others’ and myexperience as running startups

More details, please visitShift Happens Bloghttp://www.andyharjanto.com

Why listening to me? I’m just one of youNot a startup celebrity, Nor a superstar genius

Building astartup todayis not the same as building it a decade agoShift Happens

Down Trend Time to MarketDevelopment CostCapital Expenditure Distribution CostFund SizeBetter ToolsCloud ComputingModern ProgrammingSocial Media

Up Trend Market SizeCompetitionNoise LevelImpatienceGlobalizationSocial MediaEasier Barrier to Entry

Lessons Learned Topics we’ll be discussing

Most of topics discussedare also applicable to “startup” teams inside a company

1Do you have what it takes? http://bit.ly/5dGJFbto be a goodEntrepreneurRisk TakerCompetitiveResilience Tenacity

2Prepare to unlearnwhat you’ve learned2010s Startups have to domany things backward andunconventionalmore later…

3Your “killer” idea is just a hypothesis Talk to potential customers, friends,family without writing a single code

4No need to perfect your ideaIt’s almost a guarantee to change

5Careful for creating a new marketLess competition, yes, but…It’s a lot longer to create than you think

6Some games are in town really over. Don’t competeLet the big boys play

7Ride the wave, Be the firstYou have millionsof potential usersfrom day oneFacebook AppsTwitter Based Services/Tools

8At the end of the day, does your product solve problem?Remember, just cool won’t cut it Can you retain users?

9A 5 year business plan? How about 5 day operating plan?Startup is operatingunder extreme uncertainty

10Targeting Consumer Market....seems so binaryMore often than not, you have to be BIG fast (millions of users) in order to succeedOR Go Home

11Targeting Business Market…be prepared for long cyclesWork with channel partners, sales, build relationship.

12Your Plan: Getting revenue from advertising… Think againUnless you’re to top 5 sitesin your market, you’re almost nobody

13Overnight success is a mythBuild a long runwayMedia loves overnight success storiesAll you heard is, 6 month start; 1 million users

14Don’t sweat over your competitorsThey could be even more clueless than you are

15Going against entrenched players? They resist to change Provide a product that solvesproblems in a different, better way.

16Be wary of a small number of competitors in your market It’s either you’re genius OR there is no market

17Sadly, luck plays roles in your startup success tooYour product is ahead of its timeCelebrities love your productIt’s the economy, stupid

18Gauge market interest first via Social MediaDon’t worry about someone stealing your ideas

19Be prepared for extreme rollercoaster emotional rides Low of the lowsHigh of the highs

20Be prepared for rejection after rejectionNo one cares about your startupPersistenceis the key

21Just Do-It, you’re ahead of99% of peopleToo many people just talk with zero action

22If you start a startup to get rich, you’re in the wrong businessOnly few will make it “big”Change The WorldChallengesSolves ProblemsIndependence

23Startup is a very high risk business It does not makesense from financialperspectiveMany ways to minimize the risk

24Be prepared for at least 18 months without pay & benefits Don’t jumpbeforeyou’re sureToo many jump and abandonbefore fully developed

25Always operate under assumption of no investorsGot change formy startup?

26More than anything else, tractions are what investors looking forTrafficNumber of usersNumber of subscriptionsCan business scale?GrowthRetention Rate

27Knowing when to foldMore of art than scienceGut Feeling will tell youMeasuring your tractions is a good indicator

28In many countries, government grants are plenty for startupsGovernments encouragehigh tech companies to have presents locally, createlocal jobs, and nationalpride

29Your passionate user are sometimes your best investors

30Watch your burn rate very carefully. You’re on dietNo Physical OfficeSkype (Free)Free Email, DocsFreeSoftwareOpen SourceRamen profitability

31Less money gives you senseurgency and boosts creativity It’s amazing to see how human survival instinct kicks in

32Charge for the service from day 1 is not a bad strategyYou’ll get very passionate customerswho believe in your product

33Spend generously on tools, books, chance to network. Your ROI is excellence

34Don’t optimize your productFor VCVC: How big is the market size? Superstar developers? At the end of the day, tractionmatters the most

35Get into partner programswith the big guys Many offer free software and services

36Find a great co-founderShare the same valuesCompliment skillsCheck and balances

371st Stage: Hire Designer and Community Manager, insteadThis could also be YouGauge Market InterestIdeas ValidationQuick Prototypes

382nd Stage: Hire Great Developers, TestersThis could also be YouKnows ScalabilitySupportabilityQuality CodeSecurity

39Hire for Culture Fit & PassionateSet min-bar for Intelligent Gauge Market InterestInterview Process: Make the candidate as ifan employee for a dayIdeas Validation

40Hire temp, consultants to keepburn rate lowGauge Market InterestChannel PartnersProduct VideosMarketing materials

41A very short daily meeting is muchbetter than a long weekly meetingHuman needs constant reminderof progress, accomplishmentand togetherness

42Run effective meetingin22 minuteshttp://bit.ly/caXq6h

43Don’t grow fast, until youget to the product-fit phaseGauge Market InterestKeep in in quick tight cycles of build, validate, learn

44666 is the number to avoidIn a given startup project, nomore than 6people6months6day a week

45Everyone should be CEO ofsomethingPromote a culture of Veni, Vidi, ViciI saw the problemI own the problemI solve the problem

46Be decisive; majority of decisions are irreversibleHeard on the street: “An hour meeting with 7 people to decide one API changeWhat a waste!”

47External dependencies are kiss of death for startupsThey’re not moving at the same speedReorg does happenThey can easily out-live you

48Run your team on POT(progress, ownership, transparency)http://bit.ly/6XT3NG

49Why building an awesome product no body wants?“Build it, they may notcome”Talk to customers, before writing a single code

50Fail-Fast; andGet Traction-FastReally means Fail-Fast on bad ideasIt does not mean abandoning project too quickly

51Quick build, validate, measure and learn. It’s in our engineer DNA that welike to build a perfect systemIn an early stage, Resist to be perfect

52Can you tell the difference:Progress vs. Wasted Progress?Run tight, small loops ofIdeas (Hypothesis), Validate/Measure andBuild

53Don’t just accumulate work done without measuringMeasurement will give you feedbackto continue path, or tochange direction Retention RateUser TrafficBounce RateUser HappinessConversion Rate

54It’s OK to write messy codesduring validation process

55Your spec should be UIprototypesWritten spec is easily obsolete The cost of writing,maintainingUI prototype is minimal and fun

56Suppress many of your ideasIt’s not a feature to featurecompetitionIt’s who solves the problems the best

57Just build it now and fast. No need for optimization yet.Your code will likelybe a throw awayas you gather feedback

58Concentrate on core scenariosMake it great!No place for mediocrity People either love it Or hate it!

59Ignore your 10% cases.That will take 90% of your energy

60Eat your own dog food dailyUse your own productregularlyIn the early phase, It’s better than hiring a full-time tester

61Boost virality, make sharing a click a wayPeople love to share

62Boost retention rate.Human is a curios being Add a few analytics, newsabout themselves and friendse.g.“your doc hasbeen viewed 5 times”

63Boost retention rate.Human craves for attentionsRIM (Blackberry), Twitter, Facebook do this perfectlyThey make users addicted to their product, by tellingthem – “You’re important”

64Minimize FrictionsUsers are “very lazy” nowadaysOne clickOne minute setupNo installation

65Don’t give user optionsSet appropriate defaultThey have enoughother things toworry

66Ship your product with a minimum feature setEnough to showcaseYour core scenariosAdd featureslater afterafter undisputablefeedback

67After iterations, often ask what features to drop, instead of add Remember, your ideas are justa hypothesis; willing to let goPivot on your core beliefs, andgo to other directions appropriately

68What Microsoft, Google, Apple can’t afford, but you can? They can’t ship a crappy product,even for their betaThey have reputation to maintain, You don’t!Use it to run a tight feedback loop toimprove your product

69Without instant gratificationUsers drop like a flyFirst 60 second experience is critical I saw dead users leaving

70Create a product that 10xbetterDare to be differentStand up and get noticedThe world is a very noisyplace(and getting worse by day…)

71Collect less, better privacy,security. Many analytics tools are goodenough to measure user behavior

72Don’t put any features, concepts that you can’t explain in 15 secsDoes your product ship with you? Don’t makeuser think

73Reach Product-Market Fit Phase. Celebrate, Work Harder.40%will be upset If your service discontinues

74Watch out for yoursite performanceUsers have no patience for sluggish sites

75Do a side project/experiment.Minimize your riskMany side projects made it big

76Use Cloud ComputingLet’s not be IT guysLet’s focus on buildinggreat productSleep better at night

77Building a new walled garden,community is really, really hardPiggy back existing onesfacebooklinked-intwitter

78Never too early to start your marketing campaignHow about Day 1?Or even 90 days beforevaluable contentsqualitycomments

79Show the world what you’re doing. Stealth Mode is counter intuitive. No need for private betaAre you worried someonestealing your ideas?Really?Are you buildingspace shuttle?

80There is no such thing is product launching for startupsContinuous improvementUnless you’re Apple.

81Approaching Press. Do you have unique, interesting stories?They’re not your writersBuild a human connection first

82Don’t have good retention rate,Don’t go to press yet!NewspublishedTrafficWasted

83Most effective way to acquire customers? Your passionate customersGood news, travel fast and far

84Save your money on press releases. Ineffective.Different countries, however, it could be different stories

85SEO, Social Media takes time to developMillions of others are doing it; how you stand out?

86Viral is not a strategyPeople are immune. Mutate! Unless yourProduct is irresistibly good

87Simple pricing is almost always better than complex oneHave 1-3 pricingoptions as opposed to complex pricingchoices.Customers want predictable costs,not many options

88US is a crowded place. Go play outsideLess competitorsGrowing marketOf course, there is a catch…

89Partner locally. Remote management is an illusionClose, personal relationsoften are prerequisite outside US

90Global team communication is easy. Culture fit is hard

91In many countries, social status is more important…than your product itself. “Your product sucks,But X uses it, so I use it”

92One size does not fit allPackage your product differently in other countriesbased on marketdemand

93Nice guy finishes first… in the long run

94Admit mistakes, start from the top. We’re all learning

95Set expectation to teamChanges are constantWe’re a startupnot a manufacturer

96You’ll be surprised, many peopleare routing for small guysMany offer a helping hand

97Whom Microsoft, Google, Apple should be worried?YouThey may have the muscles, but you can run fasterFew of youwill be the next them

98Startup is not a jobIt’s a life style. It’s drive and passion to change the world with little financial reward.Yes, few made it very bigYes, it has been known that startup entrepreneurs have genetic defects

99It’s a growing pain experience with big personal rewards

100Subscribe to these excellent blogs, vlogs, podcastsPaul Graham http://bit.ly/pgqy8

Steve Blank http://bit.ly/juvQr

Venture Hacks http://bit.ly/1BOE8x

Both Side of Table http://bit.ly/EsjT7

101 Lessons Learned for Startups

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