Demise (plancast)

by | Jan 23, 2012 | Angel Investor, early stage, founder, Launch, Revenue Growth, Scalability, startup, startup CEO

This article written by Mark Henderson of Plancast took a lot of courage. The Uphill Battle Of Social Event Sharing: A Post-Mortem for Plancast | TechCrunch http://j.mp/wCnYov

By putting the words Post-Mortem in the title he made it very clear that the company is failing, a shocking move in our current startup world. So many companies/people/vcs pretend they are succeeding when they are stuck – can’t scale revenues, especially over the past 5 years or so. Once they finally shut it down they often still claim success, or invoke the over-used “pivot” panacea.

By calling it as it is, Mr. Henderson allows a true discussion about what went wrong and other strategies that could possibly change the fate of Plancast and other startups in the same position. He is also helping other startup leaders and investors to possibly follow his lead of raw honesty, so this industry can focus more resources on a smaller number of companies that truly have something special and defendable. That helps people to better learn how to do it right, contribute to bigger better businesses, create profits.

In several of my past postings I’ve touched on this problem. It’s endemic to the startup world right now, and can’t lead to a good future. Of course startups always have a low probability of success anyway, but this current environment of pretending like every company that gets angel or super-angel seed funding is made up of geniuses with genius ideas is a house of cards. Articles like that above could start the process of correcting the market back to realism and eventually streamline resources. Mark has put his ego aside and done a great service to all of us. And who knows, by publishing the companies issues he may crowd source some answers (and funding) to actually save his company.

Here are some of the comments people made about this article:

“I hope TechCrunch publishes more well-composed articles like this in the future.”

“This industry is lacking such honest analysis. Thanks for keeping everything so real.”

“I greatly respect you posting this as a way to help others learn when you could have just disappeared in the startup abyss.”

Ii looks like the beginning of several who will come forward soon. What’s the lesson here? I guess more journalists should launch startups.   @tomnora

d e s i g n

by | Jan 10, 2012 | Business Development, early stage, founder, photography, startup, startup CEO

The other day I met with a startup in Santa Monica, and noticed a giant etch of the word d e s i g n on the ceo’s glass office wall. Their company isn’t about design per say, but it was refreshing to see the discipline given such prominence. The word design is being kicked around in the startup world a lot more these days, and I think this is a good thing.

Design is the exercise of creating or adding elements of appearance to something. It is defined as “The shape or appearance given to an object, especially one that is intended to make it more attractive”. In the startup world it can make the difference between success or failure if combined properly with great business strategies. There are many examples of great design alone in a failing startup, but great design plus great engineering and business strategies often win. Also, many startups with bad/weak design but great strategies and engineering have been winners. But that seems to be changing.

To say that someone is a visual person is a little silly – everyone is visual. Colors and Shapes and beautiful Movement attract any human, often on a subconscious level. A simple attractive Design for a website or product will change its fate from yet another to the best in a category.

Beautiful design exudes success and confidence, care about details. And most importantly – originality. great design comes from within a person or organization, not copied from outside and implemented. It’s more difficult, but imperative for long term success. Simple beautiful design is proliferating on the web – lots of white space, a small number of large font words, big open boxes for interactivity, cool icons. All of these things enhance the user experience and make them want more.

A recent great experience for me was trying out Codecademy. It has quite thoughtful design elements, many of them not actually visible, but so important to its almost seamless usability.

Style, similar but different than design, is more the process of following great designs, using existing aesthetics. Sometimes this works fine, but it’s not the same as amazing original design. Just look at the continuous march of Apple over the past 34 years. Great design plus engineering plus strategy. Accessibility, simplicity, completeness. They created the template for many other products’ style and design.

UX/IA is also an important part of all digital design now. First introduced in the late 1990s, it’s replaced and expanded on UI as the critical relationship people have when using products. Often it’s a pre-design process, trying to guess how people are going to use things, then use design to optimize the experience.

The new biography on Steve Jobs is a must read for any startup founder. It has the added benefit for readers of discussing in great detail Apple and NeXT design processes, justifications and investments. It also reveals that most of the design ideas were not Steve Jobs, but rather came from several design and marketing gurus he surrounded himself with.

Like I said, it’s great that Design is becoming central to the engineering-heavy world of tech startups, because ugly design sucks. @tomnora

Scalable People

by | Dec 26, 2011 | Angel Investor, Business Development, CEO Succession, early stage, founder, Launch, Revenue Growth, Scalability, startup, startup CEO

One of the things I tend to obsess about these days is startups that have little or even no real lifespan. Almost every day I uncover another one, some even with significant funding. In greater Los Angeles, now being called Silicon Beach, this problem seems to be more prevalent than in most areas. So many people make their goals to just b a startup, get it started and look for funding, without much thought about multi-year growth and sustainability, i.e. Scalability.

A common area of neglect in this early stage is people – Scalable People. Startup founders tend to add people that are close to them – friends, coworkers, spouses, family, neighbors, roommates, similar age, etc. These folks are very accessible and trustworthy, not much interviewing required, and often will start working with little or no compensation. It’s good to have some of these. The biggest downside is that eventually you will have to extract or diminish the roles of most (not all) of these people.

I once had an early employee at a startup I took over who was sales, marketing, receptionist and payroll. Early on we were lucky to have her doing all those things, and she received great stock options for being an early employee. But as we grew there was no doubt that we needed to replace her in most areas with a professional team that could scale with the job. Every change we made pissed her off and she fought for her position, which was counter-productive to our growth. She eventually left with some bitterness, but that went away once we went public and she could pay off her mortgage entirely.

You also have to mix it up as early as possible with real professionals that can scale when the company grows- people who “think differently”, have different experiences, drive initiative that none of you have even thought of, and want the company to be much bigger. These days a popular add in Los Angeles is someone from Silicon Valley; it adds a realness to the group and gets investors excited.

I’ve been on all sides of this situation – I’ve been the founder trying to attract the best people, and just as often I’ve come in as the “suit” to a small group of founders and early employees. It’s more work and trickier to splice the 2 groups together than to just use your inner circle, but it’s the only way to grow now and later. Please contact me if you want to discuss your startup.  @tomnora