What you need to know about Guy Kawasaki

Richard Branson polishes Guy Kawasaki's shoes

Guy is currently on vacation. I tried sending him an interview request, and a responder replied. Plus I also saw on Google+ another person asking for the interview. So that wont work. I will try to get to the person that got the investment from Guy so I can reach him, but that means more research. Every step. Hustle! Research! Hustle! Work smart – work hard. Hustle!

What do you need to know about Guy Kawasaki?

Guy Kawasaki - Garage Ventures

Guy Kawasaki – Garage Ventures

He loves rottweilers. How do I know? Well, I’ve read 3 of his books (The art of the start, Enchantment: The Art of Changing Hearts, Minds, and Actions and What the Plus!: Google+ for the Rest of Us, watched several presentations,  follow him on 4 major social networks and have his picture in my room (to remind me every morning not to be a bozo). So yes, Guy has a bloodhound/Rottweiler, I am sorry I can’t remember his name, and I am not sure Google will help you with this one.

Now you also know why Guy loves to talk about selling dog food online. Pets.com, epets.com, dogfoodonline.com and many others. There’s no need for me spending time about their patent pending, curve jumping, paradigm-shifting, service with revolutionary SEO strategies. But you should know that Guy survived online dog food, and the .com bust. He also likes to say you need to eat your own dog food. Let me explain what he means by that.

My startup delivers information about domain names. We still haven’t launched, the system isn’t ready. I am using the faulty prototype, and with it I have signed our first client. Our client isn’t actually using WhoAPI, I am using it, and the first client is the end user. The client isn’t technically aware of full possibilities of our project, but he is aware of the benefits and wants to use them. I have a rottweiler. I eat my own dog food and it’s not even cooked yet.

He loves ice hockey. I am not really sure where one can play ice hockey in San Francisco or Hawaii (where Guy is Born), but if you want Guy’s attention, ice hockey is the right path. I am not sure what’s  his favorite team, but I am not here to speak about hockey either. I have two great hockey analogies for you. First one was used both by the late Steve Jobs, and Guy Kawasaki and of course the legendary hockey player Wayne Gretzky. He said:”I skate to where the puck is going to be, not where it has been.“. Wow, now that’s profound. Use this in your business, and especially in the technology. Never do what everyone else is doing, see the future, and see where the industry and the markets are going. Invent!
There were people that were cutting and delivering ice, then there were companies that were producing and shipping ice cubes, then there are people like Einstein who invented refrigeration (Szilard-Einstein refrigeration patent) and companies who built refrigerators, and you will have companies in biotech that will make food that doesn’t need freezing. That’s curve jumping, skating where the puck is going to be.

The other hockey analogy I learned from Guy Kawasaki is that of an ice resurfacer. In his presentation Guy uses the term “Zamboni” which is the most popular brand. What the ice resurfacer does it removes all the lines, and irregularities from the ice. It creates an intact ice, perfection. Similar to first snow, where no one set foot. This is the same as a new company. It’s not ruined by the logo your aunt made. It’s not ruined by nagging customers who want a discount, or by a lousy service you provide. Guy says that at that point (fresh ice, new company) is also difficult to set priorities. I don’t have to say how much I agree to this, because you have to agree to everything that Guy says (unless one thing, which I will leave for the end). He was the Macintosh evangelist, and part of the team around which the universe revolved, and one must respect that. Your focus must go towards the things you will be proud to share with your spouse. Why spouse? Well Guy celebrates women, and in all his books he is referring to “she”, rather than “he” when he wrote. This is his way of repaying them. You know what? This wouldn’t be a Guy Kawasaki post if I didn’t do the same.

Maybe that’s the reason Guy loves to fly Virgin? On a more serious note – this is what happened.

Backstage in Moscow. Richard Branson is speaking before me. He asks me if I ever fly Virgin; I admit that I never have. He asks me to try it. I say to him:  “If Richard Branson asks me, I guess I have to.” He then gets on his knees and starts polishing my shoes with his jacket in order to convince me. Can it get any better than this?

Richard Branson polishes Guy Kawasaki's shoes

Richard Branson polishes Guy Kawasaki’s shoes

So, there you have it. When was the last time you polished your prospective client shoes? Maybe today is a good day to start. Lot’s of people use some company’s products just because of the way their CEO/owner behaves. I am sure you can find examples in your lives. Be that CEO.

I have never flown with Virgin Atlantic because I can’t afford it, and I was never on a flight longer than 3 hours. But, I will one day. I’ve read Richard Branson’s autobiography “Losing my virginity” and it inspired me. I love inspiring people, and I love to inspire other people (or at least try). I also love successful high school/college dropouts, they are like that statistical spike that no one can explain. Flying Virgin Atlantic, increases your chances of bumping into Guy Kawasaki by 0.0000001% and it also gives you a common topic with your favorite VC. You won’t bump into Richard Branson, he flies with an air balloon, or water skies.

Guy loves his family. He has 4 children, and I cannot begin to explain the respect I have for successful business people (especially investors) that have children. This also means Guy turned down a job offer from Yahoo, that he says cost him 2 billion dollars. So, if Guy doesn’t invest in you, don’t take it to your heart. He has Meniere’s disease, and he can always say he didn’t hear you right. Hint, if you are are a startup that helps people with Meniere’s disease, go for it. Guy likes to joke about his condition, and that he got it from hearing lousy pitches. What’s a lousy pitch?

As I previously said not only that I have Guy Kawasaki’s picture, I also have Richard Branson’s picture.

As I previously said not only that I have Guy Kawasaki’s picture, I also have Richard Branson’s picture.

Enter the bozos. A bozo by Steve Jobs’s and Guy Kawasaki’s definition is a person who… for example, reads of the slides. When you give a presentation, DO NOT, I repeat, DO NOT, read of the slides. The slides are not there for you to be your crutch, you must know your shitake. (Shitake is a word Guy often uses) They are there to help people understand what the heck you are talking about. A picture is worth a thousand words, right? Use pictures, use videos! If you want to create inspiring presentation read Carmine Gallo’s book The presentation secrets of Steve Jobs. It helped me tremendously! When I gave my first presentation it was of bozosity (you see you can use this as an adjective) proportions. And then one day, I gave a presentation to about 50-70 college students. First thing I said  I am not going to talk about my startup because it’s really technical and niche, and they wouldn’t understand any of what I said. I then proceeded with the 20 minute presentation about investors, inspiring companies like Apple, Zappos, and Simon Sinek. The first question from the audience after the presentation was: “What is it exactly that your company does?”. I am not telling you this to brag, but to give you an example that this stuff works! Don’t be a bozo, don’t read of the slides, remain eye contact, people want to be inspired. Guy Kawasaki also has a 10-20-30 rule. 10 slides, 20 minutes, 30pt font. Do just this, and you are better than 50% presenters. As you might have guessed, Guy doesn’t love bozos, in fact, he sets his Rottweiler on them.

One does not simply buy a Porsche.

One does not simply buy a Porsche.

Every man loves his car (no matter what they tell you). Guy drives a Porsche. One does not simply buy, drive, have a Porsche. It is a special connection. Guy often posts photos of his Porsche, of the replacement Porsche they send him, and when he goes to the track to drive a special Porsche. Tip, respect the Porsche.

One last thing. Whatever you do, if Guy Kawasaki says your startup sucks, don’t believe him. He said so himself. As a matter a fact, don’t believe anyone like him. He says, the most dangerous people for your startup are VC’s who say they won’t invest in you, and that your startup sucks.

Some VC funds even display their anti-portfolio, and there you can find companies like Apple, Google, etc. Thing is, hitting a jackpot with an investment is close to gambling. A barefoot guy on LSD, and a guy wearing flip-flops are responsible for the creation of Apple and Facebook. The asocial guy responsible for the creation of the biggest social network. Seriously, are you kidding me? Richard Branson was a dyslexic who didn’t get through high-school. How do you find the courage to invest in people like that? There are no analytic skills that can tell you where to invest for a big return. Go with your gut feeling. Why is going with your gut feeling the right thing to do? Well read Simon Sinek’s Start with Why: How Great Leaders Inspire Everyone to Take Action, and Malcolm Gladwell’s “Blink: The Power of Thinking Without Thinking“.

A drummer, whose firm invested in Zynga, Seomoz, Trada and attachments.me

Foundry Group

It’s been a working Sunday for me, and it’s time for my first of many to come VC interviews. I am proud to present Jason Mendelson a co-founder and Managing Director at Foundry Group an early-stage technology venture capital firm. Yes, he is a venture capitalist. Previously, he was an attorney at a large San Francisco Bay Area Law firm and prior to that, a software engineer at Accenture. And before that he was a drummer. Yes, drummer.

Foundry group invests in a range from $100,000, up to series A – up to $10 million. So far, they have invested in: attachments.me, www.admeld.com (that was acquired by Google), www.seomoz.org and www.trada.com, www.yesware.com (my three personal favorites) and www.zynga.com (perhaps you’ve heard of them). All together 49 startups, you can see there portfolio on their website. Not bad for a drummers portfolio.

Jason Mendelson Talks About Startup Failure

Goran: Jason, thank you very much for taking the time to answer these questions. As you may know, there are a lot of startups looking for funding, looking to become great entrepreneurs. What is the most common pattern you see in someone who just doesn’t have what it takes to get the investment, to bring that startup to the next level, to succeed?

Jason: Knowing one’s strengths and weaknesses are key. Not only will this allow the person to scale into different roles with the company, but also build out a great management team. While the founder may be the CEO from start to finish, the actual job changes greatly over time, as the company matures.

Having self-awareness to be able to constantly monitor one’s own performance is key. Aside from that, have a maniacal focus on the product and customer is a must. Release product often and be deep into analytical thinking to gauge success.


Foundry Group

Foundry Group

Goran: As you already know, I interviewed Ben Coe, the co-founder of attachments.me. He certainly doesn’t fall into the previous category, but what was the sexiest thing him and Jesse did in order to get Foundry group to invest? Back than, they were in Toronto, how did that affect the negotiations?

Jason: I thought both Ben and Jesse were super smart, had a ton of passion for what they were doing and identified a real problem in the market. Personally, I’ve wasted way too much time dealing with the problems that their solution fixes. Also, I just really liked the guys. They are the type of people that you want to spend a lot of time with and that is a good quality for a VC investment.

Goran: Was moving them to Silicon Valley a part of the deal? Do you remember Ben’s and Jesse’s reaction when you told them you want to go through with the investment?

Jason: Not part of the deal – they put that on the table the first time that I spoke to them. As for their reaction, they were excited. So was I.

Goran: What does your every day look like, what is your passion? Is there something that you think about every day?

Jason Mendelson

Jason Mendelson

Jason: Best part of being a VC is that I don’t have an “every day.” It’s always different and that is what I’m passionate about – change. I love thinking about how quickly technology is changing the complex and simple things we do every day. I appreciate every day the great entrepreneurs that we get to work with.

Goran: I saw that you do interviews with Bloomberg, but you also know how to have fun. Who is the real Jason behind the curtains?

Jason: Wow, that’s a good one. I think I’m essentially the same guy who grew up in Detroit, Michigan, but with more grey hair. I really love helping, in any small way, folks who have a good head on their shoulders and are trying to do the right thing.

Goran: Can you recommend a book, speaker, or something else for those who are knowledge hungry?

Jason: I’d be remiss if I didn’t mention that my partner Brad Feld and I have a book out called “Venture Deals, how to be smarter than your lawyer and VC”. It’s a book that teaches folks how to get a VC funding done correctly and removes all the secrets of the process.

Goran: Is there something you wish to say that is important to your portfolio, is someone hiring, did someone reach a huge milestone? What’s the biggest news currently around Foundry group?

Jason Mendelson sitting to the right

Jason Mendelson sitting to the right

Jason:There is always so much going on that news will be stale by the time your readers get this article. I’d say that I’m tremendously proud of our portfolio’s success and even more proud of the great relations between the Foundry Group partners, the entrepreneurs we get to work with and our investors.

It’s really important to us that everything we do is done in an open and transparent manner. It is really important to me that being a VC means you can do well by doing good.

You can find out more about Jason on his website JasonMendelson.com.

Sasa Sarunic – serial startuper

Serial entrepreneurship like cliff diving

Serial entrepreneurship like cliff diving

Serial entrepreneurship like cliff diving

There’s something about serial entrepreneurs… Take cliff diving for example. You are standing on top of a cliff, let’s say 10m high. It doesn’t matter if your plan is to jump on a head, or legs. You are scared as hell! Some of your friends, and “friends” are teasing you, saying you don’t have the guts to jump. You know that the chances of something bad happening are minimal, but there’s this loud voice inside your head yelling you could break your back, neck, embarrass yourself.

And than finally, finally you beat the coward in yourself. You take the jump! Just do it, as the commercial said so. The rush goes through your body, as you hit the water you are relived. You are victorious as your friends are chearing, not tesing you. Entrepreneurs, you know what I am talking about.

Than a funny thing occurs. Along comes winter, and the next summer. You are up on that big rock again. Guess what, your legs are shaking of fear. Once again you have to beat the devil, the diablo. What in the world led you to that silly rock again? What in the world were you thinking?! Why, why, why do you persist? Maybe because you choose to. Maybe because you are foolish enough to think you can change the world. Maybe because you want to help people. Or maybe you just have that drive within you, and you are like a rocket prepared to do what it takes to reach Mars.

This is why I interview entrepreneurs. In our country, entrepreneurs like Saša don’t get (wrongfully) much media attention, because all the bad entrepreneurs get it. This leads the public oppinion in the wrong dirrection, so the public turns into a crowd that laughs at you, points fingers for no apparent reason, and throws accusations, because they are used of entrepreneur wrong doing. I choose to believe differently, I see entrepreneurs as saviours of the society. Paying way more taxes that drives country budget, and drive the ecnonomy by spending more, hiring people that were unemployed, and inventing new services (or bringing old ones to mass market) so they solve problems. Basically entrepreneurs are problem solvers, they are the solution!

I am sure there are some people in your country as well that call themselves entrepreneurs, when they are not. Know thy true entrepreneur, the force is strong within him.

Why Saša Šarunić? Oh well, no particular reason… He founded a succesfull mobile and software development company (5minutes) and got an $1.7 million for a third (ShoutEm) (The Next Web, 50 cent use it and even Eric Ries with Lean Startup to name a few), that’s innovation and high tech wrapped into one. You could say cliff diving is second nature to him, if you know what I mean. They were the first Croatian startup to get VC funding, went to Seedcamp, and the whole shebang.

Goran: Saša, how do you measure your success with your projects/startups/companies? You co-founded Pticica and Trosjed (which was sold to Net.hr), then 5 minutes, and then ShoutEm, in your eyes how do you measure success in them?

Saša Šarunić started coding at the age of 12

Saša Šarunić started coding at the age of 12

Saša: I measure success in work by two parameters – fun that you have by doing a work, and money as a compensation for your effort. I started all four projects with Viktor Marohnic who proved to be a great partner, full of energy and good ideas. Working with him was already guarantee enough that we were looking at fun times 🙂
While both of us were pretty enthusiastic about Pticica and Trosjed and had a great time working on them, those projects were complete failure in terms of revenue. The whole concept was based on our false presumption that advertisers will stand in a queue to advertise on such great social networks we had built. 🙂 Nevertheless, we learned a lot on our failures and entered the web and multimedia business which was completely unknown area for us before.
Experience gathered on Pticica and Trosjed allowed us to establish Five minutes which is currently going really, really great in terms of interesting projects and amazing coworkers. The money is not bad either. 🙂
ShoutEm is definitely the most fun project we’ve being working so far. It’s for us what’s going for Olympics to a sportsmen – fighting with the best ones. While not profitable yet, ShoutEm has, at our opinion, the potential to outgrow Five minutes significantly.

Goran: Can you tell my readers where did you learn to code so well? How would you compare yourself with some of the best coders in the world that work at Google, Facebook, Twitter? Would you say coding is your passion, and why did you choose this particular programming language?

Saša: I’m programming since I was 12. I’m 37 now so you can do the math 🙂 It must be a passion since no one was forcing me to do it.
There is no chance that I can compare or compete with the best coders in the world. Most of ShoutEm and Five minutes employees are better developers than I am. However, I think I have a knowledge and people skills broad enough that I can be a CTO and do it well.
Since the team is growing and management roles take more and more of my time, I must admit that I’m programming less and less, just a few hours a week on some non-critical tasks. I do it to stay in shape and because I love it.
Among programming languages, I would say that my current favorite and the language of the future is definitely – JavaScript. That is the language that was unfairly neglected and been hated over the years, considered ugly and badly designed by most. These days, Javascript is a high-performance, well understood dynamic scripting language good for both – client and server programming.
If someone wants to learn how to write code these days, the first thing I’m going to say is learn Javascript.

Goran: At what point and why, did you choose to go after a VC money? Whas the process difficult, or should I ask, what was the most difficult part? How did you feel when RSG Capital said they were interested in investing, how did they tell you the good news?

Saša: Viktor and I knew from the beginning that we don’t have enough money to finance ShoutEm development and were aiming for VC money from the day one. The process lasted for the full three years. During that time we were constantly rejected by VC-s as being in too-early stage of development (which is just a VC’s code for “we are not sure if you will succeed or not”). RSG was one of the first VCs we contacted and they passed on a deal as well. However, we were persistent as hell, and this didn’t went unnoticed. After years of pushing it, we finally closed a deal. Since it didn’t came overnight, there was no ecstasy, just a relief that we’ll be able to finish the project for which we knew will be a success.

Goran: How are you coping with the employee growth? Do you use any strategies, attend seminars, read any books, gut feeling? Werner Vogels for example likes to use small times, and he calls it the 2 jumbo pizza rule. If you can’t feed your team with 2 jumbo pizzas, the team is to big. 🙂 Do you have any particular company culture, do you do something different?

Saša and his team from 5 minutes, all wearing mustaches for a humanitarian cause - they raised 4000$ for a children's home

Saša and his team from 5 minutes, all wearing mustaches for a humanitarian cause – they raised 4000$ for a children’s home

Saša: I must say that I’ve read a pile of books on organisation, project management, psychology and software development in general, but non of them survived the touch with reality. Each company is different in its own matter and best practice books are good to get a general feeling on how others do it, but you have to find what works best for your own company by yourself.
When we looked where to grow the team, we always did it where it “hurt” the most. For example, we didn’t employ a secretary only until we couldn’t do the paperwork by ourselves because of lack of sleep.
If I could stress one thing we constantly promote in our company(ies) is pro-activeness. That is a trait that pushes the company forward.

Goran: Hypothetically speaking, if you sold ShoutEm for $100 gazillionbazillion what would you than do?

Saša: I would rest for a year (just sleeping and doing nothing 🙂 and probably start some new venture the year after 🙂

Goran: What does your tipical day look now? Do you code late, or do you get up early?

Saša: When I was younger, I really liked programming in the silence of the night and that was the most productive part of my day. However, now I have a lot of coworkers who depend on me being available in the company, and I can’t afford to wake up at noon anymore 🙂 To my great relief, I discovered that mornings are great for working as well. I would even dare to say now that you can’t be really successful in life if you don’t get up early (except if you are a rock star, maybe).

Goran: My startup WhoAPI deals with domains, so I need to ask you a couple of domaining questions 🙂 What was the first domain name you registered?

Saša: That was time.hr, a domain for my first company – Time d.o.o. This was a company doing software development for radio stations, real estate agencies and lawyers. Although it was a one-man-show, helped me earn some money during my university days.

Goran: Time.hr, that’s a great domain name, what are your plans with that!?

Saša Šarunić - wearing mustache proudly while helping raise money for a great cause!

Saša Šarunić – wearing mustache proudly while helping raise money for a great cause!

Saša: It is now a company ran by my mother doing marketing for local newspapers in Dalmatia. It is interesting that time.org and time.net domains were for sale at the time but I didn’t want to buy them. I thought that it was too much to give $70 for the domain (the price of a domain in 1995.). Stupid me! 🙂

Goran: Does ShoutEm have any other cool domains like shoutem.com? For example, would you be interested in registering shout.app? Why yes, why not?

Saša: Yes, we bought all variations that we thought people would type in and address box instead of shoutem, like shoutem.net, shoutm.com, shoutm.net and are always looking for a new ones. I consider good (short and simple) domain name crucial for the success of the company and would be interested in buying shout.app as well.
I even have a few of my own, like – sarunic.com, truehackers.com, hackerville.net, etc… waiting for me to finally start a personal blog.

Goran: Would you like to add something, perhaps if you are looking for new employees, or some special announcement, some news, or just say hi to mum and dad?

Saša: We are currently seeking a JavaScript ninja (he/she doesn’t have to be a Japanese, though). If someone is interested in changing the world of mobile app development, please send your resume to sasa [at] shoutem.com

Thank you for your time!

Discover the “attached” man – Ben Coe

Ben Coe - co-founder of attachments.me

Let me welcome you to the new era. Everything is not working the way it’s supposed to, but there are some startups that are trying to fix that. I think that’s the best thing that can happen to us, and to our society. So don’t let anyone tell you changing the world isn’t possible, cause it is.

Cloud just got cloudier - save to drive option

Cloud just got cloudier – save to drive option

There are so many cloud services out there, and one wonderes, is it really cloud if at some point you have to use your hard drive? Attachments.me is like a bridge for a few clouds. One cloud being your email (Gmail) and the other being your online drive (Dropbox, Box, Google drive). At this point you probably guessed it right. When someone sends you an attachment, you can save it directly to one of the most popular online drives, or vice versa when you are sending an email, just access your account and attach it.

Epic? Hell yeah! You can even search all your attachments, but it works way better than looking up keywords in your gmail. Why? Because this is a specialised “attachments” search, and you lookup only attachments, they are highlighted, and you can see the preview. I gotta tell you, you have to see it for yourself. (Especially if you are already a Gmail/online drive user).

Correction, I managed to filter attachments

Correction, I managed to filter attachments

I wish I could give you a screenshot of that, but it’s way to personal. I’ve tried finding a spot where I don’t publish something that’s not supposed to go public, but no luck. So it is safe to say that attachments are reeeealy important to a business individual such as my self. And obviously I am not paying enough attention to them since so far I haven’t had any real help around with dealing with them.

You are just going to have to try it by yourself. Signing up is…well, you just login with your Google account, that’s how easy it is.

So, what they want to do is get you and your company’s files organized. They do this by making sure all the files you receive in email are easy to find and automatically put in their final destination. As I said before, they connect your email to cloud storage solutions like Dropbox  (Dropbox gives 500Mb for every user you send their way, so I would be thankful if you signed up with this URL) and Box. They follow you where ever you go, which means, when you are logged in to Gmail, or when you are browsing with your Chrome (Chrome Extension – Attachments.me for Gmail, Dropbox, …), or if you are on you iPhone! Attachments.me- Gmail inbox software to efficiently manage emails

Attachments.me was founded by Benjamin Coe and Jesse Miller. Originally they were located in Toronto, Canada. After taking funding from Foundry Group they relocated the business to San Francisco. Our office is in the sunny Mission district, in a shared space called Dolores Labs.

I’ve read Ben’s “confession” and instanlty I said to myself, I have to interview this guy, he is the real deal.

Goran: Ben, first of all thank you for a great blog “Confessions of a 20-Something Startup CTO” post with wich a lot of startupers can relate too. Do you blog a lot, and why do you do it? How do you manage to find time in your busy schedule? Why do you use Tumblr as a platform?
Ben: I’ve always loved writing as a hobby, and it’s a skill I’m constantly trying to hone. Most weekends I take a bit of time to write a blog post. Partly because I enjoy it, and partly because it helps me reflect on the week. I use Tumblr because it has an intuitive interface, and is easily customizable… in short, it doesn’t get in my way.

attachments.me - changing the way we attach

attachments.me – changing the way we attach

Goran: What about the beginnings of Attachments.me, were you excited about registering that domain name? How did you choose that name, and did you have any trouble with picking the right name for your startup? Did you feel from the start that something big was about to happen?
Ben: The domain name was actually registered by Joe Stump, who was one of the original founders of Attachments.me. This saved me some trouble, since I’m terrible at picking names (you can look at my Github page and confirm this). I definitely felt from the start that something big was going to happen with Attachments.me.

After university, I spent a year working at a startup called Freshbooks. This was an awesome experience: I got to work with a great team of people, building awesome features, and shipping them to millions of people. I learned a ton about the startup world, and about the software development process. I saw Attachments.me as an opportunity for me to take that next big step, building something I believed in from the ground up.

Goran: Can you tell my readers where did you learn to code so well? How would you compare yourself with some of the best coders in the world that work at Google, Facebook, Twitter? Would you say coding is your passion, and why did you choose this particular programming language?
Ben: I fell in love with coding when I was twelve. It matched my personality, a mix of creativity, science, and problem-solving. I didn’t have the Internet, so I’d buy programming textbooks from the bargain bins at RadioShack — In particular, I fondly remember Andre Lamothe’s, Tricks of the Windows Game Programming Gurus. I read this from front to back several times.

I didn’t start learning to become a good software developer until my stint at Freshbooks. I think this is an important distinction to make, there’s a big difference between a good coder and a good software developer. There’s a lot of process outside of coding that goes into building good software — It’s a lot like an apprenticeship, you learn it from your peers when you’re in the trenches.

I don’t have a clue how I compare to the best coders in the world. I have a friend I hack with occasionally who was a developer at Twitter, I’m pretty wowed by how good he is. I think there are experiences you get when you’re developing at Twitter’s scale that I haven’t had. It changes the way you think about approaching problems.

Currently, I spend most of my time writing Python and JavaScript: Python for building tons of random DevOps scripts for administrating our servers, something it’s well suited for; and JavaScript for Attachments.me’s Chrome Extension.

Ben Coe - co-founder of attachments.me

Ben Coe – co-founder of attachments.me

Goran: At what point and why, did you choose to go after the VC money? Was the process difficult, or should I ask, what was the most difficult part? How did you feel when Foundry group said they were interested in investing? How did they tell you the good news?
Ben: We were kicking Attachments.me along on evenings and weekends, and consulting during the day; we kept this up for a few months. venture capital was attractive, because it gave us the opportunity to make Attachments.me our full-time gig.

In hindsight, it feels like raising our initial 500k seed round happened really quickly. It was definitely stressful at the time, and made more difficult by the fact that Jesse (Jesse Miller – Co-founder of Attachments.me) and I were based in Canada (we’d have to deal with immigration issues when/if we closed funding).

Jesse spent several weeks on phone calls with VCs pitching the product. We managed to get to the next stage with several of them. Jesse and I then flew down to San Francisco for a whirlwind set of meetings. We hit it off best with Foundry Group, both on the phone and in person. Within a day of the final meeting, they had a term sheet for us, Jason Mendelson told Jesse on the phone I believe. It was exciting.

Goran: How are you coping with the company growth? Do you use any strategies, attend seminars, read any books, gut feeling? Werner Vogels for example likes to use small teames, and he calls it the 2 jumbo pizza rule. If you can’t feed your team with 2 jumbo pizzas, the team is too big. 🙂 Do you have any particular company culture, do you do something different?
Ben: There are only six of us, so we haven’t run into any huge growing pains yet.

We gun for constant communication: Jesse and I have a meeting at least twice a week where him and I catch up;
we have a weekly planning meetings, and daily stand-ups with the team. The planning meeting to make sure everyone is on board for the goals of the week, and the stand-ups to make sure that everything is going alright on a daily basis.

One thing we do that’s pretty neat, is a hacking day every two weeks. This is an entire day where developers can work on whatever they feel like, with an emphasis on getting a roughed out prototype of the idea done that day. This does an awesome job of encouraging creativity, and the features often make their way into production.

Goran: I see that your office is “in a shared space called Dolores Labs.”, can you share your thoughts on what it’s like to work in Dolores Labs? Does it have to do anything with CrowdFlower? Are there any other cool startups sharing space with you?

Ben: Dolores Labs was originally CrowdFlower‘s office, it was converted into a shared space by Trinity Ventures when CrowdFlower outgrew it. Working in shared spaces has been great for us. It gave us a good set of peers early on, when our company was small. We’ve shared offices with Card.io, Milk, Happiness Engine, and Tapviva, just to name a few. It’s been great to be able to bounce ideas off these fellow entrepreneurs, I highly recommend a shared space for early stage companies. (Goran: You can read more about Dolores Labs transformation to CrowdFlower in this great inc.com article)
We recently moved into our own offices, in the Hamm’s building in San Francisco. This is an old brewery that has been converted into a space for startups. Along with Attachments.me, Asana, Rdio, and Get Satisfaction are based out of here.

Goran: Hypothetically speaking, if you sold all your companies for $100 gazillionbazillion what would you than do?

Ben: I’d rock-climb for six-months, then build my next company. Afterall – Rock Climbing Saved My Life, and Made Me a Better Software Developer.

Goran: What does your typical day look now? Do you code late, or do you get up early? Do you worry about sitting wrong, or drinking too much coffee?

Ben: Hours are flexible, if there is a big feature we’re all working on, we’ll tend to put in longer hours. We encourage everyone to live a balanced life. For example, if you you want to leave early one night a week to go to Yoga, that’s awesome. I think we all do a pretty good job of staying healthy, because of this atmosphere.

Goran: My startup WhoAPI deals with domains, so I just have to ask you a couple of domaining questions 🙂 What was the first domain name you registered?

Ben: hackwars.net, a game I made in college.

Goran: Do you have any other cool domains except attachments.me? For example, would you be interested in buying attachments.com, or something like mail.attach? Why yes, why not?

Ben: We looked into getting Attachments.com, but it was a hassle as it was owned by a fairly large company. We own att.mn, which we plan on using for short-urls eventually.

There’s also this great review on domain.me about attachments.me, check it out. Attachments.Me Rethinks Email Attachments: How Dropbox, Box.net and Gmail Should Work Together

Angel investor wants 50% equity, not exactly an angel

First of all, I should say that 50% out of nothing is still nothing. You shouldn’t be afraid of giving equity, however, you should be smart about how much you give and to whom. If an investor asks for 50% of equity he is probably inexperienced. Why?

1.    If he has the majority of equity, you are actually not the owner of “your” company, ergo it’s not your company. If he is asking for  50% he is probably an angel investor, which means you “lose” a lot and you haven’t even started. In fact, you just had your first exit, and you can go on vacation. This will most likely kill the entrepreneur inside you and if the dark days come (and trust me, they will) you are probably more likely to raise hands, say that it’s not your project anyway, and leave.

2.    If you are willing to give away 50% of something that’s so valuable and spectacular, why are you doing it? If it’s not that spectacular, why would I want to do it in the first place?

3.    If the investor is experienced, he is probably testing you, your negotiating skills and your perception on value of the idea. But in this case, he will probably start with a much lower take in equity depending on the region, industry, market size, etc.

Angel investor asks for 50% equity

Angel investor wants 50% equity

How much of equity should you give away to an angel investor? It depends on many factors, sadly your location is the first one that will influence this decision. In Silicon Valley, angel investors get below 10%, but in other parts of the world equity goes as high as 30%. You should also take into account if it’s „smart money“ or just money, that you are getting.

If your angel has a big contact list, or Rolodex, as they like to call it, perhaps it’s worth a consideration. Sometimes 30% equity means the success of your startup, and 6% means failing. This is something you will have to decide on the spot, since these decisions are really unique, custom and differ from case to case.

Giving away equity also depends on the amount of money you are getting. Also, this sets the current value of your company. But, company valuation isn’t something you should be concerned at this stage. Now your top priority is to launch early, launch often or as some say “fail fast”. Or as Guy Kawasaki would put it: „Don’t worry, be crapy“. So let’s take the 50% equity as an example and see how it would play out.

Angel investor: Your project looks interesting, and I am interested in taking a shot. I can give you $50.000 for return of 50% in equity.

You: Thank you very much, I am glad you like what we are doing. But, I am willing to give 10% at most. I want to leave room for first team developers, and VC fond.

Angel investor: Ok, even 10% sounds good, but than I am willing to give only $10.000.

The question now is, what are you going to do with only $10.000? Is this investor worth the bother? Are you going to answer his phone calls on Sunday when the project starts to go south? Is this investor going to scare away other bigger investors that want to be alone before the VC fond comes? What if you took 30000 for 15%? How much money do you need in order to get the startup moving and making first sales? How much money/time do you need until first sale? How much money/time do you need until break even?

I know I put up a lot questions, and not so much answers. However, asking the right questions will move you in a direction you want to go.

You have just read the 3rd question and answer of my book. Interested in reading more? Preorder my ebook, and support the good I am doing.

[EDIT 22nd, August, 2014] If you liked this blog post, perhaps you will like the ebook]

26 Fundraising Questions for Startups

26 Fundraising Questions for Startups

26 Fundraising Questions for Startups

Pricing strategy for startups: Do technical co-founders suck at pricing?

Psychological pricing - http://en.wikipedia.org/wiki/Psychological_pricing

I was just looking at the new prices for WhoAPI, and I have to say that for better part they were set up by the other co-founder. I wanted to raise some concerns, and instead of just going to him individualy, I decided to write this blog post. Hopefully it will help startups like Webiny who are just in the process of changing their pricing strategy. And also give me a chance to go through some things on my own, and give an opportunity to the other co-founder to learn something.

Psychological pricing

Psychological pricing

In startups like WhoAPI, and Webiny where there is a mix of a technical and business oriented co-founder pricing is a tough call to make. The technical guy either overprices (because he cares about his masterpiece) or underprices (because he is considering only the cost of his development time). It’s not that the other one doesn’t care about his masterpiece, it’s just that technical co-founders are short sited when it comes to pricing.

I believe that nobody is good at everything, and I have yet to meet a technical person that kicks ass at pricing strategy. Maybe I did meet him, but we didn’t talk about pricing. That’s because techincal guys don’t like to talk about pricing, business guys do. Get it? Rocky will knock you out with his left hand, but his right hand is just not so powerfull. Then why does Rocky like to punch with his right hand? Now, don’t get me wrong, I love technical co-founders, I work with one for the past 10 years, and you will find here interviews with them, but at least they could read a little bit about this, if they wan’t to make such a key desicion.

The technical co-founder needs to put in the quality input guiding the business co-founder, giving him a ballpark on the complexities of their product. And than the business co-founder needs to set the prices. After all, it’s his ass on the line if the product doesn’t sell, or the company isn’t making enough money. (That off-course is unless it’s a lousy product). But it’s not about covering your ass, it’s about getting the company (meaning everybody on board) move forward!

Can you set the price on this 100 ft yacht? Why not?

Can you set the price on this 100 ft yacht? Why not?

Pricing a product is one of the toughest things to do in business, especially in startups, and especially in disruptive startups with innovative products (or services, but I am using the word product). Pricing your products properly in many ways leads to company’s success!

Before setting prices, one must be clear about one thing, you are here to make money. The creative part is over, now it’s time to focus on making money. This does not mean “rip people off”, but take into evaluation what your client’s ROI will be. So, don’t sell that life insurance to the poor guy who barely has money for bread, just to make the sale. Making money means generating enough revenue from selling your products so that you can not only cover your costs, but take a profit and perhaps expand your business.

The biggest mistake many businesses make is to believe that price alone drives sales. Prices, rebates, discounts are just short-term rush, like a drug. It creates addiction, and takes you to a downward spiral! There are no passionate clients and buyers tha tattoo a companies logo on their body! Do you think that a 20% discount will make you client tattoo your logo? On more information about this, please read Simon Sinek’s: Start With Why.

The secret of profitability is not to sell a lot, but rather to sell a specific offering to a specific group and, crucially, not to waste time or resources on customers who fall outside the target group.

The secret of profitability is not to sell a lot, but rather to sell a specific offering to a specific group and, crucially, not to waste time or resources on customers who fall outside the target group.

Selling price is a function of your ability to sell! Everybody can sell a Ferrari for $200, but can you do it for $200,000? It’s no surprise technical people aren’t good at setting prices, most of them aren’t good at sales! You can find more about this with How to Sell at Margins Higher Than Your Competitors : Winning Every Sale at Full Price, Rate, or Fee, Lawrence L. Steinmetz, co-author of How to Sell at Margins Higher Than Your Competitors : Winning Every Sale at Full Price, Rate, or Fee.

“What’s the difference between an $8,000 Rolex and a $40 Seiko watch? The Seiko is a better timepiece. It’s far more accurate? The difference is your ability to sell.” says Lawrence L. Steinmetz.

Usually it involves considering certain key factors, including pinpointing your target customer and take into account how much will he profit from your product (or what will your product provide him), tracking how much competitors are charging, and understanding the relationship between quality and price.

  • Your actual product costs, including labor and the costs of marketing and selling those products.
  • All of the operating expenses necessary to own and operate the business.
  • The costs associated with borrowing money (debt service costs).
  • Your salary as the owner and/or manager of the business.
  • A return on the capital you and any other owners or shareholders have invested.
  • Capital for future expansion and replacement of fixed assets as they age.

You may realize that you have missed your target audience by pricing your products too high. You can always choose to discount your products or give customers something for free in order to get them to try your product or generate traffic to your storefront or website. “You have to get people in,” says Charles Toftoy, associate professor of management science at George Washington University. “People like getting something for free or some kind of discount.

Your product price should vary depending on a number of factors including:

  • What the market is willing to pay.
  • How your company and product are perceived in the market.
  • What your competitors charge.
  • Whether the product is “highly visible” and frequently shopped and compared.
  • The estimated volume of product you can sell.
Perhaps the most important thing in setting prices is that once you do set up prices, that is only the first step. After doing that, you just made the first step. Maybe you can try to integrate Eric Ries’s Lean Startup methodology? Launch some prices, see how you get traction, and then iterate, or take into account for your next product launch once you see your customer segment. You should always test new prices, new offers, new combinations. But never lose your vision, never lose your why (Simon Sinek). Remember, the price is just an end result. Somebody can always, and I mean always be cheaper! Every single time!
Skip to 20:19 of this video, and watch how Steve Jobs jokes about pricing the iPhone.

Another crucial component in pricing is measuring. There’s no point in doing anything if you don’t measure it. How do you know what made an impact on that change? Was it the price reduction, or did your sales feel more confident and managed to get more sales? Sometimes a salesperson has difficulties selling the product because he feels he is ripping the customer off, never a good feeling for a sales rep.

One thing is for sure with pricing, you will know really soon if you got it wrong…