David Cummings on Startups

Category: Entrepreneurship

  • What’s in a name (for this blog)?

    My initial inspiration for doing a post every day on my blog came from Fred Wilson’s blog over at avc.com. Amazingly, he’s already done 5,000 posts. Yes, 5,000. This post is actually my 365th post, and I’m feeling pretty good about things. One area that I’m still working on is the name for this blog.

    Here are some names I’ve used:

    • Entrepreneur Musings — not sure it is specific enough
    • B2B Tech Entrepreneur — possibly too generic
    • Startup Stammer — not a positive connotation with stammer although I do like the alliteration
    • 10,000 Startup Hours — the current title, which comes from the Malcom Gladwell book Outliers and is the idea that it takes 10,000 hours to become good at something

    My goal with the name is to be unique and memorable but also pretty relevant, whenever possible.

    What do you think of the new name? What are some blog names you like?

  • Entrepreneur Personal Growth Path

    One aspect of entrepreneurship that isn’t talked about very often is the personal growth path. What I mean by this is the necessary progression management progression during the lifecycle of a startup that scales from nothing to tens, hundreds, or even thousands of employees.

    Here are some sample inflection points:

    • 0 – 10 employees – doer and manager
    • 11 – 20 employees – mostly manager and some manager of managers
    • 21 – 50 employees – mostly manager of managers and some manager of manager of managers
    • 50+ employees – manager of manager of managers (e.g. manager of an executive team)

    There’s a book just about this subject — Leading at the Speed of Growth. My advice is for entrepreneurs to be cognizant of this path and to prepare and understand it as best they can.

  • The Startup Process

    The startup process: there is none. Much like the debate around business plan competitions being bad (too much making up stuff) and a potential solution being business model competitions, startups shouldn’t be viewed as having a formula. Rather, they should be viewed as a multi-year marathon with a series of iterations (some people say pivots, but I prefer iterations).

    Generally, from my experience, here’s one way to look at the startup process:

    • First six months – Build the beta product and get it in the hands of the early adopters
    • Second six months – Refine the product and get ready for launch
    • Second year – Focus on optimizing the customer acquisition process
    • Third year  and beyond – Scale and grow the business

    What else? What would you include in a simple startup process?

  • The Perfect Product Challenge

    One of the major challenges with a web application is the allure of making it perfect. Who doesn’t want the perfect product? Perfect is the enemy of good. A good product gets out the door and is put in the hands of prospects. A perfect product doesn’t exist, and while it is being built, time, energy, and especially money is being consumed.

    My recommendation is to get the product into the hands of prospects as quickly as possible. And when I say prospects, I’m thinking about random ones, not just warm intros. Warm intros are definitely worthwhile and should be used, but also make things too easy that an objective buyer might not provide.

    I’ve seen too many startups never fully get a product out the door. Don’t join the crowd! Launch early and often.

  • Recommended Entrepreneur Books

    A lightening round topic came up at today’s EO Accelerator monthly accountability group meeting about good business/entrepreneur books to read. I named a few off hand and realized I needed to have a better list available. Here’s a list of books that I own and recommend, representing about 50% of the business books that I own:

    This is a pretty good list to start with. I recommend clicking through and reading about them on Amazon.com to learn more.

    What else? What other books would you recommend?

  • More Richard Branson Thoughts on Entrepreneurship

    I’m continuing to read the Richard Branson book Business Stripped Bare and am nearing the end. For me, I usually only read a few chapters (e.g. the first, last, and skim the middle) in a book before moving on to the next one (usually several books a month). Here are a few more pieces of information that caught my attention (text verbatim from the book):

    • Virgin’s normal rate of return in business around 30 per cent [what’s your target rate of return for your business?]
    • This is the point at which entrepreneurial functions become separated from management functions…Suddenly, innovating is seen as something extra, something special, something separated from the activities the company normally engages in.
    • Virgin’s management style is unique, designed to both empower employees and avoid a culture of fear.
    • …there is a fundamental difference between an entrepreneur and a manager…Although I’m sure there are entrepreneurs who could make good managers, my advice would be: don’t try to do both…Entrepreneurs have the dynamism to get something started…Yet an entrepreneur is not necessarily good at the nuts and bolts of running a business.

    Richard Branson ranks up there as one of the most influential entrepreneurs ever, and I enjoy reading his thoughts.

  • Trends in Entrepreneurship

    At a recent EO event the topic of trends in entrepreneurship came up. We spent a good bit of time discussing ideas and changes that were affecting entrepreneurship, in order to think bigger about where want EO to excel and provide the most value.

    Here are some of the trends we identified that will play an important role with entrepreneurs:

    • Globalization
    • Social media
    • Crowdsourcing
    • Mobile
    • Internet everywhere

    What else? What are some other trends that will affect entrepreneurs over the next decade?

  • SaaS SMB Web Testing and Monitoring Software

    So, we’re starting to evaluate upgrading our in-house web testing and monitoring software to a commercial solution (we use several free and open source products now). Here’s what we’re interested in from a single provider:

    • Pinging a variety of ports and servers from different locations in the world
    • Browser emulation with pre-defined scripts and paths
    • Checking of SSL certs, domain names, etc
    • Web services (REST) testing
    • Web services API for us to inferface with
    • Priced under $1,000/mo

    We’re looking for recommendations and best practices. What do you recommend?

  • Ways to Grow a SaaS Business Faster

    Earlier today we were talking about ways to grow a SaaS business faster. SaaS, with almost all recurring revenue, is a great business model once the machine is humming. SaaS is so desirable because it provides consistent cash flow and makes it easy to budget during growth. Thinking about the ways to grow faster, at the most basic level, here’s what we came up with:

    • Sign up customers faster
    • Sign up customers at the same rate but at a higher revenue amount
    • Up-sell existing customers
    • Reduce customer churn

    Now that we have the most basic ideas, it is time to work on different strategies for each category.

    What else? What are some other ways to grow a SaaS business faster?

  • The Co-Founder Complement

    It seems there’s been a surge in activity lately of people reaching out to me for help finding a co-founder for their idea. Of course, I tell them the best thing to do in Atlanta is to start going to ATDC events. Absent the tactical tips to actually find someone, I believe it is important to think through the complementary attributes desired in the ideal co-founder.

    Here are some topics where you might be one side and could benefit from a co-founder with the other side (these aren’t opposites):

    • Sales / engineer
    • Big picture / tactical
    • Aggressive / laid back
    • No fear / measured concern
    • Ideas / details
    • Passion / passion (everyone needs this!)

    Finding one or more co-founders that complement your attributes, talents, and skills is one of the most important steps in a startup. I recommend thinking through it carefully.

    What else? What other complementary attributes do you find important?