Download/912-0002_Crossing_the_Chasm.pdf. Launching Tech Ventures: Part IV, Readings. Hot Sauce! » Blog Archive Adopt the New Startup Model: Nail It Then Scale It. January 10, 2012 by Marty Zwilling I see more and more entrepreneurs who seem to have everything going for them – vision, motivation, passion, even a good business plan, product, and money, and yet they can’t close customers. Maybe it’s time to look harder at the mantra of a new breed of gurus and successful entrepreneurs, including Steve Blank and Eric Ries, called “nail it then scale it” (NISI).
You can review all the specifics of this approach in a new book by Nathan Furr and Paul Ahlstrom, appropriately titled “Nail It then Scale It: The Entrepreneur’s Guide to Creating and Managing Breakthrough Innovation,” but I will net it out here. I found their five phases of the process to be compelling, based on my own years of experience mentoring startups: Nail the pain. Great businesses begin with a customer problem that has a big and monetizable pain point. Hero myth: Why believing in your product leads to failure. Other articles by Marty Zwilling. Filed under: Lessons Learned, Nuts & Bolts. Most startups are spending money too fast. Slow it down. You're acting as if the current bubblicious fundraising environment will continue indefinitely. You're acting as if all of your unproven hypotheses will turn out correct. You're acting as if your seed round valuation increased your likelihood of success. You're acting as if your investor excitement at the seed round automatically transfers to a bridge round.
You're acting as if you won't need to pivot. You're acting as if Good Times RIP never happened. You're acting as if you already have product-market fit. You're acting as if you already know that you're the next Dropbox. You're acting as if headcount is a definition of your success as an entrepreneur. You're acting as if you've forgotten how to be scrappy. You're acting as if being a cockroach is a bad thing. Stop Acting As If If you're seed-funded, you're probably spending money too quickly. The traditional criteria for Series A funding is stable and significant month-over-month growth in traction and, for many of us, revenue.
That's it. My dad taught me cashflow with a soda machine. After a brief, failed experiment paying me to do chores, my dad tried something really neat. It clearly took a bit of legwork, but maybe there are some transferrable lessons for parents who want to lay an entrepreneurial foundation. He gave me a vending machine. He rented the machine, found a location in a local workshop, and installed it. And then he told me two things. That this would be the last time I was given allowance.And that if I wanted to have any pocketmoney next week, I’d better spend this week’s on some inventory. I ran the machine for about 4 years from the time I was 7 or 8.
At first, my only agency was inventory management. But then the Coca-Cola runs out first and the Sunkist is half empty and nobody has bought even a single Grape Soda and should I cut my margins paying more per-unit for individual cans or do I buy full cases and find somewhere to store the extras and why am I doing algebra on the weekend!? That didn’t last. I freaked out.
Twenty year retrospective. Pitching a VC: Why Financials Matter. How I Quickly Test and Validate Startup Ideas – Startup Bound. Friday, Oct 28th 2011 at 6:04 am — Since I’ve technically been unemployed now for a week, I’ve spent most of that time brainstorming some new ideas and putting them into a Google Spreadsheet. This week I began going through that list and pulling out the ones I think have a chance and I narrowed a pretty large list down to just a few. Let’s take one of the examples from my list. It doesn’t have a name, so let’s just call it Patient Connect. The idea behind Patient Connect is that it integrates with any type of scheduling and patient management software any private medical practice or clinic uses to setup appointments for patients. The vast majority of private practices and clinics have their receptionist or anyone with some downtime call patients with upcoming appointments to give them a friendly reminder.
If a patient doesn’t show for an appointment without advanced warning, that is lost time that could have been billed. First step is to create a good landing page for your campaign. Lead Bullets. Editor’s note: Ben Horowitz is a partner at Andreessen Horowitz, the former co-founder and CEO of Opsware, and a former Netscape executive. “Yet our best trained, best educated, best equipped, best prepared troops refuse to fight. As a matter of fact, it’s safe to say that they would rather switch than fight.” —Public Enemy, Fight the Power Early in my tenure as product manager for the web servers at Netscape, we faced a terrible crisis.
We just got our hands on Microsoft’s new web server, Internet Information Server (IIS), and benchmarked against our product. I immediately went to work trying to move the playing field and pivot the server product line to something that we could sell for money. As I excitedly reviewed the plan with my engineering counterpart, Bill Turpin, he looked at me as though I was a little kid who had much to learn. As a result of Bill’s words, we focused our engineering team on fixing the performance issues while working the other things in the background. Should Startups Focus on Profitability or Not? There are certain topics that even some of the best journalists can’t fully grok. One of them is profitability. I find it amusing when a journalist writes an article about a prominent startup (either privately held or preparing for an IPO) and decries that, “They’re not even profitable!” I mention journalists here because they perpetuate the myth that focusing on profits is ALWAYS the right answer and then I hear many entrepreneurs (and certainly many “normals”) repeating the same mantra.
There is a healthy tension between profits & growth. If you hire 6 sales reps in January at $120,000 / year salary then you’ve taken on an extra $60,000 per month in costs yet these sales people might not close new business for 4-6 months. I know this seems obvious but I promise you that even smart people forget this when talking about profitability. Hiring more people isn’t always the right answer. Exec Summary: Most companies (98+%) in the world (even tech startups) should be very profit focused. Um, no, Product Marketing for Pirates: AARRR! (aka Startup Metrics for Internet Marketing & Product Management. Here is a brief powerpoint deck on startup metrics from a talk i gave at Supernova called "Product Marketing for Pirates: AARRR! ". It's about how to develop a model of your customer behavior, and then use conversion metrics / web analytics to assist your internet marketing & product management efforts. The basic concept is based on 5 types of measurements of user behavior: A: Acquisition - where / what channels do users come from?
A: Activation - what % have a "happy" initial experience? R: Retention - do they come back & re-visit over time? R: Referral - do they like it enough to tell their friends? (... otherwise known as "AARRR! " i'll post more on this later -- for now, here are a few pretty pictures: ps - National Talk Like a Pirate Day is September 19...