I began teaching on Skillshare back on November 16th, 2011. First I taught an Introduction to Business Development class. It was quite long, so I made a Part I and a Part II. Then I added a “Practical Business Development” class (less high level and more ready-to-use-today skills). These classes were all given in person and it took a lot out of me to teach them each once a month. I felt it was good to share what I’d learned to help others break into the business side of early-stage tech companies and I actually made a significant amount of money (enough to make me go “oh sh*t” when tax season came along and I hadn’t put away the proper amount owed in taxes).
But that was when it came out in 2013. It did really well then but I never updated the content, it was never really interactive (as other successful ones were), it was just my voice over slides and I think the positive reviews took a hit because of that (only 70%, as opposed to my in-person classes that were 90% or higher and 95% overall). The class gets next to no new sign ups now. So I’m wondering what I should do with the class.
Should I make a new class around the more practical business development skills? (i.e. reaching out, intros, making a pitch deck, etc.) Should I work on making my old class more interesting? Is it not even me, and rather that the virtual Skillshare classes are too complex?
Any ideas? It would be nice for people to learn in the same way I felt people learned when it was an in-person class.
This past week I almost tweet-stormed. I didn’t, but it got me thinking about the places online where you can talk about things. I think there’s still an opportunity to build the go-to platform to tell stories. The closest thing now may be Medium, but it doesn’t completely feel like a platform for “story-telling” exactly. I think pieces of what I envision exist on Reddit. But Reddit is a little bit of something for everyone.
I think a combo of Reddit + Medium would make an interesting site. Organized by short, medium, and long posts, and having the ability to have a subreddit-like experience but with different genres of stories (i.e. happy, funny, scary, sad, uplifting, etc.)
Many people talk about writing, blogging, and contributing content as a way to get their thoughts out there. The thought process is that if you write enough about something, you will be seen as an expert in that. This is great but I think there is another reason to write and that is networking.
I used to go to 3-5 events a week. Some events were good and maybe I would meet 10-20 new people. Other events would be a waste of time and I’d meet no one. As I got more and more involved in the NY tech scene I went to less events. Now I maybe go to one every two weeks. Instead I use writing as networking.
What I mean by “writing as networking” is that if I write four short posts a week and have a few hundred people read each one, my voice and ideas are reaching many more than I could ever reach or connect with by physical networking. I post each article to all my social networks and for every post I write I receive a few emails and comments. This is the perfect way to continue networking without the laborious running around from event to event.
If you aren’t writing right now, maybe start with “writing as networking” in mind.
Initial Step In Building A Roadmap For A Small Team
On the heels of the lasttwo posts, one of the big things we did at the offsite was set ourselves up to build out a roadmap. It is an easy task to build a roadmap when you are a small company; it is not an easy task to stick to it. The reason being that things change so much at early-stage companies that what might have made sense three months ago now has changed.
So what we are doing, instead of building a proper roadmap and sticking to it, is listing out all the things we want to do as a company and perform a Bang/Buck analysis on it. This allows us to figure out the level of impact it will have on our business (Bang) and what it will cost us in time (Buck). We listed out 20+ things we want to do and are now figuring out in what order we will do them.
While we generally know what is next, doing this exercise helps us clarify. I think it might help you too if you are in a similar situation.
Yesterday I wrote about offsites and why they are important for your company. Today I want to write about “The Number” as it directly relates to the first offsite you and your co-founders take.
"The Number" is something a company needs to set up early on as it is connected to what you track and care about. Sometimes there is more than one number that guides whether there is success, underachievement, or failure. The Number is the metric you look at every day and if it is doing well, you are happy. If it isn’t, you are sad (i.e. your ultimate goal is to make The Number go up).
For most startups, “The Number” is usually a numerical goal around a few metrics, the most popular ones being revenue, new users, and activity (i.e. active users).
So how do you figure out what your “Number” is?
It’s actually pretty easy. You look at what you need to do as a business to be successful. At different times in your company’s lifecycle, different things may be more important than others. Your number is the thing that helps you become profitable, build a lasting business, raise more money, get acquired, etc. Whatever your end game is, “The Number” is your guiding light.
This past week Michael and I had our first SocialRank offsite. We did it two nights last week (Wednesday and Thursday from 6pm-9pm) with one of our company advisors acting as the moderator/facilitator.
We discussed everything from what we want to be when we grow up to what roles we need to fill to be successful. It was really necessary and I highly recommend that any company should take 4-6 hours, go out of office, and do some game-planning with your co-founder.
It is hard to take a step back during the busy-ness of work. But, I think, if you don’t do this every 6 months or so your startup will hurt long term.
So, have you taken a company offsite recently? If so, how do you feel about it?
5 Awesome Tech Podcasts for Startup BD People - Guest Post
Listening to podcasts is one of my favorite ways to improve my startup knowledge and understanding of the tech industry. The 25 minutes it takes me to get to work is perfect for listening to a few short podcasts or part of a long one. And when I’m traveling around town between meetings, I often have headphones on, catching up on the latest news and interviews with leaders in the space.
If you’re on iOS, Marco Arment’s recently released Overcast app makes subscribing and listening to podcasts a dream. If you’re a Droid user, some recommendations for the best podcast apps can be found here.
Here’s a list of my five favorite podcasts to learn about startups, business development, and the tech world more broadly.
This Week in Startups: First is Jason Calacanis’s This Week in Startups (TWIST), which comes out every Tuesday and Friday afternoon. The show is fast-paced, really fun, and full of practical business insight and advice from some of the major figures in the industry.
Jason’s one of the most incisive and probing interviewers out there. He doesn’t shy away from asking hard questions, but conveys a lot of admiration and passion for startups and technology. Recent highlights include interviews with Alan Schaaf (Imgur), Hunter Walk and Satya Patel (Homebrew VCs), and Mark Suster (Upfront Ventures), and there are 500 more episodes in the archive. If you’re working on the business side of a startup, this show is a must-listen.
Just like the site, Ryan’s Product Hunt Radio carries an infectious love for new and well-designed products. Each episode is a casual conversation with other startup folks oriented around the latest apps and services. Ryan has a natural talent for analyzing products, and picking up on the things that make them interesting and effective.
From a business standpoint, listening to this podcast has taught me a lot about how “product people” think, and how to drive business growth through the product itself.
APM: Marketplace Tech: Hosted by Ben Johnson, American Public Media’s Marketplace Tech is often the first thing I listen to each morning. It’s both a report on the stories to watch for that day and a recap of key headlines from the day before. There are also short segments and interviews that dive deeper into companies, trends, and business issues.
Ben is a fantastic host and interviewer who makes the show sharp, fun, and fast-paced. It’s a great podcast for anyone in the startup world to quickly get caught up on most of the key news items of the day.
BBC Click: Hosted by the very funny Gareth Mitchell, this weekly podcast is great for a few reasons. First, most growing startups will need to think about international expansion or partnerships eventually, so learning about tech culture and companies abroad is always a smart move.
Second, Click’s longer format allows Gareth to examine different technology-driven businesses and trends in detail, which amounts to more thorough and satisfying analysis.
Lastly, Gareth and his team have a knack for identifying brand new technologies still in their early stages, which helps build my awareness of the recently possible.
a16z Podcast: If there’s a podcast I rush to listen to whenever a new episode is posted, it’s the a16z podcast. A fresh one typically appears every week or two. The discussion is usually a practical assessment of the state-of-play of various new technologies and sub-sectors from some of the leading minds in tech.
Guests include Andreessen Horowitz partners such as Benedict Evans, Chris Dixon, Steve Sinofsky, and others, and entrepreneurs from a16z portfolio companies. Recent episodes have included Orion Hindawi (Tanium), Aaron Levie (Box), and Dan Siroker (Optimizely).
I’m sure there are many other business-oriented startup podcasts missing from this list. Which ones do you like best? Let me know on Twitter: @natemodi.
Nathaniel Emodi heads up business development for Wiser, a New York-based startup focused on delivering personalized business news to teams and companies.
"How can I break into the VC world" is the second most asked question I get after "How can I break into the startup world."
To most, VC is sexy. VC, especially at the seed and A round, is really sexy. But there are very few VC jobs. Like next to zero. The chance of you getting a VC job is not as difficult as winning the lottery but there is very little supply and a huge amount of demand.
So how do you get a VC job? And just to clarify, I’m talking entry-level VC, not becoming a partner or above — that’s a whole other ballgame.
Well the truth is that it is simple to understand but not easy by any means.
The answer is — source as many good deals as possible. If you send high-quality deals to investors that they end up investing in, you will be looked at as a vital source of deal flow. There are only two things that every VC needs and that is a) $$$$$ to invest and b) access to the best deals. If you aren’t going to give $$$, your best bet is to be a point of access to the best deals.
This seems simple, and conceptually it is, but it is definitely not easy. At this point I’ve sourced a handful of deals to a variety of funds and it takes a few tries to get the right company/team to the right investor. I’ve found that the best way to help investors is to get a follow-up email from a company you meet (something like—- Hey Alex, it was great sitting down last week. Here is what we do…….. Let me know if you think anyone would be interested in talking to us….) Then I forward this along to a handful of people I think might be good fits.
There are some hits and some misses but it shows investors that I’m seeing companies before they are. This is key in the seed stage. It’s reached a point where some investors even want to know about high-quality potential founders when they are still at a company or in school so they can meet them BEFORE they even venture out. At a certain point if you are good at sourcing deals the VC firms you send deals to will want exclusive access to your deal-flow. This means they want you to join their team.
So if you are interested in getting into the VC game, what do you do? Well you go find great companies and get them in front of investors before the investors even know they exist. The companies can be childhood friends, some girl that your college friend is dating, some guy that you met on line at Whole Foods, etc. You need to keep your eyes open and ears to the ground. This is one of the only surefire ways to break into VC.
Maybe it is just me but I find video really really difficult to consume on the go (streaming not downloaded). Even the best of them like YouTube and Netflix always have problems.
Just yesterday I was coming back from DC, where I spent the weekend, and was trying to watch The Killing season 4, episode 1 on Netflix. The amount of times it paused and loaded made me just give up watching all together. Maybe it is my phone service (Verizon) or the general fact that I live in NYC (subways) but I still think we have another 2-3 years until video streaming is seamless.
When Michael and I were thinking about company ideas, we were deciding between SocialRank and another company idea. We obviously went with SocialRank but the other idea was in the video space. It was a Saas business offering to sell to content creators. But the big holdup on Michael and my end was the bandwidth issue with video. I think it is a major reason why many video startups fall by the wayside. It just isn’t ready. YouTube, Netflix, and Hulu all have tons of money and they still don’t work 75% of the time for me. Again, I might just have shitty service, but it’s not like I have some third-tier provider. This is Verizon.
So, what do you think? Is video a few years away for mobile? Or am I crazy?
I’ve been thinking about the concept of “tracking growth” recently. In the startup world, there is a difference between gaining traction and growth. Traction can be having interest from the right people (customers, investors, etc.) Growth is a number you track every hour, day, week, month, year. Growth is the lifeblood of startups. If you are growing quickly, you can do anything in startup-land. But when should you begin tracking growth?
The easy answer is “from day one.” But I also strongly believe that the data you get from tracking growth from day one, if not looked at through the right lens, can be detrimental to your company. I think you really start making decisions based on the growth information when you have the right product that is ready to grow. This seems obvious but many companies track growth early and get too crazed about growing month over month before they really should be. The problem with the above is when you don’t have the right product ready to grow, the numbers you will be tracking will (at best) most likely disappoint you, or at worst cause you to do stupid things or gray area stuff to hit the numbers you want to be hitting.
I think a good middle ground is, at the early stage, to track things with the knowledge of bettering decision-making but not for “growth” purposes and then once you have the product ready to grow, then track the hell out of everything related to things you want to grow (usually users, activity, and $$).
What do you think about tracking growth at startups?
Last week a few of us at the office had a debate around proper correspondence between investors and founders. I’d like to share it here to get some outside perspective.
The debate was about investors looping in admins to help schedule, and how it, if done wrong, could turn a founder off. The main argument was that at the seed stage, the #1 thing that a founder wants is an accessible investor and getting punted over to someone else, especially if done in a cold manner, feels as though there is already a buffer between you and the prospective investor.
The argument wasn’t that it would make the founder not want to take the meeting but rather that it would set a founder/investor off on the wrong foot. And how this is a negative for an investor in this day and age where there are many ways for startups to fund their company.
Some argued this stuff matters, others that it doesn’t.
So I turn to you, dear reader, for any opinion or story you could share about how an introduction to an prospective investor started off on the wrong foot because of correspondence or communication issues.
The New York Tech industry is awesome. Mature enough to have some great companies, but still early enough to make a name for yourself in the scene.
Tonight, Michael and I are presenting SocialRank at the NY Tech Meetup. If you aren’t coming, you should. I remember going to my first NY Tech Meetup (I just looked it up and I joined the NY Tech Meetup on August 4th 2009). It was at FIT, and Hunch, Blip.tv, and Comixology presented. It was an eye-opening night and cemented my desire to enter the startup world.
I’ve been on the stage before while at Aviary presenting the Web API, but never to present my own thing. Michael actually presented MVF back in 2012 (as “Hack of the Month”), but I was in SF for work so I couldn’t be there. So I’m really excited about getting on stage tonight.
Another thing I’d like to share here is a new newsletter called NYC Built. It is curated by a small group at RRE Ventures. NYC Built highlights the launches, new products, and funding of startups in NYC and Brooklyn. You should follow them on Twitter and subscribe to the newsletter. I received the first one and it is pretty great.
We launchedSocialRank 2.0 yesterday and a lot of planning went into it. There are obviousoutlets to get the word out about a new product or company, namely press from tech blogs and mainstream press. But there are other product launch strategies worth noting. Here are three:
1) Pre-seeding the product to friends and industry professionals
This is one effective strategy used when pre-releasing before launching a company, product, or new feature. We did it with SocialRank 2.0 earlier this week. On Monday, Tuesday and Wednesday morning before launch, we hit up friends and people with medium and large followings on Twitter and turned on the new features for them before our 11am announcement. This, a) Let them play around with the features before other people, giving them a chance to evaluate it properly and praise the product if warranted, and b) Let them access the tool before the system was clogged up with announcement/press traffic.
2) Product Hunt
I recently wrote about Product Hunt and how it can be massive. Things have only become better for Product Hunt since. Posting your company or product on Product Hunt is a surefire way that players in the tech world will see it. You’ll also get great feedback. At a minimum, you’ll get a bunch of users interested in seeing and playing with new products.
3) Emailing existing user base
Once you’ve put your product out there, you need to let your existing user base know about it. What we’ve done at SocialRank in the past is send out an email to our user base the following morning after any big product launch. This allows us to continue the inbound of usage once the press day is over. I like the format of having three stories in the email newsletter. I like the lead story on top (in our case this month was SocialRank 2.0) and then two other stories below, one on the left and one on the right side. The subject line should be related to the new release (and should be catchy if possible, Quora does a great job around this). Remember this strategy is only for companies that are releasing a new product or feature as you already have a user base.
What other launch strategies do you use at your startup?
A friend of mine recently emailed me three questions she is struggling with about pre-pitching and I thought I should share the answers here as well.
The three questions were:
"1) Finding the right person and right level: I have a general idea of the department of the person I want to speak with, but how do I figure out if it is the right person?
2. Appropriate method of contact: If I do find them, do I send a LinkedIn message? Or use a sales program to obtain an email address?
3. Pricing: Competitors do not publish their pricing online, so it is difficult to know if we are competitive or how others price. Any insights on how to remedy this?”
For the first question I responded:
I usually think about who would need to be involved in the conversation to get the deal done. Sometimes it is the business team but other times it could be the product or engineering team. I would walk through the selling process and see who needs to be sold on the idea to make it happen. That’s usually the right person to begin with.
For the second question I responded:
I would shy away from blind reach outs. I would use your network to get in front of the right people. It will save you time and rejection. I would use LinkedIn to identify the right person or someone connected to the right person. Then I would find the mutual connections, ask them for an intro (while giving them context) OFF of LinkedIn. Then get a warm intro in. If not possible, then short, blind reach out is ideal.
For the final question I responded:
This is tough. Something we are dealing with now at SocialRank for some more premium stuff. For this I would ask the company you closed (note: the friend had stolen a client away from a competitor but more by chance and was trying to replicate it). I wouldn’t put it in an email, rather I’d get on the phone or meet with them in person and ask what the industry pricing is. Let them know that this is so you can offer a more effective and cost-saving pricing and want to know so you don’t over-price. If they have worked with competitors then they should know, right?
I think these types of things should be shared. What would you have answered?
I’ve been thinking a lot about the stress of startups recently. The above tweet from @SeinfieldToday expresses the highs and lows of startups pretty well.
For the most part, SocialRank has been a smooth ride so far (I probably just jinxed us). We left our jobs and took in $150k which was supposed to last us until the end of the year. We put out a product, we got traction with thousands of brands beginning to use us, we went and closed $1M. Sure there was a ton of rejection here and there but for the most part it was smooth sailing.
Actually there is one story that was super stressful. I thought I wrote it somewhere in a previous post but can’t find it. The story is that with 4 minutes to go on the February 25th launch of SocialRank, the website completely crashed and Michael couldn’t figure out what had happened. In 4 minutes articles from TechCrunch, Mashable, The Verge, Business Insider, The Next Web, Forbes, and more were planning to go live with articles about us. And our website was completely down. Michael and I looked at each other with the deepest fear possible. Michael would tell me after that he was more scared in that moment than any moment when fighting in Lebanon for the Israeli Army. With 1 minute to go Michael figured out that he cleared the wrong database, so he cleared the right one and the site went up with 20 seconds to spare. That was quite stressful, but for us so far it has been the outlier.
So back to the question. Is the stress of running a startup worth it?
The answer is: it depends.
It depends on your stress tolerance. It depends on what your life goals are. It just depends. There are ways to mitigate the stress and risk, but it will always be there. Right around the corner. If your goal in starting a company is to make money, then there are many ways to make money with less stress. Sure, a successful startup will net you more than 99% of other jobs. But there are easier ways to make enough money to be financially well-off.
The stress of hiring, firing, managing, building, re-building, pitching, closing, shipping, rejection, fundraising, legal, and a million more things can and most likely will take a toll on you. Starting a company is not for everyone. And that’s not saying that people starting a company are better or worse people than people who don’t. It is just the reality of the level of stress one can deal with.
This post was triggered by my friend, Seth Bannon’s post about the mistakes he made as a founder. His startup Amicus has had a pretty bad month or so. The raw emotion and stress in the post will make any founder shiver. I know when I read it, I checked our bank account to see if we were paying taxes properly (we are).
When we went out and raised our seed round for SocialRank I learned a lot about what investors are looking for and how to play the fundraising game (it most definitely is a game and the people that want to raise funds have to learn how to play it. I’ll write about this topic another time). The biggest thing I learned was about how the positioning of your company, specifically expressing how you are going after a massive industry, is what most excites investors.
One prospective investor put it this way: “The trick of raising money from VC’s is to be able to focus on the tree in front of you (i.e. the product you have that users/clients/customers love) AND see the larger forest, and the skyscraper in the distance, when you lay out the vision and roadmap.” If you can do this and convince them that you are the team to take them to the promise land, you have a good shot at convincing any VC to put money into your company.
This past week when Ron (the Managing Partner at Vaizra- our lead investor for SocialRank) and I were talking and he (half-jokingly) said, “I don’t want SocialRank to return the fund, I want it to return the firm.” For those who don’t know startup inside-baseball terminology, returning the fund is when a company exits for so much money that it covers the entire investment fund (i.e. if you have a VC firm with $40M to invest and one of the companies you invested in (and own 10% of) exits for $400M - you have returned the fund). It is a rare occurrence in the startup world but does happen on occasion (ex. see Uber for most of their early investors). Ron was basically saying that we should return the firm - meaning all of the funds they have raised (usually VC’s have multiple funds if they are successful enough to raise more capital to deploy- for example, First Round Capital is on fund number five which is $175M in size).
The comment made me think back to the conversation with the prospective investor when we were raising and how the mindset of going for a moonshot is an important one if you want to successfully fundraise. I’m not sure first-time founders realize this when they initially set out to fundraise and I think it is important to understand. The go-big-or-go-home mentality can be scary for first-time founders but I think it is important to always strive to think bigger, especially if you want to raise venture capital.
So here is to the moonshot mantra of “Don’t return the fund, return the firm.”
How Much Time Before An Announcement Should You Reach Out To A Reporter When Trying To Get Coverage?
I’ve been around the block with product announcements, fundraising news, and everything in between from my time at Aviary and now at SocialRank (I didn’t do any press stuff at Dwolla; Jordan there was a stud). I’ve always struggled with the time-frame necessary to give a reporter enough time when trying to get coverage. I don’t have all the answers and I think the real answer is that it really depends and is situational. However, I think I’ve nailed down the time-frame for giving a reporter a heads-up about an upcoming product release and would love to share it here.
Let’s take a hypothetical upcoming product announcement that is newsworthy (i.e. you have a cool story that said reporter might be interested). Let’s say you plan to release it on September 24th, 2014. From my experience the best time to make first contact to set up a time to either get on the phone or meet in person is 9/4 or 9/5. Now it may seem like a long time before release but you need to give yourself some breathing room in case a) the reporter doesn’t respond and you need to try someone else b) they don’t have availability the next week but do the week after.
Hitting up the reporter on a Thursday or Friday also allows you to follow up early the next week if you don’t receive a response. The goal in your pitch is to give enough to information to pique their interest but not enough that you have nothing to talk about or show when you end up talking.
If someone doesn’t respond to the initial reach out or the follow up then it is fair game to hit up someone else from that organization in the attempt to get their interest. But never, ever mass email all of the reporters together because this is a) annoying, b) will piss them off, and c) they will either not cover you or cover you in a mean way (it has happened before).
Lastly, whenever you can, try to get a warm introduction to a reporter. They get hit up a lot and if you go in through the route of a friend or business relation you have 100x chance of them being interested in at least reading your email.
How Do You Pre-Sell When You Don't Have a Product?
Pre-selling a product is a risky game to be in and it can blow up in your face if you do it wrong. The truth is, it can even blow up in your face if you do it right!
Before pre-selling anything you need to believe three things:
1) I believe that the prospective customer will not be lost if I don’t have exactly what they want when pitching them.
2) I believe that I can internalize the feedback from prospective customers, use it for more pre-selling, and successfully express to my team what the customer wants/needs.
3) I believe in my team’s ability to build the product that the majority of people want, in a timely fashion.
Don’t sleep on #3 as it is the biggest risk you are taking by pre-selling. It happens all the time. You pre-sell well but can never sell-sell well because the product never comes into fruition.
Okay- so you believe in the three things above. How do you start?
Everyone needs to start somewhere and that place usually is a) with close friends in the industry (maybe not a customer per se) and b) with some idea of what it is you are offering/selling/pitching.
You do this because usually friends will not start ignoring your emails when you pre-sell them on something you are working on/thinking about (to clarify- this is not a hard sell and is more of a “catch up + this is what I’m up to, what do you think?” situation). On top of that, good friends will give you real advice on what works and what doesn’t.
Once you have a few friend pre-sells that have gone well, the next step is to pre-sell some potential clients. Start with people closest to you and go from there.
Pre-selling is really a more intimate way of doing market research. In each of your pre-sells you need to tell the other side what it is you are offering/doing but more importantly you need to LISTEN to what it is they are saying about their wants/needs. If you can open your ears, listen, take the feedback and come back with a product offering that fits what a majority of people have told you (don’t build one-offs) then you will be sitting quite nicely when it comes to closing deals.
I’ve written before about the four reasons why someone would want to partner with your company. They are: you’ll make them money, save them money, you’ll grow their userbase, or improve their product. Then once you determine what bucket you fall into, the question will be what are their priorities, or what is important to the other side. This will depend on where they are in their company cycle. Once that is determined they will want to know who you have done this (i.e. what you say you want to do) with before.
But there is one piece of the deal-closing puzzle that is missing from the above equation and that is “removing the friction.” If you can continually remove friction for the other side, the timetable of closing the deal will speed up by lightyears.
Just recently there was a brand we wanted to work with at SocialRank that seemed all into the product but for some reason was not moving forward with us. One of the people from the brand said something that tipped me and team off to why they were holding back. It was a big thing on their end but a small thing for us to add. They hadn’t expressed this properly to us but once we figured it out we decided to expedite the process of adding that feature. This is removing the friction of ‘yes we like it but can’t use it’ to ‘yes we are in!’
How are you removing the friction to close more deals?
I’ve started a new trend in my work flow that is working out well. Previously, when getting emails I would reply whenever I got around to it. So if I got an email during the day and only got around to responding to emails at night, I would reply then. I noticed that the response rate for emails sent late at night (11pm and on) was pretty low. I decided to change my process.
Now when I am writing emails at night I hold off from sending them until the next business day. I prepare them all at night, save them in a draft and blast them off in the morning. The response rate has jumped dramatically for important emails. I’m pretty sure this is the reason. I think my night emails were getting lost in busy people’s inbox and now that I am sending the emails during the day it is top of mind.
This is a small change but I wanted to share it to see if other people have the same or a similar experience.
Whenever I talk to people who are unhappy at their jobs, whether it be at a bigger co or startup, I try to remind them about the idea of the grass always being greener on the other side.
It can look like things might be better if you leave your job and join a different team, but most times you’ll just encounter different problems at a different place. The better idea is to take the time and try and rectify the problems at hand.
That’s not always the case, sometimes you do need to leave. It’s hard to figure out when you should be on the move and when you should make do. Your best bet is to talk to enough close friends, family, mentors, and close colleagues to figure out what is best.
I’m also here if you ever want to talk about it: Ataub24@gmail.com
I read this great Quora answer by Jim Cantrell, the co-founder of SpaceX, where he talks about how Elon Musk learned enough about rockets to run SpaceX. It is a great read. My favorite part is the quote about him having the inability to consider failure. Cantrell believes this is why he could go up against big banks and credit card companies (PayPal), US motor industry (Tesla) and the entire aerospace industry (SpaceX).
This idea jives well with how I try to live my life. I’ve written about it a bunch of times but the main difference between winners and losers is how you deal with rejection. If you give up and hide away you will fail. If you bounce back and don’t ever consider failure, you will come away victorious.
Sink The Costs: How We Decided To Start Compass - Guest Post By Mike Wilner
Today’s piece is a guest post from an up-and-coming entrepreneur named Mike Wilner. I met Mike during my time at Dwolla. He is launching a company and thought my blog would be a great place to share the concept and his RocketHub campaign. So without further ado: Mike’s post.
One of the most important things for an entrepreneur is the ability to make decisions on the margin. The right decision is the one that leads to a better tomorrow. Therefore, time, energy, and even money sometimes need to be deemed sunk costs. In our case, we made the tough decision to stop something we had put a lot of work into in order to chase something better.
Back in January, my friend Taylor Sundali and I started working on a side project that we called Gather. We became frustrated by how difficult it was to accurately gauge how many people would actually attend a social gathering, as people usually tend to RSVP “yes” only to bail at the last minute. So, we sought to create an app for event organizing that used a crowdsourced method, in which invitees play a larger role in the event’s fruition, resulting in a stronger sense of commitment.
For 5 months we worked nights and weekends repeating the same cycle over and over again: lean experiment, fail, iterate on false assumptions. While frustrating at times, we were learning a lot, and eventually, we did a lean experiment that worked exactly as we intended, and we effortlessly organized a pop-up social gathering with over 40 people.
This was a big win for us, and we now had enough validation of our assumptions that we were prepared to start building a product that people could use. Things were looking good.
Then I went to Atlanta for my sister’s graduation. It was all about my sister, but my family found the time to ask me how Gather was going, and I was excited to share some of the cool new developments with them.
All was going well, and I was excited about the potential for this project to turn into something bigger.
But then something happened. My parents asked if they could have some of my time to discuss a few things regarding their small businesses. This wasn’t unusual—I always talked off the cuff with my parents about their businesses. But this was the first time they formally asked me for some time.
The time we carved out was peppered with questions about social media, web design, suspect advice they’d received from self-proclaimed experts, and more.
In about a half hour, I was able to save my parents hundreds of dollars by explaining that they didn’t need the services that they were considering paying for. I also showed them more efficient ways to spend their time with social media, and provided them with insight into basic web design. After I explained to my father how easy it is to make a mobile website with Squarespace, he asked me to make one for him.
None of this was new to me: for years I’d seen my parents struggle with some of these questions and pay thousands of dollars for websites and other tech services. The only difference was that after a year of working in tech, I had the answers on how to help them as efficiently as possible.
My father raved about how helpful I was, and he said to me, “If you want to make some money, I know a lot of business owners that need help with these things.”
And there it was—for the first time, an entrepreneurial opportunity found me, instead of me needing to go find it.
When I went back to Detroit, I quickly met with Taylor. We had one of our regular work sessions, but I mentioned to him that I was thinking of a something different. I pitched him the idea of connecting small businesses with people like us, who can provide advice and tech services efficiently and honestly. It immediately resonated with him, but we both agreed to keep it on the back burner.
However, the next week, when we were encouraged to submit an idea to the VFA Innovation Fund. We were faced with a tough decision—go forward with the idea we’d been working on for over 5 months, or start over with an idea for which we didn’t even have a name.
We agreed that we needed to deem the previous 5 months sunk costs, and choose the project that we wanted to work on for the next 5 months.
But while the costs were sunk, we carried the lessons we learned from Gather with us. Taylor and I had learned how to efficiently work with each other and how to galvanize people around an idea. Both of these things would remain valuable no matter what we decided.
We chose the new idea, and aside from writing this post, we haven’t looked back. We’re as excited as ever to move forward with what we’re calling…
Compass- a community of tech people providing small businesses with tech advice and services. We hope to empower these small businesses to harness technology to grow their businesses rather than letting technology hinder them.
And boy does it hit home for us—as people with parents that own small businesses, but also as VFA fellows who have worked at tech startups for the past year.
While we in the tech world debate whether parallax scrolling is good or bad, 93% of small business websites—the same small businesses that account for 55% of US jobs—have websites that are not mobile friendly. This is bad news, especially when you consider that by 2015, 50% of internet searches are going to be done on mobile.
And that’s just the tip of the iceberg.
So we want to flow some of that tech knowledge back to the small businesses that need it the most, and that starts with our Rockethub campaign. If you know a small business that could use our help, you can sponsor them by funding our project. They can receive anything from advice over the phone, to their first Google AdWords campaign, to a brand new website, all provided by our community of skilled tech people.
It’s an unfair playing field right now, and we want to help level it.
Since 2012 I’ve taught a Skillshare class about Business Development and Partnerships. I eventually put the class on Udemy (which needs a little updating as it still says I work at Dwolla). This past week the fine folks at Coursmos added my class to their database. You can find it here.
The class is sort of a precursor to my book coming out (sounds surreal saying that). I’m excited. Ellen and I worked really hard on it and the people who have read it so far really like it. The book comes out on the 25th of July. You can pre-order it here.
Reflecting On My Domain Acquisition Post From Last Week
This past Thursday I published a post on Medium about how we acquired the .com for SocialRank. It was pretty widely read (over 15k views on Medium stats). It was a detailed account of how it came to be, the good and the bad. I’m happy we got the domain but definitely not proud of everything we did to get it. No one is perfect. I definitely made a ton of mistakes during the process (the biggest one being threatening legal action with very little to stand on). But I do believe in sharing experiences like this due to the fact that there is no blueprint for some things when building a company and by sharing this type of story it will help educate people to not make the same mistakes I made.
For the most part, the feedback was positive. People commented, emailed, tweeted nice things to me, thanking me for the details of the story. A ton of other people asked to be connected to Eric Friedman for his assistance. But as with every potentially controversial subject, there were negative comments. I saw a few saying we strong-armed the domain owner (even though his LinkedIn says he is a professional domain seller - which I only added later to clarify). I saw others saying we were assholes for launching a business knowing he was working on something with the same name. While I respectfully disagree with both, I think the second one is something interesting to be discussed.
Launching a company with a similar or same name as another company: It seems like common practice that the person with the .com is the sole heir to that company name. But why? In SocialRank’s case, we had the Twitter handle, the .co, the Instagram handle, the Pinterest handle, the Facebook handle, the Vine handle. We even were the first to trademark. Does someone with the .com without any website, with no working product, no prior trademarks have the sole right to call their company this name? I think not. I think if you let other companies dictate what you end up doing, whether it is naming your company, putting out of a product or something else, you will not go very far with your business. Also, you’ll probably have nothing to name your company as most good names are taken on the .com level!
These are just some of my thoughts on this situation. At the end of the day, we took a risk. It paid off. But it almost didn’t. If the owner didn’t come back after two weeks of being MIA, we were probably going to change the name of our company when we release version 2.0. I’m glad it worked out. I’m also glad I wrote the post and shared it.
I’ve been a member of Product Hunt for over six months now. In the past two months it has been taking off in thepress and in the startup world. Where I used to be asked for an upvote on Hacker News, it is all about asking for upvotes on Product Hunt now. I’ve thought a lot about Product Hunt and how it can be massive and I’d love to share my thoughts here.
For those who don’t know, Product Hunt is the place to go and discover new products every day. Users can upvote and comment on products. Right now most submissions are new products. I think Product Hunt has a really high ceiling and can become the go-to place to learn about products, whether they are new or just pushing new features/changes.
To become the place to learn about new products I think they need to evolve the product a bit more. To me, if Product Hunt offered company profiles that allowed for pushing new products, product updates, and everything in between relating to the life-cycle of a product it would play an important part of every company’s game plan when announcing a product or announcing new features.
For example with SocialRank, I learned about Product Hunt when Michael and I announced we were leaving Dwolla to start our company, incorporated under Modern Mast. Someone submitted “Modern Mast” then. There wasn’t much to say or even show. Two months later we put out the product SocialRank, and we posted it. We then announced a new tool in early-access SocialRank Market Intelligence, and we posted it again. I’d love to be able to link all three in one consolidated page.
The way Product Hunt can make the user experience accommodate this type of change would be if the posts would have color coded tags and filtering for Pre-launch, Product Launch, Product Update.
A bunch of people complained when “Modern Mast” was posted, saying there is nothing here (they were right!). Those submissions should still happen but users should have the ability to filter out those options.
I think if done right, there is a chance Product Hunt can be some sort of Github for product stages/revisions.
Earlier this month my buddy Greg McBeth wrote this post about Startup Moneyball. It focused on CEO/founder pay + equity compensation. It’s a good piece. It made me think about how one would go about building a startup team using Billy Beane and the Oakland A’s original strategy.
Now for those who don’t know the moneyball strategy it is one where the management looks to assemble a competitive baseball team by taking an analytical, evidence-based, sabermetric approach. In baseball they look at runs scored as the metric to improve. The more runs you can score the higher chance you have to get wins. Wins get you in the playoffs. Traditionally you would look at RBI’s (runs batted in), steals, or batting average. But Billy Beane and the A’s found that on-base percentage and slugging percentage were just as good, if not better, metrics to look at to determine runs per game. They were also cheaper to get on the market. The 2002 A’s had one of the lowest payrolls ($41M) but were a few outs away from beating the Yankees with an over $125M payroll that season.
So how would one apply Moneyball to startup team building? While I don’t think it is completely clean yet, I think the way startup founders can play team moneyball is by finding talent that is underpriced and undervalued and help them reach their potential. The early PayPal team did this, they would find great misfits (at the time), have them lead teams and promote within instead of hiring outside management.
I see the biggest application of this when someone joining has just come out of school. I see bigger companies look at school pedigree first over potential talent in this early stage and here is where startup team moneyball can really take your company team to the next level if you do it right. I think personality traits, communication skills, and raw talent should be looked at way before you even look at schools. For example, Michael went to California State University-Northridge which is great and all but he isn’t a Stanford, MIT, or Caltech grad (I went to Yeshiva University, so I’m not one to judge). But ask anyone who works with him, he is an unbelievable technical talent. For me, Michael was my first moneyball bet (unconsciously obviously), and it has paid off in spades.
I remember when Michael and I were at Dwolla and he was looking for a developer evangelist intern. Michael found a young talent who was graduating high school (yes, high school). It wasn’t easy and he needed to fight for him, but bringing on Gordon Zheng was a great decision and has paid off in dividends. Gordon is still at Dwolla right now, kicking ass and taking names.
So how do you figure out who has tons of upside and who doesn’t?
I’m not 100% sure yet. We’re trying to figure that out at SocialRank. We have made two hires so far. Zhanna came on in May as our lead designer and front-end engineer. She came from Digital Ocean and Quirky before that. She has been nothing but stellar since day 1. Our second hire was Olivia. She is only in week two right now but has been great working with me on BD/Partnerships. Olivia doesn’t have any deal experience as she worked in finance for two years and then was a teacher for two years. But she is very personable and has strong communication skills which is really what you need to do well in BD/Partnerships.
For us, we plan to find future hires in a similar fashion. People that may get overlooked by bigger tech companies because they don’t necessarily fit the traditional mold, but have tremendous upside. These are just some of my initial thoughts on how to build a startup moneyball team. Leave your thoughts on the concept below.
We’ve been quiet at SocialRank for the past 45 days. We’ll continue to be quiet for the next few weeks or so. The real magic at startup companies is doing the things nobody sees.
On the technical side, the stuff no one sees can be infrastructure architecture, user experience flows (although the end result is experienced) and more. On the business side, the things no one sees can be the work that goes into building out a pipeline of customers/partners/clients, qualifying what and who to spend time on, figuring out the optimal direction of the business/product, and more.
For us, we had to take some time to overhaul the infrastructure and design of our site. This sets us up to do some impressive things you’ll be seeing soon, as well as adding more networks like Instagram, Pinterest, etc.
Doing the things nobody sees is not glorified in the startup world but if you don’t execute well (and try to enjoy it) your startup will have significant problems and will probably not work out.
People always ask me “how can I land this or that job?” Or “how can I land this or that investor?” The key to “landing” that thing you want is usually being able to prove you can do something or that you deserve something before you actually get it.
In the job scenario, if you start thinking about what you would do if you got the job and went ahead on your own and did it, you immediately would have a leg up on every other candidate.
Same in the investor scenario. It is very very difficult to raise money as a first time founder without proof you can accomplish what you say you will. This is why you need to go out and get traction, you need to prove that you have a real shot at building this business before anyone will entrust money into your care.
In every scenario where you want something and someone is deciding whether you are worthy of said thing, if there is an action you can take to prove you deserve it, do everything you can to do so.
We live in a world where almost everyone is digitally connected at all times. Being present is hard. I definitely struggle with it. Every single day. It affects my relationship with my wife, my family, my friends. I don’t think it is going to get better on its own. I need to actively work on it.
I already have a few things (three below) that I’m doing to be more present. I’d love help adding to the list:
1) Never use my phone at meals when I’m eating with others. Breakfast, lunch, and dinner. Nothing worse than someone on the phone at a meal. Be present.
2) I’m Jewish and observe the Sabbath so I don’t touch electronics from Friday sundown to Saturday sunset. This allows me to spend all the time with my wife, family, and friends basically eating, going to the park, and sleeping over 24 hours. You should take off a digital sabbath; it is glorious.
3) Date night once a week. Every Tuesday night my wife and I have date night. We usually go to dinner. No electronics allowed.
The fear of getting fired is something I know happens all the time but is rarely discussed. In the world of BD I think it happens a little more often than elsewhere because of the nature of the role. The whole concept of a BD role is a pre-sales function where you are trying to find great opportunities for your business, do a few similar type deals multiple times, put together a process and then hand it off to a sales team to blow out of the water. But sometimes the deal is hard to replicate. Or you spend time on an industry you think might work and it doesn’t. The fear of getting fired is strong then.
I think I’ve written about it before (this is post #682 for those keeping track so it was hard to find) but I once felt I was very close to getting fired from Aviary early on. It was back in 2010 and I was just learning how to be part of a team (I had previously been a one man show in NY for an Israel-based startup) and was also just learning how to do BD and Partnerships the right way. Aviary was in the midst of pivoting into what it is now a photo editing API for web and mobile and I was working with @Msg on talking to prospective partners. My job was to build out a pipeline of industries and companies that would make sense to pitch and learn everything I could about said industries/companies.
I look back in disbelief but at the time I “wasn’t getting it”. I was having a hard time understanding and learning how to approach the research and how to approach the companies to make the product and offering successful. Looking back it was because I wasn’t putting in the time and effort to truly understand what I wasn’t getting. That was until @Msg said something along the lines of ‘this isn’t working out, I’m off to SF for a week, spend all the time during the week to get this right. When I get back we will have a sit down about it. If things aren’t working by then then I’m not sure this is going to work.’ It was very direct, it was very scary, but it worked. I killed myself that week working on understanding what I was doing wrong (it happened to be I was just trying to memorize companies and spit it back and not holistically learning about what they do and what they care about to understand if they would/could even care about us).
@Msg came back, we had a talk and I “got it.” In retrospect I see this as a big turning point in my career. The day I gotit. The day I understood why one company would want to work with another company. I was 22 at the time and still learning my way but the fear of getting fired really propelled me to where I am now.
I’m not here to say that the fear of getting fired is good for everyone. It worked for me, but I am not you. I will say that fear can push people out of their comfort zone and make people a little desperate. Desperation can lead to doing things you didn’t believe you could accomplish, which is why the fear of getting fired can propel you to the next level.
The last few months have been quite the ride. I really haven’t had time to take care of myself as well as spend time with family. I went from all-in at Dwolla for almost two years to leaving and starting SocialRank with Michael. There was no time off in between. On top of that, as you now know, I have been co-authoring a book over this time. It started in April 2013 and the manuscript was delivered by January 2014. So while I was leaving Dwolla I was finishing up the manuscript with my co-author, Ellen.
The first two months of SocialRank was all about building the initial product. Then the next two months were about fundraising. I’m tired.
We have some big stuff coming out in July and August at SocialRank. Also, Pitching & Closing is coming out on July 25th. But right now I need to recharge my batteries. It also happens that a childhood friend is getting married in Israel. So my wife and I decided to take a few days to unwind and come back stronger than ever. We’ll be in Israel from June 8th to the 18th.
I’m very excited to announce that I’ve co-authored a book called Pitching & Closing with my good friend Ellen DaSilva from Twitter. The book is being published by McGraw Hill, comes out on July 25th, and you can pre-order it now on Amazon.
I’m often asked about what books non-technical people joining startups can read, especially around business development and partnerships. The list is virtually non-existent. It mostly consists of great blog posts patched together. So when McGraw Hill reached out in April 2013 asking if I wanted to turn my blog and acquired knowledge into a book, I said “HELL YES!”
But then I took a step back and realized there was no way I could do this on my own. While I’ve written 600+ posts on my personal blog, they were mostly short three paragraphs or less “thoughts” (hence Alex’s Tech Thoughts). Turning short posts into a full book is not easy. This led me to reach out to Ellen DaSilva. Ellen has been a good friend for the past few years and is very helpful in providing edits and feedback to my Forbes posts that go out twice a month. Ellen quickly came on board and we got to work on the book.
We delivered the manuscript in January and now here we are ready to promote it.
The full book title is Pitching & Closing: Everything You Need to Know About Business Development, Partnerships, and Making Deals That Matter. The book is broken down into 5 sections: Part 1: Business Development, Part 2: Introduction to Partnerships, Part 3: Pitching and Closing, Part 4: Best Practices: Preparation and Execution, and Part 5: War Stories.
Each section has a lot to offer but Part 5 is especially insightful with real-life examples, as we have sub-chapters on individuals in the BD/Partnerships world and tell their stories. People like Tristan Walker (CEO/Founder of Walker and Company), Gary Vaynerchuk (Founder of VaynerMedia), Eric Friedman(Director of Sales and Revenue Operations at Foursquare), Erin Pettigrew (VP of BD at Gawker), and more.
As the book comes closer to its release date I’ll be sharing more about the process of writing a book, some things I’ve learned along the way, and how we plan to promote it.
Two ways you can help to get the word out:
1) Buy the book! As I said, it’s available for pre-order on Amazon right now. Once you buy it, please share this post and/or the Amazon pre-order page. I guarantee the book won’t disappoint. There are tons of immediately useful tips to help grow the business side of your startup. Many people have read it and across-the-board they think it will go down as the go-to book for people looking to break into the non-technical side of early-stage companies. So please share.
2) Colleges. This book is meant for people looking to learn the basics of BD/Partnerships, the difference between being good or bad at your job, and how to break in. A big goal Ellen and I have is to get our book in front of teachers and administrations to have it included on the required reading list for next semester. If you know anyone at any school that would be interested in chatting with us, hit us up at Ataub24@gmail.com and firstname.lastname@example.org.
This is just the beginning and we hope to help people continue their education post-book with pitchingandclosing.com and sharing great stuff at @PandC.
I like helping people. I like when other people succeed. I also like asking people for help. A year ago I had a post called “What I’m Looking For Right Now.” The post was a call for help on an initiative (that became Dwolla Credit) and resulted in a ton of inbound help.
Well the time has come for a new “What I’m Looking For Right Now.” This time, however, I can be a lot more specific.
SocialRank Market Intelligence gives brands the ability to run any handle on Twitter through the SocialRank platform to see that handle’s most engaged, valuable, and best followers. There are many potential applications for the product ranging from keeping tabs (or more) on your competitors to a movie studio running handles’ similar entities to a film they have coming out to build a better advertising/outreach campaign.
We plan to allow one brand per industry into SocialRank Market Intelligence in the early-access period (lasting till end of the year). We are looking to work with best-in-class brands. We already have a few Fortune 500 companies lined up. One per vertical means one airline, one hotel chain, one beverage company, one credit card company, one movie studio, one tv network, or one music label, etc.
So, if you know a social media manager, digital marketer and/or head of digital for a best-in-breed brand that you believe can make use of SocialRank Market Intelligence, please feel free to send them to this early-access request page and/or introduce them to me directly (Alex@socialrank.co).
Don’t be afraid to ask for things you want. Most people can’t read minds. Thank you!
This past week I’ve been interviewing a few potential summer interns for SocialRank. There is high demand for the upcoming SocialRank Market Intelligence and I need some help this summer figuring out who we should be working with while in early-access.
One of the candidates and I were talking about pay and I said that no job is worth starving for, that we plan to pay our summer interns at SocialRank because it is the right thing to do, and that at the end of the day when people get paid for their work they do a better job. It means more.
I’ve been an unpaid intern before. It wasn’t necessarily a bad experience but looking back I see how it can become a bad situation. If you intern for free for too long your work becomes less valued by prospective employers as well as by yourself.
The bottom line for a business and an intern is that if you actually need help, in the form of an intern or part-time worker, then you should pay for said work. If you want to use the argument that the intern’s training is enough compensation then don’t be surprised when the intern “doesn’t work out.” Remember, you usually get what you pay for. If you pay nothing, you probably won’t get an intern who will contribute that much.
I recently sent around an early version of a deck I’m using for an upcoming product to some of my investors, friends, and family for feedback/spelling/grammar corrections. I got amazing feedback and improved the presentation over this past weekend.
One comment (that actually came from my dad) made me take a step back and re-think how I was positioning the product in the deck. He wrote something along the lines of “the presentation is good overall but you aren’t selling the sizzle. Sell the sizzle.”
He was right. The presentation did a good job of giving all the facts and information about what the product does and how a brand can use it. But it didn’t make the other side go “Wow- I need this right now.” To do that we need to sell the vision of what the product was going to be and why, as a brand, you need to say “YES I AM IN. WHERE DO I SEND THE CHECK?”
And that is the difference between a good pitch and a great pitch. A good pitch is something the other side says “Yes, let’s do this. But soon.” Whereas a great pitch is when the other side wants to hash out the details of the deal before they leave the room.
I remember hitting “peak excuse-making” at the age of 13. It was my bar-mitzvah trip and I went to Israel with my father for a few days. We traveled all around Israel doing activities. I think I complained and made excuse after excuse about why I didn’t want to do this and that. I was a whiner. I’m surprised my father didn’t drop me off at the side of some road and leave me there.
Then again in high school when I played basketball during my sophomore year I used to get hacked down low (I was an undersized Center) and would complain to my coach that they were scratching me and making me bleed. I’m surprised I wasn’t benched (actually we were not a deep team, so I’m not that surprised).
Anyways, the reason I shared these two stories is that somewhere along the way, particularly in the past few years, I’ve made a deliberate effort to stop making excuses. When you decide to stop making excuses about your situation, whatever it may be, the world opens up. Life and any idea or dream you may have can become a reality. You need to believe in yourself.
My wife and I have this ongoing thing we tell each other when we begin to doubt ourselves. The doubter says something like:
"I don’t think X is going to work out. I think I’m going to give up."
Then the other says “I believe X will work out, do you believe it will? Because that’s the only way it is going to happen.”
Somehow magically that usually solves the problem, at least for me, and I get back at it. And guess what, it usually does work out.
So stop making excuses. Get back at it and make whatever you want to happen happen, because believing in yourself and working your tail off is the only way to possibly make your dreams come true.
As we announced our first hire at SocialRank today (not BD though), I think it’s a good time to do a post about hiring your first BD employee. In fact this past week I had a conversation with a founder looking to hire their first BD employee and was not sure how to go about it.
When thinking about hiring your first BD employee you need to decide whether you are looking for someone to come in with an existing network or for someone to work with the founder who is currently working on BD/Partnerships. This is probably the first and most important question to answer. The reason being that if you need one but hire the other your expectations will be out of whack. If you need someone with a built-in network in your industry but the person you hire doesn’t have one, well you are not going to get anything done. Now your hire needs to find their way in the industry when you needed them to come in and get things done quickly.
So how do you decide what you need in your first hire?
This is usually answered by what your founder(s) strength(s) are and how much demand there is for your product/offering. If one or two of your founders are working on partnerships or BD, you need to ask yourself if you really need a BD person.
For the most part, other than when fundraising happens, a founder or CEO can spend most of their time on product and developing the business. Usually when that happens you should hire a junior BD person to help support the founder. This is a great time to bet on a fresh-out-of-school, high potential individual to come in and learn the ropes (with the hopes that they can lead BD/Partnerships in a year or so).
If the founders don’t have a strong BD/Partnership background, then they need to bring on someone to run that side of the business. A big mistake people make here is when they hire high potential people with no background in their business. This is a error because they want results quickly but it will take a MINIMUM of six months for even the best people to learn a new business. So if you hire someone who is good, but doesn’t have the network, you need to understand that it will take time for things to get done.
To close out- here are four questions to ask yourself before hiring your first BD employee (they are all different sides of the same dice):
1) Are we looking for someone with experience?
2) Are we looking for someone to support the founders?
3) Does this person need domain expertise?
4) Can this person come in and take time to learn the business under someone more experienced?
If you answer these questions honestly you’ll know the general make of employee you are looking for. Now comes the difficulty of finding that person, but that’s for another post.
If you’ve never worked with reporters or been involved with press announcements you may not know how to deal with timing when going to reporters with news. Over the past few years I’ve generally learned how to deal with it. Knowing this doesn’t mean that everyone that you want will cover your news, but it does make sure you give reporters enough time to get back to you and decide if it is interesting enough for them.
To explain timing I’ll use SocialRank’s recent funding and product announcement. We announced the funding and new product on May 13th at 11am ET. To make sure we received coverage I began reaching out to reporters on May 1st and 2nd (a Thursday and Friday).
The messaging in the reach-out was that we’d have some news coming out on the week of the 11th (not needing to commit to a hard date yet) and that we wanted to give them an early look. I also said that it would be a combination of a fundraise news, a new product, and some numbers sharing. This gave them enough to pique their interest. I also tried to keep it short.
Some got back to me immediately saying they were interested in chatting. Others got back and said it wasn’t a good fit for them or that they’d pass. I scheduled times to sit down with the ones who were interested. Ones that didn’t respond got a follow up email on Tuesday and Wednesday (in this case May 5th or 6th).
At the same time I put together two blog posts about our announcements (not one post on purpose in this case). At the end of speaking on the phone or in person with reporters I told them that I would follow up with a firm date of announcement and the unpublished blog. Within 24 hours of talking I sent them the blog posts and the hard date.
From there you need to make sure that the reporters, who want to cover you, have everything they need to be successful. This is everything from trying the product to giving them an answer to any question they might have.
And this is it. Cross your fingers that it all works out. It is mostly out of your hands. Some people plan on covering and it falls to the wayside because something bigger comes out at the same time, but this post should be a good indicator of the timing around dealing with press.
Coming off our seed round of funding announcement yesterday I have a ton of thoughts about fundraising. Right now I’ll just share three main thoughts, but expect more posts in the future, because this is an important topic in startup-land and I don’t think enough people talk about how to go about it (from the founder side - most are investors or tech bloggers talking to founders or pontificating about how it is done).
Thought #1 - Learn how to play the game
A lot of people said this to me before we went out to fundraise and I didn’t 100% understand it until I was in it. An entirely separate post can address this topic but I think that the companies that fail to raise funding don’t fail because of their company, they fail because they don’t play the game right (regardless of age, gender, ethnicity). I learned the game by talking to a bunch of investors and founders. YC graduates are the best at playing “the game.” While I do want to do a separate post on the game of fundraising, I think the biggest rule is that you shouldn’t start fundraising or asking people for money for a seed round until you have a lead or first big check. A lot of people go fundraising without “raising traction.” This is different than product traction. The basics of “raising traction” is having a term sheet or first check in. This puts you in a more powerful position in your raise (as rejection shouldn’t faze you when you have a lead- the people you are pitching to participate are either in or out, end of story and move on). Going around asking for money without this is a quick and easy way to fail on your raise.
Thought #2 - Same piece of data, two different reactions
If you could see the polar opposite reactions from prospective investors on the same piece of data you would be floored. I think someone needs to make a Tumblr with side by side comparisons of prospective investor reactions to companies. One good example from our raise was the response to the fact that Michael and I left our jobs in the beginning of January and launched the product at the end of February (with two billion-dollar companies as partners - Spotify and GoPro - to boot). I distinctly remember a back-to-back meeting I had when one investor was so impressed with what we accomplished in a month and half while another said the fact that it took us two months to build means we have no defensibility. Whatever the truth may be, just remember investors will usually have strong opinions on your startup and it’s okay for some not to be a good fit and not participate. Just prove them wrong on the field.
Thought #3 - Get the round done as soon as possible
The goal is not to become a professional fundraiser, the goal is to build a business. Money helps you accelerate that but don’t continue to take investor meetings once you’ve got the round committed. Get the money in the bank and get back to the company, product, future.
These are three quick thoughts on fundraising and I’m sure I’ll have more to share in the near future.