10 Rules For Startups
Jason Calcanis and Mark Cuban made a couple lists on this topic, so since I rarely think of an original idea, I’m making one too.
Both of them are about saving money, which is very important for a startup– but knowing when to spend money can be more important sometimes.
1. Create A Comfortable Working Environment: This means no fluorescent lights and no ugly 70’s call center garbage or 90’s quasi-cool cubes. You don’t need to go to Herman Miller or DWR to make the place look decent. Here’s a tip, don’t use “office furniture” at all. Supply the bathroom like you would the bathroom in your own home. Not only do your employees use it but guests do too. People remember a nice bathroom.

2. Avoid Becoming Top-Heavy: When it comes to women, top-heaviness isn’t a bad thing at all— in a startup it’s the worst thing. Companies will often become top-heavy to disperse responsibility amongst insecure or ineffective executives. A good executive will hire an able manager who in turn hires a scrappy yet capable associate level support team. A successful team needs more people performing small processes and tasks and less people handing down directives and emails that begin with “Moving forward….”. Down the road, companies looking for an exit will begin collecting a sexy team of brand name executives from within their space to display value and manufacture what looks like an exodus from their competitors’ talent pool. While I think this is of questionable value (operating costs and bottom line speak louder than PR based hiring), it’s less pernicious once a company is already established and successful.

3. Provide Quality And Abundant Refreshments: In Jason Calcanis’ post he suggests every startup should get a Jura Industrial Expresso machine. Jason Calcanis is the CEO of Mahalo and also sits on the board of social networking shopping ThisNext.com, which is a damn fine site and I almost worked there once upon a time. Does ThisNext have a relationship with this Jura company that makes these $3,000 cappucino machines? You Guessed it. Even Mark Cuban scoffed at that advice in his post that referenced Calcanis’ post. My advice: splurge on good coffee, teas, sodas, juices—anything liquid. Every trip to the fridge or coffee maker reminds your employee that they work somewhere that gives a crap about them on a human level. Ditto for the snack cabinet and refrigerator. This goes back to #1, if an employee is comfortable and well nourished at work, the desire to do a running somersault through a plate glass window to get home is alleviated.

4. Eschew Heavy Titles: When a startup is still small, the temptation to bag a heavy title is unbearable. Sure it’s fun and looks good on a business card, but it’s also confusing from an org chart point of view and looks like amateur night from the outside looking in. If you’re communicating via email with the COO of PetSweaters.com regarding the sweater your ordered for your dog from Ebay for $12, you’ll either smirk everytime you see their signature or you won’t be informed as to the scope of their role at the company. You might want to order a dozen sweaters but you don’t want to bother the Chief Operating Officer with such a lowly task. Truth be told, the more accurate and humble your title is the more outsiders will be informed on your role, therefore making them more willing and able to help you. Avoid these: President, Officer, Chairman etc.

5. Crush The Competition: If your startup’s field is crowded or about to explode (read: about to get crowded), make 3-6 month marketing plans, not 3 year marketing plans. Invest a disproportionate amount of resources ($) into that time period. Even if you have three years worth of funding, forget about slow and steady and job security. If you gain enough traction early on any competitor will look like a “me-too” effort by both the public and the business world— even if they were first. Additional funding is given to the startups that make the most progress in the shortest amount of time in relation to their competition, not those that ration their budgets miserly in order to outlive the competition. The company that emerges early on as the fill in your startup’s business company will win the race by getting far enough ahead that nobody else can catch up. For startups, perception is reality, the startup making the big strides and taking chances will win every time. Remember that tech magazine Fast Company is called that for a reason.

6. Watch Out For Giant Cannibals: This relates to #5 but deserves it’s own number because i’m about to go on jag here. The days of the egalitarian-liberal-friendly startup world are gone—they’re never coming back. It used to be that the big guys did the big stuff and the little guys focused on the little stuff, and one day they too could be one of the big guys if their ideas and products were widely adopted. Or, they could get bought by one of the big guys for 100 cloth bags of money with $ symobls printed on them. Pretend that never happened. Because the big guys have so much egg on their face from buying dumb companies for boatloads of money around the millenium (Mark Cuban can speak to this point), and because they’ve become so, well– big— it’s far cheaper for them to take your idea, develop it minus your mistakes, put it on their front page and have double your 2 year user base in a week (or integrate it into a pre-existing product they already own). Paying you for a product they’ll probably need to rebuild, or at least re-brand and integrate is in most cases, stupid. Your only chance is to move so fast that their efforts look like some generic knock-off (We have a call for Google Video. Google Video line two). Look to live – video for an example of an impending feast, which has already been started by Yahoo Live but I suspect Youtube/Google will be cleaning up this plate.

7. Avoid Sponsorships And (Most) “Awareness Marketing”: Any intern or green marketing person will probably want to show you their plan for “branding” “awareness” or “offline” marketing initiatives. After you’ve told them to never, ever show you such a document again ask them a few questions:
• Does the guy barfing in the bleachers at a Padres game at Qualcomm Stadium know what Qualcomm Does? No.
• Do you know what Qualcomm does? No
• If Qualcomm made something, remotely related or associated with baseball would it be a good idea to sponsor the stadium? Maybe
• Have you in recent times seen a poster, billboard, newspaper, magazine, flier, bench-ad, urinal plasma-tv ad (not sure what those are called) about a website, software or service and had the presence of mind to later check it out while surfing the web? Yes.
• You little bastard liar :::begin beating this junior team member unmercifully with an item in your office, a keyboard for example::: Jk, don’t do that.
• Where is the best place to reach an internet/computer/software user? On their computer? Eureka!
CPM (cost per thousand) Banners and Ad Integrations only work for companies with big budgets that sell offline products: movies, fast food, automobiles, clothing, candy, soft drinks, video games, etc. These companies need awareness of new products; startups need action.
8. Leave Your Ego At The Door. In a startup (or any technology company) the most important thing is the end user and the product. Your ego is less important than these things. People work in this field because it’s a meritocracy, your coworkers are young (or youthfull), you affect the world and make customers happy without having to—eek– actually interact with them, your startup might be huge or it might be nothing, you might get rich or you might go broke– it’s exciting. But hey, more than anything, this is supposed to be fun. Smile while you’re making sales calls, staring at excel or writing PERL— it beats selling insurance. Be nice to those junior to you– if for no other reason than they’re a job or idea away from being Mark Cuban or Mark Zuckerberg (As a rule of thumb, be extra nice to people called Mark) and because the tech industry is a very small world. Don’t be arrogant: Nobody knows everything about technology and nobody ever can.
9. Meetings: None of us are as dumb as all of us. Keep them short and to the point, or cover everything in one weekly meeting with an agenda, minutes, and bullet points. Archive the notes and minutes not for posterity but for something humorous to read later. No laser pointers allowed in the meeting room.
10. Hot Babe Receptionist I don’t know that this is useful but every startup i’ve been to has one. The storied history of the hot babe receptionist goes back decades and historically was used as tangible proof to settle any arguments on whether the employees of the startup actually knew any hot babes.