http://alexandermimran.com/

Sublime Espresso

Thu, 09 May 2013 22:33:00 -0400

In Toronto’s Kensington Market, there’s a coffee shop called Sublime Espresso. I haven’t been inside, or tried their coffee, but if I was in the mood for espresso, chances are I would try theirs. That’s the power of positioning—if you do it right, you can own a space in the consumer’s mind. If I’m craving espresso, Sublime Espresso will come to mind. While it may be a niche market, and they’re only one small shop, it’s the smartest way to build a brand. Own a small space first before you try taking on Starbucks.

Owning a tiny segment of a larger market has worked in so many (retail) cases: Lulu Lemon, Subway, Whole Foods, and the list goes on…

Sometimes, by specializing in a niche, you become a Purple Cow. You’re noteworthy BECAUSE you are small, focused, and doing something the bigger guys aren’t.

If you want loose-leaf tea, are you going to get it from your grocer, or a loose-leaf tea specialist?

If you have termites, are you going to get a general exterminator, or the termite experts?

If you have a clogged drain, are you going to get any old plumber or the drain-cleaning masters?

This reminds me of a great tweet from Jason Fried: Just had food delivered and the delivery guy gives me his business card and says “I also do shower doors and mirrors”. Would you have that guy do your shower door or mirror? Probably not…

The Golfer

Sun, 05 May 2013 02:41:00 -0400

I wrote a post a long time ago, drawing correlations between a startup entrepreneur and Biggie Smalls. There another occupation which has commonalities with a founder: the professional golfer.

THE GOLFER

In order for a golfer to be truly great, he (or she) has to have these key fundamentals locked down: driving, approach shots, pitching, chipping, putting, sand shots. They need to stay focused through adversity and keep their mental game as sharp as everything else. They have a team behind them: their caddie, coaches, manager, sponsors, and family. They have to carefully manage risk, respond to how the field is playing, and adapt to the course conditions. Most of all they have streaks. At one point they’re on top of the world, next thing they’re not. Sound familiar?

THE FOUNDER

Similarly needs to have their skillset honed: product development, marketing, team management, finance, biz dev, etc. They definitely need to stay focused through adversity (team member leaving, bad press, etc) and remain optimistic. Behind them is their caddie (co-founder), coach (advisor), manager (board), sponsors (VCs), family (support system). They need to adapt to changes in the competitive landscape. And definitely deal with the emotional swings of trying to change the world.

One big difference, though: golfers rarely change the world outside of golf. Entrepreneurs can alter humanity…

Time

Tue, 04 Dec 2012 00:00:00 -0500

The title of this post is pretty ironic considering I haven’t written in my blog in some…

No excuses, of course. But things have been busy. I’ll try to make more room for blogging in the coming months, especially since a cadre of my millions of readers have been mailing me beautiful (but angry) hand-calligraphed letters demanding more of my poignant prose. This one is for you, Judy.

Time is everything. It’s the only thing we have. Despite being infinite, it runs out for us pretty quick. As Henry David Thoreau said, “Time is but the stream I go a-fishing in.”

More perplexing is that time is relative. It moves way slower for a house fly than it does for us. Everything has it’s own relationship with time, and that can change from moment to moment. Our perception of time gets skewed everyday - 5 minutes in a jammed, smelly, subway car feels way longer than 5 minutes on a golf course (for me at least).

I gained a new appreciation for time a couple weeks ago at the Toronto Startup Weekend. We had only 48 hours to prepare a demo and pitch of Unbox to a panel of judges - the entire weekend was a blur. It was as if I was being controlled by someone/something else, my body just going through the motions at mach-speed. And we managed to pull it off, placing second behind Herobox

I would have never thought what we did was possible to do in 2 days. But you CANbend time to your will. With the right help and a good plan, almost anything is doable. I had a great team of guys that pulled through, creating a live demo that wowed the crowd.

I’ve also realized the opposite since Unbox has been unfolding (er unboxing): time is required to make big decisions and solve big problems. Your subconscious needs cycles to crunch through data. One night you think you’ve got the solution, wake up the next day and things might be completely different. Sleep is crucial to tying the loose ends left behind from the day. The old saying, “I’ll sleep on it” has a lot of truth to it.

It takes a lot of patience to let things happen and fall into place. Einstein said, “Time exists to stop everything from happening at once.” Just like a puzzle, with pieces scattered on the table, some missing, some hidden, it can’t be done all at once. But if you start with the corner pieces (always) and get the obvious ones clicked together, the landscape starts to appear.

Unfortunately, though, moving fast and slow at the same time is paradoxical. My solution is to move fast on the knowns. Go hard where there is least resistance while trying not to box (wink) yourself in. There will be some waste, some imperfections, but time waits for no one…

The photo was taken in Sri Lanka at the Kandy train station. The clock displays the departure time for train #2.

(Simple)-Product (Sub)-Market Fit

Mon, 04 Jun 2012 00:00:00 -0400

Andrew Chen’s recent post on product/market fit reawakened some questions I’ve had about the topic. It seems to be the most crucial and sought after stage in the life to a successful startup, but at the same time the most elusive. So far, p/m fit has been defined as:

“… [Being] in a good market with a product that can satisfy that market.” (Marc Andreessen, who coined the term in this post)

“Customer Validation proves that you have found a set of customers and a market who react positively to the product: By relieving those customers of some of their money.” (Steve Blank)

“In my experience, achieving product/market fit requires at least 40% of users saying they would be “very disappointed” without your product.” (Sean Ellis)

Identifying when you’ve hit p/m fit is hard because every case is different. The p/m fit that the above people are talking about is usually one of extremely high volume and high growth businesses, which is ideal when looking at it from an investor’s perspective. However, big markets often take a sizable team and hefty bank-roll to capture, especially if it’s an established market with lots of competition and high costs/barriers to entry. Most founders don’t have the experience or credentials to raise money on an unproven idea, and most investors will take an established company with traction over a fancy slide deck. Not only that, but going after that big market at first doesn’t allow you to learn, iterate, and measure through the lean startup feedback loop.

Simple-Product/Sub-Market Fit

In my opinion, the best way to achieve product/market fit is to narrow your focus and go after a niche market with a basic product (MVP) and try to get that growing/earning/sticking first. The key is to start with a sub-market, or a piece of a much larger market, and work your way up. Would you climb Everest beforeKilimanjaro, or the other way around? Would you play Pebble Beach before learning to golf on cheap public courses? Would you enroll in the World Series of Poker for $10k before playing a smaller local tournament?

Pump the breaks! Don’t try to beat Paypal out of the gate. Instead build a focused payments product for groups . Don’t try to build the next Facebook, instead build a mobile photo sharing app for closed networks of friends. These are all simple apps that take on a smaller sub-section of a larger market, and thus have reached sub-market fit with a simple (but effective) product. They technically already have p/m fit just in a smaller market with a basic product.

Opposites of this trend are plentiful. Blekko hasn’t made much of a dent in the search market yet, and they’ve been at it for 4 years and have raised $25M (although they’ve inadvertently addressed the techie sub-market with their tagging feature, so some credit is due). Cuil ($33M in funding), SearchMe ($43M in funding) and Powerset ($22.5M in funding) have fizzled because they went after a massive highly-competitive market out of the gate with a product that should have been built for a niche audience first.

Segway is a famous example. The vision required a lot of upfront capital and R&D which pretty much priced them out of the mainstream market, ruining their chances for a instant mainstream success. The Segway has become a great vehicle for certain use cases like city tours, security patrol, managers of large manufacturing companies that need to drive around their facility, arenas and stadiums, airports, etc. This is where the Segway should have started. Quietly make sales to satisfy these smaller markets, driving down the cost of production so that the later models could be sold in a Walmart at a reasonable cost.

Color is unfortunately becoming the most recent case study of going too big too soon. They had a very counter-intuitive product that needed a ton of iterating and network effects before raising a boatload of money, let alone publicly launching. Everyone, especially Robert Scoble, was dumbfounded by the first user experience. Had they released their product at SXSW like Twitter or to a smaller audience in a localized geography, they wouldn’t could have gotten feedback early and maybe avoid tainting their brand.

Chris Dixon has an excellent post about this, dubbing it the “thin edge of the wedge” strategy. It’s basically starting with a smaller market and simple product to satisfy that market to get your foot in the door. Trying to take Rome in a day requires an army, but having a long-term strategy and evolving plan is key to making an impact with a small team in today’s crowded markets.

Conclusion

Product/market fit is still a valid and useful term. But in my opinion it isn’t a singular event. You will ultimately want multiple product-market fits (or sub-market fits), each time getting closer to the larger market allowing you to learn and iterate along the way. Doesn’t mean your vision won’t be realized, or that you have to start with a product you don’t want to build. Evaluate a market on quality of competition, size of the overall market, and difficulty of the problem and then whittle down the market as much as possible. Scale back too far, and you’re making stuff like this. The right balance of humility and patience will make for a much higher rate of success, decreased risk, and hopefully an anti-trend will emerge of sustainable startups.

We did this with Penzu: started in a subsection (journaling) of a larger market (writing and note-taking) and achieved simple-product/sub-market fit. We positioned ourselves in an even smaller niche at first by focusing on private (as opposed to public) writing. Penzu is the best app for journaling on the web and has paved the way for us to realize the original (larger) vision of putting a note-pad on the web.

Update: Great concept by David Lee (and Chris Dixon) by paying attention to how YOU fit with your market, called founder-market fit. Should be the first filter used when picking your next project.

Image source: http://joyerickson.wordpress.com/2011/04/29/top-heavy-from-mssc/

The Rapper

Tue, 26 Apr 2011 00:00:00 -0400

Above is a picture of Christopher Wallace, more popularly known as Biggie Smalls or the Notorious B.I.G. He was arguably one of the greatest rappers to ever live, even though it was only for a short 25 years. His story is pretty amazing (check out the movie) but not necessarily a unique one. A ton of rappers have come from similar beginnings so these lessons can be applied to many successful hip-hop artists.

PROFILE

Biggie was born to a single mother in Brooklyn in the early 70s. Like many families in the area they struggled to get by, his mom had to work two jobs to support them. He eventually turned to dealing crack at the age of 12 to make his own money, and dropped out of school to become a dealer until he was arrested at 18 years old and put in prison for 9 months. Apparently prison is where he was able to think and focus on his craft. He came out and recorded his first demo which piqued the interest of Sean Combs (then at Uptown Records) and kick-started his career. Biggie Smalls became a phenom in the east-coast rapping scene, his first album going platinum and his second “Life After Death” is one of the best selling albums of all time.

NOTORIOUS L.E.A.N.

As an entrepreneur, Biggie (and rappers alike), are the truest form. They create value and success from almost nothing. You can break down the process he went through and compare it to how a startup (lean in particular) gets to scale.

1. Product/Market

Entreprenuers have to make a choice early on: what do I want to work on? What problem or market excites me? I don’t think Biggie was ever considering Country music—he had immense passion for rap and was doing this in his spare time. He didn’t have to think about it much, it just came to him naturally (speaking of which, check out my previous post on this topic). He was rapping on the streets and had his skill perfected early on (see incredible video of his freestyle on the streets of Brooklyn—probably at the age of 17—below). So his vertical didn’t require much initial thought.

2. Customer Discovery

For rappers, their market is fairly obvious so very little customer discovery (finding out WHO your customer is) is required. Their “sound” is their brand and is what sets them apart — like a company’s positioning. Just like a competing product in a crowded market, their voice can’t be the same as another rapper, neither can their flow or cadence.

Biggie nailed this: his voice was so distinct and his flow so unmistakeable that others around him new he had something special. Also, at the time his lyrics and subject matter were pretty novel (now, rapping about violence etc is more than the norm). Eminem is another example of an MC who can’t be mistaken—his lyrics and his tone are like nobody else’s. Combine that with one-of-a-kind beats and you’ve got a solid start.

Most entrepreneurs, however, will tell you that a good product isn’t enough. The biggest obstacle is always distribution, which in the record industry is run by the 4 or 5 major labels. So without the help of the oligopoly, you might as well give up on the dream of Cristal and gold chains since the odds aren’t in your favor. More on this later…

3. Demo/Prototype

This is usually in the form of a demo tape or rough track recorded (at least in the 90s) on a cheap multi-track recorder. For a web startup, this is often a quickly coded site (AKA a MVP) that solves the core problem or performs the desired task. Music doesn’t solve a problem directly, so it’s efficacy is way harder to measure. It’s something that must be tested on crowds first, however the gut feeling from a record exec, given their distribution power, can be enough.

Biggie created a demo that somehow made it’s way to Sean (“P. Diddy”) Combs, who wasn’t exactly a big shot. He signed Biggie but was immediately fired from Uptown. He believed in him so much (and a few other artists like Craig Mack and Faith Evans) that he launched his own label, Bad Boy Records. That was a risky step for him, akin to an angel investor backing a tiny team. Diddy saw what Biggie COULD BE and helped develop the end product. Having an angel investor like that is key: one who can see the same vision you see and has the experience, contacts, and now-how to execute and accelerate towards it.

4. Customer Validation

Customer validation is optimizing your product to solve the problem or goal you set in step one. Are people dancing to my music? Are they buying single tracks? Music groups and bands do a ton of live shows and concerts to get an early following and to learn which songs work and which don’t. In Biggie’s case there wasn’t much to it; you might say that he was doing discovery and validation since he was a young boy, rapping for his friends and freestyling on the streets. His rise to popularity was fast, his product not changing much along the way.

Biggie definitely did shows and was a feature on other Bad Boy tracks before his single dropped. That might have been a way to get his name out there and see how people react as well, sort of like a beta or developer preview.

5. Customer Creation

Customer creation is your distribution and marketing. Getting customers and making sure that you can repeat the process. Since the music industry is a well oiled machine, their strategies for this were already established. Music videos, award shows, commercials, concerts, interviews, and the like (usually through media channels they own) are all part of the process.

A startup usually has limited resources and in this step is figuring out how to create customers ad infinitum. In essence they are finding a distribution and marketing strategy that operates at a positive ROI. For example, a concert tour for a private online journaling tool won’t create enough (or even the right) customers to justify the expense.

6. Scale

Once all the above has been attained/completed, it’s time to throw as much money behind this as possible and scale. Get as many fans, customers, and as much product out there as you can. For a tech startup this may mean raising more money, beefing up back-end architecture, and staffing up. For an artist this means coming out with multiple albums, doing a tour, collaborations, and more.

Biggies second and last album, named Life After Death was released posthumously (ironically). The media attention from his shooting and the East Coast / West Coast rivalry surrounding it was a huge bonus for Bad Boy and others. It definitely brought hip-hop and rap to the forefront and made it a part of mainstream culture in the US.

Others have written about the correlation between starting a band and a startup, which is spot on. If you’re thinking of doing either, there’s always so much to learn before starting out. Lean principles are especially applicable and might give you more control than shooting in the dark. Rock on, Eric and Steve!

Do What Comes Naturally

Sat, 09 Apr 2011 00:00:00 -0400

Recently while taking a shower I noticed the slogan on my shampoo bottle: Do what comes naturally. Not sure if it’s the best fit for the Kiss My Face brand (I know, their products are natural, but still it doesn’t work as well as it could), but I love the sentiment. It struck me as worthy of a blog post since I’ve given it thought numerous times…

Simple but powerful: If you are good at something, don’t fight it. Do what comes naturally.

This seems so obvious but you’d be surprised how many people try to make things harder than they should be. If there is something you can do better than most people, something that doesn’t require much effort but at the same time brings you joy, then that is your calling. Don’t go down a path that “makes sense” or is “what people expect”. Do what you do and you’ll be happy you did.

Obvious examples of this are in sports, where a person just has a natural gift despite the odds. Spud Webb, born out of poverty and way too short to consider being an athelete—let alone a basketball player—won the 1986 slam dunk contest over defending champ Dominique Wilkins, who was over a foot taller than him:

Clearly Spud had a gift. He was doing what came naturally to him. Give him a basketball, and he knew what to do with it. I doubt he could do the same with a paintbrush. And vice versa: Michaelangelo gravitated towards art at such a young age, despite his father’s wishes for him to “study grammar with the Humanist Francesco da Urbino in Florence” (thanks Wikipedia). I doubt he would have been a very good point guard. Steve Jobs said that he “saw” the iPhone before it was made. He envisoined a device that changed the world long before it was designed. Imagine if he had been a farmer!! He can see the future of computing (andalways could) so doing other stuff was never an option—though he did try meddling with animation, but John Lasseter at Pixar purposely kept him out of the loop.

Obviously, as Malcolm Gladwell argues in Outliers, talent is just the kernel. It takes thousands of hours of practice to hone a skill and to be the best at your craft. Just because something is easy for you doesn’t mean you’ll be the best right away. But you gotta start somewhere.

Another point: it doesn’t have to be your passion. Actually, so many people are passionate about things they suck at. Mainly because they want to prove to themselves that they can do it. One thing that an entrepreneur has to learn quickly is to stick to what he’s good at. If you aren’t good with numbers or filing, don’t do your own bookkeeping. If you’re a crappy designer, hire one. Help isn’t for the weak, it’s what all successful people have done at one point or another so they could focus on what they do best.

So pour yourself a glass of Mangosteen juice, sit on the couch without the TV on, and figure out what it is that you have always been able to do with ease. It will take some work to find it—a skill that comes easy is often taken for granted—but when you do, see how you can use and hone that skill going forward. You’ll be happier for it, I promise.

Priority & Patience

Tue, 08 Mar 2011 00:00:00 -0500

The latest juice from my mind-grapes: the two most important things you’ll need to do as an entrepreneur are PRIORITIZING and exercising PATIENCE…

First, Priority ;)

I’m assuming that you already have ideas or product improvements which you have yet to prioritize (if not, that’s another post for later). For me, good ideas and features are a curse. Mainly because I have to choose which one in the heap is best when it’s hard to measure what the outcome will be beforehand. To guide me in these uncertain situations, I’ve been following some basic rules:

1. Work on features that affect the most users/customers. I got this from theCampaign Monitor guys when featured on the 37 Signals blog. It made a lot of sense: if you’re working on a small piece of your product when there are other things that can be added or improved upon that affect significantly more users, then you’re wasting your time. Lately we’ve added some incredible features to Penzu that affect everyone AND satisfy the next point…

2. Spend time on things that enhance your differentiation. This isn’t anything new, but people tend to lose focus when chasing the money dragon. If you’ve got a list of features, work on the ones that amplify your uniqueness or expands it in ways your users (or competition) will never expect. An example for us was adding Prompts — something that I haven’t seen on the web before — which has improved the overall journaling experience for all our users.

3. Only choose what will help you achieve your most sought-after goal. if your goal is to get a lot of users, work on things that will DEFINITELY get you more users. If you goal is to increase sales, work on things that will boost your top line. You get the picture. Focus on specific goals and implement things that WILL work. The ones that might not aren’t top priority. Start with the ones that have a better chance, like increasing your price point to boost revenues (so long as you’ve tested it first so that the conversion dip doesn’t result in a net loss).

A note for the above: Make sure you are measuring and learning from your additions and product changes. Set a goal for each, and see how you measure up. Doesn’t have to be a precise goal, just something to give you an idea of progress and efficacy. All your prioritization should have a layer of metrics and data supporting it and driving it. Easier said than done, but get an AARRR refresher here if you need one.

Next, Patience (Thanks for Being Patient)

This is tough for me, but everything takes time. Especially when you have a small team. Bigger undertakings take even longer, so I often look at what satisfies the above criteria AND if it can be done in a short period time. Sometimes you need to tackle the big pieces, especially if they are top priority. But don’t dive into a big feature unless you are almost certain it will help satisfy your goals. This can be done from user feedback, analytics, etc.

With us, the more time that passes, the better things will get. Period. The product will get better, we will get smarter, and our user base will continue to grow. That’s comforting to know: that we won’t die without constant attention. (Tortoise and the Hare come to mind.) This helps ease the startup stress, especially after reading about other simple startups/ideas exiting for bajillions of dollars.

Also, rushing gets you nowhere. Trying to whip something incomplete out there (and especially those that market half-assed products too early) usually end up regretting the early launch. Take your time, stay quiet, learn learn learn, and then decide how to launch or market your product (love this article on launching by Eric Ries btw). Fast is often overrated. If you have competitors breathing down your neck, and a list of obvious features, then speed is crucial. But not essential. Get the product working so you don’t have to double-back. If it’s taking too long, then trim your todo list!

The 37 Signals guys are great at preaching the above. Rework is spot on. So stop scrambling, stressing, and asking the wrong people for feedback (which can sometimes be a small group of your users that will take you to the local maximum). Save your midnight oil for the things that matter and start building quality, useful, and efficient products!

That’s it for now. Comment below if you have any thoughts!

Photo source: flickr.com/photos/lwr/3194133751/

Paleo Diet: The First (and Last) Diet!

Sun, 12 Dec 2010 00:00:00 -0500

I’ve been obsessed with the Paleo diet lately. After reading a post on Tim Ferriss’ blog, I was hooked. I’ve been reading and learning and it’s something that opened my eyes to a completely new way to live. If you struggle with staying healthy, especially through bad food choices, read this (and this) book and it will change your life.

Summed up, the paleo diet is eating according to our history and genetics. The way we eat, the fuel that the modern world runs on, isn’t suited for us. Our hunter-and-gatherer ancestors ate a specific diet for millions of years, and just recently (in the last 5,000-10,000 years) we drastically changed what we consume. We became agrarian—which allowed for modern civilization to exist as we know it—but at the cost of our health and well-being.

Hunters and gatherers were extremely fit, tall, and almost disease free. This was because of regular exercise and eating a consistent diet of lean meats, fresh fruits, and seasonal vegetables. The above pic is exactly what happened. We moved from a healthy lifestyle to being fattened up by starchy carbs and more recently processed foods. Before farming, things like grains, dairy, and legumes didn’t exist (how can you milk a wild cow?). These foods are now the mainstay of our diet (and economy) and are not inline with our genetic requirements.

There’s lots of evidence to back this up, but the main one that gets me is this: they feed grain to pigs and cows to fatten them up. Yes, we make our animals obese. And that’s only done through overfeeding of corn and other grains. It’s so bad that cows who eat this stuff get sick—because of the havoc it wreaks on the immune system—and so anitbiotics are used to keep them alive long enough so they can be slaughtered. Terrible. A great post by John Robbins outlines some frightening things. A must read.

Without getting all technical, this is the gist.

Things to never eat:
- grains and grain products
- dairy
- legumes
- processed foods
- too much saturated fat

Eat in moderation:
- sea salt
- alcohol
- sugar (unrefined, like raw honey, agave, or maple syrup are the best)

Things you can eat unlimited amounts of:
- lean grass-fed meats
- wild fish and seafood
- poultry
- veggies
- fruits

If you want to learn more, and lose weight immediately, cure your diabetes, prevent cancer, osteoporosis, and more, read the books mentioned above. You will never look at the world the same!

Product Feedback is Your Frenemy

Sun, 31 Oct 2010 00:00:00 -0400

The latest of my learnings is this: opinions are valuable. While that seems obvious, putting it into practice is tough. It means going out there and hearing everyone’s two cents, and letting their remarks hit you like cream pies in the face, over and over. Not easy to do.

When you have a consumer product—especially a web-based one—accepting feedback is the norm. It’s hard to build something people love on the first try. Listening and incorporating user wants and needs is an obvious strategy that, if done correctly, promises progress. So bring on the cream pie! Tell us what you hate, what you love, and what we can do better! Everything you hear is worthy information, not to be ignored, right? Almost…

While all feedback is valuable, the meaningful and actionable information is below the surface. This is one of the hardest things to do in the customer validation phase of customer development. Listening to people complain about your service or problems won’t move the needle much. HEARING their pain and trying to find the real source of their feedback is how you take things up a notch. There’s a difference between hearing and listening!

So when a customer says to us, “Your service sucks! I have to lock my entries one by one? Is there any way to lock them all at once?” We don’t just listen and give him or her a “lock all entries” button. What we hear is that they want separate journals which can be encrypted and locked. Or when our users say, “The choices of backgrounds isn’t very broad” We don’t just add more backgrounds. We HEAR that people want to customize their journals and make them more personal.

Stripping away the emotion and “small problem” is where the constructive information lies. The big problem isn’t always clear to the complainant. If it was, they would suggest it. This is where the entrepreneur shines. When the puzzle pieces are scattered on the table and need to be snapped together to complete the picture. It takes creative visualization to do that—a requisite skill for entrepreneurs.

This is a good outlook to have in personal life as well. It’s way harder to go out there and take pies in the face when the feedback is about you. For some reason we get our back up, close our ears, and don’t look at it as data. We take it personally and assume we are being attacked. Sometimes people are projecting, or they’re simply attacking you for the wrong reasons, but what people tell you has value. And if you notice a trend, especially if it’s something you’ve been ignoring, listen up. Take it in, and decide what they’re really getting at. Being open to other people doesn’t mean that you have to do what they say. They don’t realize it, but, just like customer feedback, they are doing you a favor. Only their input can make you (the product) better. If more information means you can be a better person, why ignore it?

The kernel here is that people’s opinions are just information. They aren’t personal attacks or offensive remarks, just another perspective. Honesty is invaluable. Just be prepared to HEAR it.

High Resolution Experiences

Fri, 30 Jul 2010 00:00:00 -0400

Since watching a talk from Kathy Sierra (after the jump), my view on creating passionate customers has changed drastically. Kathy is a beacon of hope for all of those mediocre products and services out there. Her credo: Don’t create a better product, create a better user of that product.

I couldn’t have understood that more after my trip to Sri Lanka’s tea region. There, amidst thousands of acres of mountainous tea plantations, I learned about how tea is grown, harvested, produced, and tasted. I will never drink tea the same way again; I now have a higher-resolution experience every time I sip a cup of Orange Pekoe or Darjeeling. Knowing that tea grown at varying elevations with different processes will produce a completely new taste profile (all from the same plant!) makes me want to explore all the regions and brands to find the ultimate tea for my palette.

Knowledge is like a magnifying lens that can instantly enhance an interaction with a consumable or service. Like with photography, knowing about the Bokeh effect makes you pine for a really high-end digital-SLR. Or with wine, tasting a 1982 Petrus will make your next glass of cheap wine taste like Welch’s. Same goes for single-malt scotch, performance cars, flat screen tvs, and all the great products people are obsessed with.

If you are entering a robust product category, you can take advantage of the available knowledge in that category and educate your users. Make them the best they can be at using your product. Make it easy for them to understand what they are consuming and why it is so special. Apple does a great job of this with their seminars and Genius Bar. You can learn how to use a Mac and not only become a better Mac user, but increase your digital IQ. All great brands that create products in such spaces do a good job of this: Williams Sonoma with their Wine Club, Calphalon with their Culinary Centers (where you use only Calphalon products), BMW with their Driver Training courses, and the list goes on and on.

This video is a must watch for anyone with customers (or looking to find some!). Thanks Kathy!

http://blip.tv/play/hatvgc21fQI

Weakness = Strength

Mon, 21 Jun 2010 00:00:00 -0400

Kerala, a beautiful region in Southwest India, is now marketing their monsoon season as the ideal time to visit.

Most travelers do their best to avoid monsoon in Asia when planning a trip. And rightfully so—the rain can keep you locked up in your hotel room, and never mind the flooding.

But the idea is actually starting to make an impact. Monsoon season is apparently the best time to rejuvenate the mind, body and soul: “According to Ayurveda,” the site claims, “Monsoon is the best season for rejuvenation therapies.” It’s intriguing, isn’t it? Experiencing a time of year the most people deliberately avoid.

So while it may seem like a crazy way to increase tourism, it’s clever positioning. No one else would dare market the rainy season, so such a move usually also means you’ll own that message in customers’ minds

The Affiliates of Rajasthan

Thu, 10 Jun 2010 00:00:00 -0400

We know of affiliates mostly as online affiliates: Individuals willing to advertise your product on their site and take a cut of any sale originating from their source. Offline affiliates are akin to salespeople that get a commission. In North America it’s hard to find true offline affiliates since most salespeople are hired and paid, with a commission as a bonus. In India, however, offline affiliates are abundant and they’re amazingly good at what they do.

In the streets of arid cities in Rajasthan, I’ve come across various types of affiliates. The first kind is the tour guide. Walk into some of the many temples or free sights and a man will volunteer himself as your guide. No asking about a fee (sometimes he’ll say he does this for free) and give you a long tour. They are very nice, offering to take pictures of you, telling you historical anecdotes, and they even throw in personal stories about themselves and their family. For instance, one guide we had said his great grandfather helped to carve the temple we were visiting—easily believable.

At the end of the tour, you expect them to ask for a small payment to them and when they don’t, you feel bad. Then they say, “I have a shop right next store where I do paintings and I was wondering if you could come and see it.” How can you say no after a free half-hour tour? You can say no if you want, but most people with a conscience can’t. They deftly exercise one of Cialdini’s principles of influence:Reciprocity.

It’s quite brilliant, actually. Their shops are usually exactly the same to the other tourist traps in the area, but there’s another team of salesmen inside who do a good job of selling you stuff you don’t want. Most items are pretty cheap, so it’s not a big deal.

The second affiliate I’ve found is the taxi/rickshaw driver. Being in a foreign place, you need recommendations of some kind—for restaurants especially. Often times the guides don’t know the real local favorites, or they list too many to choose from. Or, you’re in a place where no Lonely Planet can save you. You ask your driver, “Do you know of a good lunch place?” and they say, “I can take you to the best restaurant in the city.” When you get there, the parking lot is filled with taxis. Most patrons inside are tourists. And it’s clear that the food is not the best in the city.

I’ve had this happen in Bali, Vietnam, and Thailand. Especially on scheduled day trips, the bus driver will stop at shops and restaurants along the way that they are clearly getting a cut from.

All of this to say, online affiliates are pretty passive in comparison. These guys will walk with you for hours, take you on a tour of a city for free, and then ask for a small purchase in return. It’s hard to identify who is genuinely wanting to help you and who is an affiliate with an ulterior agenda. More often than not, it’s the latter.

Are you doing something you love?

Sun, 06 Jun 2010 00:00:00 -0400

Simple: it doesn’t feel like work.

If you are doing something you love, you won’t work a day in your life. How sweet would that be?

This thinking, however, gets a lot of people in trouble. When they are on the right career path but have to endure a menial job for the first few years, many bail early in search of something else. If they would have stayed with it, there is a chance that they would find their passion in a higher-up role. But there’s also a chance they wouldn’t have and could be waking up every morning with a feeling of dread and persistent monotony. Then what?

My advice would be the following:

1) Is there something you really love doing? If yes, proceed to step 3.

2) If not, try to find what makes you happy. Anything at all.

3) Once you know what you love doing, and could do that forever and be happy (even if you don’t get paid), don’t quit your job just yet!

4) If you have expenses that your current job is paying for—like a car, house,expensive coffee drinking habits—then quitting your job is a risky move. First, test your passion. At nights, on the weekends. Do it, read about it, write about it. Immerse yourself in that world and test the waters. If that works for you, and you still love what you are doing, proceed to step 6.

5) If you are living with your parents still, have little expenses, or tons of cash, quitting your job shouldn’t be a tough decision. Always seek advice of friends and family, but most importantly, industry experts.

6) Survey your financial options. If your passion isn’t lucrative, or involves financial risk, then it’s best to lower your expenses before you take the leap. Work out what you need to survive and make it your goal to earn that amount pursuing what you love. Sometimes, pursuing your passion can be lucrative, but most often it isn’t (and in the startup/business case, it usually isn’t at first). Giving up your expensive habits to find your long lost passion is worth it. Happiness is priceless!

Once you have found what you need to do in order to do what you love doing, take the leap. Make sure you minimize risk (especially if you have a family/dependents) so that failure doesn’t ruin you. And then go with all your heart. Spend every waking moment of that initial driving energy and do what you do best.

If you do leap, and it doesn’t work out, at least you can say you tried. If you have enough chutzpah, you can hopefully get back up and try again. If, however, it does work out, and you are waking up every morning excited and happy, then you are set for life!

B-School vs. E-School

Mon, 10 May 2010 02:41:00 -0400

In Steve Blank’s talk at the Startup Lessons Learned conference, he highlights the difference between what it takes to be an entrepreneur vs. a business manager. Basically, he’s saying that what’s taught in MBA programs is only partially helpful. I couldn’t agree more.

Most of what you learn in business school is how to run a business. Primarily how to be a CEO or business manager in a large company. Understanding financial accounting, marketing, organizational behavior, economic theory, and the list of requisite classes goes on. While these are great skills to have, none of them come into play when starting a startup, especially a lean startup.

As the slide above states, being an entrepreneur isn’t applying what you’ve learned in the past, but what you are learning as you go. Your customers are your teachers and you are the student. You must throw away your business plan and instead focus on trying to find a scalable and repeatable business model. This means testing out hypotheses, often being very wrong, until you create a product that people are dying for. Having an MBA won’t help you here, and what Steve Blank has been teaching at Stanford is how all business schools should be approaching entrepreneurship. There’s no formula for success. There are formulas to help you succeed, but if your customers hate your product, your knowledge of venture financing isn’t going to change that.

So for those of you who have gone to B-School and want to create web products, forget what you learned and start asking questions. Get out of the building, talk to customers, and start learning again. A Lea(r)n Startup!

Decisions, Decisions

Fri, 30 Apr 2010 00:00:00 -0400

Most people have a tough time making decisions. And it’s not even the big decisions that people despise settling on, but more the tiny everyday small choices that cause angst.

A well known theory in Behavioral Economics called the Prospect Theory may be able to explain why.

The common problem most of us have is that we are risk averse. We constantly do as much as we can to minimize loss. But often, as the theory shows, we fear making a bad decision more than we should. Losses are disproportionally weighted when compared to gains. Basically, our pain of losing isn’t balanced with the joy of gaining.

This is different for everyone, but an example might help. Let’s say on your way to the Sarah’s Smash Shack you walk by me on the street and I give you $100—pretty sweet, right? But later, when you realize that Sarah’s Smash Shack closed, you decide to take a cab home and instead of giving the cabbie at $10 bill you give him the $100 bill by accident. That would really suck! The pain of making that mistake would outweigh the joy you received from the free $100 (even though you got a free cab ride out of it!). That’s a mistake you would regret for ever—I could have been $100 richer than I am now! What an idiot I am!

The pain associated with making mistakes like this is what causes us to deliberate on deciding and often can result in making a bad decision because all we were focusing on was minimizing risk. To solve this, you could sit there and calculate the ACTUAL pain of loss versus the real utility of making the right choice. But that is tough since if we new what our real preference was at the outset (and especially the probability of our choice being correct), we would go about never making a mistake. You can use this calculation when you have time, especially for bigger decisions, but what about the small ones?

The utility gained from small decisions usually doesn’t warrant the painful deliberation we engage in. Should I get a BLT or a burger? It really doesn’t matter that much. And it’s much easier to say “I should have done something else” instead of saying “who knows if the other choice really was that much better?” The incremental gain in happiness is so small and transient that it doesn’t matter either way. I can have a BLT tomorrow.

This notion of happiness, or objective utility, isn’t a hard figure. Expectations can play a big role in joy and so can Cognitive dissonance. Happiness is all in your head, and if you want, almost entirely in your control. Your expectations set the bar, and so do the circumstances.

Which movie should you see at the theatres? Well, the ones with the best reviews of course. But that would make for little room for error. High expectations can make great movies look like crap, and crappy movies pretty darn good. Keep that in mind when delberating over a decision—the best one isn’t always the best.

Also to consider is cognitive dissonance. We can trick ourselves into liking something even if we don’t. And we wouldn’t even know it. For example, if you were dying to see the most popular movie, but really hate waiting in line, you might persuade your buddies to see something else instead. And if that second choice wasn’t great, you are weighing it against the alternative, which was waiting for hours in a congested line. You also have to defend your decision and convincing you and your friends that the second movie was actually pretty good allows you to avoid guilt and save face.

SO keep in mind, when you are standing at the Starbucks counter and are deciding between a Grande and a Venti, that your satisfaction with your decision is entirely arbitrary. It’s ultimately your happiness that’s at stake, not anyone else’s. Also remember that the outcome isn’t always so cut and dry. Situational factors are at play and can blur your hindsight.

Another example of the maleability of happiness WRT decision making:

If I want to get a good night sleep tonight, should I get the drink that has 13% caffeine per serving or the one that is 84% caffeine free per serving?

When you think about it, both are relatively the same choice. But we’re more inclined to choose the caffeine free drink even though it has slightly more caffeine. This is called Hedonic Framing and when making quick decisions, can prove to sway us one way or another. If something is framed as a negative loss vs. a positive gain, we are more inclined to choose the gain even though it may have the exact same outcome. We can avoid this pointless deliberation and miscalculated risk aversion by realizing how things are framed.

One more trick: You can break up your gains (or utility) into smaller chunks, and group your losses into a lump sum. Since each loss is marginally worse than a corresponding gain, more losses mean even more suffering when aggregated. But if you think of lots of small loses as one big loss, it’s easier to cope.

B-School vs. E-School

Fri, 23 Apr 2010 14:02:00 -0400