StartupNorth

Category: Resources

  • Creating a Referral Engine for Your Startup

    This post is recap on some of the highlights from a how-to created by Ilya Lichtenstein of mixrank.com. I feature some of the most impressive startup strategies we encounter at StartupPlays and share them free, here at StartupNorth.ca. Enjoy.

    We recently did some work with a brilliant young guy named Ilya Lichtenstein from Mixrank.com, a company which has seen early investments from 500 Startups, Y-Combinator, and Mark Cuban. While in college Ilya was working side jobs with startups and getting deep into the affiliate marketing world. He grew a $300 investment into six figure revenue numbers in his first year. He has applied the behaviours and characteristics of major affiliate programs and adapted them to  smaller scale customer referral programs for startups, this is his “best practice manual for building a customer referral program”:

    Major Affiliate Programs

    Websites like Amazon and Netflix have elaborate affiliate networks anyone can join and receive an affiliated commission from a signup or purchase on their websites. This works because these companies have determined some of their most important baseline metrics, things like:

    • Cost per acquisition of a customer
    • Lifetime value of a customer
    • On page conversion rate
    • Variants between traffic sources
    • Cost of buying traffic within the industry
    They use these metrics to determine what affiliate commissions they can set for the business to turn the channel into a profitable one. If affiliates can purchase traffic at a cheaper price than the payout (typically between $0.50-$4.00 per click) then the program is sustainable. You’ll need to determine what these numbers are for your startup, even if you ball park it, here is an excel template that will help you do it.

    How Building your Referral Engine is Different

    A customer referral engine is a lot like an affiliate program only scaled down and involves much higher participant engagement. Building a referral program is not for the light of heart but has massive payouts for everyone involved. When creating a referral engine you won’t want to label participants “Affiliates”, but instead something like “Partners”. Your “Partners” will be composed of two segments:

    1. Existing Users
    2. Content Producers within your Niche

    Existing users are easy advocates since they’re already familiar with your brand and understand your offering. Incentivizing them to tell others what they may already be telling people is a win-win.

    Content Producers within your niche have clout and often an engaged audience on the web, they may even be looking to monetize their content and this provides them with a non traditional medium that has higher revenue potential and that sucks a lot less than one site ads.

    Compensating your Partners

    As an early stage startup your base metrics probably wont warrant a direct flat fee compensation for a new lead, you’ll be compensating partners in your referral program based on a percentage of or flat fee per paid conversion. Be careful to avoid revenue share in perpetuity, this may hurt you down the road when approaching investors. Major Affiliate programs will payout anywhere from  $30-$40 for a credit card submit on their site (this is what you’re aiming for). If you have the ability to set up coupon codes on your website, give your partners a custom coupon code, this instantly creates a value add for their audience and makes it easier for them to share with people they know. (People LOVE sharing deals)

    1. You’re an e-commerce vendor: Give partners a commission on each sale they drive.
    2. You’re a SaaS vendor: Give partners straight cash per transaction, if your offering is tiered your affiliate commission can be as well.

    When you setup an affiliate program you are effectively sharing the risk and the reward.

    If your sales funnel is: visit page -> email submit -> purchase

    You can compensate affiliates for either the page visit, the email submit, or the purchase. You will need to compensate the affiliate more for actions that are further into the funnel, as you are placing the risk on the affiliate to convert the user. If you compensate them at the start of the funnel, you can pay them less and the risk is on your side to convert them.

    You will need to determine the right risk / reward ratio to determine which action will be most profitable – and attractive – for both you and the affiliate.

    Tracking Referrals

    You need to use a third party to track referrals, this guarantees no foul play on your side ands building confidence in your program into your program. It also helps limit fraudulent activity, you can review partners as they apply, and send payouts once customer payment has been confirmed on your end.

    Here are some third party services you can use to set up a program like this:

    1. Zferral – I prefer Zferral to others because of its ease of use, and support. If you’re having issues with setting up you can use their support centre to screencast your issue and have it resolved within a few hours.
    2. HasOffers – Custom referral programs, easy setup.
    3. LinkTrust – This is a costly alternative, but is the undisputed gold standard within the industry.

    White Glove the Entire Program

    Send your partners a monthly recap, keep them updated on how other partners are doing, and how the program is a smashing success! It will keep them involved and give them a benchmark for how well they can do, and how much money they can make by being part of your program.

    The customer referral engine is a win-win channel for driving online sales generally untouched by most early stage startups. If you have a startup that could benefit from a referral program, talk to us in the comments!

    photo credit – armando cuéllar

  • 7 Ways To Rock a Startup Accelerator Mentor Day

    Editor’s note: This is a guest post by serial entrepreneur and marketing executive April Dunford who is currently the head of Enterprise Market Strategy for Huawei. April specializes in brining new products to market including messaging, positioning, market strategy, go-to-market planning and lead generation. She is one of the leading B2B/enterprise marketers in the world and we’re really lucky to be able to share here content with you. Follow her on Twitter  or RocketWatcher.com. This post was originally published in August 31, 2012 on RocketWatcher.com.

    I spent the day yesterday at FounderFuel for their Mentor Day. If you aren’t familiar with FounderFuel they are a very successful startup accelerator based in Montreal. And what a day it was – 8 startups pitched and then did roundtable breakout sessions with over 50 mentors including VC’s, angel investors, entrepreneurs and senior executives. Here’s my mentor’s perspective on how a startup can really get the most out of a day like that:

    1/ Pick your Target Mentors Ahead of Time: 50 mentors is a lot and they represented a wide cross section of folks that have deep experience in different consumer and business markets, and have a range of skills from technical expertise to sales, marketing, finance, and legal experience. Selecting a subset of the mentors with experience relevant to your business will help you target your discussions.A handful of the teams that needed marketing help reached out to me by email before the day and that helped to make sure that we connected at the session which I thought was pretty smart.

    7 Ways Rock a Startup Accelerator Mentor Day2/ Ask for Feedback on your Pitch: The mentors are both experienced pitch artists, and listen to pitches a lot. What better folks to give feedback on what worked and what didn’t work with the pitch you just gave? In this case the companies are all still in the early stages of the accelerator program so it’s a great time to get feedback that will improve the ultimate pitch you give on demo day. The feedback will also give you a feel for the differences in what an Angel investor might be looking for over what the more traditional VC’s are looking for in a pitch. “Tell me one thing that would have made my pitch better” or “What was missing from my pitch?” would both be great ways to start that discussion.

    3/ Ask for Specific Help: The mentors are ready and willing to help but they can’t guess what you need. Coming with a set of specific requests helps shape the discussion in a way that is most helpful to you. Don’t be afraid to ask for specific introductions – even if the folks in the room don’t have the answers you need, chances are they know someone who does.

    4/ Listen, Ask Questions (and Filter later): – The mentors yesterday came from really different backgrounds and had worked in a broad range of industries (consumer, gaming, retail, enterprise, financial services). Sure we’re all smart folks but you wouldn’t believe how different our opinons were about questions the startups were asking. For example, at my session with Openera – a tool for automatically organizing files and attachments –  we got into a discussion about selling to consumers versus enterprises as a starting point. I ALWAYS tilt toward enterprises when people ask me that because I know/love enterprise sales. The mentor beside me, Yona Shtern, the CEO from Beyond the Rack on the other hand thought selling B2C (or B2C2B) was just fine. Only Openera can decide who’s got smarter advice for their business (yeah OK, in this case it’s probably the smarty-pants Beyond the Rack guy but hey you get what I’m trying to say here). Another example – in the discussion with InfoActive (a very cool tool that lets you easily create beautiful interactive data visualizations), I immediately saw the applicability to creating interactive marketing materials. I’m a marketer, that’s the obvious use case for someone like me.  The mentor beside me (James Duncan, CTO at Inktank) on the other hand saw the value in selling to IT departments that needed a way to easily create good looking dashboards to help IT communicate to the business side of the house. That’s a great use case that a marketing person like me would be unlikely to immediately think of. Both ideas might be worth investigating but only InfoActive can really decide that. Avoiding “mentor whiplash”, as the FounderFuel gang refers to it, is a critical skill for startups in accelerators that have deep rosters of active mentors. Remember too that time is limited so you don’t want to waste it having a long debate with a single mentor over a specific point. Listen, probe a bit if you need to, and then move on. You can always schedule follow-on time with a specific mentor to explore an idea later.

    5/ Take Notes:  You put a couple of CEO’s a VC, a senior exec and a CTO at a table together and guess what happens? We talk. A lot. Not only that but the conversation moves very quickly from one point of view to the next. Some teams were recording the sessions but the room was loud (did I mention we talk a lot?) and figuring out who said what later might be a challenge by voice alone. Having someone taking notes is a good idea to make sure that you’re capturing ideas as they are flowing.

    6/ Work the Edge Time: By far the best way to get 1 on 1 time with a mentor yesterday was to do it over the break or over lunch. That also gives the mentor a chance to ask questions they might not get a chance to in a round table session.

    7/ Don’t Forget Everyone’s a Potential Investor : The VC’s are easy to spot (and there were a lot of them there) but most of the mentors I talked to are also doing a bit of angel investing as well. For companies at this stage anyone that’s willing to invest time with your company might also be likely to invest cash as well.

    So there’s my advice. I’m sure the other mentors all have different opinions – yep, we’re funny that way.

  • Book Review – Startup Communities: It’s About the Entrepreneur

    Brad Feld, managing director of Foundry Group, is no stranger to the Canadian tech startup scene – he was a speaker at the C100’s AccelerateMTL event in 2011.

    Over the past year, I have had the opportunity to get to know him and he has been a source of inspiration and support to me professionally. Brad is one of those rare VCs, his contributions don’t stop with the money. He is very generous with his advice and has been on a passionate mission in the past year to crack the code on how to build an entrepreneurial ecosystem in any city, hence the title of his new book: Startup Communities
    .

    Startup Communities: Building an Entrepreneurial Ecosystem in Your City
     (pre-order available) isn’t a book you that you will put down easily, but is one you will pick-up often. In fourteen chapters and one fell scoop; Brad makes us smarter and wiser about what it takes to nurture a vibrant startup ecosystem in any community.

    Startups are Everything

    Feld sets the tone early in the book by stating that “Startups are at the core of everything we do.” Feld implies that it’s easier today to create and evolve startup communities “as a result of our networked society”, and he tosses away long-drawn old-school frameworks and previous theories that were primarily based on macro-economics, socio-demographics or geographical parameters. His thinking is framed around what he labels as “The Boulder Thesis”, a fresh framework that is based on pragmatism and lower barriers of entry. It’s all about on-the-ground reality as a lever to making things happen.

    The Boulder Thesis

    “The key to every successful startup community is startups. If you do nothing else, make sure all the founders and founding teams are visible and connected to each other.” That’s a golden statement to be reminded of. Remember, his message is aimed at the entire community.

    Feld doesn’t mince words when he places the role of the entrepreneurs as the most critical component. “Lots of different people are involved in the startup community and many non-entrepreneurs play key roles. But unless the entrepreneurs lead, the startup community will not be sustainable over time.” Amen.

    The Boulder Thesis is grounded in four key components: a) entrepreneurs that lead, b) leaders that commit, c) an all-inclusive mentality, and d) activities up and down the entrepreneurial stack. The book details them.

    A 17-year resident of Boulder, Brad observed that while Boulder didn’t have a lot of local VC’s, it did have a large number of VCs that viewed companies in Boulder as attractive to invest in. This fact alone means that any city cannot complain about not having a lot of local VC’s. Rather, they should focus on making themselves attractive to VC’s wherever these VC’s may be.

    Rightfully so, Brad advocates that activities such as “hackathons, New Tech Meetups, Open Coffee Clubs, Startup Weekends, and accelerators” are more important than “entrepreneurial award events, periodic cocktail parties, monthly networking events, panel discussions, and open houses” because they engage deeper into the entrepreneurial stack. To each city that’s listening, take inventory and assess your gaps.

    Leaders and Feeders

    Then comes a key tenet of the book: there are Leaders and there are Feeders to any ecosystem. If you’re in a startup community, know who you are, and what your role is, but don’t confuse the two. So, who is a Leader and who is a Feeder? “Leaders of startup communities have to be entrepreneurs. Everyone else is a feeder into the startup community. This includes government, universities, investors, mentors, service providers, and large companies.” Entrepreneurs, rejoice.

    Driving the Leaders vs. Feeders point hard, Brad asserts that “the absence of entrepreneurs as leaders, or the overwhelming leadership by feeders, will doom a startup community.” Message aimed at the Feeders mostly.

    Classical Problems

    Chapter Six gets at the crux of the community build-out, and something that every city wants to know: What are we doing wrong? Brad nails the classical problems:

    1. The Patriarch Problem, when those who made their money many years ago are still running the show.
    2. Complaining about capital, because there will always be an imbalance between supply of capital and demand for capital.
    3. Being too reliant on Government. This is self-explanatory, but there’s a whole chapter on it entitled: “Contrasts between entrepreneurs and government.”
    4. Making short-term commitments. Well, it takes a long time to build a startup community. Twenty years to be exact.
    5. Having a bias against newcomers. Instead, swarm the newcomers.
    6. Attempt by a feeder to control the community. Why? Feeders retard the actual growth of the startup community.
    7. Creating artificial geographic boundaries. They don’t matter much at all at the state and city level. Waterloo-Toronto: are you listening?
    8. Playing a zero-sum game. This means stop thinking that “Our community is better than yours”.
    9. Having a culture of risk aversion. Make sure you learn something from what didn’t work.
    10. Avoiding people because of past failures. Rather, embrace the failed entrepreneur because it encourages more entrepreneurs to take more risks.

    Brad goes on to list in great details the many activities that make-up Boulder’s community what it is. My advice: when you get the book, use it a checklist and see what your city is missing.

    Accelerators and Universities

    In Chapter Eight, Brad takes us on the case study of TechStars, and in it he rubs in the fact that there is a distinction to be made between Accelerators and Incubators because they are formed differently and have different objectives.

    Chapter Nine focuses on the role of Universities and it ends with this advice for the entrepreneur: “The relationship between a startup community and a university can be a powerful one, but is often complicated. By focusing on specific activities and remembering that the university is a feeder to the startup community, great things can happen.”

    Myths of Community Building

    Aided by Canadian Paul Kedrosky, one of the ending chapters lists the common myths about startup communities. I’ll highlight two of them:

    1. We need to be like Silicon Valley. “If that’s really your goal, save yourself a lot of heartache and simply move to Silicon Valley.”
    2. We need more local venture capital. “Venture capital is a service function, not materially different from accounting, law, or insurance. It is a type of organization that services existing businesses, not one that causes such companies to exist in the first place. While businesses need capital, it is not the capital that creates the business. Pretending otherwise is reversing the causality in a dangerous way.” That fits well within the Leaders vs. Feeders theory.

    Startup Communities is a call for introspection aimed at any city, community, entrepreneur, developer, funder, leader or feeder. The book makes you think about whether you’re doing the right thing. It should prompt every city or ecosystem to answer the tough questions: Do we have enough leaders as entrepreneurs? Are we going to stop making excuses? Can we work better together?

    If you’re involved in technology startups, this book will not just touch a nerve. It will run through your spine.

    How do you think Canada is doing in regards to building entrepreneurial ecosystems in the major cities?

    Editor’s Note: The author, William Mougayar is CEO of Engagio, a universal Inbox and Discovery Network for social conversations. You can pre-order Brad’s book on Amazon and ensure delivery as soon as it’s published in September.

  • Not all founders are created equal

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    I was reading an excerpt from Noah Wasserman’s The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup (Kauffman Foundation Series on Innovation and Entrepreneurship) about Founder Dilemmas: Equity Splits and it struck home. Equity splits and distribution are often the key issues related to power imbalances, perceived injustice and tension amongst cofounders.

    In Noam’s dataset, 73% of founding teams split equity within a month of founding, a striking number given the big uncertainties early in the life of any startup. The majority of those teams set the equity in stone by failing to allow for future adjustments to equity stakes if there are major changes within the team or the startup…

    Setting the early equity split in stone is one of the biggest mistakes founders can make. With their confidence in their startup and themselves, their passion for their work and their mission, and their desire not to harm the fragile dynamic within the nascent founding team, cofounders tend to plan for the best that can happen. They assume that their early, high levels of commitment will last long into the future, rather than waning as the challenges of founding begin to sap their passion for the idea and for each other. They assume that no adverse events will change the composition of the team.They also tend to take a very short-term view of the factors that should affect equity splits.

    Sometimes it just doesn’t work out, and a founder will choose to leave the company or have the choice made for them. The question is how do you create a set of agreements that is fair to all of the cofounders. Often we think that standard employment and shareholder agreements cover much of the difficult situations that we can encounter with cofounders. But as cofounders it starts by really understand what you each are looking for, and then making sure your agreements cover the specifics of your situation.

    10 Critical Cofounder Questions

    1. How should we divide the shares?
    2. How will decisions get made?
    3. What happens if one of us leaves the company?
    4. Can any of us be fired? By whom? For what reasons?
    5. What are our personal goals for the startup?
    6. Will this be the primary activity for each of us?
    7. What part of our plan are we unwilling to change?
    8. What contractual terms will each of us sign with the company?
    9. Will any of us be investing cash in the company? If so, how will this be treated?
    10. What will we pay ourselves? Who gets to change this in the future?

    A couple of things. I think all founders stock should vest. I like it when founders purchase their initial shares with a one-time acceleration clause for a small percentage at purchase (3-5%). I like when founders’ stock reverse vests with a traditional one year cliff. The initial vesting acceleration is because things can change at 6 months and it seems fair to value the capital risk that each founder has taken at purchase. And the one year cliff because it is standard. What I’ve seen a lot is founders that don’t do the small initial accelerated vesting clause.

    The other thing I like to see is an Employment Agreement with Termination clauses, in particular, an acceleration on vesting regarding “Termination by the Corporation without Cause”. I like to see a single trigger acceleration with 6-12 months of stock vesting on termination without cause (I’m not alone). The goal is to be fair and to protect each cofounder and the corporation if things don’t workout.

    What tips do others have for equity splits? acceleration clauses? terms? That as cofounders we should put in our agreements.

    Other Resources

     

  • The Startup Backoffice

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    Scalabiity Inc

    StartupNorth contributor Ray Luk (LinkedIn, @rayluk) announced the launch of Scalability Inc. (@scalabilityinc). It’s a great service that provides backoffice services including bookkeeping, accounting, government filings, payroll, record keeping, and human resources. It’s the combination of tools and the people with the expertise to help with timing that can make a huge difference. Ray seems to have nailed a need in the marketplace with Scalability Inc.

    It’s great to see startups building these unsexy tools, and sharing their experiences. It’s particularly interesting to see how many Canadian startups are playing in the unsexy backoffice space. Scalability Inc., Wave Accounting (announced $12MM from Social+Capital), TribeHR ($1MM from David Skok at Matrix Partners), Shopify ($22MM from Bessemer), Dayforce (acquired by Ceridian), it seems like Canadians like critical business apps.

    @StartupCFO backoffice talk on oct 4 2011 at Founderfuel

    What are the must have tools that you are using in your startup’s back office?

    Sales & Inventory

    Analytics & Business Intelligence

    CRM

    Human Resources

    Accounting & Payroll & Expenses

    Invoicing

    Payments

    Legals

    Bookkeepers & Accountants

    What are you using in the back office? Who are the consultants and providers that we’ve missed?

     

  • 5 Steps to an Awesome Executive Summary

    Editor’s note: This is a cross post from Massive Damage Inc. written by Ken Seto,  founder of @Massive_Damage & @EndloopMobile.  He is building @PleaseStayCalm, a location based game.. Follow him on Twitter @kenseto where he tweets about Apple, music, games, food, wine & movies. This post was originally published in February 21, 2012 on MassDmg.com.

    Massive Damage Inc Header

    We’ve finally decided to post our Executive Summary to share with other founders as we’ve always had compliments and great feedback from it.

    Some folks wonder how best to use executive summaries.. basically you’ll give it to people who will be doing intros for you. That way, they can forward something that piques the interest of the potential investor without giving away the whole pitch. You don’t want your deck to do your pitch for you, you want to do the pitch.

    Here are the following guidelines I followed to create ours:

    1. Keep it to one page if possible, it’s a summary, not a pitch.
    2. If you have no eye for design, hire one or get a designer friend to help out.
    3. If you have metrics, put the good stuff front and center. Feel free to use vanity metrics for big impact but make sure you also have engagement metrics.
    4. Leave enough room for your Team section. Use pictures and previous startups/accomplishments.
    5. Include awesome visuals. Sure you can’t use zombies for every startup but give it some personality. Use bold infographics or charts.

    Here’s our Executive Summary:

    Massive Damage Executive Summary

    View more documents from Ken Seto

    Editor’s note: This is a cross post from Massive Damage Inc. written by Ken Seto,  founder of @Massive_Damage & @EndloopMobile.  He is building @PleaseStayCalm, a location based game.. Follow him on Twitter @kenseto where he tweets about Apple, music, games, food, wine & movies. This post was originally published in February 21, 2012 on MassDmg.com.

  • Should We Drink the Local Kool-Aid?

    Editor’s note: This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting. Follow him on Twitter @markevans or MarkEvansTech.com. This post was originally published in December 15, 2011 on MarkEvansTech.com.

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    In the post I wrote earlier this week about the demise of Thoora, there was a comment suggesting that “Toronto failed Thoora” due to a lack of community support to make it a “winning formula”.

    It was a puzzling comment because it suggests a community has an obligation to support a startup so it can thrive. This strikes me as an absurd idea because startups should succeed or fail on their own merits, and the ability to attract an audience near and close.

    Sure, it’s good to drink the local flavour of “Kool-Aid” but only if a startup is offering a product or service that meets a need or interest. There are lots of local startups, including some that pitch me directly, that don’t resonate because nothing something interests me or the product/service doesn’t resonate enough to warrant further exploration.

    It doesn’t mean I’m not supporting the local community; it just means a startup has a service that didn’t pass the sniff test.

    At the same time, I do think Toronto’s startup community is extremely supportive. There’s no lack of enthusiasm, energy and a willingness to share ideas, feedback, resources, real estate and time to provide startups with a boost.

    This has been a fact of life for the past five years, even before we started to see a flurry of startups appear on the scene. There has always been a strong, support community that has pulled together in different ways. A great example is tonight’s HoHoTo party, which has become a major fund-raising machine due to tremendous support from the community.

    The bottom line is if a startup needs to rely on the community to make it, it also suggests what it’s offering can’t survive  without artificial support.

    For startups, the market has to be bigger than its own backyard. It needs people to support it or not based on what’s being sold as opposed to a sense of duty or obligation.

    Editor’s note: This is a cross post from Mark Evans Tech written by Mark Evans of ME Consulting. Follow him on Twitter @markevans or MarkEvansTech.com. This post was originally published in December 15, 2011 on MarkEvansTech.com.

  • Quota is not a dirty word

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    “We are ALL in sales” – Dale Carnegie

    I used to think that quota was a dirty word. It struck me as restricting freedom and potentially forced the exploitation of trusted customers and prospects to drive the bottom line results. But I was wrong. In reality, a quota is a number that is useful to incent certain behaviours. The trick is to incent the appropriate behaviours. It is a contract between a sales person and an organization about how to compensate behaviours based on outcomes.

    “Quota is a direct path to clarity and accountability.” – Shawn Yeager

    So many entrepreneurs can benefit from contracts with defined outcomes. I was chatting with a startup last week about the numbers he agreed to with his VC to unlock the next tranche of funding. He mentioned that he wasn’t going to meet the numbers, but he still expected the VC to unlock the funding. My advice to him was very straight forward, it was to figure out how to achieve the agreed to numbers, or immediately open a conversation with the VC about missing the numbers due to changing market conditions and see if the tranche can be renegotiated. In the case of this entrepreneur, the numbers were in the funding contract, and I fully expected the VC to hold the entrepreneur to deliver on these numbers. The numbers and metrics exist to help assess the risk and the ability of an entrepreneur to deliver.

    The secret with an early stage company is to set appropriate metrics, quotas and growth numbers that incent the correct behaviours out of entrepreneurs. The good news is that there are a lot of examples of SaaS, B2B and consumer metrics that can be used.

    There are a lot of different sources of metrics and numbers. Each of the numbers needs to be considered in corporate revenue goals, past historical performance, current product development stage, market share, budget, etc. The targets and growth numbers need to be established.

    I’ve taken to requiring all of the startups I mentor, to establish 3 metrics that we discuss in our mentorship meetings. Each of the metrics must be clear enough for me to understand, for example:

    • Number of paying customers
    • Number of registered users
    • Churn rate
    • Number of pageviews or unique visitors

    And each metric should have the current measurement, the predicted growth rate and the actual target number. I try to start each conversation around the metrics. And any issues related to the market conditions, learnings, corrections, etc. Then together we set the targets as part of the planning for the next meeting. This may include a redefinition of the metrics. The trick for me as a mentor is to try to help identify what metrics I think are most useful for the startup and founder to focus on next.

    What are the metrics other entrepreneurs track? How do you set your targets and quotas?

    What are the metrics and growth rates that investors like ExtremeVP, Real Ventures, iNovia Capital, GrowthWorks, Rho and others want to see from prospective early-stage companies?

  • Lean Startup Tools

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    Back in May, Nat Friedman wrote about the tools used in setting up Xamarin. They include a great set of basic tools for getting a startup off the ground with very little investment. We have seen a lot of startups using a similar set of tools and I thought that we’d compile a list of the tools that we’re actively using (and some of the others we evaluated). There are the tools and blogs listed by Steve Blank that include many

    Landing Pages

    We’re big fans of WordPress at StartupNorth. We’ve powered StartupNorth on WP since the beginning. The combination of WordPress, Premise, and the WordPress MU Domain Mapping plugin is a pretty powerful combination for creating mutliple sites and landing pages to test your landing pages. But we’ve also developed a sweet spot for Vancouver’s Unbounce, it took us less than 5 minutes to have 2 landing pages and a domain set up. We’re big believers that you can use Adwords and Facebook Ads to quickly create a landing page to test ideas before writing a single line of code.

    Analytics

    We primarily use Google Analytics and WordPress Stats for StartupNorth. We’ve been working with startups and using a KISSmetrics and Mixpanel to measure activity on their web properties and applications. Make sure you read Ash Maurya’s 3 Rules to Actionable Metrics to understand how the analytics can be used in combination with split testing and/or cohort analysis to better track your optimization before product/market fit (What do you measure before product/market fit? – check out Ash’s conversion funnel and metrics).

    Mailing Lists

    We haven’t been as proactive in building a mailing list for the StartupNorth community as we probably should have been. I’ve used have started using MailChimp because of the quick integration to GravityForms and WooFoo, but have had very positive experiences using both Campaign Monitor and Constant Contact.

    Billing and Accounting

    What is amazing is that both of these companies are local to Toronto. We use WaveAccounting integrated with our bank account and PayPal for tracking expenses, billing, and financial operations. And we use Freshbooks to bill for sponsorships. They are a must have in our back office. What we’re missing is a really easy to use and integrated payroll system (I hear that it might be coming).

    Human Resources

    For full disclosure, I’m an advisor to TribeHR. It doesn’t change the fact that they rock. It is the easiest way to get an HR system in place. And there is no better way to get feedback and help employees improve than Rypple.

    Surveys and Feedback

    We are actively using Survey.IO to gather feedback from users about the state of StartupNorth. It helps us figure out the state of our product market-fit, if there is such a thing for a blog about Canadian startups, fill it out and help us be better.

    Project Tracking

    We use Pivotal Tracker. We like them so much, we actively recruited them as a sponsor for StartupNorth. There are lots of other tools from project tools to issue tracking. Curious at what others are using.

    Source Control

    We use Github Bronze for our project hosting. Most of the code we work on is PHP against MySQL (see WordPress), though we have additional apps in development like the StartupNorth Index (which will be moving to startupnorth.ca/index shortly) but all are LAMP.

    Hosting

    Full disclosure: VMFarms is a sponsor of StartupNorth. However, their hosted VMs that are backed up and hot mirrored coupled with the outrageous “white glove” makes them a dead simple choice. We also use Rackspace Startups and EC2 for access to easy Linux and Windows VMs for development and testing environments.

    Customer Relationship Management

    We don’t have any strong recommendations. There are platforms like Salesforce that are fantastic and sales teams are used to. There is Highrise which is broadly supported with a lot of 3rd party tools. But so far, neither of these has been the clear winner for us. There is a great Quora question about “What is the best CRM for startups” that lists SFDC, SugarCRM and Highrise. There are a lot of choices for CRM including Nimble, Insightly, Woosabi, Capsule, Solve360,AppPlane, Batchbook, PipelineDeals, TactileCRM, ZohoCRM and many others.

    Conferencing, Screen Sharing & Telecommunications

    I’ve been using Calliflower for conference calling. It’s $5/call for up-to 5 callers, or for $30/month unlimited minutes and >70 participants, it’s a great solution. It is not a replacement for a office phone system.

    Google Voice and Skype have been the least expensive way as a Canadian startup to get a US phone number. This is great for me as an individual. However, this does not scale to an enterprise or an organization. I’ve been looking at Grasshopper, RingCentral and Toktumi, but I have yet to settle on a solution.

    SEO & SEM Tools

    This part of the list is pretty much cribbed from Steve Blank’s list of tools for entrepreneurs. Go read it for a more comprehensive list of tools beyond the SEO/SEM listing included below.

    What are we missing?

    I’m going to cover in the next post: discounted travel, conferences, business cards, design services, and other tricks for being relentless resourceful as a founder.

    There are a lot of online tools that startups are using to make or break their business. And there is a lot missing, monitoring like NewRelic, PagerDuty, Pingdom and Blame Stella for example. But I’m curious what are the indispensable tools being used at iStopOver.com, HighScoreHouse, CommunityLend, Idee/Tineye, Massive Damage, Empire Avenue, Indochino, Lymbix, Hootsuite, AdParlor, Locationary, Chango and others. What are you using? What gives you the edge in quickly and effectively gathering feedback to test your hypotheses?

  • The Mentor Manifesto by David Cohen

    CC-BY Some rights reserved by pasukaru76
    Attribution Some rights reserved by pasukaru76

    I am continually amazed at the horror stories I hear from entrepreneurs about finding mentors. About mentors taking large pieces of the company and not providing any value in return. It was great to see David Cohen’s The Mentor Manifesto this morning. It is great to see David take the time from his 11 cohorts at TechStars and try to explain “What does it mean to be a great mentor?”. This is an extension of his tips for entrepreneurs that includes how to Find and Engage Great Mentors as part of his top twelve startup tips.

    The Mentor Manifesto

    • Be socratic.
    • Expect nothing in return (you’ll be delighted with what you do get back).
    • Be authentic / practice what you preach.
    • Be direct. Tell the truth, however hard.
    • Listen too.
    • The best mentor relationships eventually become two-way.
    • Be responsive.
    • Adopt at least one company every single year. Experience counts.
    • Clearly separate opinion from fact.
    • Hold information in confidence.
    • Clearly commit to mentor or do not. Either is fine.
    • Know what you don’t know. Say I don’t know when you don’t know. “I don’t know” is preferable to bravado.
    • Guide, don’t control. Teams must make their own decisions. Guide but never tell them what to do. Understand that it’s their company, not yours.
    • Accept and communicate with other mentors that get involved.
    • Be optimistic.
    • Provide specific actionable advice, don’t be vague.
    • Be challenging/robust but never destructive.
    • Have empathy. Remember that startups are hard.

    I hope that I can live up to the manifesto for the companies I mentor at UW VeloCity, FounderFuel and those I’ve been working with in Toronto and Waterloo.