Introduction Cheat Code

When someone offers to make an introduction on my behalf or - as is more often the case - I ask someone to make an introduction on my behalf, I often write the intro email myself and email it to the introducer, suggesting that they use it as a template.

I do this because:

  • It lets me control the message somewhat and ensure that it is short/accurate.
  • It saves the introducer a few minutes of writing.
  • It just seems like the right thing to do, even though people don't usually expect it.

Do it.  People will use it.  And you'll be glad they did.

The Startup Soundtrack

I LOVE music.  And I LOVE (so far) starting a company.  The two obviously go hand-in-hand - I spend a lot of time at my desk blasting tunes while I churn through my to-do list.

So here are some of my startup workaholic jams.  I welcome your recommendations for more.

Eric
--

They just don't make 'em like Ronnie James Dio any more.

I find that the The Sword helps me endure Quickbooks.

Detecting a theme? Aggressive music drives aggressive growth.

Sonny Rollins for late night sessions.

Litterfin Louie

Check out my friend Habel's soon-to-be-released iPhone/iPod game Litterfin Louie.

From his site:

Eat junk. Clean up the ocean.

The ocean is being trashed by polluters! Help Louie gobble up the trash to keep the water clean. If you miss too much, the water will become toxic. Avoid obstacles and collect power-ups to get special abilities. Coming soon for iPhone and iPod Touch. Mmmmm... junk food!

There is a video of the game on the site.  Fun!

Prediction - HubSpot Will Acquire An ESP In 2010

The ExactTarget / CoTweet deal got me thinking...and here's one of many thoughts:

HubSpot is going to buy an email marketing service provider 2010.  And I have a few pretty good ideas of who it could be.

Here's why it is going to happen:

It is blatantly obvious. 

The guys at HubSpot have built a fantastic B2B lead management machine with some nicely integrated SEO, blog, and other content tools.  (And probably more - I'm not an expert on their platform.)

Email is the obvious missing piece.  I think HubSpot already provides customers tools for simple nurturing campaigns...but my hunch is that there remains MUCH room for improvement. (What about mailings that are independent of a lead form or the HubSpot platform?)

I also suspect that many of HubSpot's low/mid-tier customers would gladly dump their existing email vendor for a reasonable, integrated offering from HubSpot.

(Yes - email marketing kinda goes against the inbound credo.  But if you do it right, email marketing makes inbound marketing MUCH stronger.)

Email marketing isn't easy...

...and it certainly can't be dumbed-down into a grader.  (Zing!)  Deliverability, workflow, reputation, best practices, etc. all have a steep learning curve - both for the customer and the vendor.  The best email marketing apps are highly specialized and get all of the little details just right.

Instead of trying to build it all in-house, HubSpot would be smart to buy a platform and all of the email marketing product/industry expertise that comes with it.

They've got to keep pace.

Eventually, HubSpot will to start bumping into up-market vendors like Marketo, Eloqua, and Salesforce.com - all of which have very strong email marketing components, either native or through amazingly tight integrations.  Thus, it would take them a long time to build out a feature-complete email platform that is strong enough to compel marketers to switch from their existing vendor.

So they'll buy a mid-tier vendor, integrate the platform with HubSpot, happily accept the top-line bump from the new contracts, and make up a lot of ground with their biggest competitors - all in one smart acquisiton.

They're flush with cash.

HubSpot CEO Brian Halligan recently said that the firm's next financing round would hopefully come from public markets, which means that their last round came at a great valuation and gives them a nice, long runway to grow...a runway presumably lengthened by the gobs of cash they're raking in every month.

A $8M - $15M acquisition is certainly in their sweet spot.  And the list of email marketing vendors that match that profile is fairly short.

--
PS - Here's why it won't happen:

  • They won't be able to get a good price from a good ESP.
  • Despite everything I just said, HubSpot seems like a builder...not a buyer.
  • I'm just taking a wild guess.

Thinking About Markets And Startups - Part II

I published a mostly-baked thought regarding startups, products, and markets last week, largely driven by my prior experience as an early employee at Bronto Software.  Bronto CEO Joe Colopy added some detailed email marketing industry insight in a lenghty comment.

In summary, new products and new markets are funny things.  The first products to enter don't always win and neither do the products with the most whiz bangs.  Those that win usually do so because they nailed a target segment right from the beginning and/or because they zigged/zagged from their original thesis to follow the market and stay alive.  Financing certainly has some correlation to success, though I'm not going to do the homework necessary to figure out how it played out in the email market.

I took the time to think this through because I think that the social media marketing software market - the market we're trying to crack with Argyle Social - is following the same cycle:

The first market entrants are (correctly) targeting the top of the market.  That's where the money is and also the most obvious application of the core sentiment/monitoring technologies that hit the market first.  Not sure who the first entrants were, but my guess would be sentiment analysis vendors like Radian6, ScoutLabs, et al. and big, enterprise players like Vocus.

There are many apps in the market today and many of them are fairly similar.  The aforementioned sentiment analysis providers (basically) inhale the Internet and/or the Twitter firehose, search for your brand and/or keywords, and then apply some natural language filters to determine sentiment.  I have no idea what makes ScoutLabs different from Radian6 and I'm not entirely sure it matters.  (Interestingly, I've talked to quite a few people that use these apps...and no one has had a glowing review to share.  Pretty sure I know why.)

The first entrants are - for the most part - well funded and duking it out for the top of the market.  Radian6, ScoutLabs, VisibleTechnologies, et al all appear to be thriving, but they're all targeting the same set of customers.  Which is fine by me because it creates big, blue oceans in other parts of the market

Marketers don't know what they don't know.  For the bottom 2/3 of the market, email marketing apps solved problems by introducing a mechanism that created a workflow, presented important information, and - in general - made it a little easier for them to feel like they were doing a good job.  I think that social media marketers are in search of the same set of solutions.  They feel like they're on to something what with all of the blogging and Twittering and Facebooking and whatnot...but they can't accurately measure the impact of their efforts because don't have a decent set of tools to tie it all together.

...and all of that is a big part of the thesis behind the Argyle Social initiative.

Having said that, there are some BIG uncertainties in the market:

  • Speed.  The Internet moves fast, but innovation around the social channel seems to be moving extra fast.  We've got to get our app in the market and pronto, lest we risk getting scooped and thus lose a chance at picking up some quick momentum.
  • Dependencies.  It has taken me a while to get comfortable with the fact that we're building an app with critical dependencies on other web services.  It compounds our risk and makes it a bit harder for us to carve out a defensible nugget.  That said - all the cool kids are doing it.
  • Value.  Many might disagree, but I think that the freemium craze is fine for consumer apps, but nets out as a negative for the business market.  Lots of free apps leaving money on the table drives down value for the entire market.  And there are LOTS of free apps in the low/mid tier of the emerging social media marketing software market.

Note that I didn't list competitors.  That's because competition is good. 

And that's a post for another time.

Thinking About Markets And Startups - Part I

I started working at Bronto back when it was called BrontoMail.  Back when companies featured downloadable .pdf brochures on their website and everyone scoffed at GOOG's overpriced IPO...way before email marketing was an "industry." 

At the time, there were lots of players clamoring for position in an emerging market that we all expected would get big, fast.  (Turns out it did.)  Funny thing is that everyone's product looked the same and more or less did the same thing - especially from a "checking the box" perspective.  Every product could track clicks, de-dupe lists, dump data to .csv files, etc.  It wasn't rocket science, even though it seemed like it at the time.

The biggest differences between vendors - even though I would never admit it while on the phone with a prospect - were price and packaging.  The core technologies and product concepts were the same across the board.  Some vendors charged $25/month and targeted SMBs with ease-of-use and consumer-esque marketing messages.  Others charged $2500/month and targeted the top of the market with high-powered marketing speak and brand name customers.  Others tried to find their way in between. 

Fast forward to today.

Many of the names that mattered in 2003 are still around and thriving - ConstantContact (which IPO'ed in 2007), ExactTarget (which should IPO any day now), SilverPop, Responsys, Cheetah, and of course Bronto - which mattered to me at the time, but wasn't big enough to matter in the broader email marketing software conversation.

Several other names that mattered in 2003 are MIA - CoolerEmail, iMakeNews, Topica, and probably more if I really thought about it.  If I recall correctly, CoolerEmail was actually one of the first to productize email marketing software.  So much for a first-move advantage.

So why do some players win and some players lose early markets?  I can think of three reasons:

1.) Financing.  Some companies started out with enough capital to out-spend, out-market, and out-last the competition.  

Some hung around long enough to get it right. Others hung around long enough to pay themselves nice salaries while they spent their company out of business.

I'm too lazy to do the legwork necessary to confirm my hunch, but I'm certain that many of the leading vendors in the market today started off with a healthy slug of financing.  Though I think it has MUCH less to do with their success than #2:

2.) Focus.  Some companies focused on a particular market segment and pounded it into submission.

ConstantContact dominated the $20/month segment in 2003 and it still does today.  It never wavered from a stripped-down, simple, easy-to-use product marketed with a "You can do it!  It is so easy!" message.

Bronto didn't have product/market focus in the beginning - we were happy being "a step up from ConstantContact...and less expensive from ExactTarget".  A precarious place to be.  The company finally figured it out a few years ago, re-focused the offering/message around ecommerce, and has been killing it ever since.  Turns out the middle is a tough place to be when it comes to marketing products - customers are either trying to step up their game with a better app or cut costs with a cheaper app.

3.) Fudge Ups.  Some companies just had bad products and/or poor execution.

Stay tuned for Part II when I explain why I think all of this matters.

One Week Down

The Argyle Company just wrapped up its first week at full strength.  A few lessons learned over the past couple months as we've taken the first steps of a (hopefully!) long journey:

Find a partner.  This past summer/fall, I spent a lot of time navel gazing in search of the right first steps toward a software start-up.  I knew the market I wanted to enter and even had a general sense of the product I'd like to build.  But I couldn't really articulate what I was thinking, let alone develop the product.  (I'm a seller, not a coder.)

My then-prospective business partner Adam and I started getting together and stuff just started happening.  The collaboration and accountability was like a shot in the arm after a period of wandering alone in the wilderness.

So - if you're looking to start something, I suggest that you start looking for the right co-founder as soon as you start getting the idea itch.

Don't delay the equity conversation.  Adam and I had the equity/role/expectations conversation over a series of meetings a couple months ago.  Awkward, but necessary...and also done pending some signatures on a handful forthcoming legal documents.  

It would have been really easy to delay the conversation, but it also would have been a mistake. Ownership is a sticky issue that you need to get right at the start.  Plus - it is just the first of many difficult questions that start-up founders will face.  So you might as well just deal with it and move on to the next one.

Regarding roles, we used HubSpot as a model.  Two founders - sales guy CEO and product guy CTO. Hopefully we'll have a fraction of the success that they've engineered.

Don't waste time with a business plan.  Business school is all about business plans.  The real world isn't. People don't read them and you don't have time to waste writing one.  Instead of planning your business, I suggest that you just start building it.

That said, you should definitely start writing.  I recommend that you:

  • Write an executive summary that can brief prospective advisors, etc. on your company. 
  • Blog to articulate your market/problem/product thesis and to generate search engine juice.
  • Set up a wiki to manage research, internal docs, etc.  Way better than doc files.

Put yourself out there.  Once you've refined your market/problem/solution thesis into an actionable nugget, start talking about it to anyone that will listen.  You'll be amazed by how:

  • You start to really believe in what you're doing.
  • You get better at articulating your thesis.
  • People are willing to help. 

Incubator Overload

This morning's LocalTechWire mentioned the launch of Appubator - the 4th new Triangle-based tech incubator I've heard about in the past few months.  Did someone start an incubator incubator?

Appubator focuses on wireless app development, so at least it is a bit different.  Add it to the following list of old and new technology incubators in the Triangle:

 

Valient Himself

It isn't everyday that the lead singer of your favorite band walks into the bar and says "hi". 

Kelly and I went out to the Reservoir in Carrboro last night to celebrate my friend Chris' 30th birthday.  After we'd been there for a bit, 3/5 of my favorite rock band - Chapel Hill-based Valient Thorr - walked into the joint.  Of course - both Chris and I recognized them immediately and, of course, we both started giggling with excitement.

Lead singer Valient Himself walked by and I greeted him.  And he reminded me that I owe him an email.  I had previously contacted him to commission an ink portrait, which was admittedly just a mechanism to get to meet him and hang out.  Pretty cool that he remembered/recognized me.

We caught up at the bar shortly thereafter.  Talked about how being the lead singer of an upstart (for 7+ years) rock band is kinda like being the CEO of a start-up.  (Ha!)  And discussed the importance of being your own man...and openly telling critics, detractors, etc. to eat sh!t - both literally (in his case) and metaphorically (probably more appropriate in my case).  And we talked about their new record that should release later this year...and how it is less metal, more funk.

Best of all?  Completely nice guy - friendly, appreciative, funny, and absolutely rock & roll.  And it was his birthday, too.

Valient Thorr is touring with Mastodon, Between The Buried And Me, and Barroness.  You should see them.  I'm going to the Raleigh show on April 17.  And I'm wearing my Thorrior armor.

You should buy their record Immortalizer.  You'll be glad you did.  I've been obsessed since the day I bought it.

You better live your life.
This ain't no practice round.
Don't stumbe off the path.
Cause it's a long way down.

Bill & Ted On Start-Ups

I LOVE Bill & Ted's Excellent Adventure - one of my favorite childhood movies.  I watched it for the umpteen millionth time this morning at Kelly's parents' house.  (One of the benefits of waking up two hours before everyone else is having unfettered access to the billion channels on the Stowe family television.)

This scene got me thinking:

My partner Adam and I are in the very early stages of something that we think has a chance to be big.  (Ahem!  Argyle - social media marketing software.) 

Much like Bill & Ted, we're really excited and certain of our eventual success.  Unlike Bill & Ted, we're not letting ourselves succomb to two classic start-up temptations:

  • Banking On Someone Else - Even though they seem to be pretty deadset on (and desperately need!) a new "hire" to elevate their performance, there's no way that Wyld Stallyns will get Eddie Van Halen to join the band.  Instead, they need to figure out how to start getting traction in their neighborhood, then on the San Dimas scene, and then on from there.  They're much more likely to recruit an "A" player like Eddie if they can show some momentum and a track record.
  • Hoping For A Big Win - Everyone dreams of a triumphant video and a quick rise to the top.  The reality?  That just doesn't happen.  The vast majority of overnight successes are the culmination of many years of pounding away in anonymity.

For now - the Argyle team is focused on learning to play our instruments and putting together a good set.  Everything else will take care of itself.

Party on, dudes.

Why I Broke Up With Kings of Leon

It was cool to like Kings of Leon in 2005.  Nobody had heard of them and the redneck Strokes sound on "Aha Shake Heartbreak" was really fresh.  You could buy a concert ticket for less than $10.  And they had this weirdo Pentecostal-white-trash background that made their music all the more mischevious.

It isn't cool to like Kings of Leon in 2010.  Kelly and I paid $40/ticket to see them put on a short, boring, ambivalent performance in Cary this past Spring.  They're on pop radio.  They probably wear really expensive blue jeans.  Basically - they've become the antithesis of everything that made them fun.

So I broke up with them.  Actually - I broke up with them the day I heard "Sex On Fire" on the radio.  Kelly will confirm.  We were in her car and the song came on Kelly's favorite Top 40 station:

  • "Is this Sex On Fire?"
  • "Yes."
  • "Well.  I guess that's that."

We'll always have the good times.  Their back catalog will remain in heavy rotation - "The Bucket" will remain one of my favorite songs and their 2nd and 3rd records will always mark fun times around 2005, 2006, 2007. 

They're still a great band and they'll still sell a gazillion records and gazillion concert tickets.  Just not to me.

(Note - I've had similar break-ups with Pearl Jam, Metallica, Modest Mouse, Son Volt, Ben Folds, Beck, and Weezer.  So pretty good company for KOL.)

Regarding John Edwards

I was in college from 1998-2002 - years in which the "we love John Edwards, the golden boy rising star of the Democratic party" hype hit a fever pitch.  He was elected to the US Senate in 1998, gave the (memorably bad) commencement address for my graduation in 2002, and more or less put North Carolina back on the national political map with his dashing charm, populist message, and rapid ascent within the Democratic party.

I had three friends from college that grew up in Robbins, NC - the hometown that John Edwards so frequently mentioned in his stump speeches.  At some point during my time as a UNC undergrad, all three of independently stated to me that:

  • John Edwards is a complete scumbag.
  • Everyone in Robbins hates him.
  • They are ashamed to share the same hometown. 

Turns out they were right.

Two Tips For Applying To Start-Up Engineering Jobs

My company is hiring a software engineer, so we've put together a job description and circulated it through free channels like our friends, local networking groups, Facebook, LinkedIn, Craigslist, etc.  We haven't seen as many applicants as we'd like, but we've seen enough to know that some software engineers need a lot of help when it comes to applying for a job with a start-up.

Two suggestions for your consideration:

Don't tell me what you've built - show me.
You're probably working on a product now, right?  How about a screenshot?  Or a description of how the product solves a business problem?  Or at least a link to your company's web site? 

Plus - every good engineer I've ever met has some sort of side project or portfolio of prior side projects/products.  Seeing your previous work will make me feel a lot better about your future work and make it obvious that software is a passion, not a 9 to 5 thing.

Use the name of my company in your cover letter.
If your cover letter/email doesn't mention Argyle by name in the first paragraph, then I stop reading.  Simple as that.

 

Culture According To Netflix

I can't remember how I found it...but this presentation about the "Freedom & Responsibility Culture" at Netflix from CEO Reed Hastings is pretty amazing.

Netflix doesn't seem like the ideal workplace for everyone...and that is precisely the point. It certainly sets the bar for me in terms of the company that I just birthed and the company I hope to build.

Also - you can take my commentary with a grain of salt. I haven't worked for an "organization" since May 2007...and that company was a late-stage 25-person software start-up.

A few of my favorite nuggets, all quoted/editorialized directly from the presentation:

Real company values are reflected in who gets rewarded, promoted, or let go. So true. Actions are way more important than granite-carved words in the lobby. Despite what they may say - your employees want more money and more recognition. Volunteer days, birthday parties, quirky events, Hawaiin-shirt-day, etc are nice and important - but only cosmetic reflections of a culture.

Adequate performance gets a generous severance package. Fear as a motivating factor? I don't hink so. Iron sharpening iron. A players want to work with other A players.

We're a team, not a family. This is probably borderline inflammatory for some, but I dig it. I've had the good fortune of working with tons of people that I like. But I've had very very very few co-workers that I love/respect as family - same for just about everyone, I'm sure. So why not just drop the lip service?

We're like a pro sports team, not a kids recreational team. Hilarious and spot on in so many ways.

Our model is to increase employee freedom as we grow. This is the most ambitious statement in the entire document. Certainly a worthwhile ideal, but only doable with A+ players throughout the organization. Not just at the management level.

Avoid chaos as you grow with ever move high performing people, not with rules. See above.

Netflix Vacation Policy - There is no vacation policy. Focus on what gets done. Not necessarily when and how.

One outstanding employee gets more done and costs less than two adequate employees. Yes, yes, yes. Salary/benefits are the obvious new-hire costs, but the secondary costs are just as important. One bad seed or one lazy colleague or simply an "average" performer can create all kinds of productivity, teamwork, and culture challenges.

Give people big salaries and the freedom to spend as they think best. Variable compensation is extremely motivating and an absolute necessity for some roles - ie sales. However, if you're running a Netflix-type org - A+ players, freedom, competition - then straight salary makes the most sense.

Individuals should manage their own career paths and not rely on a corporation for planning their careers. If I were Jeff Fischer - the Director of Career Management at Kenan-Flagler - or Shawn Graham - Director of Career Management at Pitt Katz - I would have this tatooed to my forehead.


MLK and Tar Heel Boys' State

I attended the American Legion Tar Heel Boys' State in the summer of 1997.  From the organization's website:

Tar Heel Boys’ State is a leadership action program. Qualified male North Carolina high school rising seniors take part in a practical government course designed to develop a working knowledge of the structure of the government. It is the aim of the program to impress the young citizens with the fact that the government is just what they make it.

At least that was their purpose.  Boys' State really just a weeklong rodeo of 16 year-old boys from all over NC terrorizing each other and the Wake Forest campus...with a smattering mock-government/educational events we had to attend.  As I recall, it was tons of fun for the most part.

I have no idea how it happened, but racial tension became a big problem toward the end of the week.  My hunch is that a vocal, inbred, redneck faction didn't like that the elected "president" of Boy's State was an African American.

Regardless, I had no idea that anything was going on until one of the adult leader's brought it up during one of our all-camp meetings.  The man said that we weren't the first camp to have issues with race...and that we would find the night's speaker to be extremely relevant.

Evidently, it was a tradition of sorts that one of the counselors - a middle-aged, African American preacher - deliver Martin Luther King, Jr's "I Have a Dream Speech".  I can't remember the gentleman's name, but I remember his face and his booming, Southern voice.  He recited the entire speech from memory.

I wept and so did everyone around me.

 

Why Carolina Gets A Pass This Season

1.)  Until April 2010, we're the National Champions.  Pretty easy to overlook sloppy play when you've just hung a new banner in the rafters.  (At least for me, probably not so much for Roy.)  I'll get back to stressing about our performance, berating players, and accelerating my receding hairline next season.

2.)  I've seen much worse.

2010 Resolutions

Last year's New Year's Resolutions and my efforts at keeping them were pretty weak:

  • Re-establish weighlifting routine.  (First 8 months - Fail.  Last 4 months - High Pass.)
  • Read more books.  (Low Pass)
  • Stop eating like a 14 year-old.  (Fail)

I'll blame the mixed results on the ambiguous goals, the transition from student to reality, the three weeks spent in Spain, and my Nintendo Wii.  Plus - I never really "published" my goals, so there wasn't really any public accountability. 

So - this year's resolutions are broadcast to the world and a little more measurable:

Bench press 280 lbs.  Most type-A, white, overly-educated, American males in my situation - approaching 30, cognizant of their waning athleticism...and expanding waistline - would opt for a triathalon or marathon as validation of their physical stamina, mental toughness, manhood, etc. 

Thanks to a lifetime of basketball, I don't have the knees or ankles for such a pursuit.  So, since I can't be a distance runner, I'm instead gunning for the ability to pulverize a distance runner in hand-to-hand combat.

Plus - I'm tired of being the wimp in my family.  My brother is enormous and strong as an ox.  My future-brother-in-law is also enormous and also strong as an ox.  My dad is pushing 53 and can still out-lift me.

I weigh 200 lbs, I have really long arms, and I can barely push ~210 lbs right now - which is (ahem!) more than I've ever lifted.  So 280 would be a pretty big win.  300 lbs is the stretch goal.

Read 1 novel per month.  This is the "watch less TV, play less Wii" resolution.

Note that Dan Brown, Twilight, Malcolm Gladwell brain candy shite doesn't count.  I'm talking about books that I can discuss with Ben Rogerson.  Books with depth and sub-text - not just plot.

I finished "The Human Stain" last night - a fantastic read on race and identity.  I have two more Philip Roths on my nightstand.

Be Resolute.  This one is admittedly fuzzy, but certainly more personal and more meaningful.  Details forthcoming in another post at some point.  I'm going to play some Wii before going to bed.  :)

Family Christmas Card

Kelly and I upgraded to a "family photo" style Christmas card this year:

Michael Brooks took the photo, I did the design in Gimp. 

(Sorry if you didn't get one.)

This wasn't the first Christmas card I've designed.  In 2001, my college roomates John, Lee, and I staged a photo shoot in our dorm - 210 Old West.  Afterwards, we conceived a design theme, found the requisite clipart online, and published the deeply symbolic masterpiece you'll see below.

We emailed the image to every address we could find - including Chancellor James Moeser, Coach Matt Doherty, numerous listservs, etc.  As you might imagine, many people loved/hated it.

Our's was a fairly eclectic living space.  If you can't tell, the items in the picture are (from left):

  • a banjo
  • a styrofoam cooler
  • (behind the cooler) fish tank with dead fish
  • potted plant
  • bag of Utz
  • SunMaid raisins
  • Tofu
  • 8 of Ben Rogerson's Dr Pepper cans
  • empty bowl with spoon
  • Cha Cha Chili instant soup (under the bowl)
  • empty burlap sack
  • Let's Go Europe
  • Jiffy cornbread
  • a ficus

Photo credit - Ben Rogerson