10 things I’ve never heard a successful startup founder say

August 15, 2011 147 Comments

I built this software for myself, and then it turned out a million people wanted it exactly how I originally envisioned it.

After hiring a few people, being the CEO became a lot easier, and I was able to focus on high-level strategic plans instead of fighting fires.

I wish we had spent less time talking to prospective customers before designing interfaces and writing code.

The decision of whether to form an LLC, S-Corp, or C-Corp made a significant difference in my startup’s success.

Selling the company was an easy decision, and everyone in the company was on the same page.

We were so good at acting that our first few customers never knew we were a new company with no employees and buggy software.

Thanks to a software patent we filed, we never had a serious competitor.

Our most effective marketing campaigns were the ones filled with buzzwords and non-specific claims.

My lack of an MBA degree made building a company from scratch harder for me than for others.

I wish I had spent more time reading and weighing the pros and cons of various philosophies instead of just jumping in and doing what I thought was morally and financially sensible.

Let’s collect more in the comments!

  • http://www.gregmart.in Greg Martin

    I don’t know what the big deal is, raising money is the easiest thing we’ve ever done.  If you build it, they will come!

  • Subie

    Disgreed on the  LLC/S-Corp/C-Corp and the decision to sell the company. Company type becomes a big pain when taking VC money, and the decision to sell the company is easy when you’ve built a company for the purpose of selling it.

    • Dougwithau

      OK, So form a Delaware C corp. If you raise money you are fine and good. If you don’t you are fine and good.

      Decision made, please move on.

      • r00fus
      • http://www.charliecrystle.com Charlie Crystle

        not really. Tax implications are significant. If you’re not going to raise money, Sub-S and LLC (I think) allow pass-through of losses to personal tax returns. C-corp losses do not pass through. 

  • Greg Hluska

    I hired fast and never fired anybody.

  • David Heller

    Sitting behind our screens and coding all day was the key to our success.

  • Anonymous

    Those arguments about the name, logo, and design color were critical to our eventual success with Enterprise customers!

  • Anonymous

    I disagree on the structure of the company. We went through a major fix and had it not been done, our acquisition probably wouldn’t have happened.

  • http://www.jonlim.ca/ Jon Lim

    “I spend much of my time deciding on whether to call my developers ‘rockstars’ or ‘ninjas’.”

    • Lucia

      What if my developer really is a rockstar?

      • http://twitter.com/pedro___ Pedro Batista

        Then give him a guitar and send him away.

    • http://dreamosity.com/ Dreamosity

      They really are both, depends if they’re creating or solving problems. 

      • http://twitter.com/ReinH Rein Henrichs

        They really are neither.

      • http://rpbouman.blogspot.com/ Roland Bouman

        If my ninja developer ambushes and kills the rockstar ones, is that solving or creating a problem?

  • Anonymous

    “I wish I had spent more time reading and weighing the pros and cons of various philosophies instead of just jumping in and doing what I thought was morally and financially sensible.”

    Is my favorite.

    I hate wasting time when we could be doing. I deploy first and ask questions later and its seemed to treat me well.

  • http://benhebert.com Ben Hebert

    Bring your dog to work day is the only reason our company has been successful. 

    • http://twitter.com/LynxToTweet LynxTo

      I thought it was Hawaiian shirt day…

  • Mat

    “Our most effective marketing campaigns where the ones filled with buzzwords and non-specific claims.”

    “Were”, not “where”.
    :/

    • http://blog.asmartbear.com Jason Cohen

      Fixed, thanks!

  • http://blog.usermood.com Dave Churchville

    Our success was entirely based on a couple of mentions in the tech press

  • Jham2081

    That was easy.

  • http://twitter.com/julissaarce Julissa Arce

    ” I thought I was going to be working less than when I had a corporate job”  

    Like many people thought on this article http://www.nytimes.com/2011/08/14/fashion/maybe-its-time-for-plan-c.html

  • Winner

    I wish I’d invested all the money i spent on hookers and blackjack into the company.

    • JosephmorganMD

      Let’s hang out

  • http://www.2fatdads.com JohnnyLeCanuck

    The customer always comes around to thinking like we do and using the product like we do. 

  • http://www.affenstunde.com James Barnes

    “Filling up the management team with my untrained relatives and acting on their advice over that of any other employees made all the difference in ensuring our success”

  • http://alisabog.com Alisa

    “I new exactly what I was doing when I started so I didn’t have to learn anything along the way.”

  • Anon

    It’s time to slow down…not!

  • http://twitter.com/morganlinton Morgan Linton

    Great article and really spot-on. This one in particular made me laugh: “I wish we had spent less time talking to prospective customers before designing interfaces and writing code.” 

    I’m going to be doing a post about this on my blog with comments on a few of your quotes and sending my readers your way to read your entire post. 

    Just discovered your blog today and I think you’ve just made a dealer reader out of me with this post…of course now I’m going back and reading all the posts that I’ve been missing!

  • Gerald W

    Strategic thinking was way more important than execution.

  • gummih -

    Our first project was finished on time and within the budget.

  • http://twitter.com/nomudajoe Joe Chard

    “I wish I had never hired that MBA.  As a developer, I know everything I need to know about building a business.”

    (just a counterpoint to the original MBA dig) :-)

    • http://www.charliecrystle.com Charlie Crystle

      ugh. the difference between the MBA and the founder is the founder has been learning through experience. 

      • Mark

        Don’t assume that MBA and learning through experience are mutually exclusive.

        • Talesin BatBat

          From experience getting shuffled between minty-fresh MBA holders as managers (who didn’t remain managers long), yes. Yes, they are.
          Straight out of their indoctrination, MBA-holders have a very… /interesting/ view of how the world works, and sense of entitlement that piece of paper gives them. 
          Very few are smart enough to realize when they need to listen, and not talk and put into practice all those techniques they just finished learning about to Double Or Even Triple Your Productivity Through Incessant Micromanagement/Idiotic Policy Changes/Not Asking The People Who Have Been Doing Their Job Since Before You Entered College, And Might Do It That Way For A Reason!.

          Getting an MBA *is* antithesis to experience. It intrinsically excludes real-world work experience from that entire timeframe. It just entitles a holder to *think* they have experience/more valuable experience for an equivalent (or more) timeframe.
          Ask the English majors. An overhyped piece of paper is still just a piece of paper.

          • http://www.facebook.com/people/Leah-Thomson/1802566133 Leah Thomson

            You have no clue what you are talking about.

            • Talesin BatBat

              How so? The above has been based on real-world experience, watching as these clueless idiots come out into the workforce, and generally end up one of three ways. 
              A) Fired for annoying the crap out of the experienced higher-ups
              B) Having a breakdown and quitting as none of the crap they learned actually *applies* to a real company
              C) Realizing they need to adapt and that what they were taught are starting guidelines, not the golden path that everyone needs to follow to Succeed.

            • http://dreamosity.com/ Dreamosity

              Sent from my LG phone

          • swrage

            My reply as somebody “on the other side” – an MBA who tries to contract with software developers: software developers have a very… /interesting/ view of how the world works, and sense of I KNOW BEST what my customer wants.
            Very few are smart enough to realize when they need to listen, and not sit down and put into practice all those development techniques that worked best for other projects / I don’t know this software environment but I’m a fast learner / We can always rework it later / I’m just the coder, I didn’t have the time to read your requirements document…

            Yeah, I guess it goes both ways. Are there a gazillion folks who have an MBA and are clueless? Yep, for sure. Are there a gazillion folks to claim to be software developers and are clueless? You fill in the blank!

            Oh, and an overhyped piece of code that doesn’t fulfill the requirement is still… useless!

          • swrage

            My reply as somebody “on the other side” – an MBA who tries to contract with software developers: software developers have a very… /interesting/ view of how the world works, and sense of I KNOW BEST what my customer wants.
            Very few are smart enough to realize when they need to listen, and not sit down and put into practice all those development techniques that worked best for other projects / I don’t know this software environment but I’m a fast learner / We can always rework it later / I’m just the coder, I didn’t have the time to read your requirements document…

            Yeah, I guess it goes both ways. Are there a gazillion folks who have an MBA and are clueless? Yep, for sure. Are there a gazillion folks to claim to be software developers and are clueless? You fill in the blank!

            Oh, and an overhyped piece of code that doesn’t fulfill the requirement is still… useless!

  • Anonymous

    I learned everything I needed to know about starting and running a successful business by reading blogs. 

    *SMILE*

    • http://blog.asmartbear.com Jason Cohen

      BTW I 100% agree! Less reading, more doing.

      • Anonymous

        *SMILE* 

        I do enjoy reading your blog, Jason, and find your perspective informative.Now, back to doing more doing!

    • Anonymous

      is that a Hellraiser Bert? Bert is so evil! Where can I find a bigger version?

      • Anonymous

        The Googles has an assortment available for your downloading pleasure, J.

  • Markstephens

    I spent all my effort watching my competitors and copying them.

  • http://twitter.com/jchawner John Chawner

    That was easy.

  • http://seoagencies.com seo agencies

    there are a billion people in china…if we get 1% of those users…we’ll be rich

  • http://technicallyeasy.net Paul Salmon

    We know what the customer wants.

  • http://www.facebook.com/breinlinger Josh Breinlinger

    I regret firing that guy. I should have given him more of a chance.  (Hire slowly, Fire Quickly)

  • http://www.gounfunded.com Nick Carter

    “If knew we’d finally get a sale after we signed the 3rd round of capital raise.”

  • Veknashs

    Forgive me if i am wrong but i disagree with ur first point: check 4:22 in this video: http://www.youtube.com/watch?v=_5Z7eal4uXI&feature=related

  • http://www.bigbadgoose.com Doug Lee

    user testing to back up my conviction that blue buttons in the upper left drive acquisition really propelled our success beyond the stratosphere

  • http://erica.biz ericabiz

    “I wish I would have spent more time building everything myself”

  • Max

    Everyone I spoke to about starting the business agreed that it was a good idea.

  • http://www.facebook.com/profile.php?id=1008823850 Tony Shaw

    That extra 3% benefit of the Bush tax cuts is what gave me the incentive to start this business.

    • Joshua Heard

      I understand the difference between micro and macro economics

    • Just another idiot

       So your thesis is that most founders of successful startups are so stupid that they can’t reason about margins? You might be right.

      What I do know is that my company could use a couple of extra people but we won’t be hiring anyone because we are unsure about how much it will cost us because of regulations promoted by smug assholes like you. We’re not a startup though.

  • http://www.facebook.com/profile.php?id=1008823850 Tony Shaw

    That extra 3% benefit of the Bush tax cuts is what gave me the incentive to start this business.

  • http://twitter.com/smartfastartup Mark Richards

    I’m so glad all the cofounders demanded VP titles. They were perfect for that job when we started growing.

  • http://twitter.com/glehel Glen Hellman

    Love this post with two disagreements that are 1)  ”spending more time with customers,” as there’s a fine line between the diminished returns of a perfect product and speedy execution 2) “Selling the company was an easy decision,” it was for me twice with no second guessing, including a $100 million cash deal closed April 2000 2 months or so before the big bubble.  Knew it was right then and now.  

    A great read!

  • http://twitter.com/glehel Glen Hellman

    Love this post with two disagreements that are 1)  ”spending more time with customers,” as there’s a fine line between the diminished returns of a perfect product and speedy execution 2) “Selling the company was an easy decision,” it was for me twice with no second guessing, including a $100 million cash deal closed April 2000 2 months or so before the big bubble.  Knew it was right then and now.  

    A great read!

  • http://twitter.com/smartfastartup Mark Richards

    The customers we talked to gave us a perfect product spec, and then we built  it and it sold itself…….

  • http://twitter.com/aeden Anthony Eden

    The best thing about having cofounders is that we agree on *everything*!

  • Poshlost

    We owe our success entirely to ITIL certification. We made that our number one priority. The platitudinous ITIL non-specification helped us avoid premature commitment to a technology or an implementation before we had our processes and culture down. And once we had them down, we changed them continuously. Our motto is that no change is past the point of diminishing returns. Critics might call that dilatory dilettantism, but we aren’t technical: what were a group of poshlosts supposed to do besides pay ourselves?

    • Anonymous

      What?

  • http://twitter.com/BusinessPartnrs Business Partners

    “It was an easy decision to hire, and fire a friend.”

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  • http://www.kwiclick.com/ vinniv

    “I knew once we hit the front page of TechCrunch the company would take off”

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  • http://twitter.com/ricardodsanchez Ricardo D. Sanchez

    I am glad we interviewed customers and did not move forward with our product until we got 40+ people to tell us they will buy our product when launched!

  • http://twitter.com/ricardodsanchez Ricardo D. Sanchez

    I am glad I spent all that time and money attending conferences while building my product, it was key to our success!

  • Shane Best

    Having a Foosball table made all the difference when hiring good people!

  • http://dreamosity.com/ Dreamosity

    I love the reverse take on the quotes…and this is my fav: “Selling the company was an easy decision, and everyone in the company was on the same page.” — I’m at this stage right now where we’re discussing our exit strategy and we’re not even on the same page this early on! Oh boy. 

    • http://www.facebook.com/profile.php?id=1008823850 Tony Shaw

      FWIW, I bet there are more people who regret NOT selling when they had their chance, than there are those who regret selling too early

  • Benjohn

    You know what’s funny, the first one is exactly what I did, and so far, 160,000 customers. I’ll let you now when I get to a million.

    • http://blog.asmartbear.com Jason Cohen

      Congrats! You deserve the success I’m sure. Of course for every one of you I can find 10 folks who failed, and who later found out if they had just asked first they would have saved years of time and money.

  • Cyclist Who Gets in Your Face

    We focused on appearance more than substance.

  • Cyclist Who Gets in Your Face

    We focused on appearance more than substance.

  • Anonymous

    Our mission statement was critical to our success!

  • Anonymous

    Having plenty of money made us a lot smarter on how to spend it!

  • Anonymous

    The CEO we hired was totally into making himself look good and not about sharing any of the credit.

  • Anonymous

    We knew what our customers wanted…we just had to convince them to buy it.

  • Anonymous

    We did not try to focus on any one thing, just make as much product as possible and hope we would hit a home run.

  • http://profiles.google.com/gammer1994 Gerardo Marset

    “I like cheese, and actually I think it’s getting cold in here and I have seen this movie already.”

  • Anonymous

    Our market is 1 billion people…now if we get 1% we will be rich!!!

  • http://www.facebook.com/louhong Louis Hong

    Once my startup got on TechCrunch it was smooth sailing.

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  • http://www.successfulsoftware.net Andy Brice

    “My software is so great the marketing just took care of itsself.”

    “I was able to make up for my lack of knowledge of Google Adwords by just throwing money at it.”

    “And I did it all in 4 hours a week.”

    • Anonymous

      You mean Tim Ferris is not a successful start up founder?

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  • Simon Haworth

    Shutup all of you. I know what I am doing

  • Simon Haworth

    Shutup all of you. I know what I am doing

  • Sam

    “I wish we caught those five spelling mistakes on the 156th page on our website – that made us lose first 100 customers”

  • Anonymous

    Buying a foreign domain extension (.me Montenegro, .co Columbia, .ly Libya) was our most secure long-term marketing bet ever. And just think of the resale value!

  • http://www.thebigpropertylist.co.uk/ James

    Actually my neighbour’s 15 year old nephew built our website.  Basically any kid with a computer can build a website in their bedroom.

    • http://Taytus.com Roberto Inetti

      True. But not a business.

    • http://www.opensure.net OpenSure

      And that’s such a sustainable model as 15 year olds are notoriously reliable, available during business hours and open to rational business discussion. What’s not to like?!

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  • Zircon2781

    I’m a placeholder for the people who actually did all the work.

  • http://www.facebook.com/profile.php?id=557213750 Alex Kilpatrick

    I am so glad we spent $10K on the perfect logo.  It has made all the difference in our success.

    Bonus tip:  Starting a business with a good friend meant that I would never have conflicts with my co-founder.

  • Dale Ting

    The key to my success was coming up with the right font for my detailed business plan. Oh and the right colors for the graphs of all the revenue projections going up and to the right. 

  • Berto Martin

    where’s your google +1 button? This is how I keep track of where I’ve been around the net. Good post.

  • David Haye

    I read a bunch of blogs and so felt ready to start a company.

  • Vincent van der Lubbe

    “We were happy to start in a market segment we knew nothing about. It made all the difference selling to B2B customers.”

  • http://twitter.com/R3Evolution Ales Nohel

    I love this !!! : 

    I wish I had spent more time reading and weighing the pros and cons of various philosophies instead of just jumping in and doing what I thought was morally and financially sensible.

  • Gir_dubare

    Hello Jason, I’m a french web developer . I’m also starting a business on internet , and i really need to thank you for this blog . Every post of this blog teach me everytime more about business than i can imagine .
    Cyril

  • http://rpbouman.blogspot.com/ Roland Bouman

    “We owe our success to Erlang, Clojure and Scala”

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  • http://twitter.com/yipeorg Yipe.org

    Spending money on marketing is a waste 

  • Tim Thomas

    Having one good customer is all the input you need to design a product. Customers never have differing or conflicting needs.

  • Anonymous

    Without my operations manual, I’d be lost and the company would be a mess.

  • Terry

    This was a good and funny post but it could have been a bit more clear with some better and clearer formatting with bullet or numbered lists to set off the 10 statements you wanted to present. Otherwise, though good stuff.

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  • http://twitter.com/LynxToTweet LynxTo

    I sure am glad we started dividing up the percentages of ownership when we came up with the concept.

  • http://www.opensure.net OpenSure

    Of course, I waited til the children had left home and the mortgage was paid off before I started my own company…

    Without reporting procedures and published policies my company just couldn’t have survived that first, oooh, 10 years?

  • Craig Saboe

    “Our gut-wrenching decision on which platform and language to use made all the difference between success and failure.”

  • Craig Saboe

    “Our gut-wrenching decision on which platform and language to use made all the difference between success and failure.”

  • Stu

    I agreed with Warren Buffet, and as soon as I became successful I lobbied for the government to take my money to piss it away so I couldn’t reinvest it in further job creating ideas.

  • Stu

    I agreed with Warren Buffet, and as soon as I became successful I lobbied for the government to take my money to piss it away so I couldn’t reinvest it in further job creating ideas.

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  • http://www.keepstream.com/ Tim Gasper

    Spending 5 years thinking about the idea and rehashing it a million times in my head helped me produce a much better company once I actually started executing on the idea.

  • http://twitter.com/Lucanos Luke

    I knew that adopting a 15 interview hiring process would make us just like Google!

  • Anonymous Entrepreneur

    “Spending nine months to write our business plan before actually starting to do anything was the best decision we made. When finalized, the plan had solutions for every problem we encountered, and our eventual success was inevitable just by executing the plan step by step.”

  • http://www.facebook.com/erikbower Erik Bower

    “Getting an NDA from a competitor looking to acquire us protected us from them going after our install base”. 

  • Stevesanders

    Is this supposed to be sarcastic?

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  • Anders

    Number one: “I built this software for myself, and then it turned out a million people wanted it exactly how I originally envisioned it.”

    Well, this could be me. Not a million customers but not far from and in over 152 countries. Originally not built for me but for my girlfriend.

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  • David Goldberg

    “At least I had nights and weekends to myself”

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  • http://twitter.com/christianstrang Christian Strang

    “I never doubted that my project would be a success”

  • Kevin Moran

    #1 one reason for our success – Stealth Mode.

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  • Xavier Morera

    I didn’t read the subject line, just jumped into the content. I started to think “well… this guy is pretty much contradicting himself…”

    Then I saw the subject line :)

    • http://blog.asmartbear.com Jason Cohen

      Especially funny since many people read the subject line, then assume what the content says, and then argue against it on HackerNews. :-)

  • Simon Rowland

    If I could do it all again I wouldn’t change a thing!

  • robert

    Mastering the Rockefeller Habits made me rich

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  • Su

    As soon as this app is up it will take care of itself and I can get on with building the others, I’ll have plenty of time and money to do so.

  • Jd

    The easiest way to get things done is to hire employees.

  • FooBar

    Props for commending “moral sensibility”.

  • http://twitter.com/susakajo Susakajo

    Thank God for Sarbanes-Oxley. Just as we got going, we really needed those extra 7 accountants and second auditing firm in place of the R&D and manufacturing staff the funds would have been used for.  Yessirree.

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