Monthly Archives: October 2014

How to Raise Money

Lecture 9: How to Raise Money

Link: How to Start a Startup

(You can find notes to the other lectures here.) 

Marc Andreessen (@pmarca)

Ron Conway (@RonConway)

Parker Conrad (@parkerconrad)

How to Start a StartupYou’ve got to be a communicator and a born leader. (Rob Conway)
The venture capital business is 100% a game of outliers. (Marc Andreessen)
There are 4,000 venture fundable companies a year. (Marc Andreessen)
Invest in strength rather than lack of weakness. (Marc Andreessen)
The companies that have really extreme strengths often have serious flaws. (Marc Andreessen)
When you first meet an investor you should be able to say in one compelling sentence what your product does so that the investor you are talking to can immediately picture the product in their own mind. (Ron Conway)
You have to be decisive. The only way to make progress is to make decisions. Procrastination is the devil in startups. (Ron Conway)
You can’t count on there being capital available to you. (Parker Conrad)
Bootstrap as long as you possibly can. (Ron Conway)
Steve Martin said, “The key to success is be so good they can’t ignore you.” (Marc Andreessen)
You’re almost always better off making your business better than making your pitch better. (Marc Andreessen)
Raising venture capital is the easiest thing a startup founder is ever going to do. (Marc Andreessen)
Raising money is not actually a success. It is not a milestone. (Marc Andreessen)
Calibrate the amount of money you raise with the risks. (Marc Andreessen)
Don’t ask people to sign an NDA. (Ron Conway)
The relationship between investors and founders involves a lot of trust. (Ron Conway)
Do the fundraising process as quickly and efficiently as you possibly can. (Ron Conway)
After you leave a meeting (with an investor that agrees to invest) sit in your car and type out an email to the investor. Put everything in writing. (Ron Conway)
SV Angel invests in one company out of every thirty they look at which is about one a week. (Ron Conway)
There is an enormous difference in the quality of an introduction. (Parker Conrad)
At the seed stage the best thing you can do is find the right investors. (Parker Conrad)
There seem to be (valuation) thresholds for seed stage companies. (Parker Conrad)
Get the money you need and don’t raise any more than you need. (Parker Conrad)
In a series A you’re going to sell between twenty and thirty percent of the company. (Parker Conrad)
Venture capitalists are more ownership focused (percentage of company) than price focused (amount of investment). (Parker Conrad)
Half of people grow into a big job and the other half swell into it. (Marc Andreessen)
Airbnb is such a great company because all three founders are as good as the other founders. That is very rare. (Ron Conway)
When you start a company you have to go find somebody as good or better than you to be the cofounder. If you do that your chances of success grow astronomically. (Ron Conway)
Raise as close to the exact amount of money as possible. (Marc Andreessen)
If you’re going to raise debt you need to be very precise in how you run the company. (Marc Andreessen)
If everything goes great it doesn’t matter who your investors are but hardly ever does everything go great. (Marc Andreessen)
Everybody on the team should have the same goals and be pulling the same direction. (Marc Andreessen)
Once an entrepreneur always an entrepreneur. (Ron Conway)
The big constraint on a top tier venture capital firm is opportunity cost (both from conflict policy and time). (Marc Andreessen)
Things almost never come to a board vote. And if they do they’re already broken anyway. (Parker Conrad)

Doing Things That Don't Scale

Lecture 8: Doing Things That Don’t Scale

Link: How to Start a Startup

(You can find notes to the other lectures here.) 

How to Start a StartupStanley Tang (@stanleytang)

It is okay to hack things together at the beginning.
Do things that don’t scale.
Doing things that don’t scale allows you to become an expert in your own business.
At the beginning it is all about getting this thing off the ground and trying to find product/market fit.
Test your hypothesis.
Launch fast.
Doing things that don’t scale is one of your biggest competitive advantages when starting out.
Competition doesn’t really matter when you’re getting started.

Walker Williams (@walkerteespring)

Things that don’t scale are things that are fundamentally unsustainable. They are growth strategies that won’t take you to a million users.
There is no silver bullet for user acquisition.
As time goes on users start to add up.
The first users are always going to be the hardest.
As the founder do whatever it takes to bring in your first customers.
Don’t give away your product for free. It is an unsustainable strategy. You need to make sure users value your product.
A champion is a user who talks about and advocates your product.
Delight your users with experiences they will remember.
Talk to your users.
You’re never going to get a better sense of your product than actually listening to real users.
Run customer service as long as possible.
Proactively reach out to current and churned customers.
When a user leaves your service you want to reach out and find out why.
Problems are inevitable, do whatever it takes to make them right.
One detractor is enough to reverse the progress of ten champions.
The customers that are originally the most frustrated tend to turn into the biggest champions.
You need to optimize for speed over scalability/clean code.
Only worry about the next order of magnitude.
When you have ten users you shouldn’t be worrying about how to service a million users. You should be worrying about how to get to a hundred. When you have a hundred you should be worrying about how to get to a thousand.
Necessity is the mother of invention: You’ll find a way to make it work.
Do things that don’t scale as long as you possibly can.
Often times great ideas start out looking like silly ideas.

Justin Kan (@justinkan)

Press should have targeted audience and goals (such as investors, customers, and industry).
Types of stories:

  • Product launches
  • Fundraising
  • Milestones / metrics
  • Business overviews
  • Stunts
  • Hiring announcements
  • Contributed articles

Think about your story objectively.
When you start a startup you think everything you are doing is interesting. That is not true for other people.
Journalists and bloggers are looking for things that people actually want to read.
Mechanics of a story:

  1. Think of a story
  2. Get introduced
  3. Set a date (4-7 days in advance)
  4. Reach out (get a commitment to invest time)
  5. Pitch
  6. Follow up
  7. Launch your news!

Ask fellow entrepreneurs for introductions to reporters.
You want to get the reporter to invest time with you. The best thing is to get a face to face meeting. The worst thing to do is to just have an email exchange.
By preparing you can much easier control the conversation.
With PR firms, like most everything in a startup, you want to do it yourself before you hire someone else to do it.
PR Firms:

  • Firms can only help with contacts (maybe) and follow up
  • Firms can’t generate stories
  • Firms are expensive

Getting press is work:

  • Make sure it is worth it
  • Getting press doesn’t mean you are successful
  • Press is not a scalable user acquisition strategy

Getting press is a vanity metric.
If you decide press is worth it:

  • Keep contacts fresh
  • Regular heartbeat of news
  • Golden rule

Make a press schedule on a calendar.
You’re more likely to do something for people you’ve already done something for.
You should help your fellow entrepreneurs get coverage because they will help you get coverage.
Book: The Burned out Blogger’s Guide to PR by Jason Kincaid
Book: Trust Me, I’m Lying: Confessions of a Media Manipulator by Ryan Holiday

How to Build Products Users Love, Part I

Lecture 7: How to Build Products Users Love, Part I

Link: How to Start a Startup

(You can find notes to the other lectures here.) 

How to Start a StartupKevin Hale (@ilikevests)

Growth is the gap between conversion and churn.
The best way to get to a billion dollars is to focus on the value that gets you to the first dollar.
Human beings are relationship manufacturing creatures.
What is the emotion on somebody’s face when they interact with your product?
Sometimes places where you get errors are opportunities for first moments.
Design the links to your help documents to look like magazine covers.
Customer support is what happens between the steps of the funnel.
Software development: responsibility, accountability, and humility. Support driven development.
Make everyone do customer support.
Support responsibility developers and designers give the best support.
The Four Horsemen:

  • Criticism
  • Contempt
  • Defensiveness
  • Stonewalling

Alert existing users to new features when they log in.
Focus on being best price, best product, or best overall solution.
Best overall solution is the only one that everybody can do at any stage of their company.
Focus on the people that are going to be the most passionate particularly at the early stages.
You have to get functionality right.
Word of mouth growth is the easiest kind of growth.
People love working on things where they make a difference.
Remote working is especially tricky.
Most problems in companies don’t need to be solved real time. Everything outside of the site being down or payments not working.
An office allows you to be a little bit lazier in all the things around productivity.

How Matt Donley Quit to go Full Time with His Side Gig – Even Though He’s Not an Expert

SPI 112 : How Matt Donley Quit to go Full Time with His Side Gig – Even Though He’s Not an Expert
Date: 2014-06-06
Link: Smart Passive Income
Have the mindset of what you want your site to look like when you’re successful and then act like you’re already succeeding.
Focus on putting up the best content.
Set your bars on what you want the quality to be at.
Build up a brand and an audience before you create your own product.
You need to know how to learn. You need to be able to break things down to be able to teach it to somebody.
You can teach stuff you don’t know as long as you do the proper research and put yourself in the shoes of the people that don’t know.
If you build an authority site you’re going to rank on so many other things.
Break things down into smaller chunks.

The Life of a Brand New Visitor

SPI 111 : The Life of a Brand New Visitor
Date: 2014-05-31
Link: Smart Passive Income
Not everyone who lands on your site lands on your homepage.
Every page counts.
Every page could be a first impression.
Recognize where people are coming from and where on your site they are going.
The moment people arrive at your site show them they are in the right spot.
If you can define the problem better than your target customer then they will automatically assume you have the solution.
The description of your page in the Google results is so important.
The headlines of your posts are incredibly important.
What is their first seven second like on your site? That is the time you have to show visitors that it is the place they need to be.
The speed of the page matters.
What is the first step you want (your visitors) to take?
Have a getting started page. It is as important as a resources page.
If you don’t give people incentive to move around they’re going to leave. That will give you a high bounce rate.
Make sure your content is formatted in a way to keep people going. They scan when they read things online.
Visit your site on a mobile device. What is that experience like?
Don’t leave them hanging. You don’t want to give your audience a reason to leave.
Don’t end your posts with a long awkward pause. Ask questions. Give an opinion. Continue the conversation.
At the end of your posts link to other posts or ask for an email subscription.
The “Thank You” page (after an email subscription) is the most underutilized page on a blog. It should be “thanks – here is more” or “thanks – here is something awesome that can help you right now”.
Surprise your audience.
Go out of your way.
Do something unexpected for your audience or subscribers.
The two most powerful words in the English language are “thank you.”
Unexpected things are what get people to feel really special.

Tim Ferriss on Podcasting, Productivity, Experimentation and If He Had to Start Over

SPI 110 : Tim Ferriss on Podcasting, Productivity, Experimentation and If He Had to Start Over
Date: 2014-05-24
Link: Smart Passive Income
Apply the 80/20 principle to your skillset.
You can’t optimize something you don’t ship.
Maximize per hour output.
Deconstruct problems to find non-obvious solutions.
Book: The Effective Executive
Process your email offline to reduce anxiety.
Anxiety is the antithesis of creativity.
The only way to get to inbox zero reliably is to reply to less email.
Focus on your strength (for marketing).
It has never been easier to start a company.
Read Kevin Kelly’s “1,000 true fans.”

From Personal Trainer to Successful Self-Published Author and Podcaster with Vinnie Tortorich

SPI 109 : From Personal Trainer to Successful Self-Published Author and Podcaster with Vinnie Tortorich
Date: 2014-05-16
Link: Smart Passive Income
Book: What Would Google Do?
The core of what you do online is provide value.
You can’t scam people. You don’t want to scam people.
Be honest with yourself, be honest with people, and you’re going to succeed.
It is not going to happen overnight.

8 Things That Pat Flynn is Struggling With Right Now

SPI 108 : 8 Things That Pat Flynn is Struggling With Right Now
Date: 2014-05-08
Link: Smart Passive Income
Ask your audience what they’re struggling with.
We each have things we can specialize in.
When you start to get haters that means you’re doing something right.
You’ve got to stay focused. Focus on one thing at a time.
What are you saying no to when you’re saying yes to something else?
Mediocre content is not good.
The idea of becoming successful is something that some people fear.

How a Small Blog about Food Became a Big Deal – with Lisa and Jason from 100 Days of Real Food

SPI 107 : How a Small Blog about Food Became a Big Deal – with Lisa and Jason from 100 Days of Real Food
Date: 2014-05-01
Link: Smart Passive Income
It is important to start small and climb your way up.
Only introduce things to your audience that you think will be of value.
Be proactive about doing guest posts on other sites and mentioning your content in them.
Focus on your email list.
Start diversifying early on.
Be able to delegate and automate as much as possible.
Don’t confuse being busy with being productive.
It is important to identify who your reader is and speak to them in a language they can understand.
If you can give (your audience) wins they will attribute that success to you.
Don’t be afraid to experiment. Just go out there and do.
Focus on the things that make you happy.
Don’t lose sight of why you started your website in the first place.

How to Get More Clients and Win in a Competitive Niche with Mary Beth Storjohann

SPI 106 : How to Get More Clients and Win in a Competitive Niche with Mary Beth Storjohann
Date: 2014-04-24
Link: Smart Passive Income
Communication is what this is all about.
Go to a market you can relate to.
Network and leverage the resources and contacts you have.
Know who your target audience is for every media piece.
Don’t focus on talking slowly. Focus on enunciating.
Be calm. Do your research.
Don’t be afraid to be different.
Personality is huge.
Incorporate you into your brand.