Archive for February, 2008|Monthly archive page
Is there something in the entrepreneur’s DNA that makes them more suitable for the journey or does the “right stuff” form during the course of one’s life? What attributes should one look for to recognize a winning entrepreneur?
Most angel investors or venture capital partners will tell you that one of the best predictors for assessing a start-up’s success is to determine whether the founders constitute a dream team. They look for leaders with the skills, experience, team cohesiveness, determination, and passion to build something.
I recently spent an hour with one of the most successful angel investors in Israel. His entire investment philosophy/strategy revolves around making investments based on the people factor. He says upfront that he has no clue about ideas and their chances for success. His decision whether to invest is based on the confidence he has on the entrepreneurs. During our meeting he said close to nothing and occasionally asked me a question. He very attentively observed me during the meeting constantly sizing me up. Did I mention that he is one of the most successful angel investors in Israel? I suggest all entrepreneurs adopt the same vigor when searching and selecting their co-founders.
For those following my journey it is no secret that I am investing a lot of effort in searching for complimentary high caliber entrepreneurs that share my passion and are ready to join me in a new [ad]venture. I am meeting different entrepreneurs each week from different walks of life (some are almost a different species). I still can’t come up with a refined list of attributes for finding the winning entrepreneur. My approach remains to rely on people I think are good evaluators of entrepreneurial talent. They filter and refer the entrepreneurs that they most respect. From that point it is a matter of mutual assessment, chemistry and finding a common purpose.
Over the last few weeks I have met with many start-ups who have asked me for advice on the user interface of their application. Rarely do they have the awareness that there is a difference between a user interface and a user experience.
Have you ever seen the “Pimp My Ride” show on MTV? The entire production is about taking standard cars and adding all sorts of crazy enhancements that result in a renovated one of a kind _________ (depending on who you are, fill this in with; piece of art or obscene mockery on wheels). It is all external and does not affect the engine or driving experience of the car.
Most web sites and applications do what I will call “pimping their user interface”. They have added sleeker buttons, menus that open and close like accordions, pop-up windows, changed their layout and color scheme, and added widgets. In most cases this is very similar to pimping your car since the changes are merely face-lifts to the look and feel of the application. The underlying human interaction with the application logic is not changed.
Creating a user experience or the human architecture of the way a user interacts with the application requires a much deeper analysis of the user to ensure the application design is centered on the goals of the user. I have worked with very few people that have the discipline and methodology to learn about the user, empathize with their needs and design a delightful user experience.
I had the opportunity to learn from the best over the last 8 years (Ruti Tamari, Ev Shafrir, Shane&Peter). Below is a summary of the methodology I now use. It is far from trivial and I keep learning each time I go through the cycle.
- Start by understanding the business opportunity or business problem that the company is trying to resolve (i.e. what are the accute pains points that you are solving?). Set business criteria for the user experience. What constitutes a successful user experience from the perspective of how the business will reach its’ objectives?
- Segment the users into different categories and select the target segment for the application. There might be a difference between users that interact with the application and users that benefit from the application or pay for the application (users versus buyers).
- Go observe users that fall into your target segment. Watch how they perform their tasks in their environment (office, home, factory floor, field, etc.) and learn their frustrations.
- Build personas for your target users. Personas are vivid descriptions of the target users that represent the target segment and are real enough for everyone to picture.
- Create end to end scenarios of what the target segment is trying to accomplish and use cases specifically depicting how they are completing their objectives with the application.
- Sketch or mock-up the screens showing how the user will complete each use case.
- Get feedback from users on the mock-up.
- Iterate on this process. Don’t try to get it right the first time. It took hundreds of iterations for the iPod to reach its final stage.
Feel free to list any sites or applications where you think the user experience is superior or poorly designed.
There is a lot of talk regarding whether the technology industry (specifically Internet) is heading towards another bubble and whether the US economy is on the verge of a recession. Since I have enough worries, I have decided that these macro fear factors are not the concern of anyone trying to launch a start-up. By the time you are ready to go to market with a new solution the economy should be coming out of its’ predicted slump. In fact, some argue that starting a company during a recession is ideal since it positions you to ride the market on the upswing.
The bubble that worries me is the one that I create for myself. As I ideate and imagineer through different business opportunities I often wonder just how disconnected I am from reality. I find it impossible to come up with a game changing disruption if you are too closely coupled to today’s market situation (i.e. listening too closely to what customers want TODAY). That rationalization gives me the freedom to think about new approaches to solving customer problems. But how do I know that I am not inventing a bubble (i.e. really cool solution that no one wants or needs)?
Here are some bubble reduction methods that I have collected along the way:
- Good solid dependable research: one of the best ways to try to predict the future is to gather data on your target market. Initially, start with qualitative data (interviews, focus groups) and then quantitative (surveys, statistical analysis, & trends).
- Throw it out there: The technology barriers to build software have become so low that it is often cost effective to create a reduced alpha version, offer it for free, and get live feedback from your target audience.
- Sell it before you build it: At my last start-up I sold the system using a PowerPoint presentation and a mock-up. The question I had to deflect was “how many lines of running code do you have?” I can’t remember what creative answer I must have given them since we had none. At any rate, we knew we had something good when someone was willing to pay for it and then we went ahead and raised money to built it.
If you have some other suggestions let me know. Having your bubble popped after months of hard work and dreaming is not fun so I would like to find as many venues as possible to ensure we have a winner.
[this 30 second clip completely captures the essence of this post so I couldn’t resist]
I am a type “A” personality. What does that mean besides the fact that I can be a pain in the ass?
I like setting big hairy audacious goals (BHAGs) for myself but I absolutely hate failing. In fact, I sometimes wonder whether my fear of failure is greater than my will to set BHAGs. The simple solution is to set small measly goals (SMGs) that you are sure you will attain. This is one way to eliminate the risk of failing. Just imagine – never having to deal with failure…
What separates the dreamers locked in their world of imagination from the rock stars, Olympic medalists, bestselling authors, astronauts, and Nobel peace prize winners that find ways to materialize their dreams? Skill is involved but there are hundreds of millions of talented people in the world and very few that attain stardom. I think the difference is in the courage, and longevity to try and try and try again while maintaining the optimism that at some point there will be enough luck to ride you through to success. And when that success happens it will dwarf all failures.
Just do it!
How do you find the next big idea for your venture?
This question is daunting and overwhelming. I assume there are as many approaches as there are entrepreneurs. I know an entrepreneur that found his idea while watching the Shopping Channel. I have a friend who found his idea while high on weed [kids - don’t try this at home]. And, I know some lucky folks that found their idea while working at their previous company. I unfortunately don’t fall into any of the above. I am among the folks who rely on methodological approaches to identify and assess potential opportunities.
This week I was asked by SAP’s Corporate Strategy Group to identify major trends and technological or social disruptions that could warrant new lucrative investment categories for the company. It got me thinking whether this was the right approach for entrepreneurs to take as well. SAP has the company power (market position and deep pockets) to watch, select, and then act on trends. Entrepreneurs on the other hand need to get in front of a trend and then ride it. Coming late to a trend increases the risk of becoming obsolete.
I therefore believe that entrepreneurs are best served by identifying a huge pain point or problem facing a market segment that does not have an adequate solution. Trends and disruptions come and go and are hard to predict. In most cases customer pains/problems are a constant and stand the test of time. Make the selected pain/problem an anchor for your company. Trends and disruptions will become the means to solve the problem and will change as the business grows.
Therefore, my suggestion is to first start by identifying the problem you want to address. Figure out whether:
1. it is a big enough problem worth solving (measured in economic/social/political reward)
2. you are passionate about the problem and the selected market segment
3. your team has an unfair advantage in how you solve this problem
Only then proceed to evaluate all the trends and disruptions that can be leveraged to help you solve the problem.
I would much rather be in a business that is solving a mission critical problem to a person’s existence or a corporation’s goals than be in the business of offering a unique and innovative trendy approach to enhancing how something is done.
For more reading on this topic check out Jarkko’s blog