

What I Learned From My Startup Failing - ChristianPerry
http://snapsummit.com/conference-news/7-things-i-learned-from-my-startup-failing/

======
9oliYQjP
You're giving up after less than a year? I have a rule of thumb. I think that
If you want to start a startup, make sure you're willing to devote at least 3
years to getting it going. Otherwise, don't bother. It's difficult enough to
get a business off the ground at all, without trying to do so with an
extremely tight time constraint. A corollary to this rule I suppose is that
you should ensure that you have 3 years worth of resources and motivation
before deciding to take a gamble on a startup.

I know it's easier and quicker to create a web startup today, but remember
that you are still ultimately interfacing with the rest of the world. The rest
of the world still moves at a rather leisurely pace. A lot of successful
companies really don't start taking off until the third year of business. The
rule of thumb is that for the first year, you're usually losing money. By the
second year, you're hoping to break even, and by the third, should the
business prove to be viable, you start making a profit. Even in the case of
technology companies where this does not hold true nearly as much, there
should at least be a parallel resemblance to this trajectory. Instead of being
profitable in year 3, perhaps a technology startup begins to generate revenue,
or is cash flow positive. The key characteristic is that in year 3, some sort
of inflection point for success is reached.

If you don't hit this inflection point in year 3, you probably will never hit
it. It's safe to say that you gave it your all, and quit the endeavour. If you
do hit that inflection point in year 3 though, the proverbial sky is the
limit. But in my opinion, it really does take 3 years worth of effort to say
that you really put in a concerted effort.

Do you have the resources and will to give it some more effort? My advice to
you is not to consider your current startup a failure. Rather, visualize your
startup as a swimmer that's trying to cross a lake but has underestimated the
direction and flow of the current. So you're a bit off course from where you
need to be. The answer is not to give up on where you wanted to go, but
instead change your tactics and find another route to your destination. Maybe
it's longer, takes a bit more effort, and requires more time.

All the problems I see with Trogger are ones whose solutions are within your
ability to solve. To me, Trogger appears to be a Web 2.0 version of Usenet.
Except that it does not address any of the the problems that plagued Usenet:

 _The inability to prevent spammers from ruining the dialogue._

 _The fact that conversations in Usenet needed to stay on topic so that
finding conversations was easy, but in real life conversations seldom do and
people enjoy it that way. Reward tangents. People go off on tangents in
conversations because they want to remain engaged. They leave conversations
when they're unengaged. Why would you want people to leave your
conversations?_

 _The short history of the web has shown that protocols don't make much money
by themselves. You don't want to be the protocol of conversations on the
Internet. Instead, choose a niche and be the conversation for that niche. Look
at Stack Overflow as an example. If the Stack Overflow website was simply
released as a general discussion platform, I'm pretty sure the thing would
have tanked._

If I were in your shoes and I had the resources to survive for a little while
longer, here would be my abstract thought process:

1) Reduce the scope of the problem. You know what discussion boards
traditionally suck? Healthy living/workout ones. They're all sh*t, but there's
a lot of money in that market. Find a market like that and be THE forum for
that market, like Stack Overflow is for software devs looking for technical
answers.

2) With the scope reduced, take the opportunity to refactor the user
experience. Do you still need to integrate with Twitter and Facebook? If not,
cut out those features. Cut out everything you possibly can until you've
distilled the design down to the useful minimum. Then don't add features until
you start seeing your users really hacking the system to their needs, like
posting ascii diagrams to try to illustrate a point (e.g., if you did not have
an ability to post pictures).

3) The most important part... Everything you do needs to be thought of as
costing money or making money. Ideally your strategy involves trying to
balance a cost with a revenue generator. For example, simply to host the site
will cost you money. Instead of waiting for $1M to fall out of some VC's hands
into your lap, start thinking about ways to offset this cost. On the easy end
of the spectrum is ad revenue. Implement ads in a way that people are used to
and that will begin to make you some money. Then try to grow this revenue. On
the other end of the spectrum is trying to find sponsors. This task will be
easier if you have narrowed your scope in step 1 and are targeting a specific
market. For example, if you decide to become the ultimate discussion place for
plastic surgery, Google plastic surgery and find out who's buying up ad words.
Find a way to get in contact with them and offer them the ability to sponsor
your website for a fee.

Now, whenever you go to implement a feature you can ask yourself the question
"Will this feature make my users happy and cause them to use the website more,
thus making sponsors happy or make me more ad revenue?" If not, don't
implement the feature. If it will just make them happy but won't make them use
your website more, don't bother doing it. It's amazing what this distinction
can have in making a business a successful one or not.

~~~
diN0bot
re: walking after a year:

this is curious to me. on the one hand, success can spring from numerous
failures, the numerous implying fast! imagine the inventor always inventing,
multiple projects at once! a new one every week!

on the other hand, success can spring from committment and dedication. stay
focused, don't give up.

i'm not refuting your points--in the end, one has to be smart, strategic. go
all out in the right way.

~~~
mcav
You're an airplane pilot trying to get your bird off the ground. You have to
attain a certain velocity to succeed. If your runway is short, you'd better
open the throttle wide -- and if it isn't working, you have to decide pretty
quickly to give up and try again.

But if the runway is longer, you have more time: continue building speed until
you have enough force to lift off.

You just want to avoid giving up when you had plenty of runway.

~~~
9oliYQjP
Much more succinctly put than I could have put it, but spot on! The problem
I'm seeing is a greater number of pilots that think they're flying Harrier
jump jets when they're really piloting Cessnas :)

------
mbrubeck
_"Companies succeed with single founders all the time. Just look at Digg,
Craigslist, eBay, Netflix, Wordpress, Wikipedia, Amazon, TechMeme, PBWiki,
TechCrunch, TechMeme, and Etsy."_

Is this true? I know it's hard to define "founder" precisely, since some co-
founders may get involved after the idea is partly baked, or may not have as
much of an impact. But several of these seem to be questionable. (And Techmeme
is misspelled... twice.)

<http://en.wikipedia.org/wiki/Wordpress> \- "It was first released in May 2003
by its co-founders Matt Mullenweg and Mike Little as a (considered the
official) successor to b2\cafelog." (Or if you meant Wordpress.com /
Automattic, it also has multiple co-founders.)

<http://etsy.com/about> \- "Etsy was founded by Rob Kalin, Chris Maguire, Haim
Schoppik and Jared Tarbell in June, 2005."

<http://en.wikipedia.org/wiki/Netflix> \- "Netflix was founded in 1997 in
Scotts Valley, California by Marc Randolph and Reed Hastings, who previously
had worked together at Pure Software, along with Mitch Lowe."

<http://en.wikipedia.org/wiki/Digg> \- "Digg started out as an experiment in
November 2004 by Kevin Rose, Owen Byrne, Ron Gorodetzky, and Jay Adelson."

<http://en.wikipedia.org/wiki/PBworks> \- "PBworks (formerly PBwiki) is a
commercial collaboration service created by David Weekly, with Ramit Sethi and
Nathan Schmidt joining shortly thereafter as co-founders."

<http://en.wikipedia.org/wiki/Wikipedia> \- "Launched in 2001 by Jimmy Wales
and Larry Sanger..."

~~~
ChristianPerry
You're right -- "founder" is a tough measurement. A lot of times -- as in the
case of my own company, RFOP -- one person starts a company, sees a bit of
success, then quickly brings on a small group of peers who join with the "co-
founder" moniker.

As a company grows, it quickly evolves from a solo effort to (some variation
of) a team effort. This can mean bringing on employees, or people who join as
"co-founder." At PayPal, for instance, more than a half-dozen of the first
employees were accorded "co-founder" status, which is why the company appears
to have so many.

Further complicating the matter, many companies change their story after they
reach success, presenting a company as a joint effort or team project, rife
with co-founders and collaborators, when the truth is closer to one visionary
bringing an idea to life, and assembling a team thereafter.

For instance, Digg. I was at a dinner a few years ago and had the pleasure of
sitting next to Owen Byrne, one of the people mentioned above. Owen wrote the
original code for Digg. He told me that Kevin Rose found him off of ELance.
Until then, he was a fairly unknown Canadian programmer. His success has
surely increased since taking on what started as a $2,000 contract gig, but I
hesitate to call him a "co-founder."

99 times out of 100, companies build teams in order reach success. However, in
many of those circumstances, that kernel of success starts not with a small
team reaching consensus, but a single visionary with a single vision.

~~~
ojbyrne
Obviously I'm biased, but Kevin had little if any vision other than finding a
new job. And he was much less known then he is now, after a careful, well-
crafted and expensive PR campaign. And yes, I was an "unknown coder" but also
an MBA, Ph.D candidate, and I spent years haranguing the business editor of
our local paper about how corrupt the news business was. Many people I respect
have summed up Kevin in a single word - "shallow."

And to reiterate, elance was not involved in digg. That also was part of the
PR campaign.

~~~
sireat
I remember getting one of those email postings from elance a year or two ago,
where it was explicitly mentioned about Digg being started through elance.
What is the real story then?

~~~
ojbyrne
That's impressive. I did do a couple of small jobs for Kevin nearly a year and
a half before digg, so I guess they can claim we were introduced through it.
But there were so many new fees and restrictions on providers that it was just
a nightmare to use by the time digg appeared, that I had moved on.

------
EvilTrout
_When you’re met with confusion, doubt, and dismissal, it’s time to
reevaluate. The world, collectively, is smarter than you are — pay attention
to it._

I learned exactly the opposite from my startup. I was met with blank stare
after blank stare as I explained my idea over and over.

As it turns out, if you are going after a non-mainstream market as I was
(Internet culture), you're going to get this reaction a lot.

Okay, so my startup isn't huge. But it pays for itself and my modest salary.
It's been 3 years now!

~~~
patio11
This works across the niche spectrum from "Internet forum trolling simulation
game" to "bingo card creation software". _Customers_ validate ideas -- the
opinion of non-customers is irrelevant.

------
mrshoe
_4) Talk to people and listen to them closely The world, collectively, is
smarter than you are — pay attention to it._

I feel like a lot of great companies would never have been built if the
founders didn't ignore a bunch of naysayers. That said, if you get your
product into users' hands early and often and nothing you do can persuade
anybody to like it, you're probably better off not wasting any more time on
it.

 _5) The fewer heads, the better_

I'm going to have to agree with pg and say that going it alone is a bad idea.
You need multiple, complementary skill sets. You need to balance out mood
swings. You need varied backgrounds and bodies of experience to provide
multiple perspectives on all the problems you'll undoubtedly face.

However, I can totally relate to the author when he says, "On many occasions,
I’d come up with a new, inspiring idea, only to get a knot in my stomach
before pitching it to my team."

I think it's important to cultivate a culture where it's perfectly acceptable
to throw crazy ideas on the table and get them shot down. In fact, I think the
more ideas you can burn through, the better. Creativity is an iterative
process. Often times your crazy, will-never-work idea will spark a brilliant
idea in the mind of one of your cofounders.

On a related note, we've found that getting a 3 person consensus on everything
is a broken model. For any given decision there should be exactly one person
responsible for making it. You can either divide up the problem space or you
can just defer to the same person on everything. We even decided to rotate who
gets to wear that hat every 4 months, to give everyone a chance and to make
sure we don't stagnate.

~~~
ChristianPerry
4) Yes, you're right. Naysayers do abound. I refer to the world's "collective"
opinion because, yes, it's all too easy to find a token naysayer who's eager
to shoot you down.

That said, once you have a beta out, or some kind of working concept, the
world becomes your sounding board -- where else, after all, will you get your
users and customers? While it's important at some point to ignore what people
think, it's just as important to keep at least half an ear open to their
thoughts and opinions. I believe that you can learn more by listening deeply
and attentively to people than by ignoring them.

5) As I said in the post, teams work for a number of people. They're one of
the most common structures for getting companies off the ground. In the case
of companies with strong technical needs, they can be particularly helpful, as
different people can bring different skill sets and perspectives that may
prove to be instrumental.

That said, I challenge the widely-held assumption that a founding team is
necessary, vital, or inherently "better" than starting a company by yourself,
and bringing people on later.

I hold that a single person, charged with focus and determination, can launch
a concept with speed and single-mindedness that's difficult to replicate in a
team environment. A team, despite the benefits it confers, adds added
complexity to decision-making, and can dilute an idea as easily as it can
rally behind it.

~~~
flooha
You can only bring on people later if you are successful, but becoming
successful on your own is so damn hard and psyche destroying, if you don't see
some success in a reasonable amount of time, you won't get there alone.

Do your next startup alone and come back and tell me if having two other
bright and motivated people standing next to you is a bad thing.

------
scotty79
Again repetition in short published list.
<http://news.ycombinator.com/item?id=834697>

"Companies succeed with single founders all the time. Just look at Digg,
Craigslist, eBay, Netflix, Wordpress, Wikipedia, Amazon, TechMeme, PBWiki,
TechCrunch, TechMeme, and Etsy."

------
christonog
1) Pick a problem and solve it.

Interesting, Christian never mentioned any of the "problems" Trogger wanted to
solve. It does seem, at first glance, that this idea was a solution looking
for a problem.

~~~
ChristianPerry
You're absolutely right. This was one of our biggest failing points from the
time we started. We built a cool, graceful, elegant solution... that
ultimately solved little.

------
12345678
i'm not sure what to make of my situation. i've been working at my small
business for a full 3 years now. i think the internet can make for a really
different start to companies now. i had great attention and great sales at the
beginning. then a huge lull because i changed the aesthetic and didn't realize
how much that would impact my sales. so i changed it back and again sales were
good. the the recession hit. and sales have been terrible. i'm still getting
items up for this season and will see how that goes. but the area of the
market i occupied is not good for anyone right now.

so how do i assess all this? is this a keep going and wait it out thing? am i
failing or is it just the market.

i am now finally hurting for cash. i kep my overhead low through all this and
was strategic about material costs too. but now that isn't helping.

------
jwhitlark
I would really like to see a Tufte style graph showing: a) number of people
involved over time, b) % of time spent by each person, and c) profitability
for the same time period, with a wide range of failed and successful startups.

Assuming one could come up with a way to clearly display that information.

------
zackattack
This FailCon advertised on the blog looks like a terrible idea. Why are the
Meebo founders speaking? Meebo isn't profitable. There are only like two
people from profitable companies there.

------
ojbyrne
"Companies succeed with single founders all the time. Just look at Digg..."
Bad example.

------
Virax
OK let me tell you something.

You have no idea why your startup failed. It has relatively little to do with
the things you listed.

Your startup failed because you named it "trogger".

The name of a product, technology, website, whatever is critical for success.
The name "trogger" makes me think of "troglodyte" or "troll blogger".
Seriously, this is one of the worst names for anything internet or technology-
related that anyone could possibly come up with.

Please please please make sure that someone else chooses the name of the next
startup you work on.

