Startups Unplugged

Author: Paul Orlando

  • Secrecy and Startups

    The word “stealth” used to be commonly heard in startup circles. Ten years ago. Today you’re more likely to be scoffed at for saying you’re a stealth startup and not openly discussing your work. As many have said, it’s not likely that someone you meet will want to drop everything they’re doing and copy your business.

     
    Here are four startups I met that were secret when it didn’t call for it and where they are today.

    1. Told me the general gist of their service but wouldn’t answer any questions about it. Their lawyer advised them not to talk about any details yet. Also couldn’t tell me why not. Is it time for a new lawyer?

    2. One asked me about my startup and after I finished talking introduced themselves as being in stealth mode. All it took was for me to say “oh, please…” for their explanation to come out. I liked the idea and they had a first demo user. But it didn’t work out in the end. The founder abandoned the startup to go back to the corporate world.

    3. Wanted me to sign NDAs to hear about their work. But I asked general questions and found that they refused to do any customer development work even after identifying an interesting user group. Instead they went and planned for a 12 – 18 month development timeline. My most recent news about them is they never got the service off the ground.

    4. A fashion startup that thought someone would steal their idea. Produced the first product and all marketing without any customer development work. No one used the first product, which is now discontinued and cost them their first year of work. They eventually switched their focus and are now doing well. And no one stole their first idea.

    Rather than be secret, it’s much more likely that by talking, you’ll gain some feedback or a connection to someone who can help. So don’t be afraid to talk about your work.

  • Old startups never die, they just fade away

    OK, sometimes they die. But there’s a lot more fading away.

    The startup world is like an iceberg — you only see the small bit that pops above the surface. The big ones that made it, that got major press, the ones you signed up for, the ones you really used, that you know personally or that had major flame outs. Those, you hear about. But most of the mass of the startup world sits below the surface and is unseen. A small startup might be known in its local community, or in a niche or just among friends of the founders. And of course, sometimes they never launch at all.

    I remember going to startup events in 2009, when the community was much smaller in NYC than it is today. Once in a while I think back to some of the startups I saw pitch back then and then visit their sites to see what’s new. What do I get? “Domain for sale” or an outdated blog and no progress.

    That’s the fade away. Part of the startup circle of life.

    But it’s ok to have done that, as long as you’re learning and will use what you’ve learned the next time you’re out there.

  • Why startup events are bad for you

    Any given day in NYC (where I live), there are 10 – 20 startup related events. If you didn’t want to talk to any non-startup people each day, you could probably do all of your socializing at startup events, too.

    It’s natural for people who spend most of their waking hours working on a startup to want to hang out with other people doing the same. But this is a really bad idea when it comes to building your product.First, startup people are not normal. Face it. Your customers are most likely not other startup people. Building something that the startup community will find cool will only get you so far with the rest of the world.

    I’m not saying don’t go to any startup events. I’m saying they shouldn’t be the main events you go to. If you’re building a food related startup, you should talk to non-technical foodies who might be your users. Talk to chefs, restaurant managers, street stall owners, food bloggers, farmers. If you’re building an educational startup, hang out with teachers, principals, even students. What is their life like? What do they need?

    One of the guys who took Startups Unplugged did just that for his Electronic Medical Records service. He met doctors and understood how the current EMR solutions work. Afterward, he ended up completely changing the way he was designing his service. By his admission, he never would have figured that out if he didn’t go meet doctors.

    Get out there and talk to users.

    I later wrote this about Startup Pitch Events. Hope you enjoy it.

  • No bubble in methodology

    Remember what happened after the dotcom bubble? People ran away from anything startup related. B2B and B2C became Back to Banking and Back to Consulting. Companies that survived removed the “.com” that they had added to their official business names.

    But did we learn anything from passing through that bubble? Maybe we learned how not to run a new business. There was little in institutional learning until afterwards.

    Today, even though people talk about a new bubble I think it will matter less. More of the startups today are trying to build businesses. Most still might not do it all that well, but there is at least something behind it all.

    The learning will continue.

  • My four favorite arguments for why customer development is stupid

    Every once in a while someone tells me that they’re intentionally not doing any customer development. Here’s a list of the reasons I’ve gotten for this.

    – “This is so cool, how could anyone not want this?” Actual words a startup said to me about their product. Even when they identified a niche that would form the core user base of their product they refused to talk to anyone in that demographic (also outside of their social circles). The reason can only be fear. If it’s arrogance, then there’s no hope for them.

    – “It’s antithetical to having vision.” Well, it’s possible that your vision is a hallucination. Which is better? To pursue a vision without understanding how it fits with your customers needs or to have a vision of serving your customers better than anyone ever before?

    – “Twitter didn’t do it and look how successful they are.” That’s a lack of understanding of Twitter’s history. Their service started in 2006 as a way to let Odeo’s team show each other where they were. It soon proved itself to be useful to a broader population as well as addictive. You could say that they stumbled upon what became Twitter, but are you likely to be as lucky?

    – “Apple didn’t do it and look how successful they are.” Twist on the above. Apple doesn’t go out to ask people what kind of device they want, they just do it, right? But they do deeply understand needs and what people are ready for. They’re also not innovating totally new products, they’re taking an established product (mp3 players, smartphones, tablets) and making them better with a ton of expertise, plus providing a supporting market environment (iTunes, App store) and incredible marketing. Are you really going to immediately do the same? Plus, Apple had failures too. Some of them, such as Lisa and Newton were results of ignoring what people needed.

    There’s a great quote from Napoleon’s memoirs. He wrote:
    “The greater one is, the less will he must have. He depends on events and circumstances. I had few really definite ideas, and the reason for this was that, instead of obstinately seeking to control circumstances, I obeyed them.”

    Based on that, he conquered most of Europe.

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