It is clear. Everything legacy, every business, every process will be disrupted. So the choice is yours if you will be the one to be disrupted or you will be the disruptor. The disproportionate value that the disruptor harnesses is clear (Uber, AirBnB, Dropbox, Zappos). What makes someone to become the disruptor? Sometimes it is by accident, but more often than not it is because the disruptor decides it was enough of the status quo and acts.
When asked whether he saw any pattern in the recently listed software co’s wrt sales efficiencies Tomasz Tunguz found one –
“All of these businesses sell bottom up with small initial ACVs that grow dramatically. Atlassian, Zoom, Twilio, Slack, New Relic, Elastic. All of them target small groups of users within larger organization who introduce the vendor. Over time, usage grows, accounts expand. Some acquire through open source, others through virality (Zoom).”
I was reading this article by Jackie MacMullan on the ESPN site – on how elite athletes cope or learn to cope with high stress linked to split second (guaranteed) performance. What makes them falter (mostly overthinking that disconnects their instinctive muscle memory from the last at hand) and how they make a come back from defeat. The article is a must read to see how the top athletes develop regimes to tackle stress under pressure. And it should give Founders a lot of clarity about how to deal with stress in our own play fields.
Like my post yesterday about the must have strategic plan which is simple and easily measurable, I found a 2013 post by David Cummings on SAAS Metrics dashboard. With all the discussions I have with SAAS founders, it is the rare ones who had these numbers on their finger tips or those who are measuring them at least on a monthly cadence.
Earlier this month David Cummings raised this question in his blog On Startups – Why the lack of a Strategic plan?
Why indeed?
I was meeting with Rahul Gupta, a prolific angel investor in New Delhi and he echoed very similar thoughts. Why is it that founders are not able to articulate their priorities in a simple 5 quarterly targets format? Many a times, according to Rahul, the fact that there is no-one outside the team to whom the team/founder is accountable, makes the difference.
The story of Visicalc as written by Tim Harford in bbc.com in a very recent article is indeed eye-opening. Not only because it tells the story of the first sensation in business software but because he shows how it showed the earliest signs of destruction of jobs by technology. And then creation of new ones.
There has been many attempts to define what is likable? What is beauty? Is there a formula? It seems there is and it makes a lot of sense. It is called “Optimal Newness” as defined by a research team from Harvard University which conducted a study in 2014 to know “what sorts of proposals were most likely to win funding from prestigious institutions such as the National Institutes of Health—safely familiar proposals, or extremely novel ones? They prepared about 150 research proposals and gave each one a novelty score. Then they recruited 142 world-class scientists to evaluate the projects. The most-novel proposals got the worst ratings. Exceedingly familiar proposals fared a bit better, but they still received low scores. “Everyone dislikes novelty,” Karim Lakhani, a co-author, explained to me, and “experts tend to be overly critical of proposals in their own domain.” The highest evaluation scores went to submissions that were deemed slightly new.” writes Derek Thompson in his 2017 article for The Atlantic – The Four-Letter Code to Selling Just About Anything”.
There is no denying that we are living online. And we are just about waking up to its fallout in our lives. The loneliness, the attack on privacy, the temptation and the habit of instant gratification. It’s all there. Ashesh Mukherjee, McGill University Associate Professor of Marketing, wrote one of the early insights into five noticeable trends that are shaping our lives – “too much temptation, too much information, too much customization, too many comparisons and too little privacy.” These costs come in two categories – commercial costs we pay as consumers in the form of overspending for instant gratification with very little actual value and social costs we are paying as individuals in terms of exposure to unverified opinions, fake news and increasing loss of privacy which will further erode as we integrate our lives with IOT devices.
Jason Lemkin, the founder of Saastr has written “The Ultimate Guide for scaling, sales and Raising Capital” compiled from his responses on Quora. All 100 of them. Here are some of my favorite questions and their answer highlights. Read the book for the detailed responses. It is a quick read and the Return On Time is phenomenal.
Will start with the Good news. According to Tomasz Tunguz the fundraising scene has become extremely sophisticated “along three dimensions: diversity of product offering, pricing sophistication, and efficiency of investment processes.” The types of rounds and ways to raise them has become more science than art. Five flavors of seed, wide range of A, B and C rounds with a wide array of sources – “Founders can raise $7M Series As and $15M Series As. Would you like a series A from a generalist fund or a specialist fund? Founders can raise a $15M Series B or a $200M Series B. Would you like that Series B from an opportunity fund, an SPV funded by direct LP investment or from a third part?” The options of IPO, ICO, secondary markets, venture debt – for businesses with the right indicators neither valuation nor money is going to be a problem, according to TomTunguz all indications are that 2019 will be a strong fundraising market.
