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Ineffective Entrepreneurship: Post-Mortem of Hippo (effective-altruism.com)
82 points by Gormisdomai on May 24, 2018 | hide | past | favorite | 50 comments



> The work I was doing for Hippo – designing the product and talking to users – I was able to do much quicker than David was able to build the product (he had a normal developer job).

> I think my particular mistake was probably being too optimistic about how much development work David and A would and could do. I should have been more critical of our development productivity and not given them so much of the benefit of the doubt.

Developers: Don't work for these people. This is why it is so important to donate your time to people who are serious. Do not give your time to backstop someone's else fantasies of doing something "important" or getting rich.


I’m a developer, and I will say that the fact that the guy took 2 years to make an incomplete app to show different pieces of text, shows that the developer was not very serious either.


I think all the model of modern startup culture is suboptimal but widely spread and so considered the only possible scheme by literally everyone. Couldn't we imagine the case when not enterpreneur dictates 'what to build' to developer, but exact opposite of that? Developer knows what he is going to build, and just hires marketing-minded guy for legwork wrt funding, marketing, and other extrovertial stuff - for the same little wage and stock options as it's done usually.


This happens, and you could argue is how Google and Microsoft got started.

In practice though, knowing WHAT to build is at least as important a skill as HOW to build it. Things an engineer wants to build are not necessarily things a customer will buy. So starting with someone with understanding of the market is probably more likely to bring success.


The question is who is the boss. And almost always it's the marketing guy, we usually call him enterpreneur. I don't think this model is good or bad per se, I'm just talking about maybe, just maybe, it's not supposed to be like that everywhere every time.


Agreed, this is the prototypical "non technical founder" that is primarily an "idea guy" and can't focus. Gives a bad name to all founders who aren't primarily engineers.


Non-technical founder isn't the real problem here, it's a non-skilled founder. I wouldn't have a huge problem working with a business/marketing oriented founder, as I know I lack those skills. However, this is a founder working on a moral philosophy PhD, who apparently could only interview people and come up with pie in the sky ideas. I can't blame the developers for not taking this seriously.

Plus, this isn't even a great idea, it sounds like a pitch for a silicon valley joke. Who wants an app to randomly nag them throughout the day to enter information to determine if you are happy or not. And his ideas for making you happy are telling- offer to watch a TED talk?

There's nothing wrong with being non-technical, but you have to be able to bring some sort of value. Same thing as the common advice for indie game devs: your game idea is worthless, we all have at least 5 ideas kicking around. Show me a basic implementation, or some nearly-finished art assets, or at the very least a compelling business plan with data to back it up.

Edit: this was maybe a bit harsh, I think his developer should share some blame here too. 2 years of part-time work and they were having trouble sending random push notifications? Aside from the random timing, sending a push notification is essentially android's hello world project. If you aren't interested in working on the project, then say so, don't pretend you will and then not do anything.


Right, as clarification the problem wasn't that he was non-technical. However because he's non-technical, he reinforces the stereotype of the non-technical founder as scammy con-artist, giving actually talented founders who are great at sales or strategy or operations a bad name.


This is full of classic early stage business mistakes.

- Married to the "how": app, app, app, app. It didn't have to be an app. You wanted to use technology to make people happier. There's a lot more technology than apps.

+ talking to users: well done!

+ reaching out to potential customers!: really, well done!

- not following up with customers: face palm. But that's ok, talk to another one and keep in touch!

- not using customer agreements to raise money for product dev: you should have used the banks agreement to a trial to help fund developement. The bank could have sponsored the initial build! You could have raised a little money from people based on that. Gone to an accelerator, it didn't have to YC.

- started a PhD: focus!!!! Argh. Now you're just going to half ass both.

- couldn't develop product faster enough: perhaps you needed a more experienced developer? Maybe you needed different tech. Because you were basically building a business off the back of a favour, you were pretty stuck though. You can't fire a favour.

- 9 months to launch an Alpha: this is too long to wait to get a simple mood tracking app into alpha. It didn't need to be anything more than that at this point. The fancy can come later.

- let's use ML!: NO! You do not have time for the distraction. Unless you're going to use the Hype train to raise funds.

- not useful, technical issues: fix them?

+ apply to YC: good, seeking mentorship is probably a good idea :).

- only apply to YC: all your eggs in one basket is not a good strategy.

- still struggling to articulate the idea: what did you tell the bank? That seemed to work. Mayhaps you're a little dissolusioned? Take a break tbh.

Generally great approaches, I think if you were to try again a few times you'd make it. It's evident that you have some of the right mind set to make it work.

I think you gained a fair amount of CV worthy skills and experience tbh.


This is like me who knows nothing about making music, convincing a bunch of actual musicians to create a band, not pay them, come up with a vague idea for an album and then send them e-mails every other week asking about progress, and then calling myself a failed band leader when they go off and get actual jobs.


One thing that really struck me was this comment:

> Stardom and riches beckoned! I could practically see my face on Wired magazine.

Many years ago I worked with a sports psychologist and one of the things he impressed strongly upon me was that you don't want to get caught up in dreams of the end success. The reason being that your mind can't always clearly tell the difference between the real endpoint where you can kick back and relax and the daydreams of that end point. As a result if you spend too much time dreaming about what it will be like at the end you risk getting disengaged because you've created a situation where your mind might think you have already made it more than you really have.

(Hopefully this paraphrasing gets the idea across)


I have deep respect for this entrepreneur because it is so damn easy to theorize impact/success in one’s brain and masturbate over pure thoughtstuff. It’s a whole different story when the rubber hits the road and so I really appreciate the author sharing their story. The parables to one’s personal life are impeccable.

The “Hippo” irony comes from a story from the incredible Ernesto Sirolli:

“SIROLLI: It was a project where we Italians decided to teach Zambian people how to grow food. So we arrived there with Italian seeds in southern Zambia in this absolutely magnificent valley going down to the Zambezi River. And we taught the local people how to grow Italian tomatoes and zucchini. And of course, the local people had absolutely no interest in doing that so we paid them to come and work, and sometimes they would show up. And we were amazed that the local people in such fertile valley, would not have any agriculture. But instead of asking them how come they were not growing anything, we simply said, thank God we're here. Just in the nick of time to save the Zambian people from starvation.

And of course, everything in Africa grew beautifully and we had these magnificent tomatoes. In Italy, a tomato would grow to this size. In Zambia, to this size. And we were telling the Zambians, look how easy agriculture is. When the tomatoes were nice and ripe and red, overnight, some 200 hippos came up from the river and they ate everything. And we said to the Zambians, my God, the hippos. And the Zambians said, yes, that's why we have no agriculture here. Why didn't you tell us? You never asked. I thought it was only us Italian's blundering around Africa, but then I saw what the Americans were doing, what the English were doing, what the French were doing. And after seeing what they were doing, I became quite proud of our project in Zambia because, you see, at least we fed the hippos.”


There's an intersting nugget :

>>> Failing unremarkably can happen and is something you should consider as a possibility. If I were to claim I had built career capital as a result of my 2.5 (mis)adventure, I would be deceiving myself. As it is I walk away with no cool story, no CV points. At least if I’d blown some money (mine

That's real failure.


While it is pretty easy to think of things to criticize with this article and the author's strategy, I admire the willingness to share stories of failure. It's an interesting contrast with several stories I've read recently about Elizabeth Holmes and Theranos, the startup that had an idea that didn't work out, that wouldn't quit, kept getting money, kept doing whatever it took to keep trying, and ended up resorting to deception. There is something to be said for the honest admission, "this isn't working, it's time to stop and try something else." Getting lots of money invested in your idea may make it harder to admit when you need to try something else.


I loved his 'the Mom test' link to Rob Fitzpatrick's 'how to get feedback when your customers are lying' video [0]. It reminds me of an old Jakob Nielsen post about user testing. You need to watch users actually using the product without your help, but you can probably get away with only 5 users [1].

[0]: https://www.youtube.com/watch?v=O_xjb7LB7VY

[1]: https://www.nngroup.com/articles/why-you-only-need-to-test-w...


I am extremely curious what they were actually trying to build, because as described it sounds like the sort of thing I'd expect to take at most a few months as a side project.


Though this was concerning the company who handle our home insurance, also a startup named Hippo, who are great. Thankfully not!


As a developer it's pretty easy to laugh a little condescendingly at the naivete and the missteps outlined here. However I think it's worth pointing out even skilled developers have their own version of this where they spend months or years churning on code that never produces any value because they are scared to ship and face real user feedback.


Oddly enough, my friend and I were looking for almost exactly what Hippo is offering. I guess the market is too small and not flush with cash for something like this to exist? See requirements here: https://softwarerecs.stackexchange.com/q/45070/2134


Seems like maybe the lack of random nudges during the day was the biggest missing piece here? Maybe the founder could have hired someone for minimum wage to just manually send these notifications on a schedule and send the recommendations. Scale with more cheap labour as necessary until you finally have the fancy ml automated solution


If you like this article, you might also enjoy this one by the same author: http://effective-altruism.com/ea/yv/is_effective_altruism_ov...

"TL;DR version: Mental illness is probably much worse than poverty or physical illness. Interventions which change how people think - i.e. reduce mental health and increase happiness - may be more cost-effective ways of increasing happiness than AMF or Give Directly. I outline some new opportunities EA should look into."


Reduce mental health?


He couldn't have meant that, that would be crazy.


<rant>

Why do millennials think that working on a side project for a short while constitutes a start up or being an entrepreneur? You had a vague idea, worked on it for a while and it turned out to go nowhere. There is nothing wrong with that. But it was just a side project and not a start up. It certainly does not make you an entrepreneur.

By that definition I have had a dozen start ups and almost every programmer I know must be an entrepreneur. When did the bar get so low? Is no action too small for self-aggrandizement?

If I write a blog post I am not suddenly a published author. If I give $20 to a homeless person I am not suddenly a philanthropist. Helping a friend with some code does not suddenly make me a professional teacher.

Millennials, get over yourself.

</Rant>


I agree that this is not an exceptionally insightful blogpost.

With that in mind, wrapping this in <rant> tags is a lot like being the person who says "I apologize in advance if I act like an ass today but..." It doesn't matter how that person prefaces it, they're still an ass. Extending empathy and understanding to your need to rant requires of us the same level of effort as the inverse: you extending some understanding to a group of people steeped in a culture of entrepreneurship-as-the-everyday, and understanding why that might not mean "self-aggrandizement" but instead mean "the way people I know talk" in a very benign, even banal, way.

>almost every programmer I know must be an entrepreneur. When did the bar get so low?

Probably before you were born. See the old quote about Americans being a country where everyone walks around thinking of themselves as "temporarily embarrassed millionaires". The word choice has changed, but the sentiment is nothing new.

Past that, you made me think critically for a while about the question "What if the people, who require temporary ego inflation to consider taking action, stop giving themselves that luxury?" and after some contemplation, I hope they don't stop. I hope they keep on keeping on. I also hope (as you do) that they will be a bit less insufferable in how they describe it afterward. But I don't want them to stop trying.

Besides, Side Projects are Never Successful anyway: https://www.youtube.com/watch?v=ch3oW550adA&t=3m39s


No real Scottsman!

What is a real entrepreneur then? Someone who quits their job and risks everything to fail?

You don't have to do that anymore for businesses with basically 0 startup capital requirements, > 90% margins and minimal time commitments ala software.

Are you calling for the classic starving artist entrepreneur who struggles through hell to build their business?

People don't always need to dance like that sort of monkey anymore, please stop demanding the weird masochistic performance porn. Working your self to a lonely death is no longer cool and shouldn't be again.

I'm sure you have other criteria that we must meet to be true entrepreneurs though. I'd love to hear them!


> businesses with basically 0 startup capital requirements [...] and minimal time commitments ala software

I don't know what world you live in, but in mine, new software takes a lot of time to write, or a lot of money to pay someone to write it.


I live in world where I can write the MVP to prove a business case in a week after / before work, sometimes with no code!

Edit: My MVPs may not meet your requirements for new software. They will not be all singing, all dancing. They will do some tiny slice of core functionality that allows me to prove the value of technologies application to the problem. Often with serious manual intevention.


An MVP is not a business.


I struggled to answer this without derogatory sarcasm.

I agree, an MVP is not a business. I would not expect that a business would be built in a few weeks or even months. My personal experience with businesses is that they take years.

But we're not talking about building a business. You do not launch an MVP and call it a business.

I was specifically talking about proving a business case for a solution that could turn into a business. This is precisely what the things we call 'MVPs' are mean't to be for.


> But we're not talking about building a business. You do not launch an MVP and call it a business.

Then what exactly were you talking about when you wrote this:

> businesses with basically 0 startup capital requirements, > 90% margins and minimal time commitments ala software.

?

> I was specifically talking about proving a business case for a solution that could turn into a business.

At that point, however, you do not have a business. And you're not an entrepreneur.


It's evident that you have no wish to change your mind and honestly, I have no wish to change mine.


An MVP is a Minimum Viable Product. What you describe lacks lacks both the "V" and "P" parts.


What is you're requirements for:

* Viable? * Product?

My requirements are:

Viable: Someone will use it. Product: Someone will pay me.


There's a lot of truth to what you're saying even if its a "get off my lawn Millennials!" rant (I'm guessing you're Gen-X?). I've known Gen-Xer's with this attitude and know many Millennials that call a side project a side project, so the generational slant to your rant is a little off.


What has this got to do with Millenials? Most of the young people I know nowadays are effective, professional, engaged, interesting. They, perhaps, share some foibles connected to the fact that they grew up with always-on internet, but they're not a heaving mass you can just foist your frustrations on.


Right? I don’t want to be a dick, but I don’t know what exactly the author was thinking. He seems upset that he didn’t get much developer productivity out of people he didn’t pay; well, what did you expect?

I don’t even know what he added to the project. He sounds like one of those ‘idea guys’ who think the hard part of a startup is thinking of features. No, the hard part is executing.


Reminds of that article posted here a week or two ago about the jet set entrepreneur types, outsource all your work to the cheapest possible option while you sit on a beach drinking mojitos or more likely whine in a blog post about how your start up failed.


You're being harsh, or we did not read the same piece.

While, towards the end, the OP briefly refers to his efforts as "a startup" I think he was pretty clear that he was mostly trying to get to a point where he could __start__ a startup.


This has nothing to do with millennials. I am 44 and there were and are plenty of people in my demographic cohort sharing these characteristics.


From a brief glance, the protagonist here is white, male, a philosopher and a Michael. To attribute something you don't like about his statement to his age (as opposed to his race, gender, philosopheritude or Michaelness) is a statement about yourself (and possibly your idée fixe). It has little to do with the piece or person you're commenting on.


What the heck do you mean by "Michaelness"? Michael O'Church-esness, the snowflake who used to rant here about how The World fails to reward his outstanding talent?


It's a randomly chosen characteristic that may or may not have any causal relationship to what the commenter didn't like about him. Just like age.


>>> working on a side project for a short while

imho, it has nothing to do with the time you work on it. Some people are blessed with "the good idea" and get the opportunity to hack they way from a side project to real entrepreneurship.


Why entrepreneur is such a valuable term for you?


meh. my side project turned into a venture-backed startup. Am I allowed to call myself an entrepreneur now?


You are only an entrepreneur when you take and gamble with the money of an investor.


Shrug It's a fad. Like using MongoDB or the gold rush. Just position yourself for consulting/selling pick axes and jeans.


Hello! As the person who wrote the post (but didn't put it here and only just found out someone else did) I found the fact you were annoyed at me for claiming to be an entrepreneur confusing. I found it confusing because as at no point did I claim that.

The title of the post is "... the app that never quite was" and the first line of a post states "I spent I spent two and half years trying to start a startup". The story is how I spent loads of time, failed to succeed in any interesting way, feel kind of embarrassed about it, and want this to be a lesson to other "asipirant effective entrepreneurs". Note the use of 'never quite was', 'trying', and 'aspirant'. I'm not sure I could have told my story of non-failure (failing even to fail) in a less aggrandising way.

I welcome your suggestions on this last point, if you have any.


The headline I see on your page is "Ineffective entrepreneurship". While I disagree with most of what grandparent said, it does seem like a fair response to that headline to say: you weren't an ineffective entrepreneur, you were a non-entrepreneur, and maybe you would have been more effective had you been more entrepreneurial.




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