My buddy Jason had a GREAT post about rules for startups. Read it, love it learn it.
Of course, anyone who has started a company has their own rules and guidelines, so I thought i would add to the meme with my own. My "rules" below aren't just for those founding the companies, but for those who are considering going to work for them as well.
1. Don't start a company unless its an obsession and something you love.
2. If you have an exit strategy, its not an obsession.
3. Hire people who you think will love working there.
4. Sales Cures All. Know how your company will make money and how you will actually make sales.
5. Know your core competencies and focus on being great at them. Pay up for people in your core competencies. Get the best. Outside the core competencies, hire people that fit your culture but are cheap
6. An expresso machine ? Are you kidding me ? Shoot yourself before you spend money on an expresso machine. Coffee is for closers. Sodas are free. Lunch is a chance to get out of the office and talk. There are 24 hours in a day, and if people like their jobs, they will find ways to use as much of it as possible to do their jobs.
7. No offices. Open offices keeps everyone in tune with what is going on and keeps the energy up. If an employee is about privacy, show them how to use the lock on the john. There is nothing private in a start up. This is also a good way to keep from hiring execs who can not operate successfully in a startup. My biggest fear was always hiring someone who wanted to build an empire. If the person demands to fly first class or to bring over their secretary, run away. If an exec wont go on salescalls, run away. They are empire builders and will pollute your company.
8. As far as technology, go with what you know. That is always the cheapest way. If you know Apple, use it. If you know Vista... ask yourself why, then use it. Its a startup, there are just a few employees. Let people use what they know.
9. Keep the organization flat. If you have managers reporting to managers in a startup, you will fail. Once you get beyond startup, if you have managers reporting to managers, you will create politics.
10. NEVER EVER EVER buy swag. A sure sign of failure for a startup is when someone sends me logo polo shirts. If your people are at shows and in public, its ok to buy for your own folks, but if you really think someone is going to wear your Yobaby.com polo you sent them in public, you are mistaken and have no idea how to spend your money
11. NEVER EVER EVER hire a PR firm. A PR firm will call or email people in the publications, shows and websites you already watch, listen to and read. Those people publish their emails. Whenever you consume any information related to your field, get the email of the person publishing it and send them an email introducing yourself and the company. Their job is to find new stuff. They will welcome hearing from the founder instead of some PR flack. Once you establish communications with that person, make yourself available to answer their questions about the industry and be a source for them. If you are smart, they will use you.
12. Make the job fun for employees. Keep a pulse on the stress levels and accomplishments of your people and reward them. My first company, MicroSolutions, when we had a record sales month, or someone did something special, I would walk around handing out 100 dollar bills to salespeople. At Broadcast.com and MicroSolutions, we had a company shot. Kamikaze. We would take people to a bar every now and then and buy one or 10 for everyone. At MicroSolutions, more often than not we had vendors cover the tab. Vendors always love a good party :0
These are all off the top of my head. But they have worked for me so far.
A Couple of My Rules for Startups
Recent Posts
- Beating Google ? (5/14/2008)
Reader Comments
(Page 1)2. Some of this might be a bit hard to swallow but it's tight!
I have worked for a few startups and the ones that stay great followed this philosophy. The tide really starts to turn after a buyout though. Larger companies struggle to maintain a culture like this. Especially the hierarchy and politics.
Posted at 2:58PM on Mar 9th 2008 by Steve
3. I like the comments on expenses. Don't spend any money unless it is a current need. I can't stand some of the spending people do based on the speculation that there business is going to grow extremely fast and be successful in a week. Also new policies and rules kill more time. Don't create new policies without removing and old one or being absolutely sure that it will lead to more money.
Posted at 3:19PM on Mar 9th 2008 by Refrigerators
4. I'm going to disagree with you on two points.
* Offices: It sounds good on the surface to have no offices, but you might pay for it more in the long run. Interruptions when doing any type of programming can be killer time-wasters. You're in the zone, you're balancing dozens of pieces of complex information in your head to try and get some aspect of the system right, and somebody pokes you and asks you for some help with something and all of a sudden you're out of the zone and you've got to spend 30 minutes mentally getting back to where you were before you were interrupted. Maybe you can go without offices if you have a solid "don't interrupt people when they have their headphones on" type of policy, but having no offices can waste a lot of time.
* Expresso Machine: Spending money needlessly is a bad thing, but spending a bit of money to be more productive is a good thing. If you can save even 10 minutes per employee per day by having them walk to a small kitchen for a quick cup of coffee they can take back to their desks instead of going down the street and waiting in line at Starbucks, the thing pays for itself rather quickly.
Much of the rest of the advice is understandable though.
Posted at 3:45PM on Mar 9th 2008 by Chris Papadopoulos
5. So true about PR agencies -- use to be with one. A huge waste of money. Go without on! Startups should be calling on press - when you have press worthy news. In the downtime, create you top tier press list, touch base with them, send info (something you read, heard, etc.) they can use. BE BRIEF! DO NOT GIVE THEM MARKETING BS
Posted at 3:54PM on Mar 9th 2008 by Tina C
6. Wait...that posted before I was through! (!). Anyway, as I was saying, if you stay cloe to the press you want to notice you, you're as good as in. PR firms just rack up billable hours and it's all BS. Also, don't for for quantity in press hits, quality only. Quality means publications everyone knows and reads. Who cares if you get the cover of some po-dunk pub. And never EVER pay for press. Need not say more on that one....
Posted at 3:55PM on Mar 9th 2008 by Tina C
7. Locate yourself in the South, or at least middle America! With technology and travel you do not have to be in big cities anymore. You save a ton of money on everything including offices, equipment and people.
Posted at 4:50PM on Mar 9th 2008 by Lucas
8. Would you explain #5 in more detail? By "your core competencies" do you mean the company's or founder's? If the company is a tech company, do you mean pay up for software developers and pay cheap for sales people and service/support people?
Posted at 5:42PM on Mar 9th 2008 by Bill P
9. I agree with all but #2, but not for the reasons that you would probably expect.
The typical rebuttal for this is that (most) VC's will demand an exit strategy. From their perspective, someone who has thought through the exit is someone who is savvy, credible, presumably realistic (unless is the strategy is 'uh - get bought by google...'), and most importantly - a fit with the VC's primary motivations - to liquidate their own investment in a timely fashion.
That said, I've heard your suggestion before, that a 'true' entrepreneur is one who is passionate about creating, growing and nurturing his startup, come what may.
The reality is somewhere between the two - not the extreme position you suggest - but for a different reason. Simply put, it comes straight from your answer to #5 - know your core competencies. The right person to create a company is not always the right person to grow a company, and that may not be the same person who is right to manage a business that is the more mature stages of its life cylcle. This self-awareness is, I believe, critical to a would-be entrepreneur - and knowing when to hand over the reigns, either via an exit or by bringing in a professional management team is a decision that must be well-thought through well in advance.
Posted at 7:09PM on Mar 9th 2008 by Alasdair Trotter
10. Great advice. I'm just forwarded this page to 5 people.
Posted at 7:15PM on Mar 9th 2008 by Sports Bettor
11. I agree with Chris (#4) and heartily disagree with you on your point about no offices. It's my experience that managements that favor open offices are almost always untrusting of their employees, afraid that the employees will be goofing off or doing personal business on company time. If this proves to be so, then you hired the wrong people.
I'm in the sales game. When you're on the phone trying to listen to what your prospect is telling you about their company politics, operating environment, buying process, decision making, etc., etc., taking notes of what they are saying while trying to concentrate on formulating your next question, the last thing you need is to be distracted by surrounding office noise (talking , laughing, ringing phones) and other antics.
You also don't want your prospect to hear extraneous office noises and other people on the phone, which can make your company sound like some sort of time-life call center boiler shop. Conversely, with salespeople working on the phone, other people in the office are also disturbed by the constant noise from one telephone conversation after another, all day long. Taken together, a noisy open environment is a distraction and WILL result in an overall loss of productivity.
Also, do you really want the engineers and office staff included in the negotiation discussions for each prospect? Hearing discussions on competing products, knowing how much you are selling the product for and what kind of discounts you are giving? Didn't think so.
The job where I was most successful, I had a small, windowless but private office. The positions where I was least successful were offices with low cubes and a lot of noise. I refuse to work in an open environment and in fact, walked away from one such opportunity a couple months back. Their loss......
Posted at 7:51PM on Mar 9th 2008 by Jojo
12. There is NO REASON whatsoever for an office...cell phones, EVDO, come one people...ALL employees should be selling the product every second. You want privacy? Go sit in your car. An office is a ridiculously expensive proposition. Every employee should work from home...keep out the ridiculous costs, have everyone on sales calls always, and the company is five steps ahead of their competition every single time...
Posted at 8:41PM on Mar 9th 2008 by Doug
13. #3 When it comes time to hire, what positions should you fill first? My first thought is to fill the positions that you don't like to do but I’m not sure how to find people that would "love to be there" doing a job that I would not like to be doing myself.
Posted at 9:10PM on Mar 9th 2008 by Shawn from Realado.com
15. Some great wisdom in there. No offices, no swag, and a flat organization. A great way to get it going!
Posted at 9:59PM on Mar 9th 2008 by Ken Hanscom
16. I think you are way off on hiring PR firms Mark. I have had tremendous success working with PR firms in most of my startups. I got great advice from a PR guy when I started Rust.net" "Someday Ameritech is going to enter the ISP business. Do you think you can out advertise Ameritech?" He was right. With help from a local PR firm we managed to be listed in every review of ISP's written at a time when the Internet was a hot topic. The phone rang off the hook.
I have used PR VERY successfully at RustNet, Gartner, Webroot, and Fortinet. But go ahead and give this advice to everyone else, it adds to my competitive edge!
-Stiennon
17. Thank you for advice.
I'm forwarded this page to 2 friends.
Posted at 10:32PM on Mar 9th 2008 by PR
18. Great list. Funny, I am in the middle of interviewing PR freelancers -- wasn't sure when/if to hire. Looks like that has been answered resoundingly. I will definitely share this with all those startups on campus.
Posted at 11:50PM on Mar 9th 2008 by Campus Entrepreneurship
20. Interesting. #1 is probably the MOST important yet will likely be the least-heeded observation here...
I semi agree about the offices - there are times when topics, be they financing or personnel or other, need to be discussed and would be inappropriate for others to hear. I think having numerous "private" rooms is useful if you aren't going to have dedicated offices.
I mostly disagree about the PR firms. While MANY are a waste of money, the industry should not be completely written off. My thoughts on this are on my blog here: http://www.stagetwoconsulting.com/good-marketing-aint-cheap-67/
Posted at 1:05AM on Mar 10th 2008 by Jeremy Toeman
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1. So Shoemoney shouldn't be doing t-shirt friday?
Posted at 2:56PM on Mar 9th 2008 by michael webster