
Mistakes we made in our company’s first 8 years - brennanm
https://hackernoon.com/8-mistakes-we-made-in-our-companys-first-8-years-3d38422333b
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jldugger
I'm reminded of the story of Abe Wald: [https://medium.com/@penguinpress/an-
excerpt-from-how-not-to-...](https://medium.com/@penguinpress/an-excerpt-from-
how-not-to-be-wrong-by-jordan-ellenberg-664e708cfc3d)

He ran a statistics office during WW2, and collected data on surviving
airplanes. To paraphrase his findings: reinforcements don't go where the
bullet holes are. They go where the bullet holes _aren’t_.

Similarly, when none of these mistakes killed the company, so to the extent
that all companies are the same model of airplane flying in unfriendly skies,
they shouldn't consider these mistakes necessarily existential.

~~~
rwallace
Very good point! But keep in mind one difference: unlike crashed planes,
crashed companies tend to leave survivors who can tell the tale.

So maybe read post-mortems of failed companies - and worry most about the
reported mistakes that do _not_ also show up in post-mortems of successful
companies.

~~~
rhizome
I wonder what's the incidence of non-disparagement/disclosure clauses in
severance packages.

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Stratoscope
> _Most things in life are win-lose — someone gains, and someone loses. But
> networks are one of the few things that are win-win._

That's one of the saddest things I've read all week, and I think profoundly
wrong. Does one party or the other really lose in _most_ things in life?
Surely it must be the opposite - both parties in a voluntary transaction or
interaction have gained something by it.

I once had a friend who explained a similar idea this way: "There is a fixed
amount of wealth in the world. Whenever anyone gains wealth, it always means
that someone else has to lose wealth."

~~~
mathattack
In economic theory, every trade is beneficial for both parties. You have too
many cows, but need money and I have money and am hungry - you sell me a cow
and we are both better off.

Reality is a little tougher. You and I both run hedge funds. One of us thinks
Amazon will go up. The other down. One sells to the other. In a month, only
one of us has made money. Exactly what the other missed out on making.

Conversely, I sell shoes. You sell supply chain software. You sell me the
software for a million dollars. I save 20 million in costs. I want you to
improve the software, so I tell the world about my savings. You sell to ten
other customers, and I save another 20 million with improved software. Your
investors make money, as do your employees. We grew the pie and we all win.

I don’t know what the world is truly like, but I prefer pretending it’s the
latter.

~~~
zeusk
and what about the people/services that were part of the 20 million dollar
cost you reduced using that software?

~~~
api
If there is sufficient growth and economic diversity they can find different
and hopefully better jobs.

Would you want a job as a copy clerk? These were people who copied documents
by hand before copy machines were invented.

~~~
Stratoscope
Or a job as a computer:

[https://en.wikipedia.org/wiki/Human_computer](https://en.wikipedia.org/wiki/Human_computer)

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smoll
I really enjoyed this article, but calling "being sales driven, not product
driven" a mistake doesn't make any sense to me -- had they not made the call
to be unit-economics-focused, they might have gotten into some product-
perfecting rabbit hole and failed to generate the traction needed to actually
keep their company afloat. This is something I notice in a lot of articles
like this; they say "we should have done X instead" without acknowledging that
doing X would have exposed you to a bunch of unknown unknowns, any one of
which would have sunk you. I agree though that in general "make something that
people love" is sage advice, but using the fact that your company succeeded,
though not quite as quickly as you would have wished, as evidence for it just
seems invalid.

~~~
ransom1538
If you own a company ran by sales you end up going for short term gains. You
have to push back on sales requests that dont add long term value to your
company (value others want into the future). Companies often die in a feature
loop ran by sales that need a checkbox for their presentation.

~~~
smoll
"ran by sales that need a checkbox for their presentation" is a total
strawman. I think we both agree that being entirely sales- and short-term
profit-driven is a terrible strategy, but it is possible to have an
appropriately long-term outlook yet uncompromising about the unit economics
when the success of your business is still an unknown. Being sales-focused is
perhaps even a way to keep "what people want" in top of mind, and works
especially well for certain products/industries.

~~~
ransom1538
A strawman argument is when a person tries to disprove your point by attacking
a presented argument that you did not present. I was not disproving anything
you wrote. Eg. I didn't start with, "No that isn't correct, or actually I
disagree, etc." I was just stating something I thought. Someone replying
doesn't mean they want to argue or disagree. Personally, I feel people yelling
strawman (especially when they don't know what it means) really ruins
conversations.

~~~
rfrey
Sorry to contribute to a diversion, but that’s not how I’ve understood the
phrase (and to add argument-from-authority to the mix, I did grad studies in
philosophy). I understand a strawman to be an argument presented by the author
in a particularly weak way, so as to be easy to attack. The origin is straw
figures set up by medieval soldiers to attack while training... they never
fight back.

The argument doesn’t need to be put into your counterpart’s mouth to be a
strawman, just artificially weak.

~~~
ransom1538
The typical straw man argument creates the illusion of having completely
refuted or defeated an opponent's proposition through the covert replacement
of it with a different proposition

^ striaght from Wikipedia

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avinium
Usually these articles are nothing but fluff, but this was an interesting one.

I realize that's (ironically) a fairly empty statement to make, but I'm sure
the author will be pleased to hear it.

~~~
brennanm
Thanks!

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lifeisstillgood
>>> ... in purchasing SoapBox for the entire company. They’re an old school
business. 500M Revenue and 23 people.

Err, wow. that's 20M per employee ... I am astounded - is that real? 100,000
to 300,000 is common in consultancy style services, I mean even Google has
~100k people on ~100bn which is 1M per person

So really 20M per employee is stupidly "out there".

# google numbers - yeah ok I mean Alphabet, but more accurately 90k people vs
110bn but few years ago it was 40k vs 50bn so not changed much - ratio of
about 1.1M per seems consistent - and Google is rinsing the productivity
making the 23 people at 500M seem even more ridiculous. Maybe some obscure
fintech? maybe big revenue low income? would love to know more

~~~
anuragbiyani
It all depends. Instagram was ~13 employees when bought at $1B. WhatsApp was
like ~30-40 employees and bought at $19B.

~~~
shanghaiaway
Neither had revenue so it is not comparable.

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scarface74
Point #2 about being sales focus instead of product focused reminds me of a
town hall that Jobs had when he came back to Apple...

[https://www.inc.com/justin-bariso/20-years-ago-steve-jobs-
de...](https://www.inc.com/justin-bariso/20-years-ago-steve-jobs-demonstrated-
the-perfect-w.html)

 _The hardest thing is: How does that fit into a cohesive, larger vision, that
's going to allow you to sell eight billion dollars, 10 billion dollars of
product a year? And one of the things I've always found is that you've got to
start with the customer experience and work backwards to the technology. You
can't start with the technology and try to figure out where you're going to
try to sell it._

And doing the opposite led to the Apple Watch.

If Apple had been a smaller company, it wouldn’t have had the chance to right
the ship by version 3.

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rmason
The money quote for me was when he said:

"In today’s tech, you definitely want to scale your business with electricity,
not people. Let your people figure out how to do that."

Liked it so much I tweeted it.

~~~
mbell
I don't find that particularly insightful. The reality has always been that
companies which find the most effective way to either produce or consume
electrical power are the most profitable. Actually I'd argue that power
consumption per capita corresponds quite well with prosperity. If you want to
'win big' in the long run, do it in power in one form or another.

~~~
captain_perl
Whoosh.

By electricity, he meant automation with computers.

~~~
mbell
As did I. Google, Facebook, Apple, etc. have found models to convert vast
amount of electricity into $ via computing. My point was that this isn't a new
thing, it's been true for a very long time that the largest most successful
companies have found ways to either produce or consumer vast amounts of
energy. It was true of Railways in the 1800's consuming vast amounts of coal,
it was true of the steel conglomerates in the early 1900's consuming both coal
and electricity, it was true of telephone companies consuming electricity in
the mid 1900's and it's true now of computing companies consuming electricity.
Of course it's also why energy generation companies have been as large as they
have been throughout history. Overall point being: at a reductionist level
pretty much all major businesses boil down to either producing or consuming
energy, or helping other companies produce and/or consumer energy more
efficiently.

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sarreph
This is a really insightful article. However, I feel like point 2 somewhat
contradicts point 1. I.e. In my opinion, being product-driven often forces you
to _innovate_ in some way. I guess there is a balance to be struck here and in
the end it comes down to feedback-loops from customers directly rather than
pondering over what they may want to use.

~~~
ENGNR
I think he was saying evolution rather than revolution is a better business
strategy, when bootstrapping at least

~~~
brennanm
Ooo, I like that! I’ll use that phrasing next time

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smartplaya2001
I think in our startup we are at the part where we are making all kinds of
mistakes. We are Starting our third year next month however we are still
making mistakes.

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michaelrichards
Wow. This is spot on.

I am the CTO of growing startup and every single point resonated with me.

I wish I'd read this 3 years ago and heeded your advice.

~~~
brennanm
Awesome! Hopefully it helps the next person then :P

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typetypetype
Great article, especially point #1 on innovation vs invention. Good stuff!

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brennanm
Thanks!

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telltruth
My learning from this article:

1\. An app for 1:1s is a _real_ business!

2\. You need 30 people to run this business!

3\. Stay away from articles titled "M things for N things". You will find
pointless regrets like "Not trusting my gut". So what's the solution? Trust
your gut all the time?

~~~
brennanm
1\. Yup! Well, that’s a feature in it. It’s an employee engagement platform.

2\. Don’t need 30 to run this business. Have 30 to create the next iteration
of the business.

3\. Noted

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mtorres
Great article

