Social Media Matching

People seem to be missing the really big picture of the value of social media and really the Internet for that matter.  They look at how current social networking sites work and how online and offline relationships currently work and make the assumption that this represents the value proposition.

Case in point the recent HBR blog post: The Social Media Bubble, by Umair Haque where he advances the following hypothesis:

Despite all the excitement surrounding social media, the Internet isn't connecting us as much as we think it is. It's largely home to weak, artificial connections, what I call thin relationships.

…

Call it relationship inflation. Nominally, you have a lot more relationships — but in reality, few, if any, are actually valuable. Just as currency inflation debases money, so social inflation debases relationships. The very word "relationship" is being cheapened. It used to mean someone you could count on. Today, it means someone you can swap bits with.

Thin relationships are the illusion of real relationships.

…

The promise of the Internet wasn't merely to inflate relationships, without adding depth, resonance, and meaning. It was to fundamentally rewire people, communities, civil society, business, and the state — through thicker, stronger, more meaningful relationships.

I would agree that the primary goal for most social networking sites today is to help produce deeper relationships and build new online communities.  BUT that’s not where the real value is.  And thinking the goal is to build deeper relationships is missing the point.

The Real Value

For me, the BIG value lies not in “deep” but in leveraging the breadth and time-and-place independent access to other people.

Umair gets it wrong when he says “the Internet isn't connecting us as much as we think it is” … As compared to pre-Internet, how easy is it to connect with people you know or even people you don’t know.  For your closest set of contacts, maybe things haven’t changed.  You could make an argument that people are more available via IM, cell phones, texting, etc.  Of course, the BIG change is that it’s 10x to 100x times easier to connect with people who fall outside of that immediate close network.

In my post on Visible Networking, I talk to why in-person networking is generally time-inefficient and often a questionable return on your time.  It takes 3-4 hours of time to meet up with only a few people who are from a small pool of candidates.

Consider this as an alternative:

• A 24x7 networking cocktail party with 60M+ people
• Everyone has various kinds of background information and interests expressed
• You can come and go as you please

Pretty damn cool if you ask me.  And if you compare access based on the 24x7 network to a meeting with 100 people and randomly meeting some subset of them, you realize how lame that model is in comparison.  Sure there’s serendipitous meetings, but you’ll have much more targeted connections through the 24x7 network.

But the 24x7, 60M person cocktail party definitely changes the questions and problems.

• How do you navigate 60M people to find the right people for you to talk to?
• How do you ensure that both parties get value?

Everything is Matching

The real promise comes about as we get better tools for navigating all of this.  Let’s consider some questions I might have:

• I want to find a co-founder for my startup.
• I want to find people who can help me with ideas around the business model for my startup idea.
• I want to talk to people with experience with X.

If you know me - which you might not because you only have a thin relationship :) – you know that I’m going to say that a lot of this comes back to Matching Algorithms.  There are many, very interesting and very complex matching problems that need to get solved.  Some days I start to feel that everything is matching.  Product purchases.  Business deals.  It’s all about finding the right fit.  Well it’s also knowing what kind of match you need.  And it’s knowing how to communicate with potential matches.  But the heart is filtering down from the 60M into the few that it really makes sense for you to connect with.

Some of this is relatively easy today such as leveraging LinkedIn for Finding Expertise (see also LinkedIn Guide for Knowledge Workers).  If you have a particular question and want to vet the idea, you can likely find someone through LinkedIn to provide feedback.

But other matching algorithms are still quite hard:

• Companies to employees
• Business deals
• etc.

That said, we are quickly growing more and more information on background of individuals, tweets, blog posts, social bookmarking, Facebook activity, presentations shared, etc.  This forms a pretty interesting picture of each person’s knowledge and experience.

What we don’t really have today is as good expression of their interests and willingness to get involved in different ways.  I’m interested at some level in co-founding startups if they fit the right criteria.  There are a few sites that theoretically help you find co-founders, but my experience is that there’s much more to it than what you currently get with those sites.  Still, over time we will begin to see all kinds of ways to express your interests in business deals, employment opportunities, cofounding businesses, conversations, etc.  This is really your expression of complex matching criteria.

Once we combine a rich and robust picture of expertise and knowledge along with these complex matching criteria, then finding and helping facilitate very interesting relationships becomes possible.

But it also makes the existing reliance on intermediaries less important.  What?  The depth of existing relationships will become less important. 

Instead, there’s a need for some kind of rating, expression of experience, reviews, etc.

Bottom Line

The real innovation and true value creation is going to occur around taking the massive network with little to no existing relationships and helping to find matches, foster conversation, and build relationships where they make sense.  We want more eHarmony’s in the world.

Ignore what social networks and social media looks like today.  Ignore all the information that’s been written about business networking.

Instead, go solve the big interesting problem: Social Media Matching. 

Oh, and if you are working on that, I’m interested in being involved. :)

Digital Revenue Expert – Vince Thompson

More Visible Networking? this time with Vince Thompson.

You’ve got a REALLY diverse background. What’s the short version?

Vince: I’m an author, speaker and management consultant with a special expertise in online media sales. I started out as screenwriter, went into local television, ran ad sales in the west for AOL and joined Facebook in the companies very early days.

My management book, Ignited, was released in 2007 and serves a guide and champion for middle managers.

Today I lead a small consultancy that helps advertising supported develop and scale the revenue producing sides of their businesses. I also serve as CEO of a small media companies that profile “Tomorrow’s Most Exciting People Today”. Our current focus is Actors and Actresses and we are moving into other verticals.

You can find more:

• My Consultancy – www.Middleshift.com
• My Book – www.BeIgnited.com
• My Media Company – www.Media2Watch.com
• Twitter - @vincethompson

What are you working on now?

Vince: On the consulting side we are working with a unique social network, a new television network and some original video content businesses. In addition to we’re taking GumGum and their very cool advertising opportunities to market. Example here: http://gumgum.com/advertisers.

Like me, you have a lot of different things going on, how do you balance?

Vince: I only take business that I believe in. The client has to win...I have to be excited. With that as a start it rarely feels burdensome. As for balance....it’s not easy...but I build in some time to think. That’s important in my game. I run a lot. I try to eat dinner with my family 5 nights a week and truly take Sundays off.

Tony: I personally am torn by choices around Networking Events in Los Angeles – you can go to something almost every night. I really enjoy events where there are interesting people with interesting conversations to be had. But I also like to be home with my family (or playing volleyball or whatever). Interesting to hear how you think about this.

How do you explain your personal brand to people? I need help on this as well. :)

Vince: It’s hard sometimes to not sound like a guy trying to sell nine watches up and down his arm. I usually...just focus on revenue. People understand that. I help internet companies make money. Then...if they have an interest in that we can go from there.

Tony: That’s a great way to attack it. I’m sure it sparks interesting conversations.

What keeps you up at night?

Vince: Not much...but what do I worry about? A good deal actually as like most of us I’m always pushing for more success. Am I thinking big enough? Am I seeing the future?

What are some of the top things you've published online, e.g., blog posts?

Vince: In addition to my management writing I’ve interview many CEOs and innovators.
Here’s a series I did for CBS last year - http://www.smartplanet.com/search/?q=vince+thompson
An some some videos along the same lines - http://blogs.bnet.com/dogandpony/

Tony: Some great content in there. I’d love to get your thoughts at some point about writing for these publications vs. on your own blog.

Not sure how much time you spend on your Ignited Managers, but some of the core concepts are completely in line with what I discuss in Work Literacy. For example you say:

Vince: Ignited Managers thrive because of their unique ability to connect and leverage their informal networks for the good of the company. Due to the incredible power represented by these networks, we believe that managers need a system to understand and monitor the ever-changing value of this key asset.

Tony: I come at this a bit different, especially a focus on use of social networking tools as part of this. Still it’s something that most managers need to learn how to do better.

What networking events in Los Angeles or Southern California do you go to?

Vince:

• Always On
• Paid Content
• TwiistUp
• DealMaker Events
• Digiday Events
• And many private events.

Tony: So how do you do this and still have dinner at home?

What was the best one you've been to recently?

Vince: Digiday Mobile and Digiday Social

Who are some of your go to people in Los Angeles?

Vince:

• Jim Jonassen - http://www.venturesearchllc.com/
• Mark Suster - http://www.bothsidesofthetable.com/
• Kurt Daradics - http://daradics.com/
• Brian Garrett - http://crosscutventures.com/about.html
• Marc Sternberg - http://www.linkedin.com/pub/marc-sternberg/4/775/618
• Jeff Gordon - http://www.writersbootcamp.com/

Tony: Great list. I know Jim, Mark, Kurt (see Los Angeles Technology Connector – Kurt Daradics).

------------------------------------------------------------

More Visible Networking

• Marketing, Startups and Networking in Los Angeles – Cliff Allen

• Los Angeles Technology Connector – Kurt Daradics

• Product Manager Entrepreneur Mark Geller

• Early Stage Marketing and Branding – Farida Fotouhi

• Attorney and Startup Business Advisor – Aaron Shechet

• Negative Customer Acquisition Costs - Creative Startup Marketing Ideas - Eric David Greenspan

• Product Management for Startups in Los Angeles – Steve Gilison

Symptoms of a Weak Development Team

This question came up last week.

I am hearing from my project management team a bit of distrust in the technical capacity of our web development team.  I  think we suffer because of the distance and culture but the project management team takes every late delivery or small bug as evidence that the development team may not be capable.

My quick response was that this was likely some combination of:

1. Weak development team
2. Poor communication, especially around requirements and expectation setting
3. Past failures (missed deadlines, bugs, downtime, etc.) that make it impossible to establish trust

The response I received was:

How do I know which it is?

Great question.  And the answer is that it likely takes some diving into the specific situation to understand what’s going on.  And there are always multiple things that can be improved to get a better result.  Still there are some common signals / symptoms that I hear about from Founders/CxOs in companies that are the reason they are calling me.  I thought it might be helpful to capture these symptoms so that in the future I can point people to this.  But please:

Just because your development team has these symptoms does not mean that you have a weak development team.  What it means is that you likely need to dive in to figure out what you are really dealing with.

Founder Developer Gap and A, B, C Players

By the way, this question is another example of issues around the Founder Developer Gap.  Developers operate at a level and in a language that others in the organization can’t necessarily interpret and understand.  So, it’s often hard to know if the developer is an A, B or C player.  And an “A” player is worth 10+ C players. 

Also, there are a lot of C players out there.  When we interview potential developers, it’s amazing to me how many can’t answer questions that every student in a sophomore level computer science course should be able to answer.  I used to teach this same stuff.  If a student couldn’t answer that, you normally would counsel them that they might want to think about changing majors.  How did they ever graduate not knowing this stuff?  And how do they have the resume they have?  I often wonder what’s going on, but I don’t have time to worry about it.  We try to move on to find the actual A players.

Symptoms

So what do I hear about on these calls?

• Frequently missed deadlines. 
• Last minute scope cutting to make deadlines.
• Delivery of code/product that clearly has not been tested.
• Marking bugs as fixed that aren’t fixed.
• Massive overtime.
• No communication between developers.
• No clear leader.
• No one owns architecture.
• Rogue developers with their own agenda.
• Private bits of code that are jealously protected.
• Finger pointing with no clear answer.
• Fixing one thing breaks something else.
• Source code control is only marginally being used.
• Bugs – no big deal.  The system keeps crashing – no problem.
• Annoyed at testers for finding bugs.
• No attention to detail.
• Same problems seem to occur all the time with no desire to look at what’s behind the problem.
• All new features seem to require significant rewrites and a ton of development time.
• Developers can’t explain why certain changes will require more or less development time.
• Developers are very quite when bugs, features, changes are being discussed and only come back with questions later.
• Not open to discussing all of these issues.
• One of your better developers leaves.
• No questions being asked (Startup Software Development – Do Your Homework Before You Develop Anything)
• Rest of team says - “I’m not sure where we stand.” “I’m not sure what’s in the next dev cycle or when it’s being delivered.”

And the #1 reason I get calls relates to an old software engineering adage:

The first 90% of a project takes half the time.  The last 10% takes the other half.

So the most common symptom is:

The team seemed to get a lot done early on, but now it just seems like it is taking forever to get it “done.”

Again, if you are seeing a few of these symptoms, then you may have a weak development team, but it might be other things going on that make it so the team is not as effective as it should be.  You need to dive in.  And, of course, if you have the Founder Developer Gap, then you might want to consider getting help.

Signs of a High Performing Team

Going at this another way … Christope Louvion, a fellow member of the Los Angeles CTO Forum, wrote a blog post on Signs of a high performing team

• a high service level and availability of their product/system
• a high throughput of effective change
• a low amount of unplanned work
• a culture of change management
• a culture of continual improvement
• a culture of root-cause analysis

This is a great list!

Recovery is Extremely Hard

Early failures by a development team make it really hard (next to impossible) to recover trust. 

Software development is challenging.  It’s often hard to know all the different questions you should have asked to get better requirements.  And it’s easy to not think of edge cases.  There’s pressure to get it done and get onto the next thing.  Lots of opportunity to introduce bugs.

Once you’ve been labeled as someone who doesn’t produce quality work or that you are slow, it’s hard to recover from that perception because everything you do is looked at through that lens.

But this is true of pretty much any kind of knowledge work.  Evaluating Performance of Concept Workers talks to how most managers lack the knowledge to be able to directly judge the performance of knowledge work.  Therefore they use signals.  But these are clouded by perceptions. 

If your manager thinks you are not doing a good job, it’s very hard to overcome that perception and reestablish trust.  A third party can help a lot in this situation.

Granularity and Consistency of Startup Metrics

Tim Berry has a great post on Why I Hate Those Huge Market Numbers tells us that he doesn’t like to see business plans with multi-billion market numbers used as the basis for projections.  It’s the old – 5% of massive market gives us a big number.  I agree completely:

If it makes you feel better to give me that number in passing, okay, go ahead, but don’t put any emphasis on it. Instead, give me the details on how you’re going to make your sales, and to whom, on the first day, the first quarter, and the first year. Give me granularity.

If you’re a Web-based startup, for example, show me how many unique visitors you think you can get in the beginning, and what you’re using for an estimated conversion rate (buyers to browsers). Show me how much each unique visitor is going to cost you in search engine optimization and pay-per-click search engine expense.

Great stuff!  And it’s surprising how few startup founders think in those terms. 

And it becomes really important to have that granularity really fast. 

I’ve talked before about initial conversations with founders and the questions I’m likely going to ask Startup Software Development – Do Your Homework Before You Develop Anything.  Part of those questions are around Startup Metrics.

This aligns with understanding the the core business model:

• Get Users (= Acquisition, Referral)
• Drive Usage (= Activation, Retention)
• Make Money (= Monetize) (and Lifetime Value is a good one)

Of course, that’s a big part of what the investor wants as well.

And you definitely should have ideas around important proof points for the business.  What hurdles do we need to hit for that next round of investment?

Good founders will have ideas about all of these at a fine grain.  And it will be a consistent picture provided both to the team (CTO, COO) and to investors.  We all are signing up for the same thing.

But the bottom line is that Tim won’t invest and I have a hard time executing when you describe the objective as 5% of a massive market.  Ack!  Give me granularity as well!

Don’t Subtract - Restart to Find the Minimum Viable Product

Steve Blank wrote a great post recently entitled Perfection By Subtraction – The Minimum Feature Set where he explains the real goals around defining a minimum viable product:

Founders act like the “minimum” part is the goal.  Or worse, that every potential customer should want it.  In the real world not every customer is going to get overly excited about your minimum feature set.  Only a special subset of customers will and what gets them breathing heavy is the long-term vision for your product.

The reality is that the minimum feature set is 1) a tactic to reduce wasted engineering hours (code left on the floor) and 2) to get the product in the hands of early visionary customers as soon as possible.

You’re selling the vision and delivering the minimum feature set to visionaries not everyone.

I’m a big believer in delivering a minimal product out of the gate, although minimum gets defined differently in lots of cases.  In some cases, part of the definition of minimum is going after technical risk as much as you are going after market risk which is often the focus of lean startups.

But what inspired me to write this post was his title “Perfection by Subtraction.”  My experience has been that it’s often hard to get founders to “subtract” from their product definition.

Here’s what I mean… You start with some list of product features and functions.  As you try to peel away any particular feature, there’s a good argument given you absolutely need that to make this into a viable product.  Often, it’s the related nature of the features.

We have to have X or Y won’t work and Y is critical.

Sometimes, it’s more emotional attachment than practical reality.  It’s hard to give up on something that is part of your vision.  REALLY hard for some founders.  But often it’s just that the current list is viewed as an MVP already and giving up any part of it seems to break the vision.  I’ve been in lots of these discussions and have found myself starting to agree with the founders defense of their definition of MVP.

So  … rather than “perfection by subtraction”, I’d highly recommend Do a Restart.  Go to a blank page.  And try to define a new minimal vision where you have removed everything.  Then only add something that is absolutely critical.  Challenge the group to find the most minimalist definition.  But it absolutely must start from a blank page.  And it’s critical that you mentally and physically (electronically) throw away the current vision and feature list.  It’s a barrier.

Often when you look at the same feature list after this exercise you wonder how you could have ever been arguing for all of that extra stuff. 

Well, truth be told, some founders won’t ever leave anything behind and you just have to go build that.

But again – Don’t Subtract – Restart.

Startup Technology Advisor

In my post, Technology Roles in Startups, I described some of the different ways I engage with startup companies such as CTO Founder, CTO, Part-Time CTO, Acting CTO, Consultant, Advisor and Advisory Board Member. The last two categories are quite variable on their own and there’s quite a bit to those kinds of engagements as they often are not as well defined. I thought it was worth capturing a bit more about Advisory Roles, Advisory Boards and particularly Technology-Oriented Advisors – who are often thought of a bit different when it comes to those roles.

Actually, if you look back, advisory boards came from being Technical Advisory Boards where the advisors were primarily professors, researchers, experienced practitioners where the startup had a high degree of technical complexity and needed a brain trust. Now, most often technical advisors are part of a broader advisory board. I take on these roles periodically, but before any startup engages me or anyone else as a technology advisor there are some other considerations.

In Why assemble an advisory board?, Chase Norlin talks about the normal reasons that Founders / CEOs form advisor boards for early stage companies:

• Recognized industry thought leaders add immediate validation and credibility to the venture at a stage when there is typically none;
• Advisors can open doors, make introductions, and assist with strategy and business planning;
• Advisors add value in making introductions to sources of capital, or serving as a due diligence reference during fundraising;
• Advisors know people and people know advisors, it’s that simple. The more third parties talking about your venture the better.

My experience as and with Technology Advisors is that their networks are very different and may or may not match with the introductions you want. This relates to the distinction that Alexander Muse raises in Advisory Board Compensation for your Startup between what he calls normal advisors and super advisors. Before engaging a Technology Advisor for the purpose of accessing their network – make sure it’s the right network.

Dharmesh Shah captures the role of advisors more simply in Startups and Advisory Board Members:

First, lets summarize the two most likely reasons you would put someone on your advisory board (one or both of the following apply):

1. Advisory Value: The person you are inviting has experience and knowledge and can act as an advisor to your startup.
2. Brand Value: The person you are inviting has “brand” and credibility. By placing them on your advisor board, you are hoping that some of that credibility will rub-off on your startup.

For Technology Advisors, I would add that there’s an implied value that they help check off the box that says – this can be done technically. During investor or third party partner due diligence, it is sometimes really valuable to have someone who has credentials and personal presence who can make technical questions go away. Of course, that means that the person needs to be engaged deeply enough that they feel comfortable saying it can be done.

Mark Suster - Should Your Startup Have an Advisory Board? who is often the contrarian, talks about some key issues that he and other CEOs often encounter with advisory boards which are good cautions.

1. Not enough time.

2. Not enough wisdom.

3. Too much effort.

4. Expensive.

One of the suggestions Mark makes is to get investment from advisors. That’s something I’m not going to do. My investment is my time.

Other good articles to read on setting up Advisory Boards:

• The Importance of Advisory Boards for Startup CEOs

• Critical Considerations for a Startup Advisory Board

• Everything you ever wanted to know about advisors, Part 1

• Everything you ever wanted to know about advisors, Part 2

One of the points that almost all of these posts make is that most advisory board members are not doing this primarily for the compensation or to get rich at the end of the day. Because of that, you also need to understand what the motivation is for any potential advisory board member.

Again, it’s really important as a founder to be clear with your prospective Technology Advisor (Advisory Board Member) to be clear about what you want/expect from them. And don’t confuse having a CTO with getting an Technology Advisor. There are a bunch of specific responsibilities that I described in Technology Roles in Startups that an Advisor will not be able to get into in any depth.

Technology Roles in Startups

I’ve worked with 30+ early-stage companies in all sorts of capacities (and spoken to many, many more), so I thought it might be worthwhile trying to classify the various ways that I’ve engaged in different technology roles in startups.

Background

This post partly really came about as a result of a great conversation yesterday with David Croslin a former CTO at HP who recently conducted an interesting experiment.  He posted on several social networking sites the following message:

If you know of a startup company that could benefit from the knowledge, experience, professional network and reputation of a globally recognized technology and innovation leader.

I am looking for one or two startups that I can work with on their road to success as a virtual C-level officer, board member, advisor or other relationship.

Later he posted about his experience in Challenges of Startups.  The short story is that he received 400+ responses and goes through how he categorized/vetted the responses:

• 300 Didn’t Fit – Outside expertise/interest, pushing for immediate funding assistance, too many ideas (not focused), looking for sales agents.
• 20 Required NDA to continue – a nonstarter
• 50 Couldn’t sell him
• 15 Couldn’t explain why they wanted him involved

In our conversation together, David and I spent a fair bit of time discussing the fact that a lot of people really didn’t know what he could do for them.  This is actually fairly common and I think it’s a bit challenging in that the technology roles (from technology advisor to CTO) in a startup vary widely.  Actually, David’s taking even broader roles than I generally do as he’s CEO for at least one startup. 

Activities

As I went through my 30+ different startup experiences and tried to classify them a bit more, I realized this is very messy stuff.  Each situation is just a bit different.  It depends on the business, people, technologies, etc.  So while I’m trying to make sense of this, it’s somewhat hopeless.

That said, I think it starts with what a laundry list of different kinds of needed technology activities and what the current team can reasonably accomplish.  And a big factor is how big is the Founder Developer Gap.  Unfortunately for a lot of founders, it’s hard to know the gap.  There’s a funny phenomenon where often the best sounding technical people are often the worst developers.  So, you can easily get sold that there’s little to no Gap.

Some of the activities that are likely part of the mix where there might be need:

• Review and provide input on business plans
• Costs and time estimation
• Product prioritization
• Options analysis
• Systems analysis and design
• Technical risk analysis
• Technical research and evaluation
• Systems for accounting and reporting
• Metrics (see startup metrics)
• Security
• Integration
• Scalability
• Social media integration plans (ex. see When to Use Facebook Connect – Twitter Oauth – Google Friend Connect for Authentication?)
• Development plans and resourcing, in-house, outsource, off-shore
• Other development and operational plans and resourcing
• Interviewing resources
• Coaching or managing developers or others
• Discussions with key partners or customers
• Technical innovations, protection, patents
• Networking and Introductions

It’s worthwhile to think through some of the specifics of what gaps exist among the current team and hence where you might want to augment the team.

Forms

Augmenting the team can take various forms:

• Consulting – defining how to attack particular issues, possibly directly planning
• Coaching – advising on how to approach particular issues
• Manage – lead members
• Execute – take on specific activities

Again, this is fairly fuzzy, but it comes down to having mutual expectations.

Labels and Structure

One of the more interesting questions is what this ends up being called and how it gets structured.

• CTO Founder – Direct responsibility for technical direction and development, sometimes operations, implies greater authority on product and company direction and higher equity position.
• CTO or Part-Time CTO – Direct responsibility for technical direction and bridging the gap to development
• Acting CTO – Direct responsibility but expected limited duration, often bridging to a full-time CTO

All of the above CTO titled roles imply direct responsibility to execute and manage aspects of the startup.  However, I’m always doing this part-time.  That means that it will be structured as some number of hours per week, month, etc.   It’s up to collective team to manage how this gets allocated.  That’s the same thing that everyone does, but they are playing with a larger bucket of hours.  Some weeks might end up being pretty much full-time on a single startup (e.g., important planning meetings or partner meetings).  But it generally works out well in the end.

Other labels:

• Consultant – Take bits and pieces, possibly coach
• Advisor / Advisory Board Member – Often a periodic responsibility and some ad hoc activities.  I’m going to talk to this in a future post in more detail.

The consultant role can either be a specific set of tasks for a limited duration or a set of hours over a given timeframe.  It generally is done to pick off specific needed activities.

I would suggest if you are thinking about what you really need for your startup in terms of technology, you also take a look at: Startup CTO or Lead Developer.

I would love to hear questions on this – and I’m expecting to come back and modify this as I have experiences that fit outside of this or as I figure out better ways to classify / clarify technology roles.

Pricing Customer Acquisition Sunk Costs and More - Ten Recent Great Startup Posts

Here are some recent great posts that I’ve come across that generally fall in the intersection of startups and CTOs.  Enjoy.

1. Startup Killer: the Cost of Customer Acquisition | For Entrepreneurs, February 2, 2010

   Looks at the critical equation around customer acquisition cost vs. customer lifetime value similar to what I discussed in Startup Metrics but in more depth.  Great stuff.  Of course, one of the best ideas around this is to have Negative Customer Acquisition Costs.  They have a related post: Designing startup metrics to drive successful behavior | For Entrepreneurs, but I think that looking at my Startup Metrics post provides a bit broader set of metrics to consider.  And while I’m at it, a great post by Steve Blank No Accounting For Startups looking at early stage score keeping.

2. HTML5 video markup, compatibility and playback- Niall Kennedy's Weblog, February 8, 2010

   The emerging HTML 5 specification lifts video playback out of the generic element and into specialized handlers. Explicit markup for audio and video places elevates moving pictures to a similar native rendering capacity as markup we are used to but with more fine-grained details about underlying formats and compression available before loading. This post looks at the implementation details of HTML 5 video.

3. My experiments in lean pricing- Venture Hacks, February 16, 2010

   Ash Maurya, a lean entrepreneur who runs a bootstrapped startup called CloudFire, discusses pricing issues for first versions (Minimum Viable Product – MVP).   This relates to another great post Freemium Founders: Start Charging for Things Today! where Tony Wright suggests charging right now.  This is tough stuff to get right and my recent experience in a startup where we charged out of the gate and then wonder the effects of other pricing makes me appreciate Ash’s perspective.

4. Sunk Costs: An invisible, pervasive peril- A Smart Bear: Startups and Marketing for Geeks, February 15, 2010

   I literally had this conversation yesterday with a startup.  Jason looks at the issues around "sunk cost."  The emotions around sunk costs run deep.  Good stuff from Jason.

5. Do I Need a Co-Founder: The 90/50 Rule of Startup Founders- FairSoftware's Blog, February 1, 2010
   Another post that relates to my recent post on CTO Founders and Cofounders.

6. StartupList — a new way to reach angels- Venture Hacks, February 3, 2010

   AngelList is a curated list of angel investors, representing $80M going into early-stage startups this year . They now have a cool new way to get intros to these angels: StartupList . It’s a weekly email we send to AngelList, with 3 high-quality startups who want intros.

7. Death By Revenue Plan- Steve Blank, February 16, 2010

   Steve talks about the problem created when you start to manage according to your Revenue Plan.

8. How Unique Is A Unique Visitor?- A VC : Venture Capital and Technology, February 18, 2010

   Great post from Fred Wilson that questions a common metric – unique visitors.

9. Why Venture Capitalists Avoid Innovation: They Like Making Money- OnStartups, February 18, 2010

   Andy Singleton, the founder of Assemba, talks about innovation and VC with an interesting perspective.

10. Seed funding best practices- StartupCFO, February 11, 2010

    Good post looking at seed funding which often doesn’t get quite as much attention.