Chip Griffin: Pardon the Disruption

Don't Fear Failure, Learn from It

Next week I will join a panel of entrepreneurs talking to students in an entrepreneurship class at the University of New Hampshire on the subject of failure. This is a subject that numerous entrepreneurs and investors have talked about in the blogosphere in recent years. I'm certain I have even chimed in on occasion.

But in an effort to organize my thoughts to best convey my experiences, I thought it might be constructive for me to write about it first in some detail.

Different Kinds of Failure

Spectacular Collapse. When most people think of failure in an entrepreneurial sense, they likely conceive lots of money flushed down the drain, jobs lost, and doors shuttered. Indeed, these spectacular collapses often get well-reported. When companies raise millions of dollars in venture capital and go kaput, there are usually plenty of jealous folks who like to make an example of them, especially in these days of prolific social media. And it was less than a decade ago when the first bubble burst and nary a day went by without such a tale being told.

Death of a Thousand Cuts. More often a startup simply runs out of steam, the victim of a series of small failures over time. Perhaps the product never really came to fruition, the market never quite gelled, or the sales process didn't work. Regardless, eventually the company runs out of money or the founders run out of energy trying to make it succeed, or both.

The Land of Lost Opportunity. This last form of failure may not be viewed as such by many, but to my mind it is far more common than you may think. It integrates some of the same small problems that contribute to the first two types of failure, but the venture may actually survive and even make money. But it never rises to its full potential. Perhaps it was the deal that was never done -- or a deal done too soon. More likely it was a failure to invest time and/or money resources at the right time. It's like the baseball team that wins 95 games and finishes just out of the playoffs anyway. While the team played well, it is no less a failure to fall one game short than twenty.

Lessons from My Failures

I have never experienced a Spectacular Collapse, probably because I have always eschewed "vulture capital" (a phrase I picked up from a VC friend) so it has contained the fallout. Nevertheless, I have learned a great deal from the other two kinds of failure I describe above.

Get a (Business) Spouse. To my mind, it is nearly impossible to be a successful solo founder of a company. Sooner than later, you need to join up with someone just as passionate about the business as you are. Having someone to bounce ideas off of, to keep your emotions in check (never getting too high or low), and to complement your skills and personality are absolutely critical. And don't delude yourself into thinking you can get this out of an employee. No matter how good an employee you have, it's different than having a partner in the business committed to total success. To put it in crass terms to help you understand: who stood by Elliot Spitzer's side in his final hours in office? The woman he married, not the one he hired.

Your Startup Needs to be a Daily Passion. As a serial entrepreneur, this is one of my biggest shortcomings. I have professional ADD and it has probably hurt my ventures more than anything else over the years. Trying to juggle multiple startups at the same time can be a big mistake, especially if nobody is focused on each startup for the better part of every day. A startup isn't a part-time gig, even though you may need to take on side work to bootstrap your venture. At least one of the founders needs to wake up every day asking how they can move the ball forward -- and then doing so.

Trust Your Gut Instincts. I never had my heart in one of the companies I co-founded. I actually argued with one of my partners about it for months before I finally relented and agreed to start it up. I saw too many likely pitfalls and too little long-term upside. What made me change my mind? Dollar signs. The one sign you should almost always ignore. It clouds your judgment and makes you do stupid things. All that said, the business actually did darn well for a period of time, and I made decent money off of it. But ultimately it wasn't a viable ongoing business. Thus, still a failure in my book.

Fish or Cut Bait. I like to say that my first consulting business petered out because I got too busy with CustomScoop's success. And that's partly true. But what really held that company back was my unwillingness to plunge deep into the risk pool by growing it into a "real" business. I insisted on growing through the use of freelancers (and I had no partner). Had I bit the bullet and hired my first employee, that company might well still be going strong right beside CustomScoop. Ultimately, I walked away from it at its peak, and I still wonder what might have happened if I had looked to convert it from a simple sole proprietor doing consulting into something more.

A Final Word

Don't fear failure, learn from it. Whether your own mistakes or those of others, there's lots to learn. Unless you are extraordinarily lucky, you will experience failure just as I have. Treat it as an education rather than a disaster and you'll be that much stronger for it.

Making Sense of All This Startup Advice

Many bits and bytes have been spilled over the past few days about how to curb costs and get the most out of your startup team. The never-shy Jason Calacanis launched the discussion when he rattled off a series of tips for startups to make money, including some controversial ones like firing non-workaholics, buying an expensive espresso machine, and enticing employees to stay in the office longer by catering food. Most of his advice focused on saving money, however.

The Critics and Supporters Weigh In

Christopher Hawkins takes issue with Calacanis' desire for workaholics. On the 37 Signals blog, he writes that you should "Fire the people who are workaholics!" He goes on to share a number of specific reasons for his view and concludes: "If your start-up can only succeed by being a sweatshop, your idea is simply not good enough. Go back to the drawing board and come up with something better that can be implemented by whole people, not cogs."

Venture capitalist Fred Wilson offered his two cents, largely agreeing with many of Jason's points but adding one that really resonates with me: "hire utility infielders" he says. In other words, find some good jacks-of-all-trades for your startup team where you can't afford lots of specialists.

TechCrunch founder Michael Arrington says its not just about saving money, but also about hiring the right people.  Billionaire big mouth Mark Cuban (whom I admire despite the moniker) serves up his own take, focusing in part on the need for the founder to be passionate about the startup and not focused on an exit strategy. He also wisely suggests zeroing in on how to make money.

Pat Phelan chimes in from across the pond and suggests that startups look to the suburbs for cheaper office space and curb event and travel costs. (In other words, no trips to visit him in Ireland unless you can really justify it!)

Does Anything But the Product Really Matter?

Dave Winer, often a contrarian, offers up an important observation of his own, however, when he speaks of companies he has watched succeed and fail over the years.

the difference is the ones that succeed have a hot product that lots of people want, and the ones that fail don't. I don't think whether you savor every penny makes much of a difference, in fact if you pinch them too hard your people are going to hate you, and they have to love the founder, just as the customers must and the press and even the competitors.

I often find my own views at odds with Dave's but this time I have to admit I'm in agreement more than disagreement.

So What's Important Here?

Take all of this advice with a grain of salt. If you read the suggestions of all of these individuals, you will see that they disagree as much as they agree. Yet most of them have been quite successful in the startup world themselves.

You can find an expert or a successful person who will tell you that anything you believe is the right way to go. Pick up a stack of business books and some will argue for meetings and some against. Others will advocate work-life balance and some will exhort you to make work your passion.

Ultimately, you need to figure out what works for you and your startup. You will make mistakes. And others will tell you you're doing it all wrong, while some will say you "get it" (only because you agree with them, by the way).

The good news is the bad news. There's no playbook to follow. You'll be making the rules up as you go along but you'll be judged by others who may view the rules differently. Go forth, build a great product, and have fun while you do it. What happens, happens.

Are you a writer with a passion for startups?

I'm looking for a few good writer to serve as part-time correspondents for Start Rocket, my new media publication focused on high-tech startups outside of Silicon Valley.  Specifically, I need people in Boston, Chicago, Denver, New York, and Washington to start who are willing to write between 1 and 4 articles each month about startups, entrepreneurs, and VC's in their regions.  I'm also looking for others to write in specific regions (like Texas, the Southeast and Southwest) so don't feel left out -- unless you are based in the San Francisco area.  I'm trying to offer a fresh perspective on the high-tech startup scene from people in those geographic regions.

You will be paid for every article we publish.  I'm looking for high quality writing from people willing to write original stories. It doesn't need to be investigative reporting, but I'm also not looking for a story that just refers to what others have already said.  I want news, perspectives, product discussion, profiles, etc. that include original reporting.

If you think you might be interested, email me and let's see if there might be a good fit here.

A Use I Never Thought of Before

Listening to fellow entrepreneurs speak at the Defrag conference in Denver today, I realized that a lot of my brethren were uttering a phrase I often find escaping my own lips.  "My customers are using my product in ways I never thought of before."

It struck me, not because my pure brilliance is being stolen by others in the world of startups, but because it's an important point to underscore.  Successful products will almost always be used in ways that the original inventor didn't consider.  Innovation has a great track record in this regard.  Consider all of the innovations created for the space program -- from Tang to Teflon -- that have found their way into the hands of consumers for uses beyond what the scientists behind them had likely planned.

But it also should serve as a reminder to all entrepreneurs and innovators that once you release something into the wild, it will follow a path to be determined by the market and customers, not necessarily the one you had intended.  Being a successful startup demands that you prepare for and embrace the flexibility needed to follow the flow. 

Disruptive Dialogue: Chris Brogan Discusses How "Media Makers" Can Build a Real Business

Chris Brogan graciously agreed to speak with Disruptive Dialogue about his advice to "media makers" who want to make a living off of creating media.  This is a topic he has written about on a number of occasions, but perhaps most comprehensively in a blog post over the summer.

(Click here to listen to the 15 minute interview.)

In the interview, he stressed that his advice applies primarily to those who want to make money directly from their media content, as opposed to people who create media for their friends and family or even professionals who simply aim to raise their profile and build their reputation.  This is, in his words, for "someone looking to pay their way."

At first, many successful podcasters or video bloggers "lived by their show name."  Chris wanted to make sure that people understood that what they ought to be creating instead is a production company brand rather than simply a show brand. In so doing, it becomes easier to create spin-off enterprises, to sell a particular effort to another company, or fold a failure without taking the brand down with it.

In addition, Chris talked about how he has a less than 2 minute segment in each Marketing Over Coffee podcast to help build his own brand ("Social Business Class").  This represents an example of what he describes as designing content that can be "slotted in" to a larger content production.  He notes that sometimes larger media enterprises may be looking for chunks of content to incorporate into their efforts, and if a media maker creates his material in such a way that it can be easily adopted, it may be able to expand its reach through partnerships.

The comments on Chris' original post were echoed in this interview in which he discussed the fact that a successful media enterprise will often create a community which will enable revenue opportunities beyond advertising.  But fundamentally, media creators must be sure to understand the needs of advertisers and ensure that they are collecting the appropriate traffic and demographic data that potential sponsors will want to know. He laments that many content builders don't have the "business sense" that they need to make a living at what they do and urges them to gain that knowledge.

The interview then turned to a discussion of the merits of audio versus video as a business model, including a brief look at Shel Holtz's post on that very topic today. Chris noted that his original post has frequently been misconstrued to be making a case against audio in favor of video.  In fact, he notes that he loves audio-based media and that a lot of video actually works better as audio because the video doesn't add value.  In particular, we talked about the Scoble Show which we both often listen to rather than watch, although we agreed that Robert does some of his shows where the visible content adds significantly to the understanding and impact.

"I don't think people who are investing money are right now very interested in audio overall," Chris warns. He senses more innovation in the video space which excites investors, and he recalled a recent conversation where he noted how hard it is for consumers to record and post audio online as opposed to video which has a lot of consumer-friendly solutions available.

Chris notes that the Student Loan Network not only has the Financial Aid Podcast, but they also have begun to dip into video in order to do things like show how to make a perfect cup of coffee (to save money by not going to Starbucks).  It underscores his point that the future will be made up of "media makers," not single silo audio, video, or text creators.  Blended, or multimedia, offerings will be the ones that succeed.

(Click here to listen to the 15 minute interview.)

Knowing What You Don't Know

Brad Feld wrote a post recently titled "Know What You Suck At"

I don’t hear people talk enough about what they aren’t good at.  First meetings are peppered with “I’ve done this”, “I’ve done that”, “I’m good at this”, “I’m experienced at that.”  However, rarely does someone volunteer that they suck at something.  I’m often amused by the pregnant pause that comes after I ask “so – tell me something that you are lousy at.”

Brad goes on to list things he doesn't do well (including driving, which I would echo myself).  He couldn't be more right with what he says.  We all have things we don't do well, and that's why we need to be aware of them, avoid doing them when possible, and surround ourselves with others who do them better.

But just as dangerous as not admitting what you don't do well is not knowing what you don't know.  As entrepreneurs, we often have to do things outside of our comfort zone.  in the early days of a company, everyone tends to where multiple hats.  And chances are everyone is stuck with something they don't like and probably don't even really understand.

As I was setting up a new company recently, I was faced with some routine tasks that needed to be done, but because I don't do them myself regularly, I didn't know the fastest and most efficient way to get them done. Things like opening bank accounts and getting tax ID numbers for the company, for instance.  Rather than making a potentially very costly mistake, I turned to one of the guys in another one of my companies for advice and assistance to make sure it got done right the first time.

And that's what we all need to be prepared to do.  Stop and ask an expert (or at least someone wiser than ourselves) when we don't know something.  Don't guess.  Don't make it up.  Get the knowledge that you need to do the job right.

Of course, sometimes there is no right answer, no clear body of knowledge that will help guide the way.  Sometimes you must operate on gut feel, and that's OK too.  Just so long as you don't believe you know what you are doing and admit your wining it or making a W.A.G.

Scott Karp Launches Publish2

Scott Karp over at Publishing 2.0 has quit his job and is starting a company, appropriately named Publish2.  He aims to "put his money where his mouth is" by betting on the vision of the future of media that he has outlined on his blog.  His stated goal is to create the ultimate consumer-facing news site by networking online journalism (everything from "news bloggers" to more formal journalists).

The details are still a bit vague, though an invitation-only beta is slated for September.  It sounds like something similar to what I have suggested is the future of news aggregation: a cross between free-for-all ranking sites like Digg, automated ones like TechMeme, and highly edited ones like Yahoo News.  Plus it may have original content, though I haven't had a chance to read all the material Scott has put online to achieve clarity on that point.

If Publish2 really does incorporate all of these different components, then I think it has a chance to be a powerful news resources. Hopefully, it will incorporate more than just text and pictures, as my own vision for the future of media sees convergence of text, audio, and video, with the right medium utilized for the content being conveyed.

This will certainly be a company I will be keeping an eye on.

StartRocket Delayed; Cork & Knife Launches

Slight change of plans in the order of launches in the properties in the new media company I'm starting.  StartRocket, the site focused on web entrepreneurship East of the Rockies, had been slated to begin producing content this week.  However, I have opted to delay for a few weeks to address some logistical/infrastructure issues, as well as to try to line up additional contributors before going public.

While those things are getting sorted out, I decided to release the new media site that I had slotted to launch second, Cork & Knife.  This site is focused on the people that make a difference in your professional or amateur fine dining experience.  Chefs, sommeliers, bartenders, servers, authors, purveyors, winemakers, and even the food media will be profiled to help foodies and gourmets learn more about the philosophies and personalities that impact the food and wine.

So, check out Cork & Knife and let me know if you are interested in becoming a contributor to that site or especially to StartRocket. 

I'll keep you updated in this space on developments on both fronts.

Technorati Tags: StartRocket, Cork & Knife, food, wine, fine dining, foodie, gourmet, new media, New Media Cocktail, media convergence, niche media, startup, entrepreneur

How Many Different Directions Are Too Many?

I'm a serial entrepreneur at heart.  An idea guy.  An angel investor.  I love diving into new things.  I guess you could say I have Entrepreneur ADD.  I just can't help myself sometimes.  A constant in my life since 2000 has been CustomScoop. But I have had other companies that I have started and sold off (for modest amounts) or shut down.  I have helped other companies grow, some successfully and some less so.

In With the New...

And now I'm in a phase where I have several different ventures percolating.  A new media company featuring niche online properties relying on my theory of converged media that I described in The New Media Cocktail.  First out of the gate will be StartRocket, a web site focused on Internet entrepreneurship with an "East of the Rockies" perspective.  Then I have a fine dining property in the works called Cork & Knife (more on that to come in due course) that will likely exist under the same company banner.

But I also have an inkling for a couple of other companies that are more application oriented.  One is a quick, fun application that I think would have real potential viral appeal.  It would likely take off or not and wouldn't require a ton of work unless it does (but then could be all consuming to make sure it could handle the load).  Another application I'm musing about has more lasting appeal and would actually nicely complement some of the things that the new media company I'm starting will do.

...While Hanging on to the Old

Of course, I'm remaining as CEO of CustomScoop, too.  In fairness, though, years ago I got out of the day-to-day management of the company and I play more of a strategic role while serving as the public face of the company -- probably Chairman or possibly hyper-active Chairman is a more accurate depiction of my role.  And I still have this blog and my podcast (both of which have been suffering of late as I have been gearing up the new venture and writing an e-book).

Not to mention speaking engagements, conference commitments, serving as a columnist for Mass High Tech magazine, and writing numerous one-off articles for various publications.

So How Much is Too Much?

I'm fortunate in that I have a great team with me at CustomScoop that enables me to roam free.  I also have a solid team of business partners who help make these things possible through things like our angel investing outfit.  I have had the good luck to assemble thoughtful outside advisors who are always there to have their brains picked.  And, of course, an understanding family that tolerates seeing me on the road half the year and buried in work at home when I'm not in some hotel somewhere.

From time to time over the past decade I have realized that I was going in too many different directions at once and everything was suffering.  Ironically, sometimes it was only two things that had my attention.  At others, I have been able to juggle as many as five ventures simultaneously without too many ill effects.

I guess it's one of those things that you can only define when you see it -- and hope that you do see it before it is too late.  Many successful entrepreneurs juggle more than one serious thing at a time -- look at Kevin Rose with Digg and Pownce.  Or even Bill Gates with Microsoft and his foundation.  Obviously, the key is to define one's role appropriately, surround yourself with real talent, and avoid over-committing. 

It will be interesting to see if I succeed at that concept this time around.

Technorati tags: entrepreneur, team building, time management, angel investing, venture capital

Looking for StartRocket Contributors

As I gear up for the launch of StartRocket on August 1, I'm trying to line up a stable of people who will contribute to the site by writing profiles of startups and covering events.  The pay will be modest, but the exposure and opportunity should help as well.  And, of course, if this takes off like I hope it will, then the pay will be better, the opportunities will improve, and who knows -- maybe it will even become a real company with stock options and everything!

If you're based East of the Rockies, have an interest in web entrepreneurship, and are handy with the pen or video camera, drop me a note and we can connect about your interests and how you might be able to contribute.  I'm most interested in steady contributors, but if you're only able to do an occasional contribution, feel free to shoot me your idea as well.

Be sure to let me know how you are interested in contributing, why you are interested, and point me to some links of previous blogging or videos for me to take a look.  My email address is chipgriffin@gmail.com.

Technorati tags: StartRocket, blogging, video, entrepreneur