Note: This is not the complete story. This is just my perspective. I'm hoping the other OneTrueFan folks also feel like posting up their learnings - which will yield a more complete perspective. This is simply me detailing what I (alone) learned from my experience at OneTrueFan. I'm hoping it is complete and most of all honest and transparent. I hope it doesn't make anyone uncomfortable. The goal of this exercise is to help other entrepreneurs.
So... OneTrueFan has been bought. The company as it was when dreamed up; as it was when funded; as it was when the product(s) launched; and as it was while I was employed there -- that's no more.
This is a super win for OneTrueFan the company - and for the founders of OneTrueFan. In looking back at the company - there are a ton of things that we did really well. And there are some we could have done better. At the end of the day, could this win have been better? Yes, absolutely. We could have dominated the entire market and gone public in 3 years. But that would have required us not only to have done everything perfectly - but also we'd have had to have gotten very very lucky.
I've had a little time to look back at things and gain perspective. I think as a result I'm ready to share what I learned from the experience. I believe strongly in the idea of analyzing performance (independent of results) in order to improve future efforts. That is the point of this. "What did I learn - what will I take away - what will I do better or differently in the future." I hope that these thoughts can be helpful to other entrepreneurs.
At the end of the day - this is the sort of stuff that most entrepreneurs (in my experience) learn the hard way. And it's stuff that (in the past) I've held close to my vest in order to then make money charging entrepreneurs (cash or equity) for my advising and consulting services. This time, however, I want to share this all publicly and transparently.
WHY WE DIDN'T DOMINATE
I always prefer to start with the things we could have done better as I believe this is where we learn best. Without further ado... time to pull off the band-aid.
You cannot be half pregnant.
While OneTrueFan began as a so-called "lean start up" and while the founders and execs and team were and are all fans of this approach, over time we started abandoning some of the core practices of this model. We did not do this by developing a new model - and in fact continued to think of ourselves as a lean start up. We were just a lean start up with higher than normal monthly operating expenses. So we were, in essence, a kinda fat lean start up.
In many ways we knew what we were doing and justified it by saying both "well... we're experienced and know what we're doing and can make this kind of call" and "in this one unique case we need to be flexible because it's going to make us happier."
This was a problem for us. If you decide you're going to be a lean start up, you're choosing a complete model for your company. Changing the attributes of that model without starting with a change to the overall model is highly likely to decrease the odds of a big win.
We got lucky and it worked out for us. But that was straight-up luck. It was the equivalent of putting your last $100 on 16 in roulette - and having it come up. It is not something that you want to repeat (god knows I'm never doing it again).
Now... I'm not saying that this means I'm a dogmatic believer in the Lean Start Up Model. But if you decide you're going to choose a model - then you choose the whole model.
Don't hire Business Development too early (or too late).
I was hired to run and do BD right before the product was to be released in beta. The company was 6 people at that time. Adding me at this time altered the "center of gravity" (the focus) of the business. Before I was hired, the focus of the business was driving consumer adoption through the creation of a delightful and fun user experience. This is exactly where a business at the stage OneTrueFan was at should be focused.
Adding me to the mix caused the focus of the business to shift from delighting the consumers to satisfying our customers and getting them to sign contracts.
This not only changed what working at the company was like - it also changed the product rather dramatically. Things like having a place to meet prospective customers that communicated trustworthiness and credibility became important. Features that were of no interest to consumers (but were valuable in closing deals) became prioritized.
To be frank - these were all things that were going to need to be done.
But looking back it was just a little too early.
Because our focus went away from delighting consumers - we didn't really delight consumers. This slowed our consumer adoption. This made it harder than it should have been for us to get buzz. And it made selling to publishers harder as well. But more than that... it resulted in our product not progressing in the directions it needed to go - and made the jobs of everyone in the company less fun.
Every day I would push on the team to give me what I needed in order to better sell. And they would give me what I needed - but at the expense of evolving the product.
Everything is easy when things are going well.
The truth is that pushing on the team to get what I needed in order to better sell would have been bad for the company and the product - but easy on the team - if I'd been able to close more deals. But I wasn't. And then things are harder on everyone.
Early on we had a couple very good weeks and I remember saying to the team, "remember how this feels and bank it now - because we will have days and weeks that are as bad as this is good in the future."
That's a great thing to say (I guess) but is basically impossible to execute on.
When things go poorly - the past good days are quickly forgotten.
One of the single more important lessons I'm going to take away from OneTrueFan is that the role of a leader in a start up is largely to be the person who keeps the team excited and motivated and focused. Keeping the team focused is a challenge when things are bad - and when they are good. But the true test of your leadership is how well you can keep your team excited and motivated when things are going poorly.
Along with failing to close as many deals as we really needed this was my major failing.
When choosing a customer type, don't take into account product fit ("customer need") and your own network alone.
With OneTrueFan, we identified the ideal target customer as a publisher of a media or entertainment website with more than 1M monthly uniques. This made perfect sense. The product we were creating solved a number of the most significant business and user problems for these companies. And the executives in OneTrueFan had incredibly strong contacts in this market sector. So it was the right target - yes?
Well.... probably not. We (and I'm included in this in a major way) ignored things like "what's the sales cycle for this customer type" and "does this customer type commonly work with very small early stage companies." And most significantly we never validated that these customer agreed with us when we identified the significant business and user problems they were facing.
What we found out over time was:
- the sales cycle was far too long for these customers given our limited sales and BD resources (and intersected with our somewhat short runway as a start up)
- most of these companies were uncomfortable working with small start ups
- the vast majority of these companies saw the problems we were attacking as valid and interesting, but lower priority than other issues (and in many cases solving these other issues - which we often thought invalid - precluded them using our product)
Going back to an earlier point... if OneTrueFan had included a Business Development person earlier these issues would have been discovered earlier and addressed earlier. But by the time we learned these things - a lot of time had passed and a lot of decisions had been made.
In the future I will always not only look at more factors in validating customer focus - I will also validate not just customer interest, but also that customers agree with our premise in terms of their needs and priorities.
Your Board of Directors doesn't have to be a burden.
The majority of our board meetings were preceded by a couple of days of very high stress. By the day of the board meeting all the executives would be dreading the meeting and resenting having to do it.
The board meeting would then turn out to be either easy and painless or productive and helpful.
But by the next board meeting we'd be back to stress and negativity.
Looking back at this pattern I have realized that I really should have been working far more frequently and tightly with the board and our investors. While some of them often either had little to offer or no time to help us - others had the potential to be hugely helpful. Instead I leveraged them purely for BD assistance (introductions, back-channel, etc) and rarely if ever (outside board meetings) asked them for advice.
That was a mistake that I will not make again.
Choose your vendors wisely.
We made a mistake choosing our bank.
We made a far bigger mistake choosing our accounting and bookkeeping firm.
The former was painful.
The latter could have been fatal (and was incredibly painful).
Margin of error in start ups is too small to choose a bad vendor, especially a vendor who provides any sort of financial or legal services.
My advice for other entrepreneurs.... don't only ask your friends at other start ups who they use. Also ask your investors. They have a far larger sample set to draw on than your friends do - and they have a lot to lose should you get the wrong vendor.
Swinging for the fences is fine - but putting all your eggs in one basket is dumb.
Early on we had a sales opportunity that would have taken us from roughly 9M monthly uniques to roughly 180M monthly uniques. Closing this deal became my number one focus. In fact it became my obsession. Eventually I had put so much attention and time and effort into closing the deal that the deal itself became a single pass/fail test for the entire company. If it closed, future investors would pony up tons of cash and our investors would be overjoyed and we'd see massive success and win a Nobel prize etc. And if the deal fell through the company would be doomed.
Now, obviously neither of these two are true. But that wasn't the point. The narrative for the company had become all about this one deal. And I had not only fed that but created it.
I worked on the deal for six months. The problem was that every time we got close to agreement our primary champion within the company would leave. We went through 5 different key contacts. During this time I spent a larger and larger percentage of my working hours on this opportunity - not generating a ton of new opportunities and not advancing other opportunities quickly enough.
When the deal fell through, we had as a result effectively lost 3 months of BD time. In addition, we had developed a number of features and systems that were purely driven by this deal - wasting probably 45 days of product development time. And, of course, the deal had become this symbol of the company. So when it fell though, to folks within the company it felt a lot like the company had failed.
Sharing the load is a required survival tactic.
Everyone talks about the need for co-founders in a start up. What few point out is that having co-founders (or at least an executive team of at least 3 people) means that other people have your back.
Towards the end of the 6 month sales effort on the one big Whale account - I came down with a severe viral infection. In this case, one that is really only contracted when you have a weakened immune system. One of the first questions the doc asked was, "have you been under a lot of stress."
For almost two weeks I was in quarantine. The other two managers at OneTrueFan carried the company - and carried me - for those two weeks. Without the two of them I would have had no chance to recover and would have been forced to try and work through the illness. This would have almost certainly killed the company - and might have actually killed me as well.
In retrospect, I should have asked them for help earlier. Carrying the stress of trying to close a deal that we'd bet the entire company on by myself was obviously hurting me.
I'll never do another start up without at least 2 other people to share leadership and management with. It's just too hard to be "On" every day - and it's simply impossible for you to be happy and positive and a great leader and engaged and energetic... every. single. day. With 2 other folks, you pretty much can always have one person who is "off their meds" at any one time.
Let your product vision determine your funding strategy and sources (not vice versa).
We took too much money too early.
We let the need to close another round (and the feedback of these funding sources) change what we were doing as a business and with the product.
For an early stage start up, speed of development and release and efficiency of engineers is far more valuable than scalability or performance.
I hope Todd posts something about this - but suffice it to say that we learned (the hard way) the modeling your technology stack on what the huge, complicated systems (Google, Twitter, Facebook, whatever) are doing is a bad idea.
You can solve your scalability and performance issues once you have them. Focus on releasing early and often and then hope for enough happy users that scalability becomes a problem.
WHAT WE DID RIGHT
Now that I've shared all the ugliness - time for some of the good things!
Dave McClure was right.
The basic model for a successful early stage company is Hacker + Hustler + Designer.
But... my definition of each might be different than others. So...
Hacker equals someone who wants (needs?) to build things and solve problems and come up with cool and efficient solutions to problems. A Hacker is not the same as an Engineer. A lot of Hackers are Engineers - but not all Engineers are Hackers.
Huster equals someone who needs to get out there and Win. They need to do the soft-shoe and flash the jazz hands and walk away with the customers' money. A Hustler is not the same as a Salesman. Most Hustlers are great at Business Development - but not all BD people (and a minority of Salesmen) are Hustlers.
Designer equals someone who has a vision in their head that they need (want?) to communicate to people. This vision is a vision for how a product is going to work, be experienced, change people's lives. A Designer is not the same as someone who does design for a living. In fact, few Designers have any training or experience in graphic design or the like - and few designers are likely to be good Designers.
This mix is incredibly powerful. I'm unlikely to ever do another start up which isn't set up like this.
Agile methodologies work.
It's really that simple. If you're in an early stage, high risk and short timeline start up, there really isn't another option.
Once we got our tech stack sorted out it was amazing how efficient, effective and fast our development became.
If you're not shipping product you're failing.
We measured our success on various metrics. But at the end of the day, it was all about shipping. And that is a very very good thing. It's good for the motivation and focus of the team. It's good for your odds of success. This was something we were really quite good at.
Learn from your mistakes.
Watching user testing videos is very painful. Seeing users fail to love something (or fail to understand it) when it's "your baby" is a rough experience. But fighting against the users is the quickest shortcut to failure.
We were really quite good at accepting what users did and did not do and really did understand that at the end of the day it's not how you intend the product to be used that matters - but how (and if) users choose to use it. Give them what they want.
We were (perhaps painfully) honest with our team, with our investors, with customers and users and pundits and (the list goes on). This was often uncomfortable at the time (for all involved)
But trust me on this... when things go poorly it's far far easier on everyone if you've been honest and transparent all along.
Just tell folks the truth.
Believe in the team.
The OneTrueFan team was amazing. There were so many incredibly talented and committed folks involved. Trusting them made the entire experience not only easier and more fun - it made the job possible.
Sure, some times people fuck up. But if you've got a good team, in the end they're going to be amazing like this team was. So let them fuck up when they do, and reward them when it all goes well. And the best reward you can give them is to trust them.
Food and Drink are incredibly important.
Choosing a business location based on proximity to places the team wants to eat and drink at is a very smart idea. Food and drink are the new social medium and lubricant.
As relates to this... going out for food and drinks with any prospective hire, partner, customer, investor, etc is something I consider "new best practices." You'll learn so much about this person and, as I've said before...
Success is determined far more by who you choose to not work with than it is by who you choose to work with.