Today’s guest post from Chris Moody, the COO of Gnip, follows on the heels of the amazing Big Boulder event that Gnip put on last Thursday and Friday. To get a feel for some of the speakers, take a look at the following blog posts summarizing talks from leaders of Tumblr, Disqus, Facebook, Klout, LinkedIn, StockTwits, GetGlue, Get Satisfaction, and Twitter.
The event was fantastic, but Chris sent out a powerful email to everyone at Gnip on Saturday that basically said “awesome job on Big Boulder – our work is just beginning.” For a more detailed version, and some thoughts on why The Work Begins When The Milestone Ends, I now hand off the keyboard to Chris.
We’ve just finished up Big Boulder, the first ever conference dedicated to social data. By all accounts, the attendees and the presenters had a great experience. The Gnip team is flying high from all the exciting conversations and the positive feedback. After countless hours of planning, hard work, and sleepless nights, it is very tempting to kick back and relax. There is a strong natural pull to get back into a normal workflow. But, we can’t relax and we won’t. Here’s why.
As a company it is important to recognize the difference between a milestone and a meaningful business result. Although it took us almost nine months to plan the event, Big Boulder is really just a milestone. In this particular case, it is actually an early milestone. The real results will likely begin months from now. All too often startups confuse milestones for results. This mistake can be deadly.
Milestones Are Not Results
Milestones represent progress towards a business result. Examples of milestones that are commonly mistaken for results include:
Getting Funded. Having someone make an early investment in your company is positive affirmation that at least one person (and perhaps many) believe in what you are trying to accomplish. But, the results will come based upon how effectively you spend the money; build your team/product, etc. Chris Sacca has tweeted a few times that he doesn’t understand why startups ever announce funding. Although I haven’t heard him explain his tweets, I assume he is making the point that funding isn’t a meaningful business result so it doesn’t make sense to announce the news to the world.
Signing a partnership. Getting a strategic partnership deal signed can take lots of hard work and months/years to accomplish. Once a partnership deal is finally signed, a big announcement usually follows. The team may celebrate because all the hard work has finally paid off. But, the obvious mistake is thinking the hard work has paid off. Getting the deal signed is a major milestone, but the results will likely be based upon the amount of effort your team puts in to the partnership after the deal is signed. I’ve never experienced a successful partnership that just worked after the deal was signed. Partnerships typically take a tremendous amount of ongoing work in order to get meaningful results.
Releasing a new feature. Your team has worked many late nights getting a new killer feature in to the product. You finally get the release out the door and a nice article runs in TechCrunch the next day. The resulting coverage leads to your highest site traffic in a year. But, have you really accomplished any business results yet? Often the results will come after lots of customer education, usage analysis, or feature iterations. If no customers use the new feature, have you really accomplished anything?
Is it okay to celebrate milestones? Absolutely! Blow off steam for a half-day or a long celebratory night. Take the time to recognize the team’s efforts and to thank them for their hard work. But, also use that moment to remind everyone that the true benefits will happen based upon what you do next.
Results Increase Value
Unlike milestones, results have a direct impact on the value of the company. Results also vary dramatically based upon different business models. Examples of common results include: increasing monthly recurring revenue, decreasing customer turnover, lowering cost of goods sold (increasing gross margin).
Announcing a new feature is a milestone because it adds no value to the company. On the other hand, having customers actually adopt a new feature might increase customer retention, which could be a meaningful business result.
The Work Begins When X Ends
When I worked at Aquent, there was a point in time when we were doing lots of tradeshows. We noticed a pattern of team members taking months to prepare for an event and then returning from the tradeshow declaring the event a success. They would put a stack of business cards on their desk and spend the next several weeks digging out from the backlog of normal work stuff. The business cards would begin to collect dust and the hot leads from the show would eventually become too cold to be useful.
In order to avoid this phenomenon, someone coined the expression “the work begins when the tradeshow ends”. This simple statement had a big impact on the way that I think about milestones versus results. Since that time, I’ve used the concept of this phrase hundreds of times to remind my team and myself that a particular milestone isn’t a result. You can substitute the word “tradeshow” for whatever milestone your team has recently achieved to help maintain focus.
The most recent example? The work begins when Big Boulder ends.
Amy and I spent the last week in Tuscany with some friends, including Howard Lindzon. Howard is the CEO of StockTwits, a company we’ve been an investor in for a few years. I was an investor in Howard’s previous company WallStrip, met Howard through an introduction from our mutual friend Fred Wilson (it’s a pretty funny story, as are many things with Howard), and have worked closely together on a bunch of things including TechStars where Howard has been a great mentor and investor since the beginning.
We had an incredibly wonderful week last week and Amy has a great post up on her blog titled Our Revels. If you know Howard, you know he’s an always on, mostly hilarious, sometimes crazy (like a fox), super high energy except when on ambien guy. After four days of Tuscany, Howard was completely chilled out and more relaxed than I’ve ever seen him.
But don’t let this totally chilled out Howard fool you. He was on his computer a lot. Whenever I looked over at him, he was on the Stocktwits web site communicating with the stock community he’s helped create and loves. As the market was gyrating around he tweeted up a storm, put up a bunch of content on StockTwits, did some trades in his hedge fund, and wrote a few insightful (and funny) blog posts about the market including his discovery that the Tuscany VIX is always less than 10.
Howard loves Stocktwits. He loves his business. He loves stocks. He loves the community of people that care about stocks. And he’s creating a company – a really interesting and important one – around his passion. It’s wonderful, infectious, fascinating, exciting, and awesome. And yes, today is adjective day.
While Foundry Group generally avoids investing in vertical markets, we make an exception for our Distribution theme. One of the key attributes of this theme is that the company must be led by an entrepreneur who is completely obsessed with a vertical market. They must be thinking – every single waking moment – about how they are going to change the way the world interacts with the vertical market they are attacking.
Howard defines this type of entrepreneur. It was incredibly inspiring to be around. We had a blast doing non-Stocktwits / non-stock stuff, but when he was working he knew exactly what he was going to work on.
We have either recently closed (but not announced) or are about to close several other investments with entrepreneurs who have similar characteristics. None of them are in our Distribution theme, which is pretty cool, as the entrepreneurs are completely obsessed with the problem their business is addressing.
When an entrepreneur is trying to decide between a couple of different ideas, I often ask the question “which one are you in love with?” If there’s a quick response, then the answer is easy. If the answer is none of them, that’s the answer to which one he should pursue.
Howard reminded me of this again last week. Thanks Howard.
Next up in the StockTwits.TV Do More Faster Interview series is Ben Huh, the founder/CEO of Pet Holdings, better known as the guys who do ICanHasCheezburger, Fail Blog, and about 50 other crazy and hilarious sites.
I was introduced to Ben several years ago by my friend Micah Baldwin (Graphic.ly CEO, TechStars Mentor, contributor to Do More Faster, and hilarious dude in his own right.) I care deeply about community and have learned a lot about it from both Micah and Ben. Ben was pretty serious sounding in this interview, so if you need a good end of the work week office laugh, one follows. But – listen to the interview with Ben – you’ll learn something.
see more Monday Through Friday
Our friend Howard Lindzon (StockTwits CEO, TechStars Mentor and Investor) did an interview series with a number of the contributors to our book Do More Faster. I’ll post one each day or so over the next week. They are all short (15 minutes or so). Howard starts the series with an interview with me and David Cohen (TechStars CEO and co-author with me of Do More Faster.)
This interview happens via Skype when David and I were at my house in Keystone (where we came up with the idea for the book) during the recent TechStars Managing Director retreat. In NY starting tomorrow is the annual TechStars Alumni Retreat (gang – sorry I’ll miss y’all) followed by TechStars for a Day for folks that have applied to the New York program.
If you are an entrepreneur I hope this stuff inspires and informs you. Or, in the worst case, occasionally amuses you (if you listen carefully around minute 9, you’ll learn about my “fuck me once” rule along with why I think work-life balance is important.) Enjoy.
Howard Lindzon cracks me up. Endlessly. Continuously. His latest rant is all about Asshat’s from 2008 put on by one of his new companies StockTwits. I’m not really sure what an Asshat is since I don’t pay any attention to the public market, but I’m going to guess it had something to do with people that consider themselves experts in trading public equities.
It’s definitely NSFW, rude, crude, and crass, but that’s how Howard likes it.