#98 | Startup lessons (part 2)
"You can be as mad as a mad dog at the way things went. You could swear, curse the fates, but when it comes to the end, you have to let go." — Benjamin Button
"We know what we are, but know not what we may be." — William Shakespeare
Today I'm offline. And being offline throws up all kinds of difficulties when publishing a weekly letter to my friends. Fortunately, Substack allows me to schedule posts. So I thought I'd run through a few lessons learnt the hard way in the last couple of years, as Monty and I have been working on Yokeru.
Reflecting, like unplugging, gives perspective. Last week I published a first post. Today follows numero 4 to 6.
But first, why is starting something new difficult at all?
In the following paragraphs, you'll note there is a certainty to the uncertain enterprise. Unfortunately, this certainty is not helpful: A startup's first idea will be incorrect in most ways. A startup won’t have enough access to users/customers. It will spend too much on the wrong things. It will always be too distracted, obsessed with shiny new projects, and over-ambitious with projections.
There is an excellent chapter in Clausewitz's On War (called Friction).
Action in war is like movement in a resistant element. Just as the simplest and most natural movements, walking, cannot easily be performed in water, so in war it is difficult for normal efforts to achieve even moderate results.
Clausewitz's friction accounts for the certainty of torrid slowness, which makes the Fortress of Overnight Success almost impenetrable. Distraction is friction; it tramps alongside spending too much too early, and hitches a ride with a general lack of clarity. Team bickering and senseless direction are friction, as are poor communication and not keeping notes.
The landscape of innovation is made from deep molasses. A startup requires a lot of pushing along; there is friction at every step. Summer holidays slow sales cycles, visionaries leaving customers cause deals to evaporate, and unresolved hypotheses lead to disillusion.
The importance of friction is not that it’s to be avoided completely — it can’t be — it’s that it must be on some deep level accounted for, and navigated. What happens if a fundraising round fails due to unforeseen but predictable friction? This is just one example, but many plausible and knowable, yet unwanted, friction-led outcomes exist.
So, should we despise friction? William Blake wrote:
‘Without Contraries is no progression. Attraction and Repulsion, Reason and Energy, Love and Hate are necessary to Human existence.’
Blake, in the 1790s, was probably not writing prose on startups, yet, on our topic, the ‘contrary’ to Success is Friction; so, friction can be enjoyed as being necessary for our existence, as part of the ‘progression’. Nevertheless, it’s not practical to celebrate friction with champaign, though it’s a necessary devil.
We’ve found launching as early as possible (lesson 4) and being unfashionably patient (number 5) are helping us endure the ever-present friction of starting something new.
Lesson 4: Launch early
I want things to look extraordinarily polished before we ‘go-live’. This is without fail a poor decision. Features should only ‘just about work’ when customers get hold of them for the first time because before they see and play with a feature, it's impossible to gauge whether what a start-up has built is useful. Asking questions, and running surveys or polls doesn’t discover 10% of the truth compared with going live with an mvp.
Paul Graham has a great comment:
The reason to launch fast is not so much that it's critical to get your product to market early, but that you haven't really started working on it till you've launched. Launching teaches you what you should have been building. Till you know that you're wasting your time. So the main value of whatever you launch with is as a pretext for engaging users.
He's entirely correct.
Lesson 5: Be patient when getting niche
A startup is a cyclical process of developing an idea, putting it in front of users, getting feedback, and refining the concept. In the refining, it's essential to get more niche. At first, we supported all vulnerable people (too broad), then vulnerable people with some adult social care support (still too broad). Finally, our starting niche was: vulnerable people who receive social care support and live in a sheltered (retirement) community. This is highly niche!
The wonderful thing about being niche is that no one else considers the space; we have no competition. The more niche one gets, the less competition there is (if we launched another productivity app, we would be fighting monday.com, and Trello, and Asana, and so on into absurdity).
But it takes time to crawl through this cyclical process (and there is plenty of friction within it). You get low-signal feedback when the idea is too broad and unwieldy. There is too much noise; it's impossible to get a sense of what works. And therefore, the founding team needs patience as it perseveres deeper into a niche.
Lesson 6: Be sure of the change you want to make
While it's ostensibly better practice to focus on the small things (that don't scale well) and not over-emphasise the 'big picture', it's good to have resolved in your mind the change you want to make. This is often framed as a problem statement: It has to be simple and true.
For us, it's clear that:
When vulnerable people get the help they need it's often too late. This is because there is no capacity in the care system to do a vast amount of proactive outreach.
What we’ve been working on solves this problem. This fundamental understanding of the benefit supports our implementation of the tech and gives context to the team's tiny bits of design and sales efforts every day. Founders can greatly benefit from spending some time underlining these fundamental truths to customers and their team, so everyone is aligned on the 'why' behind their actions, even if the product isn’t built!
Bonus! Trust the teachers
We recently joined SaaS Academy, an academy for 'software as a service' startups. In hindsight, we had no idea how to structure a sales pitch, track KPIs, or run a demo. Yes, it's American and very cheesy. But, like most American things we consume (the iPhone, Big Mac, Prison Break), it's also brilliant. The academy has all the answers to questions we didn't yet know. I highly recommend joining the academy if you're building a SaaS product and if you're not, joining your equivalent.
Finally: If you have only the time to read one thing this week (and you're a founder), read this.
My week in books
This will return on my return from the Big Mountains! Keep reading.
Live well,
H