Category: Lessons Learned

Ask More Questions

Do you have kids? They’re amazing and terrible. There are numerous studies from reputable, non fake, sources that show kids will ask so many questions and push so many buttons that they’ll figure something out better and faster than adults. Like iPads and Minecraft. They’re not afraid of asking questions or making mistakes by hitting the wrong button.

The downside is that they ask so many questions they drive you insane.

[There’s a cognitive dissonance that occurs as a parent when you tell your kids to stop asking so many questions but want them to always remain curious and ask more questions. Your head explodes.]

I heard a story today about a company whose own employee embezzled serious loot. He figured out how to divert their website’s advertising revenue from the company’s bank account to his own. The management team saw discrepancies, asked a few questions, and was satisfied with the answer.

Hamburglar5 months later they finally asked more questions, then figured out that a Digital Hamburglar was on staff.

I can count on both hands the times the past 12 months that I’ve seen something that looked weird, and took the first answer, but should have probed deeper and harder. The key is going both deep and hard. Watch out.

Ask more questions. I’ve regretted asking too few.

 

The Power of a Pointed Question

I spent 3 days of back-to-back meetings at a conference recently. We pitched, we listened.

By far the best questions I received were from my final meeting of the show. While delivering my normal feature-benefit shtick, this Chief Revenue Officer honed in.

Exactly how long have you been doing this?

Exactly how much revenue are your customers generating as a result of this data?

Tell me specifically how they’re using this data…

Not only was she paying attention, she immediately got to the most salient points.

Most of our other conversations at the show meandered around the edges. Now that I think about it, a big chunk of daily conversations never get to the point.

Sometimes that’s intentional – you don’t always need to be right, make your point, or reach a conclusive answer.

For professional conversations, I think I’d rather ask, and be asked, the pointed questions. Lesson learned.

Good Stress Vs. Bad Stress

I overheard someone at the gym today.  She remarked to her friend, “You know, it’s good stress, so it’s okay”.

Upon hearing this, I was instantly transported back to my shower.  The year was 2010.  We had newborn twins, and I a full-time job with and an evening MBA program.

In the shower I was attempting to shake off the day’s stresses when I came to a similar realization.  My life was hectic, challenging, and semi-crushing, but full of good stress.

  • Getting my learn on
  • Happy, healthy baby twins, and 3 year old on top of that
  • Making enough money to pay the bills and save a little

As a startup, realizing the difference between good and bad stress helps make sense of the world.  It’s pretty easy to spot the difference between the two.

Bad Stress

  • Losing key employees
  • Losing customers
  • Losing your market

Good Stress

  • Getting a working product in a customer’s hands after 2 years of building it
  • Getting that first big customer launched
  • Getting the infrastructure built (or re-built) to handle scale

Even on great days at a startup, or any company, there’s still stress, but hopefully it’s the good kind.

When To Begin Your Startup Pivot

After you finally accept that you must change business direction in order to survive (that’s the previous post), when should you start that process?  Immediately? Yes.

But that doesn’t mean you pull the plug on current customers immediately, or you instantly cease your current operations.  Perhaps in some cases this is necessary. In our case, not so much.

While we clearly saw the winds shifting and our current market stagnating, we knew that keeping the current revenue stream alive extended our runway.  This is startup lingo for keeping more cash in the bank so that you can keep the doors open longer.

What we’re getting at here is that phasing into your pivot over time has a few advantages.

  1. Keep current revenue flowing to fund product development.
  2. Use current customers for customer research on the new product and direction.
  3. Use current / previous customers as your new prospect base.

Here’s the academic way to describe this, penned by Ron Adner in this Harvard Business Review article.  The ecosystem carryover: “using existing positions in existing market spaces to jump-start a winning position in a new market space”.

Of course, a phased pivot poses a serious risk: Holding on for too long when you should be letting go. Perhaps you should hold on loosely, but don’t let go. If you cling too tightly, you’re gonna lose control.

What better way to start the weekend than with a dose of 38 Special’s classic rock brilliance?

How Do You Know When To Pivot?

Not quite product-market fit
Not quite product-market fit

This is the easiest part of making a pivot; deciding that you need to. It’s not really that easy, but it’s easier than the rest of the process, so we’ll keep it short & sweet.

(1) You’re losing customers faster than you can replace.  Startup buzzword enthusiasts call this losing product/market fit.

(2) You can’t get enough or any of your free beta customers to start paying.  Your product may not fit the market, or your business model needs tweaking.

(3) Your product can’t get any customers at all.  Your product never fit the market to begin with.

The hard part of knowing when to pivot is knowing WHEN TO ACTUALLY BEGIN making the major shift in your business.  Every situation is different.  I’ll share our experiences in coming posts.

Happy To Be Here

This is not some happy-go-lucky, lets-all-hold-hands-and-listen-to-jam-bands-happy-to-be-here, nonsense.

moviesRather, it’s that feeling when the jaws of the giant worm are closing around you, and you narrowly pilot the Millenium Falcon to safety.  Nice one, Han. It’s when that massive ston garage-door on the cave is closing down, and you power slide right under only to emerge safely on the other side.  Nice work, Indy.  Or when you hit 88mph and your giant coat hanger hits the wire just as lightening strikes, returning you to 1988 with a flaming blaze of awesome. Time flux capacitor, all day.

When that happens, you’re happy to be there.

That’s what it feels like when you emerge from the depths of starting a company to see the light, either because things are going well, or because you flamed out and have the “relief” of finally shutting down.

My first mobile startup gotten eaten by the worm, crushed by the stone door, and mis-timed the lightening strike.  The business didn’t make it through, but I did. I joined my current company after that.

I’ve been “happy to be here” since. Shutting down your startup puts a whole new shine on the rest of the working world.

In the three years since, the market forced our hand. We sold the old business to focus on a new direction instead of completely closing down. The classic: Pivot. What a simple yet challenging word.  It’s two syllables that sound like the sound of spitting a watermelon seed. Pivot appears easy and quick, when it’s actually slow and deliberate and more like evolving.  Pivolution.

We’re starting to emerge. There is light at the end of the tunnel, and at least for now, it’s not a train.  That’s the “happy to be here” sentiment we’re discussing today.

Stick with me and I’ll walk you through the last 18 months of our overnight pivot.

 

 

 

PMS at Startups & Big Companies

Burgundy-bigdealWhen I started my enterprise sales career in 2005, I had it all figured out.  I closed a couple of deals, made some cash, and pretty much knew how to run a company.  Except, nothing could be further from the truth, despite that being my attitude.

After 8 years of slinging software, I quit my job to run a startup, where I began to dabble in product, and became more deeply involved in marketing. Hmm…these things appear related.

As I approach two years at StepLeader, I am deep in the trenches of the product, marketing, and sales trio, henceforth known as PMS.  One of my biggest lessons learned? These three elements intersect on a daily basis.

  • Without a product worth talking about, your marketing is meaningless.
  • Without marketing that provides value to customers (as opposed to asking for attention), your sales will be 10x harder.
  • Without product and market knowledge, your sales team will be borderline inept.

If you’re a sales person at large company, with little contact with the marketing or product teams, you are doing yourself a huge disservice.  Join their daily standups, ask for advice, ask for time with their leadership, and make it routine. You’ll close more deals.

If you’re a marketer and not participating in product discussions or listening in on sales calls, are you high? Are you making things up?

If you’re a product manager and not speaking with your customers, both inside and outside your office, you’ll build terrible products. You won’t be able to arm your marketing and sales teams with key messaging.

At a startup, it’s easier to have true PMS integration. Small teams make communication easier, in theory.

For everyone else working in a silo, break the silos down, not because you’re on a mission from God, but because you’ll enjoy your work more, and be better at it.

Continually Humbled

In the middle of July, I took Friday off.  The wife was away on vacation while I managed the kids.  After depositing the twins at pre-school, I took our oldest out for a mountain bike ride.

The night before I watched “Wheelies for Dummies” on YouTube. Wheelies on a mountain bike.  Piece of cake.

mountainbikeflip

Two minutes in to our father-son ride, I gave the wheelie a try.  In the fastest slow-motion event ever, my view changed from path to trees to sky to bike on my face as I flipped the bike backwards over my head.

The obscenities I attempted to spout forth were fortunately muffled by the lack of air in my lungs.  Searing pain shot from my ass all the way up my back.  Did I just cripple myself in front of my terrified 6 year old?

I slowly recuperated, caught my breath, and hopped back on my bike to finish the ride.

A few days later as giant purple, green, and black bruises appeared on my rear, I thought back to how much of an idiot I felt like.  I was humbled.  It didn’t feel good.  It never feels good, but it felt appropriate.  Lesson learned.

I’ve been professionally humbled more times than I care to count.  Publicly losing large sales deals, getting laid off, running my old startup out of business.  It blows.  Everytime.

The saving grace is that being continually humbled prevents me from turning in to a completely, arrogant, egotistical jerk.  Getting knocked down reminds me I’m not as smart as I think I am. It took two massive ass bruises to refresh my memory.

Since it’s Friday, I’m borrowing an eloquent “face quote” that sums this whole thing up.

“Success is a lousy teacher.  It seduces smart people into thinking they can’t lose.” – Bill Gates

billgates

Family as a Source of Strength

One of the best lessons I learned during my tenure as a startup founder was the importance of family. In startup world, shit gets real.  And it gets “real” really fast.

Two years ago when my company was on the fast path to implosion, I struggled to make sense of it all.  I carried around enough stress to detonate a nuke.  The self-imposed nervousness, anxiety, doubting, and crawling under the desk into fetal position is the worst part of company building.

What diffused that nuke-bomb stress was rolling in to the driveway, where my three little kids would charge, usually butt-naked, out the back door screaming “Daddy’s home!”.  All that stress evaporated. My wife and parents also offered perspective, comfort, and understanding.

IMG_0878This lesson that family serves as a source of strength surfaced again last month. With my wife away on a 6 day vacation, and the children with the grandparents, the house was vacant.  Work has been pretty demanding lately, and I acutely missed their presence.  Their absence made work harder.

For the record – this was their second time away in 30 days.  I partied like a 38 year old dad the first time. Up ’til 11:15pm!

My message is this: all you single startup founders should get married and have kids immediately.  Nothing boosts your confidence like people that like you and who don’t know any better.  Just kidding.

The truth is that I’ve found a way to help cope with difficult times.  Family.  Sounds obvious for most people.  I learned it in my own way.

When you need help or a lift, ask your “family”: parents, spouse, children, close friends, pets.

Everyone Burns Out

Sometimes the view from the top is a little hot.
Sometimes the view from the top is a little hot.

I had lunch yesterday with a good friend.  Three and a half years ago he quit his job to start a company.  They’ve grown to 10 employees, seven figure gross revenue, and most importantly are finally making more money than they lose.  Cha-ching.

Side note – 3.5 years to become profitable.  Starting a new business? You’re lucky if you can be profitable [i.e. also pay yourself a salary] in less time than that.

Paraphrasing his words, “I’ve made it, but I’m dragging myself into the office everyday.” He’s finally reached the top of the mountain, but he doesn’t like the view.  He’s burned out.  Why?

Building things, solving problems, making sales – my buddy excels at this.  What’s wearing him down are the mundane, yet sometimes business-threatening, details of running a business: retroactively collecting sales tax due to new regulations, HR compliance with state and national policies. When you are El Presidente [or La Presidente], all that crap lands at your feet.

Running a software company was easily the hardest and most stressful thing I’ve ever done.  It happened concurrently with “life”: welcoming twins to the family, starting an MBA program, and moving to a new home.  I burned out.  Everyone burns out.

Fortunately for my friend, he sees a few ways out.  Hire a COO or President to run the day-to-day while he focuses on expanding the business.  That gets him excited.  Given his company’s upward trajectory, it’s also a good time to sell.

It doesn’t matter if you’re running your own business, running a team, grinding out your day job, or managing your family, you will burn out eventually.  Be me like my friend and use that as an opportunity to find ways to bring your life back under control.