David Cummings on Startups

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  • Consensus or Leader-Led Decision Making in Startups

    John D. Rockefeller ca. 1875
    Image via Wikipedia

    With a small, agile team there usually aren’t too many people to get on board with a decision. The ability to move quickly in a startup is critical, and team members need to be on board. In fact, fast decision making is one of the main reasons startups beat larger, more well-funded competitors. Two of the most common decision making approaches in startups are consensus and leader-led.

    In a consensus process the leader works with the team members both individually and as a group to see how each person feels about a potential decision. The decision to move forward is only made with everyone in agreement, requiring more time and energy to reach an agreement. John D. Rockefeller was famous for requiring consensus from his management team before doing an intitiative.

    In a leader-led process the leader works to get everyone to voice his or her opinion so that their choice and reasoning is well understood. After getting everyone’s opinion, and talking through things, the leader makes the decision that he/she believes best, even if it isn’t consensus. Because everyone has voiced their opinion and contributed to the process, they are more bought into the decision even if it isn’t the direction they wanted.

    There’s no right or wrong approach in a startup but it is important for leaders to understand their personal style, as well as the magnitude of the decision, and to decide the best course of action.

    What else? What style do you prefer and why?

  • Commitment to Content Marketing

    Students celebrate the opening of the 2007 Mar...
    Image via Wikipedia

    Every B2B startup needs to make a commitment to content marketing. A commitment to content is devoting serious organization resources to developing great content on a regular basis. Blogging? Check. Social media? Check. Videos? Check. Webinars? Check.

    A commitment to content is not cheap or easy. It takes a tremendous amount of time and money to produce great content with a consistent rhythm. One of the more difficult aspects is staying with the process long enough to produce the desired results, much like it takes time to build a brand. The best thing to do is to hire great people, come up with a process, and run with it.

    Content marketing is not merely a function of marketing. Content should be developed by team members throughout the company. Sales, services, support, operations, engineering, and other departments interact with customers and prospects on a daily basis. Best practices, trends, and more are constantly uncovered by team members. These people should be part of the content army.

    A commitment to content is hard but the payoff is immense.

    What else? What are your thoughts on a commitment to content marketing?

  • The Ideal 4 Person Startup Team

    Forums and Minerals, the new Internet tools
    Image via Wikipedia

    For a new capital-light web startup I’m a big fan of a two person team comprised of a product manager with domain expertise and a lead developer. This type of team can move quickly towards finding product/market fit. Now, as the team grows from there the third hire should often be another software engineer. Software engineers, especially in the early stages, provide great leverage and economies of scale with their time.

    At some point the product rapidly approaches the needs of the market, which are being coordinated through customer driven development by the product manager, and it ‘s time for that fourth hire. That fourth hire should either be another software developer or a jack-of-all-trades with a marketing/sales/service focus to start building a sales and marketing machine.

    Here’s the ideal four person startup:

    • Product manager/domain expert
    • Lead developer
    • Software developer
    • Software developer or jack-of-all-trades sales and marketing person

    Building a successful startup takes timing, luck, and hard work. A team like this significantly improves the odds of success.

    What else? What’s your ideal four person startup team?

  • A Quick and Dirty B2B Marketing Plan for Startups

    Marketing PlanIt’s that time of year when managers are running around working on their 2012 plans. Well, for B2B marketers in startups, I want to offer a quick and dirty marketing plan format. Here we go:

    • Rhythm
      Outline the responsibilities for daily, weekly, monthly, quarterly, and yearly efforts. Developing new content on a regular basis for different channels is especially important.
    • Projects
      Layout strategic projects for the year in broad brush form (save the details for separate documents).
    • Goals
      Articulate the goals and metrics for macro-level items like monthly traffic, leads, Twitter followers as well as more precise goals for different initiatives.
    • Budget
      Make a Google Spreadsheet detailing the different line item costs on a monthly basis for the year.

    This simple approach helps get different team members on the same page and provides a guide for the new year.

    What else? What are some other items to add to the B2B marketing plan for startups?

  • The All Hands Startup Sales Meetings

    0771B Brook Lodge - Conference Hall | 2007 | C...
    Image by Facility Records | MSU Physical Plant via Flickr

    Recently I was talking with a friend about sales-oriented startup cultures. He recalled how at his first startup, of which he was an early employee and investor, everyone in the company was extremely focused on sales. It was such a sales-oriented culture that the entire company participated in the weekly sales meetings where they discussed the pipeline, opportunities, wins, and losses.

    Naturally, you’re probably thinking that that’s not a big deal when you have five or 10 employees. Everyone can jump into a conference room and hash things out for an hour. Well, they kept doing the all hands weekly sales meeting by conference call up to the time they had 100 employees. Imagine taking an hour a week out of the busy schedules of 100 people, most of which weren’t in sales, to be on the sales meetings.

    The all hands sales meetings were important so that everyone in the company was thinking about ways to improve the product, close deals, and outsmart the competition. There was no telephone game from the front line sales reps back to the engineers by way of the product managers. Everyone was able to hear everything good, and bad, that was going on each and every week.

    What else? What are your thoughts on an all hands weekly sales meetings?

  • 7 Startup CEO Tactics for Operational Excellence

    MIT Museum: Oil machine
    Image by Chris Devers via Flickr

    As a startup grows into a small business it becomes necessary to add more process and operational aspects to the company. The need for this typically occurs when a startup reaches the 10 – 20 employee size, and thus has more going on than can be simply managed by the startup CEO and other co-founders.

    Here are seven startup CEO tactics for operational excellence:

    1. Company-wide daily check-in stand ups/scrums
    2. Weekly KPIs available company-wide in a Google Spreadsheet
    3. Weekly tactical meetings with the management team to discuss the week ahead
    4. Quarterly check-ins that act like a lightweight performance review
    5. Quarterly off-site meetings with the management team to plan the next 90 days
    6. Quarterly celebrations with all team members to spend time outside the office and reflect on the last 90 days
    7. LCD scoreboard in a very visible location with up-to-date goals and progress

    These ideas come from a combination of Mastering the Rockefeller Habits and books from Patrick Lencioni. I’ve found this approach works well and I highly recommend it.

    What else? What are some other CEO tactics for operational excellence?

  • Catalytic Mechanisms to Drive Behavior

    Commerce Street in Paris, 15th district, as se...
    Image via Wikipedia

    Recently I was talking to an entrepreneur that had rolled out a new technology product to her team members. The challenge was that the adoption was weak and they weren’t seeing a return for the significant investment made in the custom technology.

    Catalytic mechanisms are processes and procedures that drive change through the very way things operate. You can think of it as ways to explicitly align interests or make one thing more tightly dependent on another. Instead of asking for a behavior change one approach is to rearrange something else that forces the behavior change.

    For the entrepreneur, I offered up a simple suggestion: pay the team members (independent contractors) based on data present in the new system. If they don’t put it in the software, they don’t get paid. It seems so simple but it can make a profound impact (I know of companies that don’t pay commissions to sales reps unless the deals are in the CRM).

    What else? What are some other catalytic mechanisms that drive human behavior?

  • Startups Should Keep Frenemies Close

    Image representing Frenemies as depicted in Cr...
    Image via CrunchBase

    Startups in a competitive market should develop frenemies. Frenemies are companies that you compete with but respect and share market intelligence. Now, you can’t collude on price, as that’s against the law, but you can compete against each other on Monday and share information about a different competitor on Tuesday.

    If you haven’t done it before it might seem strange. Once you start doing it it becomes invaluable. Startups are always looking for an edge, something to be more effective in the market. Frenemies provide a mechanism to do just that against joint enemies.

    The next time you pick up a great piece of competitive intelligence, and suspect your frenemy has value to add, consider sharing information in a way that doesn’t reveal your whole hand, but does help your organization become more effective.

    What else? What other thoughts do you have about frenemies?

  • The Opportunistic Startup Hire

    Isles of Scilly, United Kingdom (NASA, Interna...
    Image by NASA's Marshall Space Flight Center via Flickr

    A difficult situation some startups face is the opportunistic hire they can’t afford. What I mean by this is that the startup gets referred a great person, and there’s no position available, but they really want to hire her.

    Here are some things to think through when the opportunistic startup hire comes along:

    • What does the growth of the business in the next 12-24 months look like with and without the person?
    • What impact will this person have on the business outside of growth?
    • What ways can you get the person involved if you can’t afford them full-time? Advisor? Part-time?
    • What’s the likelihood you’ll be able to hire this person down the road when you can afford them?

    I’ve found that opportunistic hires rarely come along, but you know it when you see it.

    What else? What other considerations do you have when you find an opportunistic startup hire?

  • The Startup Tendency is to Over-Engineer the Product

    Shepard Fairey Press Preview

    Greg and another successful entrepreneur independently mentioned that startups have a tendency to over-engineer their original product. Over-engineering a product is done with the best of intentions: there’s a clean slate, more time for adding features since there aren’t customers, and an idealistic view of what the market needs and wants. Without customers to slow things down, find bugs, and submit requests, the pace of development is blazingly fast.

    Startups need to spend more time with prospects and less time over-engineering the product.

    This isn’t easy. Human nature, tending towards instant gratification, and the desire to build things, lends itself to writing more code and inventing more features, regardless of market demand.

    The next time you add a feature without customer input, ask yourself the following question: will 80% of my future customers get value from this fuctionality?

    What else? Have you seen the startup tendency to over-engineer the product?