SUMMER OF TECH 2011

STARTUP LESSONS

Following on from our awesome User Groups talk, the presenter at the 2nd instalment of the Xero Summer Seminar Series was Rowan Simpson (who probably needs no introduction, but a bit more background is here, and you can find his blog here, and follow him on Twitter here).

Here’s my notes from his seminar, but stay tuned for the video, we’ll post it to this blog asap.

Startup Myth-Busting with Rowan Simpson

The mythical startup model involves a lone hero having a “eureka moment” in a shed.  Next thing, they’re inundated with customers, the business grows, is sold to an investor for a gazillion $, and the inventor retires happily to a bach (with a boat & beemer parked nearby).

HOLD IT!  Reality-check, people.  Rowan knocked off those myths one at a time:

1. Inventor Team

In spite of the “lone hero / inventor” myth, the reality is that it takes a wide range of skills to build an idea into a product, and a product into a business. Developers, designers, marketing experts, leaders, strategists, operational folks.  Surround yourself with the right people for you and for your venture.

2. Eureka! Iterate

That amazing lightning flash moment of inspiration and invention?  Sorry, its a myth.  Most startups iterate, so be ready for your Big Idea to evolve.  What makes a successful product might not being the same as your startup idea.  Trade Me set out to replace free classifieds, but moved rapidly from computer parts to womenswear to real estate. Flickr started out as a tool for online gamers, Paypal was a virtual currency for palm pilots…

Build it, launch it quick, get people using it…  remember:

‘If you are not embarrassed by the first version of your product, you’ve launched too late.’

(Reid Hoffman, founder of LinkedIn)

Observe & listen to your customers.  A successful product is something people need/want/remember and will pay for!

3. In the Shed Executed & Networked

Isolation and secrecy have no place in the successful startup world.  Your idea doesn’t have to be original, you don’t need to run around with NDA’s, you just need to have a compelling product or service that solves a customer’s pain.  Get it out of the shed!  Use your networks!  If you have a remarkable solution to a real need, it’ll go viral, and that’s the best way to ensure:

4. Massive uptake Build Momentum

Um, well, be ready for this to take longer than you think.  Trade Me’s “overnight success” took 7 years.  (For more on this, check out this series of posts, a.k.a.  “The Trade Me Manifesto”).  Remember that your early audience may be different from your mass market.  Again, be ready to adapt your business & product to meet market needs.

The key thing here is to get early sales, and continue the growth momentum.  One approach is to set clear goals – have a number to obsess about.  Measure the right things, and focus on optimising everything about your startup.

Execution is everything.  Build your product, then prove it by getting customers to use it.  Then turn it into a successful business by getting even more customers to buy it!

5. Sell it Smart Money

Yes, sometimes a buyer comes along with a big chequebook… but it’s a tough journey for lots of entrepreneurs.  The key is to find an investor that recognises the value of your business model and the growth trajectory, and that you’ll add value to their business or investment portfolio.

Another reality check: it’s very rare that a pre-momentum idea would be worth anything near the $1m pricetag most startups seem to feel is appropriate.  Why not re-think capital-raising… how about giving away as much equity as you need to in order to get the right investors onto your team?

6. Retire Stay Passionate

Or… keep working on what you’re passionate about!  Don’t rest on your laurels!

How’s this for a reality check:

This is really just a quick run-down of my take-aways from what was a very insightful and enlightening talk in which Rowan Simpson shared lessons for NZ startups.  Feel free to add your lessons in the comments, and hang in there, we’ll get the video up soon!

Thanks Rowan, and thanks all of you who joined in the q&as and discussions.  Wellington’s a great place for tech startups, and we’re lucky to have people willing to share lessons like these!

Reminder: Snapper API Challenge
Last week, Snapper announced the SoT2010 API Challenge!  More info is up on their website here, and did you see there’s a MacBook Air and iPhone up for grabs? All you’ve got to do is come up with the awesomest API plugin to interact with the  Snapper smartcard.  They’ve opened up the source code for MySnapper, and its up to YOU to build stuff on it.

We’re working on getting the videos uploaded asap, so those of you who weren’t able to be there will get a chance to share the learnings.  Hope to see you ALL next week for XSSS-03, don’t forget to rsvp here!

Thanks to all our speakers, and our fabulous sponsors Xero.
Thanks to Kiwibank for hosting us, too!