Yesterday I attended the TechStars Chicago Demo Day and was blown away by the presentations. If I had any money at all, I probably would have invested in 3 or 4 of the companies on the spot. (Pathful, FindIt, and SimpleRelevance particularly resonated with me).
As several of the TechStars companies are just now launching, it made me think back to August 2008 when we first launched GiveForward. To be perfectly honest, even today five years after launching we still don’t have a clue how to run a company. But back in 2008 we really, really, really had no clue.
So to all the TechStars Chicago companies who are just launching and wondering what the heck you’re supposed to be doing now that demo day is over, here are some of the things I wish I had known when we first launched.
(1) Focus Is Everything. Startups rarely die for a lack of ideas. But they often die for a lack of focus. Try to find the one thing you are really good at and then set out to do it better than anyone else in the world. For us at GiveForward, this was customer service.
(2) Your Idea Is Poop. When we launched, we were dead certain we were going to be a crowdfunding platform for everything. Turned out, no one wanted a crowdfunding platform for everything. What our customers told us they wanted was a crowdfunding platform for medical expenses. It took us a year to find product-market fit, and truthfully, it was really hard for us to give up on our original idea because it was our baby and giving up on it felt like failing. But being flexible and willing to adapt was key to staying in the game long enough to catch our lucky break (getting into Excelerate Labs in 2010). Long story short – don’t get stuck on your original idea. Chances are it’s not going to be the one that makes you money.
(3) Do The Things That Don’t Scale. As two non-technical, first-time founders with zero real world job experience, we focused our energy on the few things we were actually good at. One of the skills we had was simply being nice to people. This turned into an emphasis on customer service and tons of interaction with our customers. At first, the goal was simply to inject a tiny bit of humanity into each interaction. But these frequent interactions with our customers led to an ongoing dialogue. We were unintentionally doing tons of customer development and learning about what our customers actually wanted. Eventually, after about a year of talking to our customers we discovered that we needed to pivot away from general crowdfunding and move towards medical crowdfunding. At the end of the day, the pivot that transformed our business was really just luck – no more than a positive externality from doing the things that don’t scale.
(4) Define Your Core Values, Mission, Vision Early On. Write them down. And then LIVE them. It took us two years to write down our core values. It took us three years to write down our mission and vision. I wish, wish, wish we had done this sooner. Your values, mission and vision drive your culture, your recruiting and your retention. They give everyone in the company an understanding of not what you do but why you do it. They give people purpose. Once people find purpose, they have passion.
Passionate team members = the greatest competitive advantage known to man.
Here is a blog post written yesterday by our newest team member Mike Danko about why he’s leaving his current job to join our team at GiveForward. He says it much more eloquently than I ever I could.
If you are interested in learning more about why I feel so strongly about culture and values, check out this blog post.
Also, the folks at MOZ and Zappos probably do this better than anyone else in the world. Check out both their sites and I recommend reading Tony Hsieh’s Delivering Happiness if you haven’t already read it.
(5) Lastly, When Times Are Good, Don’t Give Yourself Too Much Credit. When Times Are Bad, Don’t Give Yourself Too Much Blame. This one might be the most important lesson of them all (at least for your mental health). As a founder, it’s easy to get down on yourself if things aren’t going gangbusters out of the gate but the truth of the matter is that so much of what we consider success is really based on luck and good timing. Many people in the startup world like to pretend that the equation for success is simply smarts + hard work. Well, that’s a huge load of bullshit. As Ryan Graves, head of global operations at Uber, mentioned yesterday at Demo Day, “hustle is trendy”. Of course smarts and hustle are a prerequisite for success but no one becomes successful without the help of others. What many of us forget is that the real equation for success is smarts + hard work + a good amount of LUCK. Our first mentor and board member, Tim Krauskoph shared this wisdom with us in 2010 two years after we launched. Once we realized how much luck plays into success, it felt like a huge wave of relief washed over us. It made both me and Desiree more humble and more self confident at the same time because we no longer judged ourselves through a distorted view of reality where the success or failure of our company all hinged on our every decision. If you learn this lesson early on, it will probably save you a lot of heartburn down the road.