Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about their favorite table top games. Deviating from the typical topics, they change things up and reveal some games they enjoy as a personal hobby. They put the games into 3 different categories by age range and difficulty and share some stories on how their families and kids enjoy them.
Items mentioned in this episode:
Transcript
Mike [00:00:00]: In this episode of “Startups for the Rest of Us,” Rob and I are going to be talking about our favorite tabletop games. This is “Startups for the Rest of Us,” episode 303.
[Theme music]
Mike [00:00:15]: Welcome to “Startups for the Rest of Us,” the podcast that helps developers, designers and entrepreneurs be awesome at building, launching and growing software products. Whether you’ve built your first product, or you’re just thinking about it. I’m Mike –
Rob [00:00:24]: And I’m Rob.
Mike [00:00:25]: – and we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s going on this week, Rob?
Rob [00:00:29]: Well, we are mostly unpacked now in Minneapolis. There’s only just a few boxes left, and now we’ve gotten to the point where we’re hanging curtains, hanging photographs, really putting finishing touches on things. It’s amazing the amount of stuff that, even once we got here, we’re just like, “Oh, yeah. We didn’t really need that,” so we we’re giving stuff away to Goodwill, and then the amount of stuff that we actually need, right? We’re buying all thee curtains and all these paintings and art and stuff for this wall and that. Our living room stuff didn’t quite fit perfectly in the space, so we had to get another chair and stuff. It’s very time-consuming. At this point, I’m not super concerned about the money, like I used to be in our very first apartment, where everything had to be used and everything was Ikea and Craig’s List, but it’s just the time to do that and to find stuff that you like.
Mike [00:01:15]: You know, there’s a time shortcut you could take here. Just go to Target and buy a bunch of picture frames and just unpackage them and hang them on the wall. Just leave the stock photos in there. You’d be good.
Rob [00:01:23]: Boom! That’d be a great idea.
Mike [00:01:25]: [Laughs].
Rob [00:01:25]: Be like, “These are all our children that are away at college.”
Mike [00:01:28]: When you rent it out as an Airbnb, it won’t matter.
Rob [00:01:29]: Yeah, exactly, because everyone will feel like it’s theirs. The other thing I’ve been up to is a lot of hiring, like at work. I always forget how time-consuming it is to find really good people, and to find people that are the right fit for what you need, and we’ve tended to be extremely picky, in general. We’ve hired pretty slow, and we basically have four open positions right now. It’s almost my entire job right now. It’s like 30-plus hours a week of reviewing resumes and meeting with people and talking and then getting that going. That’s with – Lead Pages has a full-time recruiter, and several full-time HR people, so I’m not even negotiating anything in terms of actual salary, or researching salaries, or doing any of that. It’s purely just finding the right people. I’m hoping that we get over a hump here pretty soon and I can back off of that and get back to some more product-focused stuff.
Mike [00:02:1]: Cool.
Rob [00:02:17]: How about you? What’s going on?
Mike [00:02:18]: I think last week, I was – I don’t want to say “down in the dumps,” but I was just a little disappointed about the apparent lack of progress on the technical front and all the different challenges we’ve been running into. I feel like we’re starting to turn a corner. I just onboarded a more advanced senior developer onto the team, and basically replaced the rest of the team with him. So that is going pretty well so far. He did a full review of the API, and started overhauling a bunch of things, and I’m still working on other things in the meantime; but I think things are going in the right direction now. It’s been a slow process, but I think things are starting to turn a corner.
I’ve had a couple of conversations with some customers about some things that are in our feature pipeline that they’ve been looking for, that are, I’ll say, preventing them from fully transitioning over and using the product, because they want to use it to replaces some other things that they’re using. Until those things are in place, they really can’t make that transition, and it looks so far like – I’m mitigating as much of the risk as I can by having those conversations, but so far it seems like we’re really on the right track in terms of what it is that we want to deliver. So, I’ll have the conversation with them and say, “Here’s the broad-strokes idea of the feature. What is it that you’re looking for?” then let them talk, and see if it mentally maps back to what it is that we were planning on building, or we’re in the middle building. It’s nice that there’s 90, 95 percent overlap in what they envision versus what we’ve road-mapped out and are building.
Rob [00:03:40]: That’s really cool. It always is painful to run into roadblocks like this, and it’s nice to feel like you’re back on track. Do you feel like you’re just turning the corner now – like you’re just coming out of it and that’s going to be sustained – or do you still have in the back of your mind, “Are we still stuck in this?” and, “Are we really actually making progress?”
Mike [00:03:56]: No, I feel like we’re starting to come out of it, because a lot of the testing, I’ll say historically for certain things, has taken much longer. The reason it has taken longer is because we have to run a bunch of data through a process that will take hours or days to run, and as part of going through that process, it’ll run into a problem that we didn’t anticipate. Then we have to rewrite a bunch of stuff and then run the entire thing again to see if that worked instead. It’s almost like we’re translating data from one place to another. If fails along the way, we’ve got to redo a bunch of stuff. But in reworking it, we also are able to find places where we can cut down on the amount of time that it takes to process and do all of the work. I’ll give you an example. One thing took four days the first time – or it was on track to take four days. Then after it ran into a problem, I reworked a bunch of the code, got it down to take, I think, ten hours or something like that. Then it ran into a different problem, and then I reworked that and was able to get it down to about three hours. So, the initial iteration times to just see if a particular prototype of how to do something is extraordinarily painful, but over time as you go through some of the different challenges, it gets to be less painful because the iteration time is quicker. It still takes time to build all that stuff.
Rob [00:05:10]: Oh, for sure.
Mike [00:05:11]: I feel like we’re starting to turn that corner, and it’s getting easier and progressively faster to go through each of those iterations. That’s good to see.
Rob [00:05:18]: So, what are we talking about today?
Mike [00:05:20]: Well, today we’re going to be talking about some of our favorite tabletop games. This is a bit of a deviation from the shows that we typically do, where we focus in on a particular aspect of how to do something, or certain things that you might need to be careful of when approaching a particular problem. Every once in a while, we like to do, I’ll say, an “off-the-beaten-path” episode, where we talk about something different, whether it’s something that we specifically do either in our personal lives or just something that interests us. Today, I wanted to talk about one of the things that – in my house, we have a family game night. Once a month, roughly, we get together with other families, and we’ll bring all of our kids together. There’s – I don’t know – like ten, 12 kids or something like that, and we’ll be playing different games with them. Sometimes it’s just smaller groups. Sometimes it’s just the kids. Sometimes the kids will be playing one game, and sometimes the adults will be playing different games.
[00:06:07] I wanted to talk about some of the different games that we’ve played, and some of the different things we’ve tried, because some things we’ve tried introducing our kids to, and the kids are interested, but it’s just way too advanced for them, or it’s just not a good fit. Then there’s other ones where we don’t think it’s going to be – we’re really not sure, and it turns out that it’s a great game and everybody has a fantastic time.
Rob [00:06:26]: Super cool. Yeah, I’m such a board game fanatic. I should say “tabletop games” right, because I like RPGs, and I like more – I think “board game” connotes – to me, it’s like Monopoly and Chutes and Ladders and stuff, but “tabletop” is just more sophisticated, more strategic, something that just gets your brain firing. Just learning the rules is always such a task, and then learning the strategy of those rules and how to beat others at it is – I think it brings out – I think a lot of founders, this should ignite something, because it’s about complex systems and competition, and it’s really similar to launching a startup, so I think we could do almost an entire episode on Rob’s favorite tabletop games that he’s gotten on Kickstarter, because I have dozens and dozens of them. I’m that into this stuff.
Go ahead. Say it. “Ne-e-erd!”
Mike [00:07:11]: Nerd! [Laughs] Of course, on that note, I’ll mention that we’ll link up a website called boardgamegeek.com in the show notes that you can go take a look. You can probably find every single one of these games on that website, and there’s usually an in-depth review, and there’s reviews of each of the different games and the age-appropriateness and the number of recommended players and things like that.
Rob [00:07:33]: I want to throw one other – oh, you’re going to just hate me if you like tabletop games and you like Kickstarter. There’s a podcast called “Game Punting.” It comes out once a week, maybe once every other week. All they do is review their favorite six or seven crowd-funded tabletop games. It’ll be Indiegogo and Kickstarter, and it is just – it’s terrible for me, because I listen to that, and I’m just clicking through. I’m backing games, all crazy stuff. Sorry if you like tabletop games and crowdfunding, because you’re going to spend a lot of money.
Mike [00:08:02]: I guess we’ll break this down into four, broad categories. The first one is games that I will say are aimed at younger kids, and by “younger kids” I mean seven and up. These are the types of games that you can get a kid into and they will understand it, and it will actually be fun to play the game with them versus those things where you try to introduce them to it, and it’s just way too advanced for them.
Rob [00:08:23]: And these are not just games for kids. It’s just games that kids can start playing, because on this list we’re going to talk about Dungeons and Dragons, Magic: The Gathering. You can play that up until you’re our age, and it’s still super interesting. So we’re not going to be talking about necessarily kid games, but things that they can start playing at seven or eight years old.
Mike [00:08:40]: Yeah, that’s a really good distinction, because a lot of these games, I still find them highly entertaining, and it’s a lot of fun to play them, whether you’re playing with the kids or without them. These are just the types of games that you can introduce smaller kids to that you’re still going to enjoy playing regardless of whether it is aimed at that younger crowd or not. It doesn’t necessarily matter.
The first one is called “Sushi Go!”, and it’s a card game where you deal the cards out to everybody, and you are trying to score points from one round to the next. It’s very easy for kids to get into it. The idea is that you’re trying to collect and match up these different types of sushi, and for each match that you get, or each set that you get, you will score a certain number of points. The points are anywhere up to, I think, three points for each set that you get, so it’s either one, two or three points. You go through several rounds. Then at the end of the rounds, you add up the number of points that you get. Usually, the games in this are pretty close in terms of points. It’s really hard to get so far ahead of somebody else that you have no chance of winning, so that’s one of the benefits of Sushi Go!, especially when you’re trying to play with kids. The other thing is that there a lot of complexities to it. There are certain things that are worth a lot more points than others, and it can be difficult to get those matches, so if you’re trying to get something that’s worth four points, it can be very difficult to get that, but if you do get it, it can be very helpful if you are able to put those things together. You are trying to match what you get versus what other people may have in their hands, so you’re essentially playing head-to-head by taking things away from them when you play down sets.
Rob [00:10:11]: Oh, man. That would be so brutal. My six-year-old would scream bloody murder if someone took something from him.
Mike [00:10:17]: The thing is you don’t know. You just know that there is a card in there, and it may be face down, it may be in the deck, or it may be in somebody else’s hand. But let’s say that I’m trying to get a California roll, or something like that, and you’ve got one in your hand. I’ve got three in my hand, but I want a fourth one. Well, I don’t know where that fourth one is, but if you’re hanging on to it, I won’t get it, but I won’t necessarily know until the end.
Rob [00:10:39]: It looks like Sushi Go! Is right around $9 on Amazon.com here in the States.
The Second game we want to talk about is “Magic: The Gathering”, and this is a card game that’s been out since the early ‘90s. I actually played it in college. I don’t think it was out when I was in high school. Super fun game, and you can get starter decks for – I don’t know – 10 or 15 bucks, and each player needs a deck. So, my ten-year-old and I play – and, to be honest, we didn’t actually by starter decks. We went on eBay. For, like, 20 bucks – I think on Amazon as well – you can get a big, old box of hundreds and hundreds of “commons,” they’re called – commons and some uncommons and two rares or something. They’re not actually worth that much, but you can totally play the game if you don’t want to get into the collecting of it, because Magic is both a collectors’ game – where the cards go up in value and stuff – but if you really just want to play it as a game, which is probably would I’d recommend if you’re going to be playing it with younger kids, you can, again, spend 20 bucks and get plenty for tons of different decks. The concept is almost like a simplified version of Dungeons and Dragons, in a way. It’s just two wizards battling. It’s pretty sophisticated now. It’s actually gotten more complicated with more game mechanics over the years; but, in essence, you have some cards you play that are like your resources. Then you can tap those resources to summon creatures, and then you attack each other. You, as the spell caster, have 20 points when you start, and you’re just trying to get the other guy below 20. You can attack each other as creatures or each other. Yeah, it’s a pretty fun game, and we’ve played it a lot. We’ve gone to camps my ten-year-old went to where there were Magic tournaments, and it was so cool. He had brought his deck. What is it? A 20-year-old thing now, so a lot of folks play it, and it’s really age-appropriate from probably age seven or eight and up. Even when my oldest was seven, he picked it up pretty quickly.
Mike [00:12:17]: Yeah, I think the game came out in ’94 or ’93, maybe even ’92, something along those lines. So, it’s a pretty old game at this point, but every year they come out with new expansion packs, and they come up with new stuff. But I think you’re right. If you’re just trying to get into it, or you are trying to bring kids into it, it’s very well worth it to go on eBay and just buy, like, thousands of cards because they’re very, very cheap there. You won’t get the greatest cards in the world, but you can get a lot of them, and it’s significantly cheaper to do that than it is to buy all your cards new. There’s really no additional value to buying a new card these days. I think that the company behind it, Wizards of the Coast, realized very early on, or at least maybe five or ten years into it, that some of the previous cards that they came out with, they just weren’t going to make anymore; and some of them are worth thousands of dollars at this point. They’re not going to make them anymore, but nobody plays with those either, and they’ve banned certain cards from tournaments and things like that. I actually have a deck that was built ten, 15 years ago. It is completely not tournament-legal. There’s no way that it’s tournament-legal at this point.
Rob [00:13:15]: One, last thing about Magic: The Gathering, and we’ll move on. This is one of those games, one of the few games on this list, that you can play over and over for years. Since every time you choose what your deck is, you can just play with new cards. You can play different – there’s five, different colors you can be. Depending on which color you are, it’s just a totally different game, so much like Dungeons and Dragons or something with infinite possibilities – there’s no board. Certain games have boards. I find that you play them five, ten times, and then you’re kind of done with them. You’ve played it out, and it’s not fun anymore. Magic is one of those that you can play for a really long time.
Mike [00:13:46]: The next one on this list is called “Storming the Castle.” I got my kids into this when they were about seven years old, and they love it. It’s based on the movie “The Princess Bride.” So the idea is that you pick one of the characters from “The Princess Bride,” and you send them on a mission to try and storm the castle. Whoever gets there first is the person who wins, and there’s all the different places from the movie inside the game on these different cards, and you can put them in front of other players. You can overcome different challenges on your own path, but the idea is you’re just trying to storm the castle as fast as you can and get there before anyone else is able to get through all of their challenges.
Rob [00:14:22]: It looks like it’s available for about 17 bucks on Amazon. There’s a whole series of “Princess Bride” games. That’s hilarious. I’ve never even heard of these. I like that movie, but I’ve never heard of any of these games.
The next game is called “Boss Monster,” and this is also for about ages 7 and up. What I like about this game – I’ve only played it a few times, but the art is super cool. It’s eight-bit. It almost looks like Super Mario Brothers graphics on these cards. It’s just a card game, and it’s like a dungeon-building game. Not a dungeon-building, but – what do you call it? You put the dungeons down, and then you fight through them in rounds.
Mike [00:14:53]: I forget what the specific name is for it, but it’s kind of a resource-building game where you put the different cards down, and those are your resources, and you’re trying to attract or, in some cases, repel certain types of heroes from your dungeon; because there’re certain ones where you’re just not going to be able to compete to get them to your dungeon, so you just say, “I’m going to give up on that type of hero,” whether it’s a fighter or a wizard. There’s other ones you’re trying to attract based on what it is that you have in your dungeon. The goal is to get enough of the heroes to come into your dungeon that you can kill and get the points for them, before enough of the heroes come in and get through your dungeon and kill you. So, you can either get hurt, or you can kill the hero and get the points for it. You can either win the game or lose the game, or you can cause somebody else to win or lose the game based on whether or not you push a hero to their dungeon or you take the hero away from their dungeon.
Rob [00:15:41]: Yeah, it’s “Boss Monster: The Dungeon Building Card Game.” I think that about wraps it up. It was $20 on Amazon.
Mike [00:15:50]: The next one is a fun one. It’s called “Car Wars: The Card Game.” There is a Car Wars pen-and-paper game. It’s not really a role-playing game, but the idea in that game is that you build your vehicle of some kind, and then you can get put into an arena, and you can shoot other cars until one of you blows up, or one of you tries to get away. In the card game, Car Wars: The Card Game, you have a card that represents your car, and then you draw a bunch of cards, so does everybody else, and then you play one card per turn against the other players. You are essentially trying to be the last person in the arena with a functional vehicle, and there’s lots of different things that you can play. You can either play armor. There’s weapons that you can play. There’re special abilities that you can get and certain types of defensive measures, stuff like that.
I find that this is a lot of fun with my kids, and my wife plays with us as well. It’s interesting to see that, because you can attack anyone, it’s very easy to either be ganged up on or to have somebody else gang up on you. The kid will occasionally gang up on somebody, and there’s really not much you can do if that happens, but it’s not to say that you can’t get certain types of cars that will help you overcome two people coming against you.
Rob [00:16:55]: It looks like Car Wars: The Card Game is about 14 bucks on Amazon, and there’s also Card Wars: The Board Game. I haven’t played either of those, but I have heard about them. Car Wars: The Board Game is actually – what – 20, 30 years old. It’s kind of a classic.
Mike [00:17:07]: Car Wars was made by Steve Jackson Games, and it has been around for a very long time. Steve Jackson Games is also behind Gurps, which is the generic, universal roleplaying system, I believe.
Rob [00:17:17]: Our next game is called Dungeon. I actually recommend this. If you’re thinking about getting your child into Dungeons and Dragons, or you’ve never played Dungeons and Dragons and you want to get a more entry-level version of that, Dungeon is – when I bought it on Amazon brand new, it was $15, super cheap. Comes with a board, so it’s like D&D lite. Comes with a board, and it comes with some generic character classes, and then you just wander around the board. When you go into a room, you flip a monster, and then you try to fight it. It’s very simplified rules, but it just gets you some of the combat mechanics so that you understand the movement in combat stuff. This is one of those you play five or ten times, and then, yeah, you’ve kind of played it out. There’s just only so many things you can do, but it’s super cool, especially for younger kids because they just get it. It’s in the paradigm of the little pog moving around with the roll of the dice and being able to fight things, but you don’t need all the heavy weight of six, polyhedral dice like in D&D and all the heavy rules set.
Mike [00:18:14]: That’s a really good way to describe it. It’s “Dungeons and Dragons lite,” because there is that board game, and it’s very self-contained. But the downside, I think, of it is, as you said, you play it five or ten times, and then it gets boring. You start to realize there’s one character class in the entire game that has an advantage over all of the others, and there’s no point in choosing any other one. Since there’s only four character classes and only two people can chose any one, if you have more than three players, two of them are going to get that one character class, and the third player has to choose something else, and it can be really challenging to win, or even come close, if you have to use anything other than that one class. I think it’s the cleric, but I’m not sure of that.
The next one on this list is called “Small World,” and this one’s got great graphics. It’s a very colorful game. It’s a little bit like Risk, but without all of the annoyances of Risk, and I think they put that in some of their marketing materials as well. The idea is that you have a race that you choose, and then that race will get some special abilities that go with it. This has a lot of replay value, because those things get mixed up every time, so there’s 15 different races, I think and 12 or 15 different types of abilities, and depending on how those get mashed up in the game, you can have, for example, flying giants. Or, you can have underworld elves, or something along those lines. The idea is that you get a handful of these tokens, and you put them on the board, and it costs you a certain number of tokens to take over a space. That number is modified by the abilities and the race, so you might be able to take over seven or eight different spaces, or you might only be able to take over two or three. It depends on what other people have played on the board. The goal of the game is to try and score as many points as you can at the end of the turn that you take. What I like about it: 1) is the infinite replay value of it, and 2) that it’s so simplistic that it’s easy to understand and get the appeal of it without having to go through all of the intricacies of Risk and all the advanced strategy of Risk. In general, Risk is a very simplified game, but it makes it a challenge to play just because it takes so long to play Risk. With Small World, you just don’t have that option. You have very limited opportunities to do things during your turn.
Rob [00:20:20]: That’s the cool way to explain it. I’ve never played this game, and for as much as we are into tabletop games, it’s really surprising because there are, like, 20 different versions of it, and there’s all these expansions, so I knew it was a popular franchise. I’ve just never bought it, and that description actually makes me much more interested it.
Mike [00:20:37]: I would highly recommend this game. My kids love it. My wife will play with us as well, and it’s a lot of fun.
It kind of leads us into our next one, which the kids also really like. It’s called “Settlers of Catan.” It’s a very similar game in terms of the complexity, but obviously Settlers of Catan is much different in that you are trying to get your team or – you’re trying to get to ten points, and so you have to build cities. You can build roads. You can’t directly affect or attack somebody else, but you can indirectly block them or, prevent them from doing things. In Small World, you can directly attack somebody and completely take over a particular spot, but if you do that – you might only get eight tokens on a given turn, and it might take five or six to take over one spot. With Settlers of Catan, it’s very much a resource-driven game where you’re trying to gain resources and deploy them in a way that allows you to build things down the road. It’s a little bit more strategic in that sense. I like the replay value of Small World over Settlers of Catan. Settlers of Catan is the same from one game to the next, but I also think that that’s partially because we don’t move the board around in Settlers of Catan. I think with Settlers of Catan, the board will change, and where the resources are and the point values and stuff. With Small World, the board is different, depending on how many players you have, but the board is always the same. The two-player board is always the same. The three-player board is always the same. With Settlers of Catan, everything could be different. We don’t play it that way just because it could result in a four-hour game, but those are the main differences between them.
Rob [00:22:04]: Our next game is the classic, the originator, Dungeons and Dragons. I played in grade school and then a tiny, tiny bit in high school. Then I just didn’t play again for decades. When my son got to be about eight or nine and we were playing some Magic: The Gathering and I knew he was ready for it – I did research, and I was figuring I played first edition. I played basic D&D first –
Mike [00:22:27]: Oh, you’re old. You’re old. [Laughs].
Rob [00:22:28]: Yeah, no. I am that old. I was young. I was seven or eight when my brother got it. Anyways, there’s been five editions, and there’s all this religiosity around which edition you want to play and stuff, but I’ve researched, researched, and I finally figured out that if you’re going to start today, I would just highly you start with fifth edition. It’s got a streamlined rules set. Again, there’s a beginning D&D thing for 13 bucks on Amazon, and it comes with the dice, and it comes with one module, and it comes with a guide, the rules to it. D&D, if you’ve never played, it will blow your mind. It is a free-form game where you need a dungeon master, so it’s someone who’s running the game. They’re not playing against the players, but they’re basically crafting the story. It’s really nice to have multiple kids or multiple players playing their characters. You can really get into it and have people roll their own characters and create their own. We just use the ones out of the box at this point just purely due to time, because you can sink hours and hours into this. We got some miniatures, and we printed out some layouts. Man, we used to play without miniatures, where it was purely just describing what was around you, and that was fun, but combat’s a lot more fun if you have miniatures to figure stuff out.
There’s too much to be said about this game, to be honest. But if you’ve never played it and you’re into tabletop games, it is a classic. Fifth edition is a very solid game. I recommend that you check it out.
Mike [00:23:45]: Yeah, I would definitely recommend the fifth edition as well. I, like you, started back when it was still – it wasn’t even advanced Dungeons and Dragons. It was just the basic rules set back then. They had all the different boxes for it. I like the fifth edition rules much better than a lot of the advanced Dungeons and Dragons rules. I stopped around the second edition or so. There was 3, 3½ and then 4; and I didn’t really pay too much attention to those. Then as my kids got older, I got back into it. I really like that they’ve clarified a lot of things, and they allow you to create a character in such a way that it really builds a story around the character, and it’s character-focused, as opposed to previous editions, where it seemed more about the abilities that you got and the treasure and stuff like that. It was much more geared towards hack and slash, which I think younger kids are much more attracted to that side of the game, and that’s one of the downsides of this game as well, especially if they’re six or seven, or maybe even eight years old. They’re not so good at the roleplay, and they’re much more hands-on when it comes to the action sequences or there’s combat going on. They really like that aspect of it. The roleplaying, they’re just not as in tune with how to do that. So there are some challenges that you have to overcome; but, again, depending on the group that you’re in, you can still definitely make that happen and make it work.
[00:24:56] The next game is called “Code Master.” Code Master is a game that is aimed directly at smaller kids. If you’re a software developer of any kind, you’re probably not going to be interested in this one, but it is a nice intro to how computers work for kids. It’s very logic-driven. You get a series of commands on each of the boards, and there’s 40 or 50 different boards. Let’s say that one of them gives you three commands, and you can go from a red space to a green space, and then you can go down a slide, and then you can move from a purple space to a red one, and you have to move this little pog from one side of the board to the other using just those instructions. You can’t duplicate things. There’s usually almost only one way to make that happen given the board that you’re on and the instructions that they give you, so it’s very self-contained and very constrained; but it also teaches kids how to work out a problem that has a single solution. Some of them, as you go through further and further into the game, some things can be reused. You can enter a space more than once, and it can get more complicated, but it starts out, and it’s very, very easy. It’s a nice intro into teaching kids how to mentally map out what the path is to get to a given destination.
Rob [00:26:06]: Yeah, and if you’re looking for games along these lines, Robot Turtles is another one I’d recommend. It’s some very basic programming skills.
Our next category is collaborative games. Again, these are all ages. You can start probably around seven or eight years old. These games are so fun, because you’re all working together against an AI. It’s like an AI mechanism that sometime is flipping cards. Sometimes it’s rolling dice. It sometimes is picking randomly out of a pile. So, Castle Panic is one that’s really cool. It’s aimed at a little bit younger kids, but you’re basically just defending a castle, and all these monsters are running at it. Forbidden Island, as well as Forbidden Desert, are neat games. They’re a little more complicated. I’d say it’s – probably want to be a little older to play that, but they have neat, little – what are they? Little, plastic game pieces that make this field, and the are in metal boxes, so it makes it feel like a real premium game. These ones are a little more expensive.
Then I really like both Pandemic and Flashpoint. I think they were designed by the same guy, and they have similar game mechanics, but in Pandemic this virus, or multiple viruses, are taking over the world. The viruses are the AI, and you just have to – you’re trying to knock them off. Then in Flashpoint, it’s actually a home that’s on fire. The fire spreads with each round, and you’re a fireman going in and trying to take it out. Cool part about these, again, is you’re all working together. It works well with younger kids, because you can help them, and you’re not helping them play against you. Also, you either all win together or all lose together. These are probably – aside from maybe D&D and Magic: The Gathering, these are probably my favorite games.
Mike [00:27:33]: Yeah, we play Castle Panic, and Forbidden Island. That is the nice piece of those games, is that it is collaborative, and you win or lose as a team. If you don’t help each other out, then you’re all going to collectively lose. It’s nice to see the collaboration and the strategy behind helping each other out: “Well, if I do this, or I give you that, then you’ll be able to do this and that,” and being able to work through the problems in advance. Again, a lot of them are just driven by the cards, or the AI, as you put it; and sometimes there’s nothing you can do. You can play the best game in the world, especially with something like Pandemic, and you can still just lose, and there’s nothing that you did wrong.
[00:28:09] The next category of games – I will say that these are probably more for mid- to late teenaged kids, so if you have kids that are 12 or up, or 15 or up, then these two games are probably more appropriate for them. The first one is called “X-Wing Miniatures,” and the next one is called “Wrath of Ashardalon.” The X-Wing Miniatures game – my kids looked at that and said, “Hey, I really want that, and I want to play it.” We got it. In less than 24 hours, they broke one of the pieces; and within three or four days, half of them were broken. The reason I would say that this is aimed more at older kids 12 and up is because they’re just not careful enough to not break those things, and they are very, very brittle. It’s not just kids, to be perfectly honest. There’s plenty of adults complaining online, “Hey, these are easily broken. How do I get replacements?” and they didn’t really sell replacements for those pieces.
Rob [00:28:57]: Yeah, we had the same experience. It’s a fun game, but I think almost all of our pieces have been broken and glued back together at this point.
Mike [00:29:04]: Wrath of Ashardalon is almost like a Dungeons and Dragons lite game, similar to Dungeon in some respects, but it has a lot more replay value than Dungeon, but it’s also a lot more complicated. There’s a lot of nice figurines that comes with it, and it’s kind of expensive. There’s probably four or five different variations of the same type of game. There’s one that’s set in the Ravenloft realm, and there’s probably two or three others that I can think of; but they’re all, I would say, probably 14 to 16+ games. You really can’t have smaller kids playing those games, because they just don’t understand all the rules, and there’s just so many rules. It’s actually kind of painful to play, so unless you’re really into sitting down and playing a board game like that for three or four hours when you feel like you’re going to be flipping through the rules a lot, probably not a great game for the younger kids.
Rob [00:29:52]: That about wraps us up for today. If you have a question for us, call our voicemail number at 888.801.9690; or, email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Outta Control” by MoOt, used under Creative Commons. Subscribe to us in iTunes by searching for “startups” and visit startupsfortherestofus.com for a full transcript of each episode.
Thanks for listening, and we’ll see you next time.
Episode 302 | 8 Key Takeaways from MicroConf Europe 2016
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike discuss 8 key takeaways from MicroConf Europe 2016. A couple weeks after the conference they highlight some of their favorite points from the speaker’s talks. Also detailed notes from the entire conference are available at microconfeuroperecap.com
Items mentioned in this episode:
- Self-Funded Product Survey
- MicroConf Europe
- MicroConf.com
- BlueTick.io
- CartHook
- Teamwork.com
- Qualaroo
- Balsamiq
- Leadfuze
- Drip
Transcript
Rob [00:01]: In this episode of Startups for the Rest of Us, Mike and I discuss eight key take-aways from Micro Conf Europe 2016. This is Start-Ups for the Rest of Us, episode 302. [music] Welcome to Start-Ups for the Rest of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at building, launching, and growing software products. Whether you’ve built your first product or you’re just thinking about it. I’m Rob.
Mike [00:28]: And I’m Mike.
Rob [00:29]: And we’re going to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, sir?
Mike [00:33]: Well, kind of in a little bit of a slump lately. I’ve been trying to plod through some of the development issues for [Bluetick?] and try and get the product to a point where customers are actually getting value out of it that they need, and there’s just technical problems. Some of them are just really hard to get through and are taking forever, just way longer than I would have anticipated initially, and it’s just a long slow slog. So it’s a little disappointing. But, I mean, I’ve had conversations with the people that have been using it and everything is on the right track, it’s going the right direction, it’s just a lot slower than I would like it to be.
Rob [01:04]: Is this because of technical debt? Or is it early scaling issues?
Mike [01:08]: It’s a little bit of both. Some of it is scaling issues, because certain things are a just a little bit slow on the back end because of the number of messages that I’m storing and what I’m doing with them. And then some design decisions, for example, one of which is I’m not going to bother storing some of this information because we don’t need it. It turned out that we did, and it’s a lot more complicated to shoe-horn it in later than it would have been to grab it all upfront. Those are the kinds of things that we’re running into, and just scaling up that amount of data is a lot harder than it seemed to be initially.
Rob [01:39]: Yup. And do you have – do you think you have a couple of weeks? Because you don’t want to get new customers on when you’re doing this, right? You’re kind of holding off?
Mike [01:46]: Right, yeah.
Rob [01:47]: How long do you think that’s going to be?
Mike [01:48]: Well, the things that I’m working on now I’m kind of in the final phases of testing it, so I’m hoping that I’ll be able to do some of that migration, and getting some of that data into the system, within the next week or so. Beyond that, it’s a matter of going back to people and saying, “Okay, this is where it is.” Because there’s all this work that needs to be done upfront to gather everything, and then there’s additional work that needs to be done to display everything. So I’m hoping that in the next week or two I’ll have something that is, I’ll say, much further along, and can display information that they need. But it’s kind of hard to say, to be honest.
Rob [02:19]: Yeah, it’s a long slog, man. I’m sorry to hear that it’s going slower than you want it to, especially when it’s technical issues, those are the things that kill me. It’s like we have one advantage as software people, and it’s that we know how to build products. But when you run into these things, it always feels like, “Man, this is just killing me!”, because you want to get the sales going, and you know you should be focused on marketing and onboarding and getting new people in, and sometimes these things, you just have to take care of them. You know? You can’t have the technical debt sneaking it, especially if the app isn’t working properly, or you can tell it’s not going to scale past 50 people or something.
Mike [02:50]: Yeah, and part of the issue is that I’m also running into bizarre edge cases that, if you think about it and say – I’ll give you a prime example, what characters are valid characters in an email address? You probably think to yourself, “Well, alphanumeric, and then dots and then the at-sign, of course.” But then beyond that, there’s all these additional characters that you would not even consider could possibly be part of an email address and they can be. For example, like slashes, plus signs, equal signs. There’s all this other crap that can go in there, and according to the RFC’s, those are all completely valid characters, and it just sucks to end up running into those things when you just didn’t anticipate them.
Rob [03:29]: Yup. Early on we had to do a little research too, and I think – the nice part of using Ruby is that I think there’s a gem that does the validation and it’s a very complex – I’m not sure if it’s a [Reg-x?] or a complex series of statements. But that’s the kind of thing, in that particular case, be on the lookout for rather than – we’ve tried not to write our own because we’re not experts at it. We probably would be now, but we weren’t three and a half years ago when we were building DRIP.
Mike [03:52]: Yeah. This isn’t for specifically validating that it’s a valid email address, I’m already using modules for that. It’s more a matter of – to give you a prime example, if a slash appears on an email address I can’t use it in Microsoft shared platform as a partition key, so I basically have to apply some sort of transform to it, and then use that as the look-up key, as opposed to actually using the email address, which is what I originally planned on doing. Of course, when you run into that after processing several hundred thousand messages, then it becomes a problem.
Rob [04:21]: For sure. So on my end it’s been kind of nice. A couple more of the DRIP team members have joined me here in Minneapolis. So for a couple weeks there I was kind of – you know, you’re just kind of flying solo, didn’t know anybody, like the first day at a big company, and you don’t know anybody. But it was really cool, Derek and Anna have since joined me and I feel like things are continuing to fall into place. We’re hiring now three new people for the engineering team, and it continues to be fun. It continues to be a good journey where I am learning, and my team is learning, and things are going well. We’re going fast, like our trial count, I probably can’t even say how much it went up, but hundreds and hundreds of percents, many x’s up from where it was the week before closing. It’s been a fun ride, and it’s been interesting to watch the app scale, and to watch which things start to creak and kind of teeter, and then we have to jump in and say, “Alright, we need to increase these boxes. We need to increase RAM on this box. Or “We need to rewrite this one piece.” And so we’ve been doing that. But fingers crossed, knock on wood, we haven’t seen any major scaling issues to date, so that’s been really nice.
Mike [05:26]: Awesome. So what are we talking about today?
Rob [05:27]: Well today we’re talking about eight key take-aways from Micro Conf Europe 2016. We ran Micro Conf Europe just a couple weeks ago in Barcelona. We had about 110 attendees, so it was a little smaller this year than last year. Before we dive into these, I want to refer focus to MicroConfEuropeRecap.com if you’re interested in detailed notes on each of the talks. We had nine talks, and then we had some other attendee talks, and a panel and some other stuff. Kristoff [Egalhart?], once again volunteered to take notes for us, and they’re at MicroConfEuropeRecap.com and they’re detailed and very good. So what you and I did is sat down and said, “What were kind of the key take-aways?” These are not all of the take-aways, for sure. There were people taking pages and pages of notes. These are just some things that kind of struck out to you and I as we talked through the two days of speakers. So our first take-away is to be prepared to rewrite your MVP, and this one is from Jordan Gaule who did a talk called “Two Years in the Sass Trenches”, where he walked through his experience starting Cart Hook, where he walked through his experience of the last two years of launching and growing Cart Hook, and finding a co-founder, and partnership catastrophes with external companies, and perseverance and what it’s taken to get there. A big lesson that he said was, “If you build an MVP be prepared to rewrite it.”
Mike [06:48]: I thought that was a very telling, and probably an eye-opening piece of advice, just because when you’re building something you try and build it with the future in mind so that things aren’t going to fall over and break as soon as you add one, or ten, or twenty customers on to it. You can’t always predict what’s going to happen at that point. I think Gabriel [Weinberg?] of [Duck Duck Go?] had mentioned this in the past as well – if you 10X what you’re doing the problems that you’re going to run into are just exponentially more than what you had previously anticipated in whatever previous rewrite you had done, or reengineering, and you’re always going to run into those scaling issues at some point along the way that you have to rewrite a bunch of stuff. Which kind of sucks, but it’s, in a way, a good problem to have if you’re getting to that point.
Rob [07:30]: Yeah. Whenever I hear people say “MVP,” I wonder in my head, “Do you mean a crappy version that has a lot of technical debt?” Because if that’s what they mean, that scares me a little bit. When I think of the MVP of DRIP that we launched, it was the code – the underlying code was good, and the architecture was solid, and it had test coverage. It was a solidly engineered software product, but it didn’t have a ton of features. That’s what I think of minimally viable in that instance. And obviously, an MVP doesn’t even necessarily need to be software, even if you’re going to start a software company. We’ve talked about that – how you can do human automation, and there’s all kinds of ways to work around having to not build software, basically. But if, in fact, you are building a software product for something, I don’t think I could move forward with it as something that has a bunch of technical debt, because it’s going to come back to bite you at some point. Because if you do you’re MVP, you get 10, 20, 30 customers, what do you do now? Do you take six months to rewrite it? You’re just standing still? That’s no fun. Think twice about what you’re doing, and how you’re doing this. Our second take-away is to brute force sales in the early days. This also comes from Jordan, who, in essence, had a virtual assistant that was going out and looking for possible clients of Cart Hook, and then doing cold email sequences, and just talking on the phone. I mean, it’s really just brute force. It’s just perseverance. It’s coming in every day, doing the slog, doing the grind, and I think he said that got him to – it was around 5K in MRR. That’s like super admirable, just clawing your way. He didn’t really have an audience, he didn’t really have a list he could go to, and he just showed up every day and did the stuff a lot of other people aren’t willing to do.
Mike [09:01]: Yeah, and a lot of those types of things are going out and writing cold emails, or scraping lists together from different websites that you think would be a good target. That’s actually one of the strategies that I’ve seen recommended to people to get your first hundred customers, is go out and create a list of who you think your best, or flagship, customers would be for your top 25 or top 50 customers, and people you would want to do business with. Then iterate through them, and talk to those people, and see if you can get them on- boarded as customers. If you can, then it will help you build the roadmap for the future in terms of how to get in front of more of those types of people. But just showing up and doing the work is, I’ll say, highly underrated.
Rob [09:42]: Our third take-away is, if you’re not getting initial traction during customer development you may just have things completely wrong. The advice to talk to more customers may not be correct. This is a take-away we pulled out of your talk, which is called “Drawing the Line Between Success and Failure” where you did the survey, or the mini-research study, where you asked boot-strappers specifically about products that they had either failed to launch, or launched, and then had either failed or succeeded at the after-launch. You looked at the data and you analyzed it and you showed your findings.
Mike [10:11]: I think one of the hard things about the data that I had was there’s not enough data to begin with, especially in the boot-strapping and self-funded space. But some of the things that I really wanted to zero in on were edge cases where you could see clearly defined lines between the maximum amount of time that successful companies spent doing customer development, and then the average time, for example – or the minimum time – that companies that were not successful did. You could see very clearly that the maximum amount of time was I think about 10 or 12 hours of customer development for the successful ones, and then there were some people who did upwards of 50 or 100 or even 200 hours of customer development. The reality is that, in looking through that data, and kind of picking through all of the things that I found, what I came to realize was that there’s people who can get themselves into a situation where they’re not sure what they should do. They think that they don’t have a clear picture or clear understanding, but they want an idea to work so they’ll keep talking to people in an effort to try and make it work. That is essentially deluding yourself into thinking that strategy is going to work, because just talking to more people will get you more people to say “Yes”, but it also kind of shows you how difficult it’s going to be, in the long run, to get more people on board. If you can’t convince people who are in your network, who are very likely the people who you’re talking to first, if you can’t convince them that your idea is something that is going to provide business value, what chance do you have from an anonymous webpage where people who have no idea who you are are coming to it and are trying to evaluate it?
Rob [11:42]: Right. I think in the long term you want to increase the number of survey respondents. I think you had about 55 or 60 at the time you presented it there, but it would be nice if some more people would submit their stuff so you can increase the accuracy of this statistics you’re running. Perhaps we could link that up in the show notes, and if you’re interested in providing your data, it can be anonymous or not, it’s up to you, then Mike can maybe revise that in a future talk, or blog post. Our fourth take-away was to find out what people want. Go get it, give it to them, and do it in that order. This was from James Kennedy’s talk “Zero to 20K MRR in 20 ‘Easy’ Steps; The Story of Rubber Stamp.IO.” The title was a little bit facetious because the Easy was in quotes. It was 20 really hard steps. It took a long time to get 20K MRR, which made for a great story. One of the pivotal moments of it was when he read – do you remember what the guy’s name was?
Mike [12:32]: I don’t remember the specific book.
Rob [12:34]: But he read a book, and the instructions were to find out what people want, go get it, and give it to them. He was trying to do that but he was failing. In the end he realized that you have to do it in that specific order.
Mike [12:46]: It might have been the book called “Instant Cash Flow” by Bradley Sugars.
Rob [12:49]: Yes, that’s the book. And actually it’s in Kristoff’s notes, as I think you were secretly looking out while I was fumbling around for the name. One of the other things I liked about James’ talk is he had a lot of really actionable stuff. I mean, he’s attended several Micro Confs, so he knows the level of talk you want to bring, and he talked about some really cool marketing approaches that other people haven’t tried. There was SoftwareAdvice.com, there was [Captera?]. There was – I’m trying to think of what else there was – he had several things that really were kind of off the beaten path that he has used and optimized in order to grow his business.
Mike [13:23]: The other thing I like about his talk is that really laid out, in a manner that was very systematic, about what his approach was to identifying those different channels. I had specifically asked him about that at Micro Conf: What was it that make him decide to go after [Captera?] and those other things? He said he went out and had read the book called “Traction” by Gabrielle [Weinberg?] and Justin [Merez?], and in it it lays out the bullseye approach. We’ve had Gabrielle on the show before talking specifically about that book, and about that approach. They just went through it, and they were very systematic about it: “What’s working? What isn’t? What do we think has the best chances?” And that’s how they identified that those different channels were going to work for them. Because if you look at the channels that they are using, that are being successful for them, they aren’t things you’d think of off the top of your head. I was really interested to hear about how he stumbled across those, and he’s like, “We just systematically went through that and used the information that we had to identify which one was going to work.” and when they didn’t have enough data they went out and got the data.
Rob [14:22]: I also like that he referenced Jason [Cohen’s?] talk from Micro Conf – I think it was 2012 maybe, 2012 or 2013 – and he’s been attending Micro Confs and basically he didn’t have a business, and started a small one, and learned from Micro Conf and grew it, and later shut that one down and started another one. Really, he’s just learned so much from the community, and from the talks, that it was cool to see him reference that and call it out, and now he’s a main stage MicroConf speaker, talking about his road of getting to 20K MRR. That’s the fun stuff. If you’re listening to this and you have not watched Jason [Coen’s?] talk, I think it’s called “Building the Idea Boot-strap Business,” or something like that, it’s linked to from the Micro Conf website, or you can find it on Vimeo. In my opinion, it is the best boot-strapped talk ever in the history of boot-strapped talks. He just rocks it out of the park. I remember as he was giving it, I was thinking, “My head is exploding. This is completely rocking my world.” And then every year since then I try to re-watch it just to remind myself, and to relearn, and to pick up new things. It’s just really written and executed – I don’t know if anyone’s going to ever outdo that talk because it was just so phenomenal. Our fifth take-away is to constantly ask yourself: Why are you doing this? Reevaluate your core values as they might not be etched in stone, and they might change. This comes from my talk, which I titled “Eleven Years to Overnight Success from Beach Towels to Successful Exit.” The idea here is I really talked through the decision process of deciding to sell DRIP, and how that all went down. There’s a lot of thought processes to it, but one of the key threads that kept coming up for me as I looked back and I thought, “What did happen here throughout this career?” I went all the way back – I mean, I started launching products in 2000, but I didn’t really have my first dollar revenue until 2005, so I kind of included, that’s really the last eleven years. I looked back and I thought, “What are the things that were my core values? Why was I doing this at all? Why didn’t I stay a salaried employee?” And so I talked through that I wanted freedom, that I wanted to have purpose, and that I wanted strong relationships. Freedom, purpose, and relationships were three three things that I had originally heard, it’s psychological concept from years back. I heard it on a podcast years ago, and I’ve really just taken it to heart. It’s been something I’ve come back to. Throughout this journey, as I’ve wandered off that path, as I’ve given up some of my freedom, given up some of my purpose, hurt my relationships because I work too much or over-committed, I’ve always had to come back to that center line of making a change. That really was the story. In the end, by the way, I added a fourth one which had never been on my radar, which is stability. Having a lot of products, or having a product that can easily be taken away from you when you’re paying your mortgage from it and your entire income come from that, I’ve had a few scares over the years where Hit Tail almost got creamed by Google, and other things like that. I realized that having that stability was an important thing which, of course, factored into that decision.
Mike [17:04]: I think that what really stood out for me from your talk was the fact that you kept going back to those core values, but at the end of the day you also realized that those core values can change over time. The values that you have when you’re 25, for example, and not married and no kids, those will change over time as you hit 35 and 45 and get older, your priorities change. The things that you want and need in life are going to be different than what they were earlier in life. I think that it was interesting to see that verbalized, because it wasn’t something I had necessarily really given a lot of consideration to before.
Rob [17:38]: Our sixth take-away requires a little explanation. Okay, if you’ve seen the movie Glengarry Glen Ross, Alec Baldwin is like a sales manager, and he uses this expression or this phrase, “ABC – Always Be Closing.” So our sixth take-away is ABFU – Always Be Following Up. This, of course, comes from [Stelli Efdi?]. He did his talk called “Building and Optimizing Your First Sales Process.” If you’ve heard [Stelli?] talk, he’s a very engaging speaker. He gets really riled up on stage in a positive way that just keeps you captivated. He went first on the second day. He’s the perfect post-lunch, or “first in the day” slot because everybody’s trying to wake up and he gets them going. There were a lot of messages, but one of his messages was “always be following up”, and we have abbreviated that. Maybe [Stelli?] can take that and use it, I like it. ABFU.
Mike [18:27]: One of the things I liked about [Stelli’s?] talk was that he gave a bunch of sales metrics that people should be using to help establish whether or not they’re doing the right activities, or they’ve got the right quality metrics for their sales that they’re looking at. For example, if you’re trying to reach out to people and put them into your sales funnel, you should ideally be reaching at least a 15% reach rate, and ideally you would get to 30, but for every 100 calls you make you would reach at least 15 people, ideally you get to 30. So you need to adjust things that you’re doing around that in order to make sure you’re meeting the right metrics. It’s not just enough to call 100 people. You need to also be reaching them as well. Then he also talked about some of the different conversion metrics, and hiring people, making sure you’re hiring the right types of people, making sure that the sales are also founder-driven. You need to do sales yourself in the very beginning stages of the company to make sure that you’re selling to the right people and identifying the right prospects that you should be talking to. It’s very difficult to bring in a sales rep from outside the company and then just plop them down in a chair and say, “Okay start selling.”, because you haven’t figured out a process. You haven’t figured out who is it you should be talking to. That sort of thing really can’t be outsourced. It’s very difficult to just plop somebody in and expect them to be the entrepreneur, because I think a lot of developers, our natural inclination is to kind of step back from that and say, “I need to hire a sales rep to so this sales thing for me.” when the reality is that the developer is going to the best person for that job because they understand all the different pieces that are in it. They may be very uncomfortable, but they understand all the things that go into it. I’ve actually been in conversations where people will tell me flat out, “Hey, I actually trust a lot of what you’re telling me because you’re coming at it from an engineering standpoint. You’re not coming at me as a sales rep.” So when you’re talking at the technical levels about the specific challenges that you’re solving, don’t sell yourself short. You can easily overcome your own uncomfortability about that, and come across to somebody as much more trustworthy just by virtue of the fact that you’re a little bit more technical, and a little less sales-y.
Rob [20:29]: Our seventh take-away is to be deliberate about your direction once you’ve had early success with a product. This came from Jenna [Bestow?] who talked about the power of product focus. She basically talked about how early success makes things complicated, because once you have 10 or 20K in MRR you really have a lot of options. You can go in a lot of directions. If you try and follow all of those threads, it can be a pretty dangerous time for your business, because you can kind of wander off the reservation and not be focused on the product. She showed from first-hand experience how it had them kind of just wandering around and it hurt growth in the end.
Mike [21:05]: I think one of the most interesting things about her talk was that she had graphs that showed what some of the different cohorts looked like, and you could see, over time, as they focused in on the user-acquisition process, and trying to get people from trial to paid, you could very clearly see in the graphs exactly where changes were happening, and how they were moving people to make those decisions earlier in the process. Whereas previous to that they weren’t focused on that. They weren’t concentrating on it, because they were trying all these different things. They didn’t necessarily have set goals and specific things that they were trying to accomplish. They just had money coming in the door, and they were trying a bunch of different things, but they didn’t really have a plan. But once they stepped back and said, “Okay, let’s make a plan. Let’s do these things and be very deliberate about them.” you could see very clearly how well it impacted the business.
Rob [21:55]: Our eighth and final take-away from Micro Conf Europe 2016 is to focus on retention instead of acquisition. This came from Drew [Sinaki?] and his talk “Double Your Business.” It had a long subtitle, but it was just about doubling your business. What he walked through was there are only three ways to increase revenue. It’s to increase your average revenue per user, to decrease churn, or to increase the number of customers that you have. He said if you do all three of them they’re multiplicative. So if you do one of them you get a 30% rise. If you do all three of them, they multiply times each other. It becomes exponentially – it’s like a 2.2 times growth, getting a .3 increase from each of them, I think that’s what the numbers are. You know what I liked is he pointed out how most people focus on the third one. They focus on “We need to see more customers, more customers, more customers.” But if you’re not increasing average revenue per user, and decreasing churn along the way, you’re leaving a ton of money on the table. Then he walked through specific ways that he has done that, both he talked about doing it on an e-commerce site, talked about doing it on Sass apps, because he does some marketing consulting for Teamwork.com, and overall it was a good talk.
Mike [22:57]: What I liked about his talk was that he showed how those three things were applicable to different types of businesses. One of the examples that kind of sticks out in my mind was when someone is going through an e-commerce business, they offered an up-sell. It wasn’t very much, but at the same time there was a certain percentage of people who purchased that up-sell. I forget what it was. It was like an extra t-shirt for $10 or $15, but they got a significant and measurable increase in the number of sales, which impacts the bottom line, and all it took was them to add in that extra page, and that extra offer for the person who was making the purchase. It was just fascinating to see how all those little things ended up adding so much to the bottom line for the business.
Rob [23:39]: And so I think to start wrapping us up, if you attended it was great to see you. Thanks for coming. If you’re interested in attending either of our Micro Confs, in Las Vegas or in Europe, come to MicroConf.com and enter your email address. We also want to thank our sponsors. Frankly, Micro Conf really runs on the energy from the attendees and the help from our sponsors. This year we had five sponsors at MicroConfEuropeTeamwork.com. [Qualaroo?, Balsamic, Lead Fuse, and, of course, DRIP. We’ve been getting some questions via email about our Micro Conf in Vegas this next year. We mentioned it briefly in episode 300 to kind of give you a teaser, we didn’t give you too much detail. In essence, we are having the Micro Conf in Las Vegas on Monday and Tuesday for the past five, six years. We’re having that again this year on April 10th and 11th, of course with an evening event the Sunday before that, the 9th. Then we’re having a separate conference called Micro Conf Starter Edition, and this is for folks who are in more of an early stage. Maybe if you are looking for an idea, you have an idea, you’re not yet launched. Even if you’re launched and just trying to find product market fit, Micro Conf Starter Edition is going to totally geared at idea-validation, early traction, getting the first 10 or the first 100 customers. Because some of the feedback we’ve gotten over the years is that some of the Micro Conf attendees and speakers have progressed to a point where we’ve started thinking about maybe larger problems, and we have new challenges. So you think about me, when we started Micro Conf in 2011, I hadn’t even acquired Hit Tail. I still had a bunch of little businesses doing a few grand a month, and then bought Hit Tail, grew that, started DRIP, 10 employees, that whole thing, I’m just at a different place. There are a lot of folks who are in my shoes, who have gone from zero to businesses that are doing 50K, 100K a month, and when you’re running a bigger business, you just have different interests. So hearing from [Des Trainer?] from Intercom, or hearing from Patrick [Holisem?], the founder of Stripe, it makes more sense at that point. But if you’re in an early stage then you actually want to hear different content. It’s more helpful to hear about idea validation, and maybe to hear about folks who are in the early stages, or to have someone come on and just talk about business ideas rather than you’ve already launched and here’s what you’re doing and what to do with your millions of dollars in revenue and that kind of stuff. That’s the idea here, is it’s two separate conferences aimed at the different stages of what boot-strap startup founders are facing.
Mike [25:49]: I think if you think about Micro Conf in a larger sense that makes sense, because over time the attendees themselves are going to evolve with their businesses. Not everybody is going to want to grow their business to multiple employees, – you know, tens or hundreds or whatever. But there are going to be people who still have those challenges, and maybe they’ve never heard of Micro Conf before, or they’ve never had a chance to go because they’ve never felt like they were in a position to really take advantage of it. So this is kind of our attempt to make sure we are still catering to the needs of the audience and making sure we’re able to deliver what they want and need out of the conference. But at the same time we’re trying to address the fact that over time people are going to have those different phases of their business, and it maybe makes more sense to have these two different conferences that people can go to based on the stage, or the evolution, of their existing business.
Rob [26:37] : Right, and I think we’ve gotten the question, “Why wouldn’t I just attend both of them?” And I think my answer is, “If you want to, that’s fine.” I actually think that depending on your stage you’re going to get a lot more out of one of these conferences than the other. But if you wanted to attend both I don’t see why you shouldn’t. This is also an opportunity for us to allow more people to attend a Micro Conf. Once we launch to the public we sell out in five minutes, and we have wanted to grow the conference to 450 people or whatever. But if we do these two conferences back-to-back, we get people, based on their stage, from the most amount of value that really helps them where they’re at. It also allows us – if we do 200, 225 per conference – then we can’t have 450 people getting help and valued learning out of Micro Conf without having just this massive conference of people wandering around and feeling like – let’s say you have 450 people of all stages, then when you walk around you’re going to talk to a bunch of people who are still validating ideas, and that feels – if you’re already doing seven figures – it feels kind of weird. What do we have to talk about? Whereas if we segment this, and we have the standard Micro Conf and then Micro Conf Starter Edition, you’re just going to run into more people who are doing exactly what you are. That’s always been the point and purpose of Micro Conf. If this sounds interesting, either Micro Conf or Micro Conf Starter Edition, come to MicroConf.com and enter your email address and you’ll be the first to hear about it when we sell tickets.
Mike [27:53]: Well I think that about wraps us up for the day. If you have a question for us, you can call it in to our voicemail number at 1-888-801-9690, or you email it to us at questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Out Of Control” by MOot, used under Creative Commons. Subscribe to us in iTunes by searching for “startups”, and visit StartupsForTheRestOfUs.com for a full transcript of each episode. Thanks for listening and we’ll see you next time.
Episode 301 | Six Decision Making Tips for Entrepreneurs
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about decision making for entrepreneurs. They walk you through some decision making techniques and look at how they can help you make decisions faster and more efficiently.
Items mentioned in this episode:
Transcript
Mike [00:01]: In this episode of Startups for the Rest of Us, Rob and I are going to be talking about decision-making for entrepreneurs. This is Startups for the Rest of Us, episode 301. [music] Welcome to Startups for the Rest of Us, the podcast that helps developers and designers and entrepreneurs be awesome at building, launching, and growing software products. Whether you have built your first product, or you’re just thinking about it. I’m Mike.
Rob [00:25]: And I’m Rob.
Mike [00:26]: And we’re share our experiences to help you avoid the same mistakes we have made. What’s going on this week Rob?
Rob [00:29]: Just recovering from MicroConf Europe. I had a really good time last year. I guess we should a Take-Away’s episode from Europe 2016, shouldn’t we?
Mike [00:38]: Oh, we probably should. It might have been a good idea for the live podcast episode, but that would have been difficult to do I guess.
Rob [00:42]: Because the conference wasn’t done.
Mike [00:44]: Right.
Rob [00:45]: But we’ll try to do next week’s with our Take-Away’s. It was a really, really good conference. I had a lot of fun. Sometimes when we throw the event there’s a lot of struggles, and some things don’t turn out the way you want, but it ran really smooth. I thought that the talks were very good this year, and overall I had a really good time. It was good to be back in Barcelona again.
Mike [01:04]: It’s really funny that the episode that went out last week – I listened to it, and at the very beginning it made it into the cut where I interrupted you and said, “You didn’t say episode 300,” and you said, “I was getting to there,” and then you completely skipped over saying it was episode 300.
Rob [01:18]: No, I did say it was 300 –
Mike [01:19]: No you did not! I went back and listened to it, and even my wife listened to it and she was like, “He didn’t say it, did he?”
Rob [01:24]: No. I’m going to pull that snippet and email it to you, or post it on the blog or something.
Mike [01:29]: I don’t think it was there.
Rob [01:31]: That episode was fun. Hopefully as a listener, you’ve already listened to that. It was our first live episode ever, so there was definitely a different energy level, and sound quality, and ambiance, and that kind of stuff. But it was fun to be able to share that kind of recording experience with a group of people, because normally it’s basically you and I basically sitting on opposite ends of the country in our respective closets with the shades drawn.
Mike [01:52]: Yeah, that was a lot of fun. It’s definitely interesting to be up on stage like that and to talk to people directly, either during an episode or even immediately afterwards, and being able to answer questions and talk a little bit about it, and just hear how long people have been listening, what kind of take-away’s they’ve have. We sent out an email to the email list for the podcast – which if you’re not on that email list, you can go to Startupsfortherestofus.com and there’s an email list you can sign up for. We don’t send out too many emails, but we do use it to kind of communicate with the audience to some extent.
Rob [02:20]: ”What are some unfair advantages for faster SaaS growth? This is Startups for the Rest of Us, episode 300.” Oh, snap!
Mike [02:29]: I must have missed that.
Rob [02:31]: So now that we know I’m right, what’s going on with you?
Mike [02:25]: Well, I guess I’m just getting older and I can’t remember things as well. I was sure I had listened to that. I didn’t hear that.
Rob [02:41]: Getting older. Was it fun for you to have 110 of your closest founder-friends singing you Happy Birthday on the Micro Conf Europe stage last week?
Mike [02:49]: I’m not sure I’ll forgive you for that, ever.
Rob [02:52]: Yeah, now I know your birthday is right around early August here, so –
Mike [02:56]: I still am kind of speechless about that. I can’t believe you did that to me.
Rob [02:59]: You turned 40.
Mike [03:01]: Yes, I did.
Rob [03:02]: How does that feel?
Mike [03:03]: Well, I am still always going to be younger than you, so it feels great.
Rob [03:06]: That’s true.
Mike [03:08]: No, I didn’t really do much. I just worked and then late evening I sat down, had a glass of whiskey, and read a book. That’s about it.
Rob [03:14]: Nice. Low-key. Good way to recover from travels last week.
Mike [03:19]: It’s a good way to get old.
Rob [03:20]: Yeah, dig it. Cool. So what are we talking about this week?
Mike [03:23]: Well, today we’re going to talking about decision-making for entrepreneurs. The idea here is that with this episode we’re going to walk through some decision-making techniques, and looking specifically at how we can make better decisions faster. because the progress that we make in a daily basis is generally constrained by our ability to make good decisions and make those decisions quickly so we can actually get back to work. When you are struggling to make decisions, or you’re not making decisions quick enough, then the progress that you’re making and the output tends to slow down a lot. I’ve noticed this in my own situations where if I’m struggling with a decision, or it’s taking me much longer than it probably should to make that decision, then progress on pretty much everything stops, because I’m either wrestling with it, or trying to do different things to get more information and trying to figure out what I should be doing. Instead of actually doing anything I’m just trying to make a decision. It kind of leads to procrastination, but there’s a lot of implications of that because obviously it detracts from morale and makes you think about things a lot more and increases stress and all these other things that go along with it. Because you’re stressed out that you’re not making a decision, or moving things forward, and it’s constantly on your mind. So the idea for this episode is to talk about how to go through the decision-making process faster.
Rob [04:38]: Yeah, and decision-making, as you said, is such a key part of what you do day-to-day as a founder, and I think that one of the biggest parts of how to keep things moving forward is making decisions with not enough information. That is like a majority of my day, making the best decision you can given that you don’t have all the info that you would otherwise want to make a perfect decision.
Mike [05:01]: Number one on our list of decision-making for entrepreneurs is being cognizant that you are not making a decision. I think one of the tell-tale signs of this is that you’re procrastinating and there’s a lack of progress. Those are really symptoms of not being able to make a decision. They are not the root problem itself. The root problem is that you are struggling to make this decision. I think one of the ways to be more cognizant of this is you have to pay attention to the progress that you’re making. Because it’s very difficult to be in that situation and then say, “I’m in the middle of trying to make a decision and I’m having a hard time with it.” But there are symptoms that you can be aware of, and if you are tracking those types of things on a regular basis, then it will kind of remind you that you are maybe struggling with this decision. So if you’re tracking your daily tasks that you are attempting, or that you have actually achieved – whether it’s through a journal or a task list, any of those types of things – if you find that you’re not making progress on them then try to figure out if it’s because you’re having a problem making decisions. Is that the problem that you have, or is that you’re working on the wrong thing and you’re not making any progress, and it ultimately doesn’t matter? Not every day is going to yield any sort of progress, but if there’s too many days in a row without a substantial amount of progress, then it could be because you’re struggling to make decisions. When you are struggling to make those decisions, that’s where these symptoms start to come out.
Rob [06:21]: I notice when I’m procrastinating and not able to make decisions it tends to be because there’s either something at the top of my to-do list that I really don’t want to think about, don’t want to do, don’t want to make a decision, or there’s something somewhere in my inbox where I keep skipping around. I think having the discipline to always force yourself to work top to bottom through your to-do list, or bottom to top through your email inbox, and basically power through it and make fast decisions and make the best decisions that you can – I think that’s a discipline that we all should work on. I don’t maintain it full-time, but I notice that on the days that I do I notice that there’s a lot of willpower, and it typically requires me to get some music playing and get some caffeine in my system, and then I can break through. I mean, I will have stuff on top of my to-do list for weeks and then I realize that I’m going around it and doing things of a lower priority because I just don’t want to do that one, but when I start hammering through it, the things you put off for weeks – because you don’t want to do it, or you think they’re going to take a long time – you often hammer them out in like, an hour, typically is what winds up happening. There’s this huge freeing weight lifting from your shoulders. You have to kind of be aware of this. You have to make yourself aware that you are not focusing, and that you are not making decisions because of that. Then fight it head on. Pick a moment where you’re at maximum strength. You’re awake, you’re motivated, you’re in a good mood, and just get psyched up and hammer through something that you’ve been holding off on. Once you do that, it’s amazing how much momentum you gain from that, and the positive energy that comes out of tackling something like that that’s been holding you back for days, hours, or weeks.
Mike [07:52]: The second tip for decision-making is to frame the decisions that you do need to make. Part of that comes with outlining the issues around the decision. But it also ties into separating your emotional ties from that decision so you can be more objective about it. Think about why it is that you need to make this decision. What are the results of that decision? What is the outcome? And is this decision even important? Do you have to make this decision? Because sometimes you don’t. There’s certainly decisions you may come across that you feel you may need to make a decision. So ,for example, an email comes in and you feel like you need to reply to it right away. Usually that’s not the case. A lot of times you can either delay those things, or, if it’s a support request, you can hand it off to somebody else. It depends on the specifics of that. But a lot of times you can take a look at those decisions and either push them off a little bit – which there’s a fine line between actively deciding to deal with something later, versus performing avoidance techniques to not do it. I think these are two very different things. But take a look at whether or not you even need to make this decision. Is it relevant to you?
Rob [08:55]: Something to keep in mind – as you are making a decision – this is a little bit of a tangent, but there’s this acronym that I think is used in psychology, or in coaching, or something, but it’s an acronym that’s HALT. That’s H-A-L-T. It’s don’t make decisions when you’re Hungry, Angry, Lonely, or Tired. And then actually Jacob Thurman did an attendy talk a couple years ago at [MicroConf] and he added an “S” for Sick because he had a stomach ailment, and he was having a really tough time making decisions and he didn’t want to make a bad one. So be really cognizant of your state of mind as you’re doing this. This is, again, a self-awareness thing, and it’s going to be aware that you are angry or hungry or lonely. It’s easy to be sad or depressed or to be having a rough day and make decisions that are just not ideal, especially if you’re making permanent or semi-permanent decisions you really don’t want to do that. That’s something to kind of keep in mind.
Mike [09:46]: The third step is to ask yourself if you have enough information to make this decision. Most of the time we don’t have all the information relevant to a particular problem in order to make a decision, so the vast majority of the decisions that we are making are based on incomplete information. There is a threshold that you are going to cross where you will have enough information to make that decision, and when you’re in the middle of trying to make a decision, if you’re struggling with it, ask yourself if you do have enough information to make that decision. If you don’t, how do you get it? How long is it going to take to get that information? What is the cost, in time, to acquire that information? If you were to make that decision and move in a particular direction, is that going to be faster than taking four to six weeks to identify the information that you need to do something that would have only taken two weeks to begin with? You have to balance out and you have to look at that and figure out whether it’s warranted to just make the decision and move forward knowing that you may have to do work again and, or make a different decision, versus spending the next four to six weeks trying to figure out the additional information that you need. Sometimes there’s an opportunity cost there that a lot of times it’s just easier to just make the decision and move forward even if it is the wrong decision, because you will learn things along the way.
Rob [11:02]: I said this a couple episodes ago about how there are certain decisions that are easy to undo, so make those quickly. Make the best when you can and move on. Then there are certain decisions that are really hard to undo, and those are the ones that you are going to need to agonize over and get as much information as possible, and being deliberate about information-gathering. Thinking like, “What test could I run?” Sometimes it’s a decision of like, “”Should we change our pricing?” Or, “Should we change our home page to a totally different version?” Often times you can just run a split test, or you can talk to customers. There are ways that you can gather some more information, and it might take some work to do, but it will help keep you from shooting into the dark and basically not knowing if what you’re doing is going to improve the situation.
Mike [11:46]: The fourth tip is actually the opposite, which is you have too much information, or you have conflicting information. I think this is a common source of angst among people, myself included, where you don’t want to make the wrong decision, and not wanting to make the wrong decision can lead to procrastination. I think in these situations you have to do something of a cost-benefit analysis to figure out how much longer it would take to get decisive information, or whether even that situation exists. Is it possible to get decisive information? If you look at something like AB-testing, it can take a long time for something to be statistically significant if the differences are minute, or you’re not able to throw a lot of traffic at a particular thing for example. Sometimes adding more information is simply not going to help. You’re going to have to make a decision one way or the other. And as you said, sometimes you just have to make that decision and you’ll go down the wrong path and that’s okay. You have to be comfortable with that ,and accept that there are going to be decisions that you are going to make, you’re going to be wrong, and that’s okay. The fifth tip is that decisions tend to have a way of proving themselves right or wrong rather quickly. If you’ve made a decision and you’re not sure if it’s the right one, several weeks afterwards or several months afterwards, take a look at how much longer it’s going to be before you think that you’re going to be a position where you believe you’ve made the right or wrong decision. What are the conditions that need to come up that are going to allow you to verify one way or the other? When you get into those in between stages where you have made a decision and you’re looking back historically to figure that out, sometimes that’s difficult. Sometimes there’s kind of a meandering of the environment, or what it is that you’re working on, and you’re just not sure. When you’re doing that it’s difficult to be confident about the direction that you’re going and you have to just take a step back and say, “Is this the right approach? Am I doing the right thing?” Because sometimes it’s not. Looking at the reward for being right, or the penalty for being wrong, is warranted in those cases.
Rob [13:37]: You know, this is something that I’ve struggled with a long time, and actually used to struggle with a lot more when I was younger and kind of as an earlier start-up founder, I would make decisions and then I would second-guess them for days or weeks or months if it was warranted. That is not how you want to make decisions. You are carrying around this cognitive load and this baggage, and it really distracts you from moving forward and getting the work done that you’re trying to get done. So I think, over time, maybe it’s purely just kind of desensitizing yourself to it, and learning that the more decisions you make the less each individual one matters. Or maybe it’s just a learned skill. Maybe it’s something – I genuinely don’t know. I think at a certain point in order to move forward I had to start making the call and living with the outcomes. I didn’t have the time or the energy to sweat it anymore. I don’t necessarily have any fantastic guidance, tips, or tactics. I’m sure someone out there does who has studied this, but I do know that I’ve gotten way, way better and I feel better about so many more of the decisions that I make now than I used to when I would kind of second-guess everything that I was thinking about.
Mike [14:40]: I think what you just said there is probably a fantastic quotable quote, which is the part about the more decisions you make the less impact each individual decision has, because you’re able to achieve more and accomplish more, so the addition of all of those things overcomes any individual wrong decisions that you might make along the way. If you make a massive incorrect path decision, then that also a collection of lots of other decisions as well, but the individual decisions along the way, in and of themselves, don’t necessarily matter as much. The last tip we have here, which is something that Rob talked about a little bit earlier, which is decisions tend to be reversible. There’s a lot of decisions you’re going to make where you can make tiny course corrections, or you may decide, “Hey this is a strategy that is not working and we’re going to go in a different direction now.” So you make either minor course alterations, or a massive course alteration, based on the environment, but these things are not set in stone. You don’t have to continue going down a path you have already gone down for the sole purpose of going down that path, or because you don’t want to be wrong. You’re going to be wrong on occasion, so if you have to change your course, or change the decision that you’ve made, that’s okay too.
Rob [15:50]: I think that’s something big that I learned – is undoing decisions. In most cases, while sometimes you’ll lose face, or you look a little foolish to someone going back, but you can undo almost every decision. There are some exceptions, but I think that getting over the fear of looking dumb, or of having someone think that person didn’t know what they wanted – it tends to be social fears, I think, that keep us from undoing decisions. Almost all decisions you make can be undone. The question is always just at what cost, right? Sometimes undoing decisions will cost you $20, or sometimes it could be hundreds of dollars or thousands, and you just have to value it – is it worth paying that in order to be able to undo it? In another respect, sometimes it’s just your reputation, it’s just a little ding, or a large ding, against your reputation, and you have decide, “Is it better to move forward the way I’ve decided? Or is it better to take that short-term hit to my reputation and to be able to undo it?” I think it’s an interesting way to think about it. To not think about it in black-and-white, like, “I made the decision and therefore I’m moving forward.” Because if the information changes, and even if there’s going to be some type of cost to you – whether that’s money or reputation – if it’s the right choice then it’s the right choice. Go back and undo it. What you often find out is that the ramifications are often a lot less severe than you think they will be in your mind. That question of, “What’s the worst that can happen if I undo this decision?” Ask yourself that and dig into it and really think, “What is likely to happen here?” Maybe get a sanity check, because I think you can trap yourself in a box, especially us as engineers, we can trap ourselves in this box of thinking everything is black and white, and once you make the decision it’s done. I have learned over the years — this is something which I did not understand at all when I was younger – I’ve learned over the years that so much is able to be undone.
So to recap, the six tips for decision-making for entrepreneurs are – number one, be cognizant of when you’re making a decision. Number two, frame the decisions you need to make. Number three, do you have enough info? Number four, do you have too much information or conflicting information? Number five, decisions have a way of proving themselves right or wrong quickly. Number six, decisions are reversible. If you have a question for us, call our voicemail number at 888-801-9690, or email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Out of Control” by MOot, used under Creative Comments. Subscribe to us in iTunes by searching for “Startups” and visit Startupsfortherestofus.com for a full transcript of each episode. Thanks for listening and we’ll see you next time.
Episode 300 | The 4 Unfair Advantages for Faster SaaS Growth
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk live at MicroConf Europe about the four unfair advantages to faster SaaS growth. They also expand the topic to things that seem like unfair advantages but aren’t and how to improve your chances of getting an unfair advantage. At the end of the talk they do a short Q&A with some audience members.
Items mentioned in this episode:
- MicroConf
- Slides from Presentation
- Drip
- Baremetrics
- Stripe
- Bidsketch
- Appsumo
- Clarity.fm
- WPengine
- SumoME
- Kissmetrics
- LeadFuze
- Buffer
- Woo Themes
- Basecamp
- Qualaroo
- Balsamiq
- CartHook
- MeetEdgar
- Crazy Egg
Transcript
Rob [00:00]: In this episode of ‘Startups for the Rest of Us,’ Mike and I are going to discuss the four –
Mike [00:04]: Stop. You didn’t say it was episode 300.
Rob [00:06]: Then I say this is episode –
Mike [00:10]: All right.
Rob [00:10]: This is going to be good.
Mike [00:11]: We do stop like this on occasion.
Rob [00:13]: Oh, I love it.
Mike [00:13]: I’m not kidding.
Rob [00:14]: In this episode of ‘Startups for the Rest of Us,’ Mike and I discuss the four unfair advantages for faster SaaS growth. This is ‘Startups for the Rest of Us’ episode 300.
Welcome to ‘Startups for the Rest of Us,’ the podcast that helps developers, designers and entrepreneurs be awesome at building, launching and growing software products. Whether you’ve built your first product, or you’re just thinking about it. I’m Rob.
Mike [00:44]: And I’m Mike.
Rob [00:47]: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, sir?
Mike [00:51]: Well, we are live with an episode. We’ve never done a live episode before. And we’re recording at the 10th MicroConf in Europe, in sunny Barcelona.
Rob [01:00]: Indeed. And we have some audience participation going on. We’re going to have a Q and A at the end. But I have to admit it feels very different to record here in front of 110 people, instead of sitting home alone in my office with the mic muted.
Mike [01:12]: Yes, very different. Not necessarily intimidating, but it’s just all eyes are one you, and you’re like all of our general screw-ups are going to visible to everyone.
Rob [01:21]: Right. So we do have an interesting announcement. A little top secret preview, both for the audience here and the folks that are going to hear it next week. MicroConf in Vegas this year is going to be two conferences back to back. So we’re doing MicroConf as usual – MicroConf that we’ve done for the past several years – April 10th and 11th at the Tropicana. And then we’re doing something called MicroConf Starter Edition. And that’s going to be on the 12th and the 13th. And there will be more info to come on that later. But if you’re interested in potentially coming to Vegas for either of those two day conferences that we’ll be running back to back – and they’ll have an evening reception that overlaps – come to MicroConf.com and enter your email.
Mike [02:02]: Awesome. So, anything else new this week?
Rob [02:05]: Hanging out in Barcelona.
Mike [02:05]: Awesome.
Rob [02:06]: Pretty cool.
Mike [02:06]: What are we talking about this week?
Rob [02:08]: We’re talking about the four unfair advantages for faster SaaS growth. And this is specifically the self-funded edition. This is based on a MicroConf talk I did in Las Vegas just about four or five months ago. We actually have some slides the folks here in the audience will see, and maybe we’ll publish these in the show notes or something, if Josh contacts us.
Mike [02:24]: Yes, that would be cool.
Rob [02:25]: That would be nice. The whole premise of this is that as I was putting together this talk, I was trying to think of – I’ve had a lot of software products over the years, and some that are not software products, and DRIP, of all of them, grew way faster than the others. I had a SaaS app called HitTail before this, Wedding Toolbox, DotNetInvoice, CMSthemer, Beach Towels. I wrote a book, ‘Conference.’ Just other stuff. And I started thinking, “Why is it that DRIP got such traction so quickly?” Once we had product market fit there was a lot of growth. How did this happen? What was the anomaly?
And so, I started thinking through the differences of how I had changed, how my skills had changed, and I was trying to attribute it to just, well, I got smarter, I had a little more money, I had a little more skills. Then I took a look at some other fast growing SaaS apps. I looked at things like Baremetrics, Balsamiq, Bidsketch, Woo Themes, Clarity, Basecamp – some of these aren’t SaaS apps, per se. Woo Themes is a subscription WordPress theme service – WP Engine and others. And was trying to pick out what was the advantage that these had over other apps that maybe launched around the same time, even in similar spaces or overlapping spaces, but didn’t have kind of this meteoric growth. A lot of these apps were growing 10, 20, 30% a month in the early months, and once they stopped reporting – because eventually most people do stop telling all the numbers once the table stakes get high. I’m trying to figure out what it was.
So I looked at these. I looked at a whole other list. This is from, I think, our Founder Café homepage, just looked through apps and did research. I talked to some founders. So, this is mostly anecdotal, but it’s based on my experience, my conversations with hundreds of SaaS founders and even other software product types. So, I dug in and I picked out four things I know are unfair advantages. And I think one of them is a requirement for fast, early growth. I couldn’t find an app that was growing quickly that didn’t have at least one of these things in place. When I say “quickly” I don’t mean it was growing three, four, five percent a month. I’m talking the ones that – remember when Baremetrics came out and Josh was publishing his early revenue? And we were like, “What in the world? This is really fast.” It’s that kind of growth. And it may not sustain forever, but at least in the early days how he got there. I’m sorry. We’re going to also talk about things that seem like unfair advantages but aren’t. And then we’re going to talk about how to improve your chances of getting an unfair advantage.
Mike [04:45]: Why don’t we talk a little bit about what an unfair advantage is. An unfair advantage is really a competitive advantage that you have over other people, and whether that’s other people or other businesses. And there’s a bunch of different ways to define this. Probably one of the better ones comes from Jason Cohen. He says that the only real competitive advantage is that which cannot be copied and cannot be bought. This encompasses a bunch of different things. And I think the really important piece here is that there’s a differentiation between those two sides of it. It cannot be copied and it cannot be bought. So, cannot be copied. There’s a lot of different reasons why something might not be able to be copied. You may have some insight or knowledge, for example, on a very specific type of business. Or you may have a background that relates to how a particular process is done, or a new roadmap for how version 2.0 or 3.0 of something is coming out, and you’re involved in the creation of that. Those are the types of things where you have that insider knowledge that nobody else has, and they could learn it but it’s going to take them a long time. The second side of that is it cannot be bought. If you get funding, you still are not going to be able to replicate that. Those two factors in place, I think Jason has got it brilliantly on at that point. The combination of those two factors, that’s what makes it a competitive advantage.
Rob [06:04]: So let’s dive into the first one. Unfair advantage number one is if you are early. So, it’s to be early. This is probably the most common as I looked through. As I ran through Baremetrics and – what was it? Woo Themes? – they were an early one. I think I actually talk about them in a second. I shouldn’t start naming the companies. But being early is a very common way. If you’re early into a niche, it’s a way to get fast early growth, because there’s just no other options for you at the time. The issue with being early is that it’s temporary, because typically – unless you’re in a very small niche – there’s going to be fast followers. So, if you’re the first one to launch into, let’s say Woo Themes as they created their first subscription premium themes, there were dozens of them by the next year. It doesn’t necessarily go away, because you can still keep that brand recognition, but you are going to bring competition. Especially if you talk a lot about your success, which we’ve seen some people do, and bring competitors into the space.
Mike [07:01]: And it seems like there’s places where just being involved in a particular space, or on a particular platform, just by virtue of being there you can almost make yourself early anyway. In some cases you just completely luck out. You happen to be in the right place at the right time, and there’s not necessarily an element of skill or your relationships involved. But if you are – let’s say that you’re working with Woo Themes and you already know the people – you know the founders personally – and they come to you and they say, “We’re building a platform, and we want to be able to build a mechanism for people to build plug-ins on our platform.” By virtue of having those relationships you are able to leverage yourself into being early there. There is a large element of luck involved. You can’t necessarily depend on being early all the time, or even most of the time. It’s something that is just going to happen, and you don’t really have a lot of control over it.
Rob [07:51]: Being early is basically feasible in very small markets, because at this point those tend to be the markets that are underserved in this day and age. In 2016, there are SaaS apps in all the major markets. So it’s going to be feasible in small markets, or in emerging markets. What I mean by that is markets that don’t really exist yet. So again, you think of Woo Themes premium – WordPress was around, but it was really kind of an emerging market when Woo Themes came out. And Stripe had been around a little while, but how many SaaS apps had built on it when Josh launched Baremetrics. Stripe Analytics was an emerging market when he hit that. The other thing is being early requires swift execution. So if you get out early and you build something and you get to market, if you’re still working your fulltime job and you only have five, ten hours a week to work on it, and you do get any type of pickup, you’re going to get trucked. You’re going to get caught and you’re going to get overtaken quickly. So, once you get out ahead, you really don’t want to lose this be early advantage. We look at our two criteria. What do you think, Mike? Can being early be copied or bought?
Mike [08:49]: Not easily. If you are able to quickly execute on something that you see it coming out, and you have the money to be able to do it, then yes. But by virtue of the type of company that would have that type of money, they don’t move quickly. You have that advantage of being small, being able to out-maneuver them and implement something fast that they’re not going to be able to get there in front of you. Now they may get there a little after you, and that poses a bit of a different challenge just because they come in after you and they do have more money than you, they do have more resources, but, hopefully, you can leverage yourself into a position of “dominance.” And if you are early, it’s probably in a small market anyway. And chances are good they won’t come after you.
Rob [09:24]: Very good. Some examples of folks who were early. I’ve already mentioned Baremetrics. It’s SaaS analytics for Stripe, Joshua’s first to market as far as I know. Balsamiq. So Peldi’s startup was a really early mockup tool, basically. If not the first one that I had heard about that was kind of made for the modern age, and wasn’t the old kind of Visio style. Bidsketch, a friend of MicroConf, Rubin Gamez, was really the first proposal software made for the web, and he got early traction with that. Woo Themes, as I said. And then Basecamp. They were the first web-based project management tool that I remember. I’m not sure if they were the number one, but they certainly were the first early entrant.
So as we’re going to walk through these four unfair advantages, I kind of want, instead of everyone just listening, I want you to think to yourself, “Where do I stand on a scale of one to ten?” But I was trying to think what does that mean? What does one to ten mean? And so, I think maybe one to Basecamp. Or one to Baremetrics. Where do you think your app, or the app idea that you have, stands on this rating scale? And this may not be super relevant to you. We have three other advantages, and maybe they’ll be more relevant. But if you are thinking of launching something, it’s good to know. If you think about DRIP, it was probably a one or a two. It wasn’t early. We have hundreds of competitors so that wasn’t necessarily our unfair advantage. So it’s okay if you don’t have some of these.
Mike [10:38]: I think there’s some challenge in trying to figure out where you are in that spectrum, because you look at something like Basecamp now and they have 30 or 60 employees or something like that. And they have millions of dollars that are coming in, and hundreds of thousands, or millions, of subscribers. And knowing whether or not your market – or the thing that you’re going after – and whether or not it’s going to ever get to that point, it makes it difficult to try and relate yourself to where they are. One to Basecamp, I think there may be a better way to put that. I’m not sure.
Rob [11:05]: There probably is. Maybe when we do this next time you can write the outline. No, I was only kidding – BOOM! I only do that when it’s live. I don’t –
Mike [11:13]: I’ll write your talk next time.
Rob [11:13]: All right. Unfair advantage number two is who you know. This is your network. These are the people, not just who you know, but who would be willing to endorse you, who would be willing to promote you to their audience, who would be willing to advise you, or make intros. It’s deeper than just, “Oh yeah, I know that guy who sat next to me at MicroConf.” It’s like, is this person willing; do they know you, like and trust you enough that they’re willing to put a little bit of their reputation on the line in front of their audience, or in front of someone else who has an audience that they’ll make an intro to?
Mike [11:47]: Yeah. You’re basically asking them to spend their social capital on your behalf. So you have to have at least some level of trust, or knowledge, there. And it’s not really just about the type of product that you have, or how good it is, because if you’re just launching a product it’s probably not very good, and you have to have that relationship with them that they know that you’re going to be able to come through, or you’re willing to do what it takes and put forth the effort. As opposed to, “Hey, I’d like an introduction to [Beth Flynn?].” Or somebody else like that. And there’s a lot of social capital there, and if that product tanks, or that relationship goes south for whatever reason, then it’s really their reputation on the line. It’s not yours. So that makes it challenging.
Rob [12:25]: Another caveat, or note about this, is that who you know, you kind of need to know people that your competitors can’t access as well, because there’s potentially a loss of value there. I think if someone was an affiliate for you and a competitor, it could work, but it certainly has a lot less value if your networks overlap heavily. It would be really nice if your network was very different, and the two circles didn’t overlap much. So what do you think, Mike, who you know? Copied, bought?
Mike [12:51]: Definitely not. Well, it depends on your friends, and who you know, and whether they can be bought or not [laughter]. I think that there’s definitely difficulty in copying, or buying, either one of those things. With certain types of markets you can kind of buy your way into relationships. For example, a reseller market, you can spend money taking people out to dinner and convincing them to promote your products, especially if you have the type of margins that are there in order to, essentially, compensate them for that time, or that’s their business. It could very well be that they’re getting paid to promote products and they don’t necessarily care. But I think that, in general, you probably don’t want those types of people to help you promote your product anyway.
Rob [13:27]: And some examples of businesses that were grown based on the person’s network, based on who they knew, AppSumo is one. Most people don’t remember but Noah Kagan was pretty much an unknown in our circles in 2012, 2011, whenever AppSumo launched. And, in fact –
Mike [13:45]: He spoke at the first MicroConf.
Rob [13:47]: That’s right.
Mike [13:47]: He was not known until after MicroConf. We can make that claim.
Rob [13:50]: Yes, I guess so.
Mike [13:51]: I don’t think so.
Rob [13:51]: The two aren’t correlated, but they happen to line up. So, when he launched AppSumo it was a “deal a day” site, where he would get these big bundles of software and he’d discount them, and the first deal they every did 20 or 25% of the deal sales went to Micropreneur Academy members. Somebody posted it in our forums, and it was just the perfect lineup because we all consumed software and stuff, and it was kind of a founder bundle, or startup bundle. And he just picked up the phone and started calling me. And I’m like, “Who is this guy?” A) I don’t like talking on the phone and b) who are you. I get a lot of phone calls. And we talked and I had no idea. And he’s like, “I was employee number seven at Facebook.” And I’m like, “This is crazy.” But he built a lot of that business based on relationships. And he either built them – like he did when he picked up the phone and called me – because later on we did a deal together. He put HitTail on AppSumo. He was able to build these bundles because of his extensive network of people. Then he was able to get affiliates and just do all types of crazy stuff. And it was based on his network.
Clarity.FM from Dan Martell. Dan Martell is also a MicroConf speaker. That dude just knows everyone, and if he doesn’t know you, he will soon. He just utilized that network really well. Clarity.FM is advice for founders and entrepreneurs. It’s actually a network of successful founders who you can call on the phone and just book like ten minutes of their time for X dollars, and it was a marketplace, right? Few of us in this room, if any, could start a marketplace like that, because you need so many high-end founders. And he just picked up the phone, wrote emails, and was able to populate this business. And he later sold it. He sold it a couple of years ago to Startups.co.
WP Engine is another one. Jason Cohen talked early on about how his network didn’t allow him to grow WP Engine, but it allowed him to hire really good people because of his blog, and it allowed him to raise funding like that because he was well known. So those two things contributed heavily towards his growth. And then a shout-out to [Carthoop?]. It’s an honorable mention, because he’s still working on it and growing it. But Jordan, as I view it, he knows a lot of people, especially in his space. So he’s in the e-commerce space. He just has a way of — I see it, and I remember Dan Martell meeting everybody, and suddenly Dan Martell knows way more people than I do in my own circle. And Jordan’s the kind of guy who’s doing that. So these are some good examples.
Mike [15:59]: I kind of joked about it earlier, but every single person behind those companies has been a MicroConf speaker at one point.
Rob [16:05]: I didn’t do that intentionally –
Mike [16:07]: I know.
Rob [16:07]: – but it is – when I’m going to write this and outline it it’s kind of like I’m going through and I went to all these startup lists and all these – I did go through all the MicroConf speakers and I just put this huge list of SaaS apps and startups together. And I was thinking which one do we know grew fast? Which ones didn’t we? And then breaking down the criteria. So there is definitely some bias here. It did come out of me.
Mike [16:26]: Yeah. There’s definitely bias there, but I also think that there’s a correlation with those types of people, because they travel in the same circles. And when you tend to get into a particular – and social network is kind of a nuance term, I think at this point – but when you get into a social network of people – and I would say that MicroConf people are a social network of people. There are various other ones out there. There’s startup groups in different cities. They’re all their own social network. So you have those social – maybe social circles is a better way to phrase it – but when you get into a social circle, you can very quickly and easily be introduced to other people, and over time those relationships develop. And, as you are kind of alluding, over time those relationships develop into something where you are able to just tap into those relationships and talk to people and just get-to-know-you basis, and you’re able to use those people to grow your business. And “used” is probably a strong term, but leverage that relationship.
Rob [17:18]: So, on our one to ten scale, where do you stand between one and maybe a Jason Cohen, in terms of your network?
Mike [17:25]: Jason Cohen knows everybody.
Rob [17:27]: He does. It’s crazy. All right. Unfair advantage number three is, who knows you. So this is your audience. This could be an existing customer base, where there’s people who may have perhaps bought an info product from you. Maybe it’s folks who have subscribed to your one-time sale WordPress plug-in and then you’re going to launch a SaaS app. It’s people who know, like and trust you.
Mike [17:46]: And it could just be people you’ve worked with before. Most people discount, or undervalue, LinkedIn to some extent, because a lot of people will use it as a mechanism for just kind of increasing their network connections in efforts to be able to leverage that into success, or download the list of emails, and they’ll just start introducing themselves to other people. But when you connect with somebody, a lot of times people will start with the people that they’ve worked with in the past, people they actually shared a job experience. Then, from there, you start finding, “Oh, there’s these small groups of people that I worked with maybe at a startup ten or 15 years ago that went on to do other things, and I didn’t realize that these two people now work at the same company, and I worked with them – one at this company and one at this other company – and now they work together. You can also leverage those relationships to ask them about other people; your second or third connections in LinkedIn. And I’m not saying that LinkedIn is the panacea for all of your networking issues, because it’s certainly not. But you can use that to gain some visibility, and it works in the reverse as well. Those people will see you on the other end. So you see it from your perspective, but you are on the other end of that as well.
Rob [18:51]: All right. What do you think, Mike, who knows you, your audience? Can that be copied, can it be bought?
Mike [18:54]: It goes back a little bit to who you know, and whether or not those relationships are reciprocal. Because just because you know somebody doesn’t mean that they know you as well. There’s that element of trust that you can leverage, and whether or not you have a voice that they’re paying attention to in any way, shape or form. So, it definitely can’t be copied or bought. It can be re-implemented, but it’s going to be at a slower growth rate. You’re probably much better off being in a position where other people know you than you know of them on a peripheral basis. For example, I know Jason Cohen, but it’s not like I’m on his inner circle or anything. And he knows who I am, but the relationship is not, I would say, directly equivalent in both ways.
Rob [19:35]: All right. So, examples of businesses that have been built on the who knows you, but built on an existing audience. SumoMe. So going back to Noah Kagan, he had already had AppSumo, he had a very large email list. 750,000. I think they’ve kind of made it public. And then when they went to build SumoMe, they basically had the big email list that they could get started really quick, and they got to six figures in the installs – hundreds of thousands, or over a hundred thousand pretty quickly based on that list. They took their existing audience and they very intelligently turned it into a software success.
Edgar, meetedgar.com. This is Laura Roeder. She had an audience of folks who had bought training and information products from her on social media and Twitter marketing. It may have been Facebook, too, but definitely Twitter marketing. Then she started a SaaS app for essentially doing just that. It had a system to it, and was able to pretty quickly get to – I think she got to $100,000 a month of MRR within, was it six months or ten months? It was very fast. Anomalous growth.
KISSmetrics. Hiten Shah, Neil Patel. They started Crazy Egg. They had an audience of marketers who said, “These guys build good products.” When they came out with KISSmetrics, they already had that list of customers, and they had a small marketing audience, but they really had a lot of customers who trusted them.
LeadFuze. Justin McGill started this as a productized service. It was doing cold email outreach. He actually had what they call BDR’s – business development reps – he had a staff of them who were doing email outreach. They were actually doing some for DRIP. They would go get customers. Then he built LeadFuze, the software product, behind it using that revenue. Then he sunsetted that productized service, and now LeadFuze is a SaaS app – and he’s public about this so I can say it – but they hit 30,000, 31,000 in MRR in a short time. Again, it’s like six months or something. So it’s pretty good growth.
Then DRIP. I would say that one of the big reasons that I got early traction, and that Drip was able to grow the way it did, was a little bit because of my network. But I think a bigger part of that is because of who knows me. It’s because when I said, “I’m launching something and I think it’s good.”, people would listen. They would at least give me the time of day. Whether they were going to switch that day from MailChimp, I at least got the benefit of the doubt.
Mike [21:41]: I think there’s an important distinction to make here when you use the phrase “Who knows you?” It is not necessarily who is in your audience that knows you. At least not the number of people because, for example, ‘Startups for the Rest of Us’ has 11,000 listeners or weekly downloads or something like that. All it takes is one person in that audience who they may know 200,000 people, or 300,000 people, and they may have a channel that you can leverage. So, even though your particular audience, the people listening directly to you, may be lower than you’d like, it doesn’t necessarily mean go out build an audience. You could very well have just five friends, and one of those people, all it takes is their relationships. And if they know who you are and they know what you’re building, “Oh, let me introduce you to so and so. They can help you.” That’s where that social capital comes in. That’s where those social circles are really helpful. So, it is not necessarily equal in both ways. But that’s an important distinction about “Who knows you?” is not just about the number of people that know you. That number gives you a bigger surface area, but it also gives you those people that may have their own relationships that can work in reverse for you.
Rob [22:45]: The influencers. So, in terms of “who knows you,” where do you stand from one to ten with ten maybe being someone like Noah Kagan, who has, obviously, a very large audience. And our fourth and final unfair advantages for self-funded SaaS founders is growth expertise. This one’s a little tricky. Growth expertise is knowing the tactics, knowing the strategy, and having experience doing these things. It’s not just reading about them, but it’s having this in-depth knowledge of it. And it’s people who we think of as the best growth people. That’s what I mean by expertise. I don’t mean someone who has toyed around with stuff, or someone who has done some marketing. And there are people, who without an audience – this was the tricky one where I said, “I have apps here that have grown with no audience and very little network as far as I can tell. And they weren’t early so how did that happen?” And every one of them there was a founder, or there was a marketer there, who just knew his stuff, his or her stuff. They just nailed it. And that’s what I’ve encapsulated with this one.
And copied or bought is a tough one on this. Copying, very hard. It could take years to get that expertise. Bought, could be bought perhaps with equity, but the best growth people we know they don’t just work. You can’t just pay someone $200,000, $300,000. These growth people, they’re not going to do it. So bought, very, very hard. You would need to give away a chunk of equity.
Mike [23:55]: I think that’s the key piece there. You can pay for expertise, but there becomes a certain level of expertise that is, I’ll say, early enough in a particular technique of some kind that is really difficult to buy them. You can go out and you can find people that are doing consulting for $20,000, $30,000, $50,000 a week for certain things, and you can’t buy them. There’s stories from unnamed individuals who’ve probably been a little bit public about – without naming names – and they’ve said, “I was offered $1 million dollars for annual salary and I turned it down.” And it wasn’t to say that they couldn’t be bought, because they were obviously doing the consulting work, but they didn’t want to be tied to that, and there was no equity involved. So when you get into those situations, to find somebody that is that good that early, without offering them equity, I think it would be really challenging to be able to buy them.
Rob [24:42]: Some examples of these companies are companies like Sean Ellis’ Qualaroo, who’s here in the house.
Mike [24:48]: Actually, it’s not Sean Ellis –
Rob [24:49]: Sean Ellis. Yes, I know he sold it, but he grew it and then sold it. But Qualaroo’s a sponsor of MicroConf this year. That’s not why this is here. I put this here back in April. We have Buffer from Joel and Leo. They were a little bit early into that market, but they weren’t the first. There were plenty doing what Buffer was doing. But is it Leo? Leo’s the growth guy, is that right? I forget if Joel’s the – Anyway, one of them is the programmer and one of them is more the growth guy. And that dude just hustled, and they didn’t know anybody. He cold emailed me, and he knew Hiten, and then he cold emailed me and said, “I’d love to do a guest post or two on your blog.” And I was like, “Well, you know…” And he showed me examples of his writing. I get a lot – if you have a successful blog then you get tons of offers for this. I typically turn them down but I said, “Well, give me a sample.” And his writing was really good. Over the course of a couple weeks, he did two guest posts. I found out later he was doing one guest post a day on all the big blogs. If you go back and you look at that time when Buffer was getting started, you look at everybody, like Jason Cohen, my blog, on Startups, [?] blog – just pretty much every blog you can imagine that has any type of influence, any type of link-back authority, and Buffer has a guest post on that. He was just hustling. He had growth expertise and he had hustle.
Crazy Egg is another one where they didn’t have an audience at that point but Hiten and Neil, let’s just say, they’re at the top of their game, and some of the best in the world at this.
Mike [26:04]: Going back to your Buffer example. When you do that type of thing and you’ve reached out to Hiten Shah or Rob Walling and you get at least some visibility. You said yourself, “I had no idea who this guy was.” And you asked for a sample of his writing, and then started looking back and seeing where else it was that he was being published, you can leverage those relationships, because really what you’re doing in a way is – back to your stair step approach – you’re leveling up the people that you’re talking to. You’re talking to people who have fairly large social circles, and you leverage that relationship into a larger relationship that they may have with somebody else who is bigger. Then you go bigger, and you keep going bigger. And you go, “By the way, I did a blog post over here for Neil Patel. And I did one for Rob Walling. And I did one for Hiten Shah.” And then it’s like how do you turn something like that down? You can leverage those types of relationships, but you can’t just go for the big fish. You’ve got to work your way up to it.
Rob [26:51]: In terms of growth expertise, I’d ask you to think about, “Where do you stand on a scale from one to ten, where ten maybe someone like a Sean Ellis or a Neil Patel?” Whoever you think in your mind is maybe the best of the best. So, a couple other things that I’d say are not unfair advantages, and that a lot of these are just table stakes for competitive spaces. If you’re going to go into a space with 100 competitors all of these are table stakes. If you go into a niche that’s maybe smaller and doesn’t have a tone of competitors, these will get you an advantage, but it’s not an unfair high growth advantage having just these things. I have five or six things here. One is great design and UX. I love great design and UX, most people in here probably do. But this alone isn’t going to cut it. This is table stakes if you’re going to be in a competitive space.
Mike [27:32]: And the reason is because that can be copied. You can very easily copy that.
Rob [27:36]: Copy or buy it.
Mike [27:37]: And that goes back to Jason’s quote, “You can copy it or buy it.” You can go buy the same theme that they did. Or you can buy the same designer that they used. There’s way to copy a design. It’s not a big deal.
Rob [27:46]: Technical or design skills. While, again, I think these are super valuable, most of us in here do. These are things that can be bought for a couple hundred thousand dollars. You could hire a really good technical or design person, or a great design or UX person, unlike that growth thing. Money. Money’s not an unfair advantage. Maybe unless you’re the only one in an entire space that has money, but money is cheap these days. It may not be forever, but it’s pretty easy to get a round of funding. As we’ve heard a lot of people just having some success, and then people are throwing hundreds of thousands of dollars at you. This is the climate we currently live in. Five years ago it wasn’t that way, right after 2008, 2009 – which I guess is not seven years ago – and in five years it may not be that way. But right now money is pretty easy to get.
An uncopiable idea. When I was researching unfair advantages, this came up in a few of kind of the big MBA like Stanford Business Review, Harvard Journal of such and such MBA stuff, and an uncopiable idea is something like a Google where you have that killer algorithm and it’s completely uncopiable. And the reason that I don’t think this applies to us is because this is for self-funded SaaS, and I could not think or find a single self-funded SaaS app that ever had an uncopiable idea. So that’s why it’s on this list. Domain expertise. Let’s say you’re selling to lawyers. I think that’s a good thing, that if you were a lawyer, your brother’s a lawyer, your co-founders a lawyer, that is really good. Not uncopiable though. And then passion, interest, time, focus. Again, these are table stakes. These are things that I used to think, “If I have that, I have an advantage over people.” These days I don’t think you do.
Mike [29:13]: I think everything that you just listed there, all of its stuff that you could either copy or buy. And they are helpful, but they’re not the only things that are going to get you to a higher level.
Rob [29:21]: So if you look at the four unfair advantages we’ve listed – we’ve listed be early, who you know, who knows you, and growth expertise. The latter three – who you know, who knows you, and growth expertise – those come with you. Those are skills, or assets, that you can bring with you from product to product, year over year. Being early – I’m not trying to downplay that – I wish I could be early actually. I think that’s the thing is I’ve never been early to anything in my life. I’m not the creative type. And I think that there are certain people who are just going to be thinking that way and are going to be at the right place, at the right time. But for me, I like to develop repeatable models that can be used over and over. That’s what we do at MicroConf is try to teach things that, not just say, “Well, go be early.” because that’s not helpful. Because you don’t know how to do that. We like to teach things that are fairly repeatable, testable, validatable. And so these latter three are things that you can take with you over time.
Mike [30:10]: You’re not even early to the podcast half the time.
Rob [30:12]: I know. I have to keep you waiting. And so, to wrap us up – there’s just a couple of more minutes here – it’s interesting, as I looked at my stair-step approach, where I talk about building one-time apps and then stepping up to one-time sale apps, like WordPress plug-ins and such. Then stepping up to step two which is selling enough of those until you can buy your own time. And then eventually stepping up into recurring revenue. This fits pretty well with this whole unfair advantage thing, because if you do this right – you’re going to launch a WordPress plug-in for e-signature or for lawyers or for something. For sales people. For ecommerce. Then you’re probably going to launch maybe a few more WordPress plug-ins in that space. And by the time you get to step three, and you’re trying to do recurring revenue, which is really hard as we kind of all hear over and over, you may have that. You’re likely to have maybe some growth expertise in that. Maybe you have a network of people in that space, which is who knows you. Maybe you have an audience in that space, which is who you know. So the ideal is that if you travel a path that you would build these skills and build these unfair advantages up over time as you go through your journey.
Mike [31:13]: That was actually an interesting thing that I looked at. Even on your stair step approach, early on you look at the things that you did. It was the WordPress plug-in, all the single products, the one-time sales, things like that. And you didn’t even really have any unfair advantages at the time. You were basically in learning mode. You’ve got the learn, build, grow stages for, basically, how DRIP went. But early on it was just you were learning, and you were in learning mode the entire time. And eventually you got to a point where you learned and then people knew who you were. And then after that it was kind of going a step beyond that. So you built up these unfair advantages over time. And I think that that’s an interesting point, is that just because you don’t have them now doesn’t mean that you can’t have them in the future. Being able to build them over time, there’s a trajectory that you can get, and as you build that trajectory – as you build more products or launch more things or do different things in different markets – you learn to toggle the levers in ways that will accelerate the growth in ways that were previously never possible.
Earlier in Steli’s talk, somebody had asked him could he have started with Close.IO and he said, “No, I don’t think that I could have, because there were a lot of things that we needed to go through and we needed to learn.” And I think that that’s very true for most of the paths that many of us are on as self-funded bootstrappers. You really need to go through those missteps and learn those different things along the way. As you get further advanced you learn the techniques and the patterns that come up where you can turn that knob just a little bit tighter and get a growth acceleration that you never thought possible, or that you weren’t comfortable with.
That’s one thing with, for example, building an email list or sending out emails. People are very hesitant in their early days. You’ve got 25 subscribers. “Oh, I’m really not sure about hitting the button on that email that I’m going to send.” It’s 25 people, it doesn’t matter. There’s people, as they proceed past that, you get to 2,500 and 25,000 and you’re just like, “Okay, whatever, I’m just going to hit the button.” And it doesn’t matter at that point because you’re comfortable, you’re confident that you’ve gone through those missteps, and it doesn’t make a difference anymore because you’ve learned what to do and realized that some of the mistakes that you make, they don’t matter nearly as much as you think that they do.
Rob [33:12]: I like that you used the phrase “self-funded bootstrappers.”
Mike [33:15]: Sorry.
Rob [33:16]: So the question we want to leave you with today is, “Which of your advantages do you want to increase?” And now I think we have time for just a couple questions from the audience.
Mike [33:24]: I made up that term, by the way. “Self-funded bootstrappers.”
Rob [33:27]: Self-funded bootstrappers. Hiten would love and hate it, right?
Mike [33:28]: You want to hear another term I –
Speaker 3 [33:30]: He would hate it.
Mike [33:32]: I’ve got another one I made up. Plagiarism.
Rob [33:33]: Plagiarism. Nice.
Andreas [33:35]: I’m Andreas. I’m the founder of [Hunter Recruitment?]. And I was thinking about the unfair advantage, and I was thinking about the problem because we are building a platform with a validation machine. But really maybe our unfair advantage is the people that we know, the tech people that we know. We are [residents?] right now in [Google Campus?] in Madrid, and probably the disadvantage is the people that sit down near to us. We really want the other startups outside the campus know these people could be. I don’t know if you agree with that.
Mike [34:17]: I would say it does map back to that, because it is partly about who you know and who knows you. And I don’t want to directly say it’s because of geography at that point, because you sit close to them. But in a way it is. You are sitting very close to them. How many other people are sitting close to them that are doing what you do? That are trying to connect tech people with businesses that are trying to hire them? So there is that element of geography, but when you translate it to the internet it’s not exactly one to one mapping.
Andreas [34:39]: A relationship.
Mike [34:42]: Right. But that relationship is there because you sit around the corner from them. And you’re probably going to give somebody who sits around the corner in another cubicle the time of day, whereas if somebody just cold calls you over the internet and says, “I’m James Kennedy from Rubberstamp.IO in South Africa. I’d like – “. You’re not going to pay attention, unless you wanted that and you’re basically right there.
Rob [34:59]: Any more questions? May be time for one more.
Speaker 4 [35:04]: What do you think about software patents, because I think there are some companies who use them and abuse them as an unfair advantage?
Rob [35:13]: Software patents?
Mike [35:14]: Software patents, yes. I think both Rob and I have lots of things to say about –
Rob [35:16]: Travesty.
Mike [35:17]: – patents.
Rob [35:17]: Yes, I have a lot of opinions on that. Go listen to the ‘This American Life’ and the ‘Planet Money’ episodes on it. It’s absolutely catastrophic. That’s my opinion. Software patents in the U.S. were not allowed until 1998, and since then it has become an absolute epidemic.
Speaker 5 [35:31]: Okay, thank you. A quick question. How do you recognize when you’re early then when you are wrong?
Rob [35:36]: That’s good. This is our last question. How do you recognize when you’re early or when you’re wrong? Okay, so this advantage is to be early and hit it at the right time rather than – you’re talking about being too early. Being too early to a market is where there’s no one there that needs it yet. And then in a year you see someone launched the exact same thing and it takes off. So like Foursquare had been done like six times. Facebook had been done three or four times, almost exactly the same way, but there was something about the flux of technology and such. You know when you’re right, because you’re right, and the curve looks like this. And you know when you’re wrong – I guess what I’m saying is, you said early versus wrong, and I’m saying too early is equivalent to wrong. But this early advantage is actually when it works. It’s the perfect time. You’re just early ahead of other competitors, but you hit the market at the right time. That’s what I meant by it.
Mike [36:31]: I would say you don’t know until way after the fact. If you are early there’s varying degrees of early. There’s “way too early”, which is – as Rob said – is effectively wrong. But there’s also near the tail end of it, when you’re basically ready to give up, there will be an uptick in growth and that’s going to start giving you hope. And you maybe stick around a little bit. That’s the point where you would recognize, “Hey, I was just early,” versus you were way to early and you get to that point and you just give up. And it’s a matter of how much time do you spend in the “zombie product” land where you’re not really making enough money to be able to support it and be able to grow it the way you need. And I think that boils down to trajectory at that point. How fast are you growing whether it’s users or installs or money? Those are the three things that you can, at least initially, measure a business on.
If you have a question for us, call our voicemail at 1-888-801-9690 or come to MicroConf. You can also email us at questions@startupsfortherestofus.com. Our theme music is an excerpt for ‘We’re Outta Control’ by MoOt, used under creative comments. Subscribe to us on iTunes by searching for startups and visit startupsfortherestofus.com for a full transcript of each episode.
Thanks for listening and we’ll see you next time.
Episode 299.5 | Ten Lessons Every Startup Founder Should Learn from Bill Walsh
Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike talk about a book by former head coach of the San Francisco 49ers Bill Walsh, about his standards of performance. Rob and Mike pull out 10 different points from the book that are most relevant to a startup founder and elaborate on them.
Items mentioned in this episode:
Transcript
Rob [00:00]: In this episode of ‘Startups for the Rest of Us,’ Mike and I talk about ten lessons every startup founder should learn from Bill Walsh. This is ‘Startups for the Rest of Us’, episode 299.5.
Welcome to ‘Startups for the Rest of Us,’ the podcast that helps developers, designers and entrepreneurs be awesome at building, launching and growing software products. Whether you’ve built your first product, or are just thinking about it. I’m Rob.
Mike [00:30]: And I’m Mike.
Rob [00:30]: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week, sir?
Mike [00:34]: 299.5. Are we going down in the numbers here?
Rob [00:38]: Yeah, we’re going to start doing every half episode. Every episode will be half an episode. No, you want to tell them why we’re doing that? How you thought of gaming the system here?
Mike [00:46]: Yes. So we’re coming up on episode 300, and we were trying to think of something good to do for the 300th episode. And a lot of the ideas that we came up with were going to take – I wouldn’t say a fair amount of time – but enough time that I didn’t think that it was really possible for us to pull some of them off. So, I kind of had the idea that way back – I guess probably two, three, four years ago – we would do these half episodes on occasion for special occasions, whether it was right after MicroConf, or leading up to certain things. And next week is MicroConf Europe, so I thought that it would be appropriate to say, “Let’s slot in this episode here, and then next week what we’ll do is we’ll record a live episode at MicroConf Europe, and that will be the 300th episode.”
Rob [01:27]: And it’s our first live episode ever.
Mike [01:30]: Yes. And the people at MicroConf Europe have no idea this is coming. We’ll kind of announce it on the spot. But they’ll get to hear it, essentially, in advance of everybody else.
Rob [01:38]: And it’s an experiment. We will see if it’s good or bad. We tend to have quite a bit of editing, so it’ll be fun to try to hammer this out live on stage with an audience. And so this is episode 299-and-a-half but it is a complete episode. It’s not a half-length episode. Is that correct?
Mike [01:53]: Yes.
Rob [01:53]: Cool. So other than that, what’s going on with you?
Mike [01:55]: Well, the survey that I talked about last week that I had mentioned on the show about trying to aggregate data from different startups that have launched, and how far they got, how much customer development people did, how much revenue those endeavors made. I’m up to 55 responses so far. So, it’s interesting to see the range of the data that’s coming in. Everywhere from people who made absolutely nothing from it, to people who’ve made a couple hundred thousand dollars within a few months of launch. It’s nice to be able to see that kind of information. And the other thing I’d say that’s striking – or that’s really interesting – is the number of people that were comfortable to just say, “Yes, you can share anything you want. You can highlight it. Share my name and product name, etcetera. I don’t care.” I’ve gotten over 40% of the people who’ve submitted have said that level of sharing was okay. But the flip side of it is there’s another 40+% have said, “Yes, I want to be completely anonymous in sharing this.
Rob [02:48]: Very cool. Congratulations already. I haven’t filled out my responses yet, but I plan to do that while I’m sitting in an airport, because tomorrow I’m wheels up to Barcelona. I’ve got about 12 hours of flying ahead of me as you do as well. I think we’re flying on the same day.
Mike [03:01]: Yes.
Rob [03:01]: So, I’m looking forward to that. And I guess the other thing on my radar is since Leadpages acquired us – now it’s almost a month ago – trials have kicked up substantially, as you would expect. Their marketing engine is a well-honed machine, and so we get to scale support and demos and all other kinds of stuff. So that’s the fun that I’m dealing with now. And actually, when I say fun, I’m not being facetious. Like it actually is pretty enjoyable. It’s nice to have the resources that these guys do because they do have an entire support staff. And so, they’re basically training – I don’t have to go out and hire people from scratch. They’re able to train in-house people and kind of lend them to us for now. So, it’s kind of a fun process to talk about how they do things, how we do things and comparing them, and taking the best of the two, and saying, “Boy! There’s some things that I like the way we do it better, and then other things it’s like, ‘You have a much better system for that. Why don’t we use that?’ So that’s been kind of neat to collaborate on with just a bigger, I’ll say, more experienced team in terms of supporting large volumes of customers. So that’s been what I’ve been up to for the last week.
Mike [03:59]: It’s interesting that you put it that way, because being able to take the best of two different ways of addressing the same types of problems — because a lot of times when you’re running your own business you’re kind of operating in a bubble, because you don’t necessarily have experience from other companies to bring in. I mean, you’ve obviously worked in different areas on your own, or worked in previous companies before you launched something yourself, but you aren’t necessarily bringing a lot of additional experience, or different ways of handling the same types of problems, into the same company, because your hiring is going to be limited. You have to grow at least kind of slow because you are bootstrapped. And when you start combining teams like that, or even just bringing one new person onto the team, if they’ve done something differently at a previous company it brings in this wealth of knowledge and experience, and it’s nice to have two successful teams that have come together and collaborate at that level to be able to figure out, ‘What is the best way to do this?”
Rob [04:52]. Yes. And the interesting thing is, obviously I’ve bootstrapped for 15 years now, and it’s a certain way of thinking about things, and “How do we automate this?” Or, “How do we dial that down?” And, “It’s going to take two months to hire someone.” And, “We don’t have budget right now.”, and all that stuff. But Leadpages has been in business for what three, three and a half years now? And they think in terms of having lots of resources, because they raised a big chunk of funding. And so, it’s two different ways of looking at the same problem. And it’s cool to see that sometimes the bootstrapped way of looking at it, I think, is superior, and often times the resource-heavy, or the kind of resource-rich, way of looking at it can be better as well.
Today, we’re talking about ten lessons every startup founder should learn from Bill Walsh. And I’m very excited about this topic, actually. This is one that I’ve read in the past, I don’t know, six to 12 months let’s say. Really blew me away. It’s not even a new book. I think it’s at least ten years old, but it was recommended to me by my older brother. And the book is called ‘The Score Takes Care of Itself: My Philosophy of Leadership.’ And Bill Walsh was the head coach of the San Francisco 49ers, and he’s one of the greatest football coaches of all time. It’s pretty much inarguable that he is one of the greatest. There’s Vince Lombardi, there’s Bill Walsh, there’s a handful of others. But he absolutely was at the top of his game.
I really liked this book. The 49ers basically hired Bill Walsh in the aftermath of a 2 and 14 season in 1978. For those that aren’t familiar with the San Francisco 49ers, that is an American football team in San Francisco. And in 1978, they won two games and they lost 14, which is an abysmal record. And the team had posted losing records in five of the previous six seasons. So, it was a terrible situation, and he actually talks about this in the book. There was no discipline, there were people getting in fights, and there was all types of madness going on. Walsh came on in 1979 and he won the first Super Bowl with the 49ers. It was two years later, in essence. It was 1981. And then he won in ’84 and ’88. And he won ten of his 14 post-season games along the way, six division titles, three NFC championships. Just amazing record. And he was named NFL coach of the year a couple of years and he was elected to the pro football Hall of Fame.
So, really an astounding record. To be honest, I like football a lot, but I haven’t watched it in years but I have always respected people who perform at the top of their game. Even if you’ve never watched an American football game, or you don’t care about it or whatever. You don’t need to like sports to, a, like this book, and, b, enjoy and learn from what we’re going to talk about today.
Mike [07:24]: So let’s dive right in.
Rob [07:25]: Cool. So this – to be honest, boiling it down to just ten takeaways – was a challenge for me, because he has this thing called “standards of performance”. And he had this for everyone in the organization. So all the players had it. They had a certain standard of performance. All the staff had it. He said he has his own list of 16 standards of performance. And, in addition, I had another 10 or 15 kind of notes, quotes, thoughts, from him. So I easily could have put 30 points in this podcast episode worthy of discussion. But, obviously, that would be very long and it’s too much information. So, I basically boiled it down to what I consider kind of the best ten that are most relevant to a startup founder. So let’s kick it off with the first one.
The first learning that I want to talk about today is that everything starts with work ethic. And he talks about Joe Montana and Jerry Rice, also Hall of Famers, also arguably one of the best quarterbacks and one of the best receivers ever to play the game. He talks about the two of them doing drills on the field that high school players wouldn’t do because they were too boring. And so he would watch these guys who were at the top of their game do very basic arm drills, or very basic catching a ball and throwing a ball – I mean, just stuff that no one else would do, but they worked so intently at it to keep themselves at the top of their game. And they knew that just because they were the best doesn’t mean that you can relax. And the way they got to be the best was through that work ethic.
And there’s this other quote I really like relating to this. This is one of his standards of performance. He says, “Exhibit a ferocious and intelligently applied work ethic focused on continual improvement.” And I think every startup founder can learn from, and would be way better off then they currently are, if they would think about everything starting with work ethic and to focus on continual improvement. And the successful founders who I know are killing it and are doing it year after year, startup after startup, are the ones who are focused on these two things.
Mike [09:19]: I think there’s a natural tendency to try and jump forward in terms of your abilities, or the things that you’re trying to tackle, or the challenges you’re trying to overcome, just in an effort to get better. Nobody wants to go out and try to learn how to downhill ski, for example, and sit there on the bunny slopes forever. You really want to get out there and go out to the diamonds or the double black diamonds. And you have to start at the beginning. Otherwise, you’re probably going to fall and kill yourself.
But the fact of the matter is just practicing a lot of those fundamentals can really help you hone in on your skills so that you can do them, essentially, automatically and not have to think about it, or even worry about, ‘Am I going to be successful at this?’ And in this case, obviously like with Jerry Rice is, “Am I going to catch this ball?” It probably never even crossed his mind. It was more of an, “Okay, I know that this is coming in. I’m going to catch it. Then what do I do?” But it’s only a result of him having practiced catching for so long, and so many times. So it becomes just so repetitive, and so second nature, that he doesn’t even have to consider the ramifications of failing in those particular cases.
Rob [10:22]: Yeah. And I want to clarify, too, when I say work ethic here I don’t mean you need to work 80-hour weeks. What I view work ethic as is being incredibly focused, and when you’re working, getting it done. Sitting down, hammering through, not avoiding and not kind of having a mix of conversations at the watercooler, or being on Twitter and Reddit. I mean that you are a focused individual, and that you’re relentlessly executing when you’re sitting in front of that computer. And when you step away, you’re not. That’s the time when you rest your brain. I’ve seen a lot of folks who say, “Hey, I work 60 or 70 hours.” But when I’m actually around and working with them it’s like, “Oh, no, you’re in front of a computer for 60 or 70 hours. But you’re not actually sit there and focused.” Some folks fool themselves, I guess, is what I’m saying. So don’t feel like when I say work ethic it’s like, “Oh man, he’s telling me to work ridiculous hours.” That’s not the case.
Mike [11:09]: It’s interesting that you bring it up and put it in that light, just because if you think about a 40 hour a week job that most people will go to, you’re paid to be there for 40 hours, but the reality is that most people don’t actually work 40 hours when they’re there. And if you were to sit down and just focus and intently try to be productive, then your level of productivity just soars. It skyrockets way above and beyond what a normal person, or a typical worker, will be able to achieve, because you’re focused on that productivity and you’re trying to do better there. But if you’re getting paid to just show up, or if you are just showing up, then you’re not going to be nearly as productive.
Rob [11:47]: The second lesson is to blame yourself for poor team performance. And you can imagine how this plays out as a professional coach. You are going to get blamed if the team doesn’t perform well. But this reminded me of a story. A friend of mine was in grad school and she had a supervisor, and there was a whole process where the friend had to put together this survey or a document that was going to get sent out. And there were three or four people that reviewed it and they were supposed to review it and they all signed off including the supervisor. And then a document went out and it had a typo in it that was a big deal. It impacted the effectiveness of the survey, basically, or wasn’t just a non-issue. It actually caused them a bunch of work down the line. And the supervisor came down on the person who had written it, and basically was like, “You’re sloppy, and you don’t have attention to detail and this is your fault.” And when she told me the story it blew my mind because I never think that way. And I think that if you have someone who you think is sloppy and isn’t working out, then they shouldn’t be working for you. There’s a mismatch there. Either your expectations are too high, or they’re not very good. Get rid of them, because if you have a team that you like working with and the people are solid and there’s a big mistake and a server goes down, or someone’s money gets lost, or emails are sent at the wrong time, any of these things that are basically catastrophic happen, you don’t blame the team. You blame yourself, or you blame the process. And if the process is broken then it’s your fault, because you’re the leader and you’re the one putting it in place. This is something that I try to embody, and I feel very strongly about this. We can all learn from the mistakes, but it’s never time to blame someone for mistakes. If your team makes mistakes or has poor performance, it should always reflect back to the person or people in charge.
Mike [13:24]: I think sometimes this puts people in an awkward position where they’re trying to figure out whether or not they should continue down a particular path with a contractor or an employee, or if they should just kind of throw in the towel and move on to somebody else. Because you have to have a certain amount of empathy as a human being to run a company. But at the same time there are times when you have to put the needs of the business and the customers above the individual needs of the contractors or employees that you’re working with. And as you’ve said, if it’s not a good match then perhaps it’s time to part ways. But I wouldn’t say that that’s necessarily always the easiest decision to make either. So you do have to keep in mind, though, that you are leading the team, and if you are not making the decisions that need to be made then that reflects poorly on the team itself, and people notice that kind of thing. And that’s something else that may make some of these decisions a little bit easier, because if you’re not doing what you need to do and, I’ll say culling the team of people who are not contributing on the level that they need to, then people are going to notice and they’re going to become demoralized. And then the entire team’s performance suffers. It’s not just going to be one individual person.
Rob [14:30]: As you were talking I was reflecting. One reason why I like this book so much is because I think it says things that I already believed but that I maybe haven’t put into words. I’ve never written this list of ten, but as soon as I started reading through them I was like, “Oh my gosh, yes. Yes, this is so true. That’s exactly how I want to be. Or how, if I’m working for someone, I want them to kind of embody all of these things.” And it’s really interesting.
So the third lesson is not to win by fluke. He says, “Don’t win by fluke. Always examine what caused your victory and how can you repeat it and improve upon it.” And the reason this struck me is because you hear these fluke startup stories of someone launching – whatever it is – Flappy Birds or back in the day it was Hot or Not. Remember that? Or Plenty of Fish or whatever. I’m not sure Plenty of Fish was a fluke but you get the idea. There are these stories that are told – or the Facebook apps that suddenly were making the guy a million bucks a month. And while that would be great if we could all do that, we just can’t all do that. It really is a story that is kind of portrayed by people wanting to sell magazines. And that if you are in this for the long haul – you’re not just trying to make a bucket of money, and it’s kind of like a gold rush in a sense – if you’re not trying to do that and you actually want a sustainable lifestyle, and you want a much better chance of being able to live off the proceeds from your startup or your app, then don’t look for flukes.
Now, you can look for arbitrage, and you can look for angles, but if you have a victory, if you have an early success, I think you should look at that and say, “How can I repeat it? How can I improve upon it?” And I see this through my own career with a bunch of a failures and then DotNetInvoice makes a few thousand bucks a month, and I looked at that and said, “Boy, what worked here and how was that different than all the previous ones? And now, how can I either improve upon this or repeat this over and over?” Rather than just constantly going for moon shots, which I think is perhaps the curse of the startup space; to always think, “Boy, I’m really just going to have to catch a fluke here, and then I’m going to make $10 or $20 million.” Whereas, as we’ve talked about, we’re about startups for the rest of us, the people who want to turn this into a sustainable thing. And it’s much more of a calculated repeatable process.
Mike [16:35]: Yeah. This is kind of the anti-lottery strategy. You’re not hoping against hope that something’s going to happen and fall your way. You’re not making bets that are unreasonable to pay off in the end. It’s really about taking a hard look at what is working and what’s not, and doubling down on the things that are working, and either changing or getting rid of the things that aren’t. Because as you said, if you can find a strategy that works and is repeatable then that’s what you should do more of. And anything that’s not working, get rid of it.
Rob [17:05]: The fourth lesson is to make friends not enemies. And Bill Walsh specifically says, “Enemies suck up too much time and emotional focus. One enemy can do more damage than the good of 100 friends.” And this is something that I’ve long struggled with because I don’t get into the Twitter fights, or the comment fights, or the Reddit fights. And I see people doing it and I always feel like, “Boy, a, that takes an emotional toll and, b, don’t you have better things to be doing then sitting here saying how you’re right and the other person’s wrong?” But I feel like I’m kind of in the minority, and it’s always hard to back down from a fight if someone says something – because basically it’s someone picking a fight with you. And what he’s literally saying is back down. Even if someone is up in your face back down. It’s a hard thing to do, but what I’ve found is that it saves so much time, and so many emotional and mental cycles, that it is now my defacto way. Especially online where people can get out of hand pretty easily. I heard someone talk about this. It was Scott Hanselman, actually. It was on his podcast, and I think he was talking with Richard and they were going back and forth. And Richard was like, “Yeah. All these guys were saying all this stuff and you just didn’t say anything.” And he was like, “I basically have better things to do with my time. And there’s absolutely no use in responding to them.” And I was like, “Oh my gosh, that’s totally how I feel!” I really like this one. And it is hard to do. When someone says something that you know is incorrect, and it’s attacking you, and it insults you, it is very hard not to pipe back. And what I find is that typically you will pipe back once, and it doesn’t make a difference, because they either come up with some new thing, or they tell you, “Now that thing that you said is wrong.” And it becomes this thing where you’re now checking Twitter instead of working, and you’re all riled up to no end. You won’t change their mind, it will not improve you, it won’t sell more of your app, it won’t grow your business. None of that does anyone any good. So, it’s a really interesting thing, I think, for startup founders to learn. And I love that he puts it this way, “Basically, make friends not enemies. And that one enemy can do more damage than the good of 100 friends.” And he means no only for your reputation, but he really means also the emotional toll that it takes on you. Bill Walsh has his own story of actually doing this once and making an enemy and then having to turn it around. It was with Howard Cosell who was an announcer here in the States. And it’s a really good story of that. If you listen to the book you can get more detail.
Mike [19:24[: I’ve had conversations with people about similar situations at MicroConf before, where they’ll have a story about, “Oh, I got into an argument with somebody on Twitter, of all places.” It’s not like any argument ever gets solved on Twitter. But that’s where I would say that they’re probably the most visible, and where a lot of them – you know, you’ll see these things publically get started. And then there’s people who will just walk away and they’re just like, “Yeah, I’m just not even going to bother to respond.” It’s interesting to see the people that have that ability to just simply walk away and not bother to get involved are also the people that have a tendency to just get things done. They speak with their actions as opposed to their words, and, as you said, if you get into an argument with somebody it’s very difficult to convince them, especially if they don’t know who you are and they don’t have an understanding of the things that you’ve done, or your history, or anything like that. People just simply don’t listen, and it’s distracting to get into those arguments and feel like you need to respond. It’s difficult to deal with that on a regular basis anyway, but especially on a public forum like Twitter or various other places. If you get involved in those it can just be distracting to you, and your entire day of productivity can be completely shot if you start paying attention to that.
Rob [20:37]: The fifth lesson is to, “Take pride in your effort as an entity. Separate yourself from the result of that effort.” And he basically says, “Deal appropriately with victory and defeat. Don’t get crazy with victory, nor dysfunctional with loss.” He talks about winning Super Bowls and how certain people suddenly think that they won a Super Bowl because of them, or that their whole reputation and their whole self-worth relies on winning Super Bowls. Or you get crushed at the last minute right before the Super Bowl or at the Super Bowl and suddenly you just basically go into this massive depression. And you can imagine, especially as a football coach, it’s a big deal where your job depends on that. But as a startup founder you’re going to see similar ups and downs, where you’re going to have a month where you kill it, and you’re going to have months where you’re just going to get punched in the face over and over. And this is going to impact you. It will. But realize that you are separate from your successes and failures, and you are separate from the effort that you’ve expended. So do everything you can to make this happen so you have no regrets, so you essentially leave everything on the field. But then step away and realize that, “I’ve put the effort in, and I really hope it succeeds, but I am not the embodiment of that effort, and I am not the success or failure.” This is easier said than done. I’m going to admit it. But I like reading this one, because it reminds me again of what’s important to us and how we can make this a sustainable, sane lifestyle.
Mike [21:56]: I think especially with startup founders it’s very difficult sometimes to separate the success of your product, or projects – books that you’re writing or software that you’re building – it’s very difficult to separate the success of those things from the success of you as an individual. So, if you pour your heart and soul into something and it doesn’t work out, it doesn’t mean that you’re a failure. It just means that that particular endeavor wasn’t going to work out. But if you put everything that you had into it then you should at least be proud of the effort that you put into it. And it’s very difficult to alter your viewpoint to be able to see it that way. Especially if you have it in your head that, “Hey, I’m going to do this and it’s going to be successful.” And kind of planning things out before you’ve even gotten there. You’re planning out, “I’m going to celebrate in this way.” Or, “I’m going to take this victory lap over here.” But you’re planning those things out in anticipation of this goal that you may or may not reach. When the reality is you should be focused on the efforts that you’re putting in, not the results of those efforts. And, as you said, it’s very difficult to separate yourself from those things.
Rob [22:58]: Lesson number six is to demonstrate respect for each person in your organization and the work he or she does. I think this one’s pretty simple. I think that, hopefully, this comes naturally to you. I have worked with people, I have worked for people, who don’t demonstrate respect for the people in the organization, or they don’t demonstrate respect for certain jobs, as an example. Or they don’t demonstrate respect for the work; like a certain job isn’t as important as others. And I think this is an important reminder of that even if you have someone who’s writing the code for your core app, and then you have someone over here who’s doing whatever. I don’t know, what could it be? Support. Someone might make that out to be less important. Or marketing or, I don’t know. I know as developers often times – especially when you’re getting started – you think marketing is a lot less important. And it’s like, no. Each of these pieces, if you don’t do them, they can and will spell the end of your app, again, over the long term. It may not hit you in the first couple of months, but if you do a poor job with support, you do a poor job of marketing, you do a poor job of building, you’re going to fail. So respect the people who are doing them and respect the work that they’re doing.
Mike [23:57]: Yeah. I think it’s important, in this case, if you’re mathematically inclined, it’s important to keep in mind that for each piece that integrates into your app – whether it is the software development itself, or the support, or the marketing channels, customer development. All those things, they tend to create multiplicative outcomes. So if you do half as well at support as you probably should then your final results are essentially going to be half as good as they probably could otherwise. And the reverse is true as well. But keeping in mind that those things multiply themselves together to get you to the end of it, it really brings you back to the standpoint, or this viewpoint, that all of those things are important. And if you do terrible at one of them it’s going to tank the rest of it. And, as you said, maybe not now, maybe not two months from now, but eventually down the road it is going to reflect poorly.
Rob [24:48]: Lesson number seven is to be deeply committed to learning and teaching. And this ties into what Bill Walsh talked about earlier which is that work ethic focused on continual improvement. Because a lot of continual improvement may be doing drills and honing a muscle, but it’s also about learning. And I think that if you’ve had any success as a startup founder, or if you’re drawn to this, you probably have a deep desire to learn. So that’s probably not going to be the issue. The hard part tends to be taking the time and making the investment in someone to teach others. And typically that’s going to be teaching folks on your team and actually investing in making them better, and not just teaching them exactly what they need to do in order to do this particular job, but actually elevating them and letting them go out and make a little bit of a name for themselves. And let them achieve goals and making them better off having worked for you. So, I’m not saying this one is an absolute requirement in order for you to have success. But I think, again, making this a long term play, that being deeply committed to learning and teaching is not only healthy, but it will have positive dividends for you in years to come.
Mike [25:46]: I almost feel like I have a different take on this one, where I don’t necessarily think that you have to be deeply committed to learning and teaching so much as you have to be committed to enabling the people on your team to learn and, potentially, to teach other people on the team. Because if you’re the one who takes on all the responsibility for teaching people, then you kind of put yourself in this position where you have to know everything. And I don’t think that that’s the case in most startups. You can’t possibly know everything. So you’re better off putting people in a position where they can learn from other sources, or you’re enabling them to either mentor other people on the team or to learn from other people on the team. And I think if you approach it from that standpoint, as opposed to the view of, “Hey, I need to be able to learn this stuff so that I can teach my team.” I don’t think you need to do it that way. I think as long as you’re enabling everybody to do both of those things, because I think both of those really tie into the type of team that most people are going to want at their startup.
Rob [26:40]: The eight lesson is to demonstrate and prize loyalty. This involves being loyal to your team and not letting them get beat up. If you have a support person and someone’s being really rude in support, you very well may need to step in. And you very well may need to fire a customer, which is hard to do. And you very well may need to have a confrontation. But to me, having loyalty to your team and not letting them get abused… I’ve heard of some acquisitions where something goes wrong and, I don’t know, the healthcare isn’t as good in the new company or something, or it’s more expensive, and a startup founder can step in and just make it right. To me, that’s expressing that you are willing to sacrifice some of your own comfort, or maybe some of your own money, or something of yours in order to show loyalty to people who have shown it to you. And this is, I think, a very strong value of my own. I get along best with people who show that in response, in essence – a reciprocal loyalty. But I like that Bill Walsh called this out because it was obviously something that was very important to him.
Mike [27:39]: I sometimes have a hard time differentiating this type of thing. When somebody says that they prize loyalty, for example, because I tend to look at different situations. And you kind of pointed to a situation where you may have to step in and fire a customer. Well, if they were mistreated by the employee, then it makes more sense for you to side on the customer’s side than on the employee’s side. So, I think it really depends a little bit on the situation. I take this with a lot more context than just flat out, I’ll say, blind loyalty.
Rob [28:10]: Oh, yeah, totally. I meant if you’re in the wrong, or your employee screwed something up, then I wouldn’t fire the customer. But I would back the employee and be like, “Look, we make mistakes. Let’s not do this again. How do we avoid this?” And then make it right with the customer. At that point, it’s a loyalty thing like, “Man, I’m sorry. We screwed up and here’s how we’re going to fix it.” That’s how I’d view it. I was simply implying you had like a toxic, out-of-control customer, which unfortunately you are going to see at some point during your career.
Mike [28:36]: Yes. Understood.
Rob [28:37]: So lesson number nine is know what constitutes greatness for every role, and if you don’t know, find out. I like this one. I think this ties in with teaching because it’s kind of knowing what someone needs to learn. But also, you often hear like, “How does a non-technical person hire a programmer?” Or, “How does someone who’s never done marketing hire a marketer?” And my answer tends to be some derivative of, “You need to find out. You need to educate yourself.” You can’t just hire someone when you have no knowledge of what makes a good marketer or makes a good developer. You can get a referral from a developer who refers another developer. That’s the best. But other than that, learn enough about coding so that you can at least talk to someone about it in an intelligent way. And it takes more than that to know what constitutes greatness for everything, but I like the gestalt of this, of like, if you’re running a team than it is your responsibility to know what everyone should be doing, and what skills they will need in order to be the best performer at that role.
Mike [29:37]: I think the biggest challenge for trying to figure out what constitutes greatness for each role is that it takes time to do that. And most of the time it takes significantly longer than we want it to because we’re unfamiliar with what it should look like, or how certain things should be done. And because of that unfamiliarity, or that inexperience, we want to look for shortcuts. We want to look for a ten-point bullet list of ‘These are the things that I should be looking for.’ Or, ‘These are the things that I need to do.’ But even when you get that – even if somebody were to hand that to you on a silver platter – you’re still going to look at it and take it with a grain of salt, and you’re probably going to procrastinate because you’re just unfamiliar with all the different bullet points. Maybe it’s four through seven, you’re like ‘I’m not so sure how to do this.’ Or, ‘I’m unfamiliar with this.’ Or, ‘I’m uncomfortable.’ And it’s still going to take you significantly longer. So, you’re looking for those silver bullets, and it’s hard because you have to buckle down and just do the work to learn that stuff. So, I think that that’s one of the biggest particular one, is trying to justify to yourself spending all of the time in order to become enough of an expert that you can make that judgement call without spending so much time that it derails you from all the other things that you’re doing.
Rob [30:46]: And the tenth and final lesson is to control what you can control, then let the score take care of itself. This heads back to the stuff we talked about earlier about not getting so wrapped up into the results. But he takes it a step further and basically says, “There are certain things you can control. That involves choosing your team. It involves training your team and being loyal to them. It involves making yourself a constant learner and having a work ethic. There are things you can control and there’s a bunch that you can’t.” And as a founder, you’re going to run into things and sometimes it’s hard to tell the difference between the two. Sometimes if you lose MRR, or you have a terrible month, or an employee quits, or you have lay somebody off, or you have an amazing month where you double MRR. Any of these things can happen, and some of them are direct links to what you can control, and many of them are not. They’re more indirect ties to what you’ve been doing over the long term. And so, it can be very helpful that if your stressed out, or if you’re flipping out about something, sit down and make a list. ‘What can I control here? What can I not control?’ And then focus on the things that you can control and let that score take care of itself.
Mike [31:53]: I think as a startup founder it’s difficult to deal with things that you can’t control, because by nature they’re out of your control. And in some cases it feels like luck, or it feels like you have no influence. But I think in most cases, you have influence, it’s just not direct control. For example, you can’t force somebody to sign up for your mailing list. But you can influence them. You can provide trust factors. You can do all these things that will help guide them in that direction. But at the end of the day you can’t force them to do it. So, it’s trying to figure out different ways that you can influence things or toggle the different knobs. That’s going to be helpful but, as you said, understand that at the end of the day, you are not going to be in complete control. You’re going to have some semblance of control, and some semblance of ability to influence the results, but you can’t force them.
Rob [32:41]: And so to recap our ten lessons that every startup founder should learn from Bill Walsh are: Number 1: everything starts with work ethic. Number two: blame yourself for poor team performance. Number three: don’t win by fluke. Make friends not enemies. Take pride in your effort as an entity. Separate yourself from the result of that effort. Demonstrate respect for each person in the organization. Be deeply committed to learning and teaching. Demonstrate and prize loyalty. Know what constitutes greatness for every role. And control what you can control then let the score take care of itself.
Mike [33:09]: We’ll link this book up in the show notes so you can go check it out. If you have a question for us, you can call it into our voicemail number at 1-888-801-9690, or you can email it to us at questions@startupsfortherestofus.com. Our theme music is an excerpt from “We’re Outta Control” by MoOt used under creative comments. Subscribe to us in iTunes by searching for startups. And visit startupsfortherestofus.com for a full transcript of each episode. Thanks for listening and we’ll see you next time.