Rock and Roll and Startups – “We’re getting signed!”

February 17, 2012 - Leave a Response

I’ve written three posts about how being a musician and being in a band is a lot like being a programmer and being part of a startup. Scroll down to read them. Now, part 4…”We’re getting signed!”

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Long before there was MySpace and YouTube, bands worked hard to “get signed”. This means a record label signs you to a contract and presumably fronts some money so you can make a record, go on tour, make music videos, etc. While I am keenly aware that the rules have changed in the music business, the model used to be fairly simple: getting signed to a record label meant that you might not be perpetually broke, playing shows for 5 of your friends on a Tuesday night.

In short, getting signed meant that someone else saw the potential in your band that you saw yourself. It was support from someone with a megaphone bigger than your own. It was a partner in your endeavor who provided – if only a little – some stability so you could focus on making music.

This is of course exactly like how raising venture capital is now in the startup world. You build a prototype of your product and go shopping for money. You are trying to find a partner who will open doors and write checks so you can focus on doing your best work. Without VC money it feels like you are in a band that plays the midnight slot on Tuesday night at a cafe in Waco in exchange for free chicken fried steak. With VC money, you’re bumped up to be the headliner on Saturday night at Antone’s.

At least that is how it seems.

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I was only once in a band that ever had any prayer of signing a record deal. Urban Pet Collective (junior year in college) went in to the studio once and recorded a three song demo. By some fate, a guy named Ed Levy fronted us about two grand to pay for studio time and finish the recordings. I didn’t have any part in that negotiation. I only knew that Ed had done the same for a band called “Honeybrowne” and they were starting to get some attention around Texas. So Ed gave us money, we recorded a three song demo, and then basically never saw Ed again until 8 months later when we needed money to record three more songs. I didn’t realize it at the time, but without Ed’s money, there would have never been any recordings of the band and we would have never been able to book shows all over the country and a handful of radio appearances. Having Ed’s support opened doors we couldn’t open ourselves. (This was all before Pro Tools and Garage Band made it possible to record studio level stuff in your bedroom).

After using the demo Ed financed to get shows in New York, Chicago, Detroit, and St. Louis, we applied for the North By Northwest festival in Toronto in the summer of 1998. We were given a slot at 11pm at an upstairs club. The stage was about 10 square feet but our five piece band played great. After the show, a guy from Fish Head Records gave our singer his card and told us to call him for breakfast in the morning. The next morning, we loaded our gear and left town for our show in New York. We weren’t interested in a small label out of Cleveland.

We didn’t realize that just like Ed had helped us get to that point, Fish Head could help us maybe get to the next point.

That was the closest I ever came to being signed to a record label.

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So much of that experience mirrors the startup world. You try and find partners to open doors and finance things. You try to “get signed” by some big, experienced firm that can help you navigate through the muck and mire of starting a business. But most successful bands actually are successful because they build followings one fan at a time, never sign record deals, and self-publish their music. Same with startups – most will never sign a term sheet with a VC. Those that are successful are likely to be self-financed, building their businesses one customer at a time.

There are no hit singles for most of us. There are no sold out shows at the LA Forum. There are no grammy appearances. For most of us, there is one club show after another. THere is a lot of hard work between shows getting every nuance and beat just right. There are tough times when it doesn’t seem worth it. But if you stay at it long enough you might look up one day and be able to say, “you know, there are a lot of people in the audience tonight.”

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February 15, 2012 - Leave a Response

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Ok, so now what?

February 14, 2012 - Leave a Response

Two of my friends have started “something” in the last six months. One invested a lot of his own time and a little money making a website that engages people to see how their behaviors, likes, habits, etc. compare to the behaviors, likes, and habits of other people in the community. The other invested a lot of money and time in a brick and mortar business.

The first person’s venture relies on a huge audience regularly engaging the site. His business model presumably is to sell advertising and (hopefully) build up enough of a data set to sell that data to corporations. This is the business model you see on Facebook, for example.

The second person’s product is in high demand and has a high price point. Landing customers can be a challenge, but simply having one customer pays the bills and two starts to put money in his pocket. If he were to “sell out” of his capacity at about 12 customers, he would be bringing in a nice chunk of change.

Unfortunately, both people’s ventures opened for business and did not experience an early “pop” of interest. So now both are in the unenviable “now what?” position.

Some people might encourage them to “pivot” or seek “social proof” or “product market fit.” My experience has been that these phrases are most often uttered by people whose business vocabulary far outstrips their business ability. Neither of my friends needs a wholesale change in what they are doing. Why? Because neither of them has had enough interest and audience to know whether what they are doing is good or bad, right or wrong.

I’m all for changing direction when something isn’t working, but you can’t change simply based on a hunch. Having 200 people visit a website and only 10% of them return within a week is not a failure – that’s actually a fairly solid rate of return. ANd having 5 potential customers visit a business and not buy isn’t a failure either – it might simply mean you need more volume. The 6th visitor could be a “yes”…or the 7th or 8th or 50th.

Changing directions for a business or an idea or a product is often important. Even a subtle change can be the difference between massive success and quick failure. But make sure your motivations are based in fact. Don’t give up on the initial direction just because great things didn’t happen as quickly as you wanted. OVernight success usually takes years.

The Rule of Awesome

February 10, 2012 - Leave a Response

It is so easy to overthink everything. Overthinking features, offerings, pricing, bullet points on a presentation….think and tweak and pivot and change and tweak some more. Just to make it awesome.

Quit overthinking everything. Nothing you do is going to take your product or service or idea from “pretty good” to “awesome.”

The Rule of Awesome is simple: Things that are awesome are always awesome. Things that are not awesome suck. Either now, or eventually, they will head in the wrong direction. THere is no crossing-over. Little tweaks and turns of the screw won’t make a piece of shit awesome. THe idea, the overarching concept, was either awesome or it wasn’t long before you came along to manage it.

In music it is easy to see that Awesome is always Awesome. THink Bruce Springsteen’s “Born In The USA” studio recording contrasted with the live version. It’s barely the same song, but it’s awesome both ways.

Same goes for “Patience” by GNR, which is soft and acoustic on record and loud and gritty live. Still Awesome. Dylan and Jimi Hendrix doing “All Along the Watchtower”, Marley and Clapton doing “I Shot the Sheriff.” Awesome is awesome.

The same goes for your business, your startup, your product. You can not fake awesome.

(As a caveat: People who buy things that aren’t awesome are AWARE that their purchase isn’t awesome but they are doing it anyway. Maybe its peer pressure or cost or availability or the fact that they like the Dell sales guy more then the IBM sales guy. But don’t let a person buying something somehow convince you that it is awesome, just as a lack of sales is hardly confirmation that something isn’t awesome.)

Its hard to operate in business for long and make money without having to respond to competitors with price cuts and discounts. It’s hard to create anything – a physical good, a website, a service offering – that stands up and stands out.

The way to grow margins and make money, however, is easy: have something that is Awesome. Have something to sell where – if your customer had an unlimited budget – they would choose your Awesome offering over the competition’s not-awesome offering every time. You would actually be surprised how much more people will pay for Awesome if they are given the opportunity.

ANd for an A/B test showing you that Awesome is always Awesome, check out Biffy Clyro’s “Mountains”, which is awesome no matter how the band plays it:

Live at Wembley:

Acoustic:

Yup, still Awesome.

Startups and Rock and Roll – Part 3 – Guitar tone

February 9, 2012 - Leave a Response

Look at earlier posts for the first two parts of this “series”. I wrote one about how naming your band and naming your business are basically the same thing. And I wrote another about learning to play guitar and starting a band as it relates to learning to code and starting a business. They are two of my favorite posts. Anyway, on to part three…..

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Guitar players obsess about their “tone.” The sound created by mixing various Amps, effects pedals, processors, speakers, and (of course) guitars makes up the tone. And guitar players are ridiculous about getting “their” sound. Ty Tabor (King’s X guitarist) used to famously build boxes to hide his amps in on stage so no one could see what gear he was using. I spent hundreds of hours (literally) in high school tweaking every knob just right and trying different strings in an effort to get the exact sound I wanted. Truly, if you are a guitar player then you know that the importance of “tone” can not be overstated.

Which is why I find it so funny that even though most guitar players know the following two things, they still obsess about their tone.

Thing #1 – No one cares about your guitar tone. In the event someone else cares about your tone, then they are also a guitar player and they probably think your tone sucks.

I am 100% sure that no one ever heard Jimi Hendrix play “Fire” in person and said, “That would have been so much better if he’d been using a Les Paul instead of a Strat.” And no one ever saw Guns N Roses and said, “Why is Slash using a Fender Twin for “Estranged” instead of a Marshall stack? THIS SUCKS!”

99.99% of people that listen to music neither know nor care that you are using a ’65 strat reissue with a maple fingerboard through a Fender twin rocking two 12″ speakers with a Boss DS1 distortion pedal. THEY DO NOT CARE. And as I said, the few people you meet that do care are also guitar players and they either (1) think your tone sucks or (2) are spying your gear to see how they can copy you. Most of the people listening just hope the music sounds good. The rest is unimportant.

This is exactly the same as coding. 99.99% of your users don’t care if you are using PHP or Ruby or Javascript or Perl or whatever. They don’t know what MySql is or what NoSql is or what a “stack” is or who named their kid Linux. They only care that the site, program, or app they are using works correctly. The remaining .01%? Well, those are the other programmers/hackers and they either (1) think your code sucks or (2) are looking at it and thinking of ways to steal the cool features you came up with.

Thing #2 – YOu will never sound like anyone else. When I was in high school I spent a ton of time at Texas Music Emporium. It was a music store run by some older rock-n-roll dudes (both named Jim) that were really helpful to other musicians. I probably spent $200 there EVER but likely played the guitars on their walls for thousands of hours. I was not a high-yield customer.

One summer night, they rolled out a flatbed trailer and put gear on it. A local drummer and bass player came and played Jimi Hendrix and Black Sabbath songs with Zack Wylde. At the time, Wylde was Ozzy Osbourne’s guitar player and his guitar tone inspired a LOT of discussion. The rumor was that for the “No More Tears” album he had recorded every guitar track 4 times using Les Pauls, Marshall amps, and a single Boss SD1 overdrive pedal. The result was a blisteringly thick wall of sound that amazed almost all guitar players. We tried to recreate his setup and never came close to sounding like that tone. It was never as heavy, as thick, or as biting in our bedroom as it was on his records. So my friends and I concluded that something else was going on because that guitar, amp, and pedal combo sounded NOTHING like Wylde’s tone.

Anyway, he gets on the flatbed trailer to start playing. He had pulled a Les Paul off the wall at TME, a Marshall amp from their amp room, and an SD1 guitar pedal from behind the counter. Everything was brand new and hadn’t ever been played by Zack Wylde before, and everything matched the setup he professed to use on the “No More Tears” record. He launched in to “Purple Haze” using the exact same rig that he claimed to use. The resulting sound is best described as being like standing in the middle of an artillery range with munitions exploding around you. He was a hurricane of sonic force that evening in a way that makes a young musician go home and quit playing for a week. He was that good, that “big” with a guitar off the wall and two guys he’d never met. And the tone? It sounded EXACTLY like the No More Tears recordings.

What’s the point? Zack Wylde could walk in to a guitar store and pull a guitar off the wall and sound like Zack Wylde. Eddie Van Halen could borrow my guitar and still sound like Eddie Van Halen. Dave Mustain could make “Sweating Bullets” sound right on a Pawn Shop guitar and Peavy Amp. Tone is in the player, not the gear.

This is the same as programming and staring a business – even if you could see under the hood and read all the code of facebook or Quora or Twitter, you wouldn’t be able to recreate facebook or QUora or Twitter. If you could look at the design process that went in to Basecamp, you wouldn’t be able to recreate how Basecamp looks. Even with the exact same tools and exact same music in front of you, you will NEVER be able to “sound” like someone else when your code is finished. You will always sound like “you.” The best guitar players – like the best programmers – realize this and embrace it.

Great Customer Service from Mouser.com

February 3, 2012 - Leave a Response

The folks at Mouser’s online team have really gone above and beyond in recent days and I thought I’d share: a few days ago we had a package that shipped to the wrong location. UPS will only let the shipper modify a shipping request. I sent an email to the general mailbox of the Mouser.com online team asking that it be rerouted. I was not holding my breath that it would be resolved anytime soon which meant I would have to tell my customer that their delivery would be delayed.

That would not be good.

Much to my surprise, Kayla with Mouser emailed me in about 10 minutes apologizing for the error and saying that the package had been rerouted to my location and would be delivered on time.

So, thanks for that…

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January 20, 2012 - Leave a Response

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The Myth of the Technical Cofounder

January 16, 2012 - Leave a Response

There is much discussion on startup sites like Hacker New and Quora revolving around the idea that every software startup needs a technical cofounder. The idea is that outsourcing engineering rarely leads to a quality product and investors are not likely to invest money if the tech-engineering isn’t done in house.

This may well be true. But it GREATLY overlooks the value of other roles in a startup, primarily sales. Paul Graham (of Y-Combinator fame) had a good post last week talking about how it is virtually impossible to code your way to success. He says – and I agree – that at some point, someone in your company is going to have to find customers and partners and negotiate contracts. For some reason, these vital roles are often put on the backburner. My guess is that many technical people simply don’t want to do them or are scared to dive in to sales and marketing – so they hide behind code instead of getting out there to sell the product.

A recent startup, Convore, recently changed their model because they couldn’t make any money despite a decent product. THe founder was quoted as saying (paraphrase) that they were in a fuzzy area because without a million users they couldn’t get advertisers interested.

Wait….what?

They built a product/business and the way they planned on succeeding was by getting a MILLION users (or more) and selling ads? If you know 100 people who will use your product then you would need each of them to get 100 people to sign up and each of THOSE people would need to get 100 people to sign up to get to 1,000,000 users. Think about how unlikely that kind of adoption is. And to base your entire/sole business model around it is not only foolish, but shows an utterly ridiculous avoidance of doing the hard sales and marketing work.

Conversely, if a company had a skilled salesperson capable of selling the product for $1/month to each user then it would be reasonable to imagine that getting 50 companies with 1,000 users each would result in a solid business with both the time and money to continue to grow (or 500 users at $50 a month or 100 companies at $200 a month, etc.)

While having technical expertise is of course vital in any software startup, you absolutely MUST avoid thinking that simply producing a great product will result in success. In fact, having a great product is only marginally better then having a crummy product if you still have no sales support. It’s like having a cruise ship sitting at port compared to a rubber dingy – neither one is going to sail across the ocean without fuel to run the engines.

Being technical is great. Having superior code and security and a dazzling user interface that provides value is all well and good. But if you don’t have people on board that can get someone else to give you their hard earned money in some way (whether it be customers, investors, advertisers, etc.) then you will be dead in the water.

How to Name Your Startup – More Rock N Roll

January 10, 2012 - Leave a Response

A month or so ago I wrote a post about how being a musician was a lot like being a programmer-startup-dreamer type. This post is part two or a series that will include a few parts

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Naming your startup is not hard. At all. Unfortunately, it’s the thing that most people starting a company fret over the most without good reason. My theory is that picking a name is something that can be done easily (i.e. no money required, no engineering, no financing, no selling). You can sit at your desk brainstorming as easily as you can sit in the pool with a beer thinking of what to call your new baby. The process of thinking of a name is easy, cheap, and taps in to a person’s creativity, so it makes sense that people would spend a disproportionate amount of time working on it. Plus it can be fun.

The most obvious problem with this activity is that it takes time from, you know, actually starting the business. Having endless meetings about how a name will play in the market and spending a lot of time making sure the Twitter handle and domain are available is not nearly as constructive as sitting down and saying, “We’re going to call it Acme Inc. until the site/app/product is ready. Now everyone quit thinking about names and let’s get to work.”

Not ironically, naming a band is exactly the same thing. When you are not a good musician, you spend an inordinate amount of time thinking of band names. I spent most of high school not learning anything but becoming a sensational “band logo drawer.” I drew logos for bands I was in, bands I wanted to be in, other people’s bands, bands I might start one day, bands that would be my side project after I was in the rock n roll Hall of Fame. HUNDREDS of band logos.

And even though I was in school while I did this, I wasn’t spending as much time as I could learning to actually be a good musician. I opted for art class over music (drawing vs. learning to play the guitar better). I drew logos while I should have been learning English lit, which included some sensational poetry that would have helped me as a lyricist. Without exception, I spent time doing the easy work (thinking of band names) instead of diving in to the hard work that would have actually been worth something.

As I became a better musician I became less interested in the name. It was apparent to me that the band makes the name, not the other way around. I was in a college band called Billy Ruben and the Little Fat God. That’s a terrible band name, but we were a really good band and people really took to us. By the time I was out of college, naming the band took two minutes: someone would say, “Let’s call it Broken Stars.” And everyone else nodded and we got back to work practicing that new song we’d just written.

As I mentioned above, naming a startup is much the same. Even worse, there are dozens (hundred?) of articles online about how to name your startup that bring back memories of the interviews I used to pour over trying to crack the code of how bands found their names. “So that’s what Alice In Chains means…a ha! Pearl Jam is really about this…”

Some of these articles about naming startups go so far as to break down how many letters, vowels, etc. “successful” startups have in their names compared to unsuccessful. Some of them talk about picking a name that explains what you do (TripAdvisor) while some say to think of something memorable and unique (Twitter). There is so much advice out there about naming a startup that – like most other advice having anything to do with startups – it is easy to find your head spinning in the midst of it all.

And most of it is complete and utter bullshit. Most of it is someone saying “this did work for me!” or “this didn’t work for me!” and the reader is somehow supposed to take that information and process it in to their own unique startup and take something from it. OK, sure, whatever. The truth is there is one rule about having a startup: Get to work. Do something. That’s all you need to know.

And there is only one rule you need to follow about naming your startup, and its the same rule to follow when naming a band:

Name it something that you are excited to hear come out of your mouth.

Period. The end. That’s it.

If Eddie Vedder likes telling people his band is called Pearl Jam then that makes it a GREAT name and people will be sold on it based on his enthusiasm. If John Lennon was more fired up stepping up to the mic saying, “Hello, we’re the Beatles” then he was saying “we’re the Quarrymen..” then that makes it a GREAT name. If Joel SPolsky (sp?) thinks “Trello” is a great name for his new list of lists product, then it is. If “HipMunk” is exciting for those guys, then great.

It doesn’t matter if the name conveys what you do or not. It doesn’t matter how many letters it has in it or the language origin or if its nonsensical or whatever. There are some bands whose names give you an idea of their music (Motorhead, Metallica, Megadeth) just as their are names of bands that don’t give any insight at all (Naked and Famous, Silversun Pickups). The Afghan Whigs could be ethnic music. The Twilight Singers could be a boys choir. There are great bands with awful names (R.E.M.) and awful bands with great names (…And You Will Know Us By The Trail of Dead). In the end, the band names don’t matter but rather the confidence and excitement that comes when the members of the band open their mouth at a keg party to tell someone for the first time, “Yeah, I’m in a band…we’re called Sixteen Deluxe.” or whatever.

Starting a business is the same. Your customers’ first impression will be the name of the company. If you want to call it “Alien Ghost Factory” and you make T-Shirts, then that’s a great name as long as you are excited about saying it and having it on business cards and telling your friends about it. If you want to call it “Standard T-Shirt Company” then that’s a great name too for the same reasons.

In the end, there is no math and no metric and no test for naming your startup. No one can tell you a great name for your startup and you shouldn’t want them to. You wouldn’t let fans name your band so don’t let anyone else name your company.

Pick something you LOVE to say. Something you love to write on a piece of paper. Something you love to see in the subject line. Something you are excited to say to the people you meet at SXSW and the people you meet at the club and the people you meet for coffee on Tuesday morning.

THAT is the only thing you need to know about naming your startup. Because if you follow any other guide or metric or suggestion, everyone will see through you and know. And while “Warrant” wasn’t an outright awful band name, the guys in the band hated it and now none of them even likes to talk about the experience at all because the whole thing, starting with the name, was so damn awful from start to finish.

Plan

January 8, 2012 - One Response

If your business plan depends on having millions of users and then extracting a small amount of money from each then you should at least acknowledge the extreme likelihood that your business will never make much money and will become the bane of your existence.

If you plan on making your product invaluable in a way that fewer people will pay a lot for it, then you are smarter then the other guy.