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StartPad Countdown 1 - The Best Laid Plans of Startups...
 

StartPad Countdown 1 - The Best Laid Plans of Startups...

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It's easy (and perhaps necessary) for a new entrepreneur to be very optimistic about the business opportunity before them. But not every great idea translates to business success....

It's easy (and perhaps necessary) for a new entrepreneur to be very optimistic about the business opportunity before them. But not every great idea translates to business success.

Mohit Srivastava and Mikhail Seregine, previously of Faves.com and ClayValet.com respectively, discuss the rise and fall of tech startups. We will hear from these two experienced entrepreneurs who have learned the hard way how difficult it can be to achieve a successful outcome.

The goal of this talk is to arm you with knowledge of potential pitfalls and to help you recognize realistic and achievable goals for your own project.

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    StartPad Countdown 1 - The Best Laid Plans of Startups... StartPad Countdown 1 - The Best Laid Plans of Startups... Presentation Transcript

    • Mohit Srivastava Co-Founder & Former CTO of Faves.com Copyright (c) 2009 Mohit Srivastava
    • Copyright (c) 2009 Mohit Srivastava 1996-2000 BS in CS 2000 Dev 2002 Dev Dec 2004 Co-Founder & CTO Dec 2008 Senior PM Oct 2008 Consultant
      • Co-founded Faves in December 2004
      • Grew to 10 employees (including 2 founders)
      • Launched at Gnomedex in June 2006
      • Initial offering: “Share the Web, Connect with Friends”
      • Raised approximately $2M via multiple angel rounds
      • Still operating in low burn mode and are pursuing a few high ROI yet relatively low cost initiatives
      Copyright (c) 2009 Mohit Srivastava
      • Over 1M monthly visitors
      • Over $2 sitewide CPM in some months
      • One of TechCrunch 2007 “Web 2.0 Companies I Couldn’t Live Without”
      • Technology
        • Pioneer in aggregating friend activity (pre-Facebook newsfeed and pre-Twitter)
        • Pioneer in creating an intelligent in-page yet no-install authoring experience
      Copyright (c) 2009 Mohit Srivastava
    • Copyright (c) 2009 Mohit Srivastava
    • Copyright (c) 2009 Mohit Srivastava
      • Situation: We unknowingly overemphasized items that were “comfortable” to us while underemphasizing those that were more important for the business.
      • Mitigation: Checklist that captures the major components of a product lifecycle. This would have kept us grounded. I recommend: http://www.pragmaticmarketing.com/pragmatic-marketing-framework .
      • Corollary: Hire and/or find a co-founder such that you have the expertise to cover the checklist.
      Copyright (c) 2009 Mohit Srivastava
    • Copyright (c) 2009 Mohit Srivastava
      • Situation: We underestimated the difficulty in building a viable advertising-supported business. While both our CPM and traffic levels were respectable, one of those two parameters needed to be *exceptional* (e.g. 10x).
      • Mitigation:
        • CPM: More focus on a vertical with higher CPM’s.
        • Traffic: More focus on positioning and distribution.
      Copyright (c) 2009 Mohit Srivastava
      • Situation:
        • We had difficulty articulating why customers should pay for our white-label feature set. They perceived us as a “nice-to-have” but not a “must-to-have”.
      • Mitigation: Create an offering where the return on investment (ROI) is simple and direct. Articulate why you help your customers make more money and/or save money.
      Copyright (c) 2009 Mohit Srivastava
      • Situation: We did not have somebody with deep pre-existing relationships with our target customers. This is often *the* differentiator in a customer selecting your offering over a competitor’s.
      • Mitigation: Talk to your advisor network to find such a person. Be generous with equity and/or incentive-based compensation. Do not underestimate the value of relationships.
      Copyright (c) 2009 Mohit Srivastava
      • Situation: We focused on a general purpose Internet audience. We found that acquirers often prefer more targeted audiences. They (just like advertisers) are willing to pay to get access to customers consistent with their business. For example, a bookseller might pay for a community book review site.
      • Mitigation: Build your business around a lucrative and targeted user base.
      Copyright (c) 2009 Mohit Srivastava
      • Situation:
        • We (and hence our customers) were conflicted:
          • Were we about bookmarking or were we about friend activity aggregation?
          • In what area did we want to be known as the “only”, “best”, “first”, and/or “most-used” way to accomplish something?
        • Without good answers to the above, we fragmented our development activities.
      • Mitigation:
        • Answer the above questions
        • Hire a positioning expert
      Copyright (c) 2009 Mohit Srivastava
      • Situation: We could have given more attention to our highest value (yet smallest in number) group of users.
      • Mitigation: Periodically segment your user base. Understand the dynamics of each group, which groups you want to invest in, and what features will best target those groups. I recommend this case study by HBS – http://harvardbusinessonline.hbsp.harvard.edu/b02/en/common/item_detail.jhtml?id=707406 – which shows how LinkedIn did just that.
      Copyright (c) 2009 Mohit Srivastava
      • Situation: For awhile, we had a high “maintenance tax” which compromised our ability to innovate. This was a combination of us having built our own datacenter and us not bounding our database calls (i.e. no more than n joins, kill queries after ).
      • Mitigation:
        • Don’t build your own datacenter.
        • Anticipate requests that could bring down your site. Note: This is not the same thing as over-engineering in anticipation of massive user growth.
      Copyright (c) 2009 Mohit Srivastava
      • Release early, and release often.
      • Don’t be shy to share you idea – especially with friends and potential advisors. Do they get it right away?
      Copyright (c) 2009 Mohit Srivastava
      • More About Me
        • http://faves.com/users/mohit
        • http://thishostedlife.com
      • Questions?
      Copyright (c) 2009 Mohit Srivastava