in Startups

Products are Lines, not Dots

I see a lot of founders and startups struggling with explaining what they are trying to accomplish. Many are just focused on how they are going to do the next thing. The next release, the next pitch, the next campaign.

Releasing a product is not an accomplishment in and of itself. Launching isn’t either. Getting a feedback and signs of traction never quite feels like enough.

Why are you doing all this?

Mark Suster wrote an important blog post in 2010: Invest in Lines, Not Dots.

The tl;dr: Relationships are important.

It’s easy to think that when you meet someone once, you’ve MET them. It just isn’t true. A relationship is that line that is formed across a series of encounters.

Products are no different and the sins that we commit are the same as those Mark describes.

Mark says:

“[ . . ] I tell entrepreneurs the following: Meet your potential investors early.  Tell them you’re not raising money yet but that you will be in the next 6 months or so.”

Screen Shot 2015-01-20 at 1.01.31 PMIn a world of fast iteration and Running Lean, it’s easy to think of products as the entire picture. It’s one big giant dot that we hope brings us success and a mass of users.

It’s never like that though.

Your Product  is a relationship with your users. Like Mark (and the rest of us), Users invest in Lines, not Dots.

When you have that first meeting you need to not only make a good impression, but you have to tell everyone where you are going. We call it Vision.

Release Early, Then Release With Purpose

Fast product iteration is important: You listen to users, you monitor and assess metrics and you make changes that bring your product closer to perfection.

Perfection is not what you need: Purpose is. Why are you releasing and why should users and customers continue to invest in you and your product with their time, money and feedback?

In looking for perfection (product/market fit?) it’s easy to think it is something that *just happens* and then you are instantly successful. It’s never like that. It takes work and focus, and a vision for how the future is going to be different for your customers because of it.

Screen Shot 2015-01-20 at 1.23.18 PM

Vision is what defines the future you see for you and your customers. It’s why they try things for the first time and it’s why they will stick around even when you don’t quite get things right.

It’s easy to miss and it’s easy to get bogged down in the day to day, but if you have it and if you can articulate a vision, then you have a better business plan than you could ever put in a doc or deck.

When you iterate on your product and deliver releases, it should be about taking the customer closer to your vision for your product and why it’s important.

 

 

 

An Investor’s Rendition of ‘Twas the Night Before Christmas

Peanuts Christmas Panorama by Kevin Dooley

by Travis Cocke (sourced from Seth Levine)

‘Twas the night before Christmas, when all through the land
Not a banker was lending, not even “Gold-Man”
Foreclosures were hung by the courthouse with care
In hopes that Hank Paulson soon would be there.

The Bankers were nestled all snug in their beds
While visions of bonuses danced in their heads.
And my teachers in their offices and me in my room
Had just settled an argument about the depth of the gloom

When out on Wall Street there arose such a clatter
I sprang from my bed to see what was the matter
Away to the computer I flew like a flash!
Started up the ticker, and threw up some cash…

The i-banks on the brink of another bad blow
Sell all your stocks and look out below!
When, what to my wondering eyes should appear?
Green on the screen as the Fed interfered

With the same old chairman, so ready to lend
I knew in moment it must Big Ben
More dovish than Greenspan, his governors they came
And he printed and lended and called them by name!

“Now Lockhardt! now, Lacker! now, Evans and Plosser!
On, Geithner! On, Fisher! On Yellen and Krosner!
To the Treasury! To the Mile High Mint!
Now print away! Print away! C’mon now print!”

As credit spreads that before defaults do fly
When they meet with an obstacle, they drop green from the sky
So up to the Capitol the governors they flew,
With a chopper full of money, and Rick Wagoner, too.

And then, in an e-mail I read from a friend
Capitalism was dead, and this was the end
As I sold my last stock and started to cry
On the TV came Buffett and he said “Time to buy.”

He was bullish on stocks, from Nike to CVX
And his portfolio was tarnished with options and CDS
A bundle of buyouts he had flung on his back
And he looked like a genius, just following his knack

His stocks how they fell! His returns how scary…
Yet his cash-how it swelled! And His letters so merry…

He was chubby and cheerful, a right jolly investor
And I smiled when I saw him, despite my dreadful semester
A twinkle in his eye and the use of his cash
Soon gave me the know that stocks wouldn’t crash

He spoke not a word, but went straight to his work
Shoring up balance sheets, and buying preferreds
And laying his finger aside of his nose
And giving a nod, UP & UP Berkshire rose!

He sprang to his NetJet, to his pilot gave a whistle,
And away they all flew like the down of a thistle.
But I heard him exclaim, as he drove into the sky,
“Happy Trading to all, and to all a good buy!”

Featured Image by Kevin Dooley

Founders & Funders: Nov 18, 2014

beerwall

It’s that time again – to bringing together the people that start emerging technology businesses and the people that fund them, early.

Who should attend?

Uhm, yeah. Founders & Funders.

Founders

You are a founder of a emerging technology company or a technology-enabled company. You are actively raising a round of capital or starting to think about raising your next round. Feels like we’re leaning to Seed and Series A – basically if you’re name is Tobi or Ryan most investors know who you are ;-)

Funders

Space for funders will be limited. We have room for approximately 60 people. And we like to keep the ratio of 3:1 founders to funders. This means we roughly have room for 15 funders. We’re going to be picky, the target will be Seed and Series A.

Why should you attend?

Relatively small and intimate gathering of other emerging technology company founders and the people that fund them. The funder mix ranges from individuals that write first and very small cheques to larger institutional funds.

  • Social event – no formal pitches
  • Community is the framework – chance to talk to other founders about the current fundraising climate

What to expect?

It is a chance to have a bite to eat and a drink with other founders and investors that are actively investing in Toronto companies. It’s a chance to figure what has worked for others, to figure out which investors you want to spend more time with, and just connect.

How do I attend?

Submissions will end on Nov 10.