There is always more work to do in a startup than there are people in the company or hours in the day to do it. Everyone has heard horror stories about endless twelve hour days, all nighters and death marches. Some startups fail not because the idea is bad, but because they just can’t seem to focus effectively on turning the idea into a profitable business. This is the second post in a series entitled Startup Musings that discusses managerial challenges unique to the startup executive. This post covers a few handy tips on how to make the most of the few resources you’ve got.
Choose What NOT To Do
When you’re small, and looking to get noticed in a much larger crowd, it is far better to do one thing exceptionally well, than to do a lot of things mediocrely. In a startup, this simple rule of thumb applies to the highest level of strategy all the way down to the lowest level of day-to-day activities. In a word, FOCUS! Given that there is always more to do than you possibly can, the most important organizational skill of the startup executive is the ability to look an idea square in the eye and say, “We don’t need to do that, because it won’t impact revenue, save money, or make us more competitive.” You’ll be surprised how quickly this little acid test will shorten your to-do list.
Sounds Like a Volunteer!
Getting focused is hard, but staying focused throughout the organization is even more difficult. Bringing a good idea to fruition is something like 5% strategy and 95% execution. In a big organization, that might be more like 5% strategy, 45% execution and 50% waste, but you can’t afford that in a startup. Keeping the organization focused on your short list is crucial to success. Unfortunately, many startup executives fall back on micro-management when they see their staff straying from the important goals. But, I think the better solution is to show your staff how to choose what NOT to do for themselves.
The first step is to make sure everyone knows how their individual goals tie to the big picture through regular company meetings and the like. But, I will guaranteed that before these goals are achieved, you and yours will be be assailed by a multitude of new ideas for new projects and recurring ideas for projects you have already passed on as things NOT to do. Often these competing non-goals show up in subtle little complaints like these: “I don’t know why we don’t do X and get rid of this headache?” and “Yeah, the right way to do this would be Y, but we’re always taking shortcuts, so it never gets done right.” I’ve found that the best way to stay focused on the priorities at hand, while maintaining the flexibility to jump on a valuable new idea is to reply “Great, sounds like a volunteer! Still think we should do it?” If you complain, you volunteer. Works like a charm.
Size Matters….Keep It Small
Startups are big, risky financial bets. The best way to manage this risk is to break it up into lots of little bets that allow you to reap immediate results, and quickly adapt to opportunities and threats. Flexibiliy is key. You should aways be focused on goals that will yield immediate value, however you measure it: revenue, users, network partners, etc. And, you should break projects up into smaller and smaller increments, so that you don’t commit all your resources to monolithic endeavors with long time-lines and uncertain results. Stay nimble, be opportunistic and evolve through continuous learning and improvement.
Be Different. Be Creative. Get Leverage.
It’s not enough to have a great product, there are far too many great products and people have far too little time to try them all. You’ve got to get noticed, you’ve got to be remembered and you’ve got to be something worth talking about, Seth Godin’s so-called purple cow. Unfortunately, you’re always outnumbered by the competition in a startup, so you can’t compete on muscle. You’ve got to work smarter, not harder. While your left brain is focused on squeezing the highest possible ROI out of 90% of your limited resources, your right brain should take some creative risks with the remaining 10%. If you don’t buy the ticket, you can’t win the lottery. You never know what will work and what won’t, so its good to experiment and place a few bets that have potentially huge payoffs throughout the business.
For example, at Xignite we sell market data via Web services. Nine out of ten readers probably read right over that last sentence and didn’t get it. Don’t be upset if you were one of them. Web services are not well known to anyone but software developers and their benefits are NOT easy to describe. It requires education and trial to really get the value proposition. Once customers get it, they really get it, but we need them to pay attention first. We considered the usual approach to this problem, whitepapers, webinars, flash presentations, etc., but it all seem so….frankly boring…for anything but the most interested prospects who are probably registering anyway. So, we’ve decided to place one of our bets on in-house video capabilities. Our competitors Web presence is rather old school, so we are going all out to stand out. Not just a demo video…we’re converting the core of our website communications to video, and we’re doing it in-house…on a shoestring.
Resourcefulness is Golden
I have in mind a future post in this series on hiring tips for startup executives, but I couldn’t complete this list without at least touching on this topic. In a startup, everything is fuzzy. Rarely is there an established process to reinforce focus and ensure productivity. Constant hand-holding can be an excruciating drain on resources. There is nothing more comforting than people who can get $#!t done. And, I don’t mean simply completing well defined assignments on time. I mean given the basic business problem with no idea what the ultimate solution is and no idea where the resources are going to come from, they take the initiative, stay focused, get creative and deliver unexpected value to the organization. They find solutions, not problems. There are lots of qualities you can look for when hiring for a startup, but for me, good old resourcefulness is always at the top of my list.