If you don’t cannibalize your own business someone else will!

All entrepreneurs launch with the hope that their businesses will live forever — or at least survive the next hundred years. They develop long-term business plans, chart growth paths, and seek advice from veteran business owners. Those words of wisdom likely don’t advise them to find a way to “cannibalize” their own companies.

But even if your company hits the hundred-year mark, you should always be looking for ways to revolutionize your initial idea before someone else does. No cautionary tale better illustrates this point than Kodak.

Most people would be surprised to discover that Kodak invented the digital camera, but it didn’t commercialize it for fear of jeopardizing its film business. By the time Kodak realized its digital camera prototype was a game changer, it was too late. Read the full article here.

Startup Learnings

In this interview with IdeaMench i share some of my learnings along the journey of entrepreneurship (and what a journey it’s been!) Read the full article here 

 

Where did the idea for SuperTasker come from?

SuperTasker is an evolution of our parent product, PeoplePerHour, a classic two-sided community marketplace where users can post a job and get proposals from freelance talent that will complete the job remotely. Our edge is that we curate all the freelancers and have a big focus on only allowing the best to qualify for and stay in the marketplace. Small businesses use SuperTasker to outsource anything from a quick design job to managing big remote teams on an ongoing basis.

SuperTasker arose to serve a subset of jobs in which customers aren’t as worried about who does the work — they just want it done! This includes things like small design tweaks or one-hour fixes to templated sites, such as WordPress, Joomla, and Magento. The way we solve the problem here is through tight curation and definition of the deliverables up front, relieving the customer from the effort of finding someone and weighing him against other candidates. With SuperTasker, you literally complete a form, and we take it from there. The task usually gets picked up within three minutes, and most deliverables are returned within one hour.

What does your typical day look like, and how do you make it productive?

I start early because we run engineering out of Athens, which is seven hours ahead of Eastern time. I tend to have early cross-Atlantic calls with the teams in Athens and London while it’s still daytime for them. I normally take a break at lunchtime to have a quick workout, and that sort of resets my day. My U.S. day begins around 2 p.m.

How do you bring ideas to life?

We have a culture where we encourage the flow of ideas and a lot of discussion. Great ideas take time to mature and need a lot of conversation, so we allow everyone to chip in ideas about a problem we’re trying to solve, then get around the table (or on Skype or Google Hangouts) and hash them out. You can’t structure that process too much; otherwise, you kill creativity. It’s about having short but frequent conversations — with research and analysis to validate assumptions in between.

What’s one trend that really excites you?

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Rethinking the definition of ‘Entrepreneur’

I recently wrote this article for Forbes as i feel that the nature, context and value that entrepreneurship brings to the world is evolving fast, and hence is its definition.  Read the full piece here: Rethinking the definition of ‘Entrepreneur’ 

Entrepreneurs are integral to the success of the U.S. economy. According to figures from Forbes, over 50% of the working population is at a small business, equating to over 120 million people. That’s a lot of competition.

Calling yourself an entrepreneur is to define yourself as many things: You are declaring yourself an innovator and a risk taker, and may find yourself pigeonholed with assumptions and stereotypes. However, an entrepreneur cannot be defined by a group of characteristics.

As the traditional route of finding employment has become increasingly challenging, the aspiration to become an entrepreneur has risen, making the original definition of entrepreneur problematic. Forty-three percent of Americans believe there are good opportunities for entrepreneurship, up by more than 20% since 2011. These days, you can be an entrepreneur if you’re a mother making wedding cakes during the school day, or a young horseback rider setting up a business introducing buyers to sellers of the finest dressage horses. You don’t need a flashy office or lots of space; 69% of new businesses in the U.S. start at home, and 59% of established businesses are home-based. So then the term entrepreneur — what does it actually mean?

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Cut & Paste doesn’t work for startups!

One of the worst pieces of advice you can get when building a startup is the classic “Airbnb [or Apple or Google] does it this way, so should you”. Its incredible how many investors give that advice thinking you can retrofit substance to process. If it were only that easy to cut & paste there wouldn’t be any figuring out to do would there? Why is it then that first time entrepreneurs have a higher success rate? Because they are hungry, and their lack of knowledge is the best weapon. They are not afraid to ask the dumb questions. They think fresh and solve problems. Ignorance is bliss.

 

Last week I met up with two different first time entrepreneurs, super smart founders and CEOs both of venture backed business. We went for a beer to catch up and share war stories. PeoplePerHour is a little further ahead in the journey so I had the benefit to reflect on some of my many screw ups and do most of the talking while they enjoyed their beer!

 

We discussed how we manage our time, our team, how we handle meetings . What we do and don’t get involved in. I was not amazed that each of them were making the same mistake (which I also made many times). One said to me “our VCs said to me recently that Apple’s leadership team spends 3 hours just ‘talking about random stuff’ on Monday mornings… so we should do the same. It fosters creativity and innovation lalala.”  My instant reaction was “are you out of your fucking mind?” Firstly, there is a slight difference between a ten person startup and a company like Apple. Maybe at their scale talking casually about ‘random stuff’ with no agenda works because a) someone else is doing the hard work of executing and b) they may be having a good problem to have which is – where the heck to we invest our cash mountain next? Do you really think that when Apple started in a garage Woz and Steve Jobs just sat in a room talking about random shit waiting for a business to get built?

 

The other Founder I met up with similarly was spending all this time doing X because his investors told him that it worked for another portfolio company. That’s absurd logic. You will find tonnes of things that work for what are seemingly similar businesses but don’t work for you. The devil is in the detail. All that matters is what YOUR business needs NOW. That may change tomorrow. You can’t retrofit substance to process. You figure out what builds and sells the shit and fit process around it. And in a fast growing startup you probably need to rethink that every other month if not sooner.

 

At PeoplePerHour we went through this cycle multiple times. A process of holding a management meeting with everyone round the table sharing what they’re each doing worked well. Until it stopped working! So we changed it. Why did it stop working? Because we HAD to go from a phase where we needed to innovate and hence conversation was necessary, to a phase where it was all about straight line execution. In that phase, you need as little conversation as possible. You just need to roll up your cuffs and execute. You’ve figured out how to climb the mountain, so now you need to shut up and start climbing!

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Why your low moments are your biggest blessings in disguise: startup war stories

There are no certainties in a startup’s path, apart from one: you are bound to have a roller coaster ride, and a bundle of war stories to recount.  No matter how successful you end up being. It’s never a straight line to success or failure. Along the way, the true test of whether you have what it takes to make it is what you do in your lowest of low moments. When you are most vulnerable.  For make no mistake – they will come!

 

In my experience you can almost bucket people into two: those who stay down when they’re down or drift sideways, wither and die. And those who jump back up stronger.  My biggest successes, leanings and adventures always followed from such low moments. When I was weakest and most vulnerable. I’m one of those people who performs much better when things aren’t going my way. It’s like a slap in the face, it wakes me up, makes me more stubborn and determined to hit back even harder. Ben Horowitz put it perfectly in his last book ‘The Hard Thing About Hard Things’. He said ” there are two kinds of CEOs: peacetime CEOs and wartime CEOs”.  Peacetime CEOs are those who do well when things are doing well. They are typically the people who you hire to take a business from B to C and scale it up. They are smooth, political and great at blowing the trumpet. But the journey from A to B is definitely a wartime situation. You need to thrive in the gutter.

 

My first moment of vulnerability was when my first business – essentially a ‘brick n mortar’ version of PeoplePerHour.com – wasn’t scaling.  I was in my mid-twenties with no experience at all, no co-founder, partner or other senior member of the team, running what’s probably the hardest type of business to run – a service business.  I was essentially the head of sales, delivery, quality assurance, and the person everyone called when things went wrong. Which they did! Often! And in weird hours.
Exhausted and demoralized, with employees and clients jumping ship at an accelerating pace, I had to figure a way out.  Failure was not an option – I had friend’s and family money in the business and countless hours of sweat and anxiety. This being 2006 and in London where there is much more taboo around failure (decreasing no doubt but still much more than the US) I was petrified.  To make it all worse my then long-term girlfriend decided to split up with me because I was working too hard, so the one person I had close to me jumped ship too.

 

I felt like a brick had hit me on the head.  Fortunately my cost base was quite low  (and getting lower as more people were jumping ship) so going bust would take a while, but that’s like dying a  slow and painful death. It’s almost better if it’s a short sharp blow.  I kept racking my brain constantly  ‘how on earth will I scale this business up”. I decided to go away for a few days  (in the beautiful Cannes I recall) steam off and think it through (and in the mean time try and forget this ex girlfriend who ditched me at the worst possible time!). It was in that trip that the idea hit me. Why don’t I turn the business on its head, circumvent my own self by turning a service provider to a platform business that connects service providers (like myself) with customers and take a cut instead of delivering the service myself? That way it can scale. It was the eureka moment I was waiting for. PeoplePerHour.com was hence born.

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What to watch out for when raising funding

I was recently interviewed by Jonathan Mules at the FT on  what our key lessons have been in raising funding for PeoplePerHour. They are shared in this piece attached below which was published earlier this week. Entrepreneurs often embark on fundraising not realizing that there is a serious downside to raising too much capital or being too hyped. In fact there is an inverse correlation between the amount of money raised and the level of success  – refreshingly honest advice coming from one of the most prominent VC’s in New York, Fred Wilson. He also once said “if you want to be a hyped business you gotta live with the consequences” which I couldn’t agree more, yet most entrepreneurs in the heat of the moment will consistently ignore that advice. This can make or break a business depending on what the terms of the deal are, and how much grit and tenacity the entrepreneurs posses.  It’s a true test of a business and ones personality.  I share my lessons here.

The trouble with too much seed capital – FT

3 Defining qualities of great entrepreneurial leaders

http://upstart.bizjournals.com/resources/advice/2014/09/18/3-defining-qualities-of-great-entrepreneurial.html

Great leaders may possess a myriad of attributes, not the least of which are intelligence, charisma and natural charm. All of these things matter. However, you can be a great leader and not be naturally charming or very intelligent. In my time at PeoplePerHour I’ve learned a lot about leadership. I have come to the conclusion that there are three key attributes a great leader must have.

Vision

The ability to amass a great team, motivate and inspire them is plain useless if you don’t have a clear vision of where you need to go. Leadership is first about seeing the future and then about being able to figure out a feasiblepath to get there. It’s seeing the iceberg before the Titanic hits it and taking fast and decisive action.

It’s doing the one right thing rather than doing many things right. It’s being different, not following the herd, being controversial, and seeing what others don’t see. It’s having a nose for what’s coming and the eyes and ears to react before others do. Without vision, you can empower people all you like but you won’t get anywhere. You’ll have a following but no direction. You may make a great motivational coach, but not a leader. Every difficult situation needs a visionary leader to point the way and make a tough decision.

Influence

Once you have a clear vision (but only then), you need a sting following. That requires the power of influence. Whether you are in an existing leadership situation or the creator of a group, this is very hard thing to do. In either case, you are new to the situation and the odds are against you. Why should people trust someone new? The vast majority of people are resistant to change, no matter the odds. In order to fulfill any grand vision, you need to drive change. Otherwise you are just a puppet master holding the strings waiting for the show to end.

Influence people across the board — explain to employees the benefit of leaving secure jobs and come join you; convince investors to give you money at the very beginning, get customers and fans to support you, your bank manager to give you an overdraft, your landlord to give you a lease and rent-free period; and your wife to put up with sleepless nights, cold sweats and no pay. Carry that burden of influence with you. If you go down, you take more people with you than yesterday.

Courage

The third element is the most challenging. You’ve clarified a vision and built a following by charming, coercing, schmoozing…ultimately influencing enough people. After all this work, you realize that it’s only day one. Now you have your boat (more like a raft) and your compass. But you still need to cross the ocean. This is the final and true test of great leadership. It ultimately comes down to courage. Intelligence and knowledge are advantages of course, but without courage they are wasted.

Courage alone could and would get you there, albeit slower and with more pain. So the key question is: Do you have the courage to keep going when everyone tells you to turn back; to know you’re right when everyone says you’re wrong; to stick to your instincts when people call you crazy; to carry other people’s weight when they fall; to set the tempo and beat the drum despite how tired you may be? It’s your job to keep people together when they are drifting apart and losing faith, to give them courage but not false hope, to let go of some to save many, and to weather the storm but not bask in the sunlight when it ends — because it never does.

Vision and influence will make you a well equipped captain. But courage is what gets you there. On the other hand, courage alone makes you a fighter without a cause. You may be good at creating lots of noise, but to paraphrase Sun Tzu’s “Art of War”: that’s just “the noise before defeat.”

 

10 reasons to carry on doing what you’re doing (if you’re building a startup)

I was recently asked by someone why I do (or carry on doing) what I do. It’s such a simple question yet it startled me. It’s easy enough to jump in to a knee-jerk textbook answer. But its really hard to articulate why it really is that you do what you do (short of things like necessity, habit, or lack of choice. The ‘why not’ is not a valid answer.continue reading »

Are you thinking long-term enough?

Warren Buffet was once asked by Jeff Bezos a long time friend of his: “you are the second richest man in the world and yet you have the simplest investment thesis. How come others didn’t follow this?”  To which Warren Buffets responded: “because no one wants to get rich slowly” 

In a nutshell that’s what’s wrong (or rather what’s not quite right) with a lot of the investment community today, from public markets to private equity investors and unfortunately it trickles down into too many companies. You can’t time-box success. You can’t sprint a marathon. And you can’t measure success with speed but only by the  magnitude (and significance) of the end result.  Building to flip is easy. Building to last is difficult and you cannot take short cuts.continue reading »

Who stole my fruit?

The last decade or so has been paradise for entrepreneurs mainly because as the world shifted more online and on mobile devises there was so much low hanging fruit up for grabs.

Times are now changing. This is not to say that there’s no longer opportunities. There will always be. But now they are shifting to much harder problems to solve.

Much like any new revolution. When industrialization happened, anyone with a conveyor belt a-la Henry Ford’s could churn half-decent products out the door that would sell. Not for very long but they’d sell.

Today to compete in manufacturing you need state of the art equipment, R&D and people. And you probably need to be in China to compete on price.

The same is happening in technology I believe. The name of the game for the past two decades was getting content and inventory online and creating tools to make it discoverable. Starting with the browser, then directories like Yahoo and Craigslist, then search engines like Google, then social networks like Facebook and now Instagram.continue reading »