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7 Simple Rules of Networking for Product Startup Companies

Networking is not an extracurricular activity when you are building a product startup company!

It is one of the most important things that could enable you to line up angel investor, venture or expansion capital for your startup! It can help you recruit excellent people to your startup and excellent people are absolutely essential, especially in the initial years! It can help you identify potential companies you can partner with, acquire when you are expanding or be acquired by one, if you so desire.

Attending conferences should be as much about learning something new about technologies, other companies, your industry and development approaches as it is about Networking! If anything, done properly, you can get more out of Networking than you can from these other things.

So, how do you do it right? Here are 7 simple rules that have worked for me very well in my entrepreneurial activities that past two decades or so! Why seven, and not ten, or five? I think these capture what worked for me most!

  1. Understanding that Networking is Establishing Long Term Relationships – You may be in a hurry to line up angel or venture capital for your own company. But that does not mean that you network only with angel investors or venture capital folks. Networking is all about establishing long term relationships with people over multiple jobs, companies and startups. Done patiently over a long term, you will have enough Business Cards, LinkedIn contacts and Facebook friends you can call your business network. You would know who’s best for what. Today’s Entrepreneur, Competitor or Partner may be tomorrow’s Angel Investor. You never know.
  2. Networking is as much about Giving as it is Receiving – I have seen amateur networkers stop their conversation with you suddenly when they realize that you cannot help their immediate situation. Just remember that networking is just as much about you giving something – sharing your knowledge, your experiences, your contacts, as it is about receiving. So take the first step yourself – introduce somebody else to someone you just met. Forward links to information that could be useful for them. Then you have the standing to request something back from them. Even with busy Angel Investors and Venture Capitalists, if they are not interested in your company and product, introduce someone else that you think may be a better fit for the kinds of companies they are currently interested in. It’s not always one way.
  3. Always Have your Pitches Ready and Convey Your Excitement – Always have your 30 second,  2 min and 5 minute pitches practiced, and ready with you all the time when you network. When someone asks you what you and your company does, they are not asking you about your product features or Java, Python, your love of Macs and your hatred of Microsoft. They are asking you about the problem your company is attempting to solve and why you have an exciting, new approach to it.  It needs to be so simple that a non-technical person can easily understand it and relate to it. If they cannot relate to it, you are in the wrong location or forum for networking. Most importantly, you need to convey your enthusiasm and excitement about what you are doing. It helps if it is a mission, not one, or a set of products!
  4. Always Follow-up with Email and Use the Subject Line Wisely – In your networking interaction (with Angel Investors or Venture Capitalists, you may have gotten 30 seconds to introduce you and your company after a session in a conference) you may have exchanged contact information or business cards with a promise to follow up. While following up on email, use the subject line wisely. They may not remember you from Adam! They may have met 100 people just like you. Remind them of your name, company and where you met them. Have a phrase for what your company does, like “Autocall – Summoning Autos in Chennai using your App!” or something like that. Be precise about what you wanted. If you just wanted to establish contact, just say so and that you were pleased to meet him/her and will follow up later.
  5. Don’t Burn Bridges – Information Technology is a small, small world. Even those that are flung globally.  When discussing your opinions, there’s hardly any point in making strong assertions in a networking situation, even if you feel strongly about something. You never know who you will be running into as a potential investor or partner down the road. Good question to ask before expressing a strong opinion about anything – business, politics or religion- ask yourselves the question – What do I gain by saying something?
  6. Learn eagerly about what the other person does – People always may not remember you but they will always remember how you made them feel. When networking, the other person’s interests are just as important as yours. Ask questions about the state of their industry, their opinions about trends. Ask them about their companies and their products. It may uncover something useful, may be not immediately but down the road somewhere!
  7. Use Social Media to Expand your Professional Network – Unlike even a decade ago, so many new avenues for expanding your professional network are available – LinkedIn, facebook, Google Plus, Twitter, etc. Just make sure that your Personal and Professional channels are kept separate. Having company pages, twitter accounts and facebook pages for companies and products is one way to do this properly. In general, be aware of what you post or express even in your personal channels. Anybody can search for them and find what you post there anyway.

Networking is an Art. It is very valuable for a company to do this as early as possible, especially in Product Startup companies. Done right, it can be very useful for a long time, over multiple companies, jobs and startups!

I like to define networking as cultivating mutually beneficial, give-and-take, win-win relationships… The end result may be to develop a large and diverse group of people who will gladly and continually refer a lot of business to us, while we do the same for them. –Bob Burg
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Think Big! Build a Creative Culture or Transform Into It!

I started writing about Thinking Big and it is turning out to be a serial topic! As Indians, technical stuff comes naturally, business thinking comes naturally, but creativity is a touch-feely subject that many of us are not that comfortable with! We usually give it lip service and move on to more important stuff like coding or making sales calls!

You ask most Software Product Entrepreneurs about their products, and the third sentence will descend into technical details, programming languages and feature sets.

But that’s exactly the opposite of what we need to be thinking about if we want to build globally competitive, big, huge companies right there in India.

The usual disclaimers first – If you are already running a profitable software product company that serves the Indian market, good for you! If you are already running a successful software product company that does not innovate but magically keeps finding customers, revenues and profits, this article is not for you! If you think that Indian Software Product companies need to think small and be happy serving some section of the market, Indian or globally, this article may not be for you.

This article is for companies and entrepreneurs that are wondering how to build a creative culture like that of facebook, google, twitter or Pinterest and scale globally, right there in India.

That starts with the complete buy-in of the founders of a creative culture in the company and they  will be successful in as far as they act and do in keeping with that culture. Not all companies are on the same level with respect to this culture but to smaller or greater extents that is something they all must have and do have in common to succeed.

Being creative does not mean thinking up whole new products overnight, but providing and encouraging creativity in whatever function someone performs in your organization. It can be as simple telling your junior-most engineer, “here’s a problem that I want you to solve. I don’t care how you solve it. But come up with something new”, rather than telling them how to solve it, which programming language and tools to use. If they struggle, you can always jump in and guide them but the key question is “Do you give them the chance to attempt something on their own first?” And do you do this every day?

Do not underestimate the influence of Indian Culture in preventing the creative culture from forming in your company. We act in many subtle, unconscious, hierarchical ways in our companies that can snuff the creative instincts in a jiffy. The first time you quickly overrule something creative your engineer has proposed, is the time when the whole thing is dead. People revert back to a subservient mode and wait for instructions, having learned a painful lesson! Others watch this and have learned the same lesson too.

Building a creative culture is hard. Transforming into one is even harder!

It starts with hiring – are you hiring creative people? How would you know? Classic resumes and classic interviewing techniques systematically eliminate the hiring of creative people! When Microsoft or Google or facebook have “strange” interviewing techniques that pose problems that do not have a single solution or involve coming up with creative solutions, they are looking for those people who can think differently and creatively!

I am not suggesting that you forego looking for basic competencies, qualifications and experience. But what are you doing beyond that? If you have one position and you have 25 very qualified, technically vetted people, nothing prevents an Indian start-up from following the same interviewing and testing strategies that some of these companies follow to unearth the creative five among those 25! And hire across India if you could.

Diversity is the essence of creativity. People with different life experiences approach problems differently and you will be all the richer for it since creative juices start flowing when you have people in the same room approaching problems differently!

Once you have hired the creative people, building a creative culture starts at the top and has to be reflected in everything you say and do. Otherwise people get the wrong signals and clam up quickly. How many times have you NOT decided on something technical for your entire engineering team but instead called for a Brainstorming Session? How are you sure that the solution you have thought of is the better one than something any of your engineering team members may come up with on their own? It is worth going through the whole exercise anyway, even if your idea prevails in the end in the interest of your company. But you have sent a subtle message that ideas are welcome, will be considered and evaluated fairly!

In a start-up company it is very hard to do these things with all the time pressures but is certainly worth those extra hours since it will pay off for you in unexpected ways down the road. In a start-up, just remember that you are really grooming a set of leaders that are trained in this creative culture and when they lead groups of people, hopefully they would follow the same lead.

Flex time, brainstorming sessions, ping pong in the cafeteria, team building sessions with humour thrown in for good measure, are all small building blocks that build a creative culture. But they are only the icing on the cake. The cake is you and the management team’s thinking and acting around the company. Does it say – we value creativity and your ideas are welcome?

Transforming an existing culture is even more painful than building one, but it can be done. Unfortunately, not every employee is suitable for that kind of transformation. You will have to do some weeding first. You may have to get rid of people and leaders that don’t buy into this kind of approach and replace them with those that do. Then all the approaches that are recommended for a start-up apply to a mature company also.

To those who say it cannot be done in India and these are high-falutin ideas from out-of-touch expats, I could not carry more disappointing news! I have personally done it in our start-up company in Chennai. We hired people from the North and threw them in with others from the South. Creative cultures are about TRUST and there is nothing more appealing and motivating to a technically qualified, creative fresher than to be trusted with some big task! Not only did we find creative solutions even though our experienced leaders or me could have suggested the way on day 1, you would be surprised how quickly these people trained themselves on the basics, and solved problems. And in unexpected creative ways!

So before you expect BIG things out of your company, ask yourselves the question – Have I built a creative culture? Have I transformed my existing culture into a creative one or at least on the way there?

Creative cultures ask constantly the question “What If we do or have….” and out of that comes big products and big companies. It’s not just a nice-to-have. It is everything! Not Java or Python, iPhone or Android, not nicer offices and a well stocked cafeteria.

Do you trust your employees enough to be creative? Do you give them the chance?

The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function. – F. Scott Fitzgerald

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10 Advantages in Thinking Big for Product Startups!

Sometime ago I wrote two posts in this forum:

Expect a Microsoft, Google or facebook out of India? Won’t happen unless we THINK BIG!

and

How to Think Big in Software Products? .

This post is a continuation of this thought process.

What are the advantages for me in Thinking Big if I am a product startup?

Again, thinking big does not mean abandoning what you are doing currently for something fancier but extending your thought process in figuring out the bigger picture in which your product, consumer or enterprise, fits in. And communicating it to all stake holders every chance you get – first your employees, then potential investors, current investors, customers, prospects, your local government, government agencies and so on!

It needs to become part of your pitch – and you need three or four versions that – 30 seconds for someone with whom you share an elevator ride, 2 minutes when you are in a corner during a networking sesssion at a conference and 5 t0 10 minutes when you are in a pitching competition, 30 min to 45 min when you have a one hour meeting with an investor! All including a phrase or a sentence on what the big picture is!

Now, here are 10 solid advantages in Thinking Big if you are product start-up.

1. Hire Good People – Good people don’t join a company. They join a mission with a clear vision and big thinking! Especially in today’s Indian product scene, many potential employees have a fair idea of the risks they are taking with a start-up company and may join anyway. But you need to sell them as much as you sell your investors. And they would make all the difference. It’s easy to hire average people. It takes work to hire good people and they are inspired by big thinkers. That’s how they address their own anxieties about taking a risk with you and your start-up.

2. Convince Potential Investors – In software product companies, investors are looking for a large potential addressable market even if your current product addresses a small part of it currently. If it is a consumer-facing product, you need to chart a large enough course for ramp up and showing hockey stick shaped growth. So unless you think big, this is not going to happen. They will not be convinced. If it is an enterprise product, your bigger vision must include how your current product fits in naturally with additional features and additional products you are planning. How will you scale? Thinking big helps you address how you will scale.

3. Help explore partnerships – Even if your current product is a small part of a larger market, thinking about how it fits it with the bigger picture helps you identify partners early. They will  complete the other parts of the bigger picture. Given your bandwidth with people, money and other resources, you will never be able to build the products your potential partners have already built. It will help you paint the larger picture for your partners and help sign them on.

4. Spur Internal Innovation – Thinking about the bigger picture and conveying it clearly to your employees gives them a clear sense of how they can come up with good ideas and paint within the lines you have drawn for them.Somewhere I read a blog entry from  the CEO of a startup product company wondering about how to keep employees’ innovation focused and useful and not stray too much into wild and unconnected ideas. If you are a consumer focused company in the mobile space, there may be  hardly any point in your employees coming up with new ideas in the enterprise space and vice-versa. Defining your mission in larger terms makes it clear for you and your employees, the boundaries within which they can innovate.

5. Have a Product Pipeline Ready – Thinking Big helps you prioritize your product pipeline beyond your current product. You can then outline this to all of your prospects and customers and obtain their feedback. Remember that unlike software services companies, in product companies you don’t get paid to do requirements gathering for your next products. That’s all at your own expense. Before you actually write a line of code, you can sound out your future plans with your prospects and customers and refine, rearrange your own plans!  You may discover that products that you thought were the hottest ideas were not and discover the real products they need. Talking about a product pipeline with prospects and customers  and outlining their reactions and feedback  have a lot of credibility with your investors. Plus you can have contacts and phone numbers for them to do their due diligence. And rest assured, they will do it; you are just prepared for it, ahead of time!

6. Helps you Pivot to somewhere close when you need to – Sooner or later every eventually successful product company had to pivot to something else.  Twitter was dreamed up by one employee when the parent company was running out of money and they had to come up with some other idea. Thinking Big and having an idea of where your original idea fits in gives you a lot more options for you to pivot, especially if you have sounded them out with your prospects and customers. When you pivot you may be pivoting to something that your prospects and customers already told you they wanted!

7. Acquire Other Companies for Growth –  When you are successful with your initial idea, Thinking Big has helped you already visualize where you fit in and what other start-up companies are there for you to acquire when you go raise additional rounds of money. Flipkart is going around acquiring other companies that deal with similar or different products or operating in other geographic areas. Whether you are a consumer focused startup or an enterprise focused one, you are always a part of the larger picture. You may not be able to address all of the larger market but it doesn’t cost you anything to think of where you fit in!

8. Be Acquired –  This is the reverse of the previous advantage. Investors participate in software product companies for the possible big exit, either through an IPO or an acquisition. If you can think of the larger picture, it helps you get in the sights of those that are bigger than you and can acquire you. They complete their bigger picture, you  and your investors get your exit. Everybody wins!

9. Become Thought Leaders and Gain Credibility –   Thinking Big allows you to do a lot of subtle marketing through Thought Leadership. When we built an Analytics company for BPOs and Call Centers, we became thought leaders in Continuous Process Improvement which is a logical extension of what you do once you collect metrics about a process. What’s ahead of what you do? This helps you provide for free, something that’s of value to your prospects; and is not pitching your products directly, and is a lot of subtle marketing. Writing a blog about the features in your product is OK but is not compelling enough for your users to come back for information useful for them often. And it can be done, no matter what you do. You do a start-up company that does imaging on a mobile phone, start writing about image processing in general. If you are doing a SaaS enterprise play in HR in India, write about HR problems that are unique to India and write about companies that address them in a unique way. They won’t consider it spam when you send information useful to them every month and not too many things about your own product! Keep your product information to “exciting new features coming!”.

10. Helps you get started with Guerilla Marketing –  Collect published online articles about the larger market you are addressing. Post them on your facebook page, tweet them and Google+ them! That’s not spam if you are providing links to interesting approaches, news and images. And you are in front of them every week, month or quarter with your brand!

 As long as your going to be thinking anyway, think big. – Donald Trump

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How to Think Big in Software Products?

Sometime ago, I wrote another post in this forum – Expect a Microsoft, Google or facebook out of India? Won’t happen unless we THINK BIG! .

Thinking Big is a process with definite and specific benefits, about which I will write in a future post.

But this post is about How to Think Big?

Again, some disclaimers! This is only for entrepreneurs and people in the software product ecosystem who want to build something of the scale of Google or Microsoft in India.

You can certainly build great companies that serve the Indian market with Software Products or Services and make a really good living out of it.  You can build services companies that target the whole world and make them very successful like we have seen the past three decades. It is in no way less noble, profitable and good for society than software product companies that target the whole world.

So if you are of the belief that global companies do not map to the Indian market (which is complete non-sense given the reality of what people use in India everyday either as individuals or enterprises)  or Indian companies cannot be built to a global scale, this article is not for you. You can stop reading it right here! This is only for entrepreneurs in India wondering what it takes to build a software company of the scale of a Google or a Facebook or Microsoft targeting the global marketplace.

And there are lots of them today, in India!  – Check out  the article – We are very very bullish on India, Paul Singh, Partner, 500 Startups.

Thinking Big does not mean you spend days day dreaming about big things and dropping what you do today and starting to think about big things. In fact, quite the opposite is true! Big companies have been built with building something small first but quickly redefining what you do in terms of larger markets, larger visions, larger missions and tactics.

Facebook started as a silly college prank site to post pilfered pictures of pretty people and others rating them “Hot or Not”! Once they found out that its better as a virtual meeting place and for status updates about what’s happening in the students’ lives, the redefined it as a business that targets only colleges. For a long time, facebook was limited to colleges only and they rolled them out college by college. Then they realized that it is useful for everyone in the world. Today facebook defines its business as a virtual meeting place for everyone in the world!

Google started as a search company for information in websites. Now they are defining themselves as helping you search for a location (maps), videos, audios and is the business of indexing all information in the world and helping you find it!

On the enterprise products side, PeopleSoft concentrated for a long time on enterprise HR functions and then expanded out to CRM, Manufacturing, Accounting and Finance, etc.

Summly.com is a great example of someone thinking big, right at the beginning but targeting a problem everyone faces everyday. Watch this company started by a 17 year old Nick D’Aloisio – this could be one one of the next big things, and this kid could be very successful! That’s because Summly is addressing a very pressing problem in a very large market! Summly is an iPhone app that automatically summarizes in one paragraph, important stories from all major news sources. I tried it and it’s very useful. In about 10 minutes you can get yourself updated with important things that are happening in all facets of news. Google News is good but you still need to go through entire articles yourself. People don’t have time to do this on a consistent basis day in and day out.  This company could go places quickly.

So how do you Think Big?

  • Are you addressing a pressing need for your target market for the whole world? – In my previous post I outlined a number of problems individuals still face everyday – information in many form factors – smartphones, laptops and desktops. In many software packages – documents, spreadsheets, databases, calendars, notes software, etc. Enterprises are still dealing with pressing problems like security, backups, disaster recovery, incompatible data within the same company and between companies. So whether you target the consumer world or the enterprise world, there are unresolved problems everyday. I bet that no matter what you do today,it can be conceptually mapped to a larger target market anytime. It’s in your own thinking!  There are always other things that are close in affinity to what you do, to expand the market into a larger one. If you are developing a software solution for hospitals in India, how can you generalize this into a solution for hospitals in Europe, US or Asia-Pacific?. While doing this just remember that your technology delivery mechanisms may need to change also. Hospitals in India may be using desktops and laptops but elsewhere it may need to be tablets and smartphones. Summly above is a great example in the consumer marketplace – thinking big to solve a common problem for everyone in the world – Too much information, too little time. You think that such companies cannot be built in India? I don’t think so! Resources to build such companies are available to Indian Entrepreneurs just as easily and cheaply to any body in Silicon Valley or elsewhere! What’s holding us back is our own thinking, nothing else!
  • Is it a large enough and fast-growing market?  – Both the words large and fast-growing are important if you want to build something of the scale of Google or Microsoft. That has everything to do with the problem you are solving as well as the timing of it. Oracle was aggressive with its Relational Database product when the demand for databases was growing fast since it was the beginning of the IT automation in many companies. Microsoft grew with the fast growth or personal computing. Google grew with the fast growth of websites and the need to search for a needle in a haystack of billions of websites. So you may ask, what are the corresponding trends today?  If I were to start a company today (for the global market, not just India) , I will not bother about laptops and desktops and enterprise systems. The future of computing is small form factor systems like Smart Phones and Tablets with cloud-powered backends. In five years’ time tablets and smartphones will be the laptops and desktops of today. But each of those platforms are different from even each other. Smartphone apps need to do something quickly, simply and not too complicated. People realistically spend at most a minute with apps in a Smartphone. Tablets have more screen space, have space for complex applications but they have other problems that need to be addressed properly like security, online and offline modes of working that you did not encounter with laptops and desktops. These are the problems that create opportunities in both the consumer and business global marketplaces!
It’s as simple as that! Thinking Big is about  – Is it a pressing need and is it addressing a large enough and fast growing market? It does not matter that you address all of that market right away but can you see how your current products can be expanded to cover more and more of the larger market?
So it boils down to – Are you Thinking Big if you are just starting out and if you have an existing company with software products, are you Thinking Bigger?
In my next post I will address definite and specific benefits to a startup company or an existing company with software products on Thinking Big!
Look at things not as they are, but as they can be. Visualization adds value to everything. A big thinker always visualizes what can be done in the future. He isn’t stuck with the present. – David J. Schwartz.

 

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Expect a Microsoft, Google or facebook out of India? Won’t happen unless we THINK BIG!

When VCs from the US flooded into India about 5 to 10 years ago, they were expecting to invest and make happen, a number of Microsofts, Google and facebooks!

They ended up buying shares of existing public companies and became more of Private Equity investors rather than VCs who could put in a 1$ in 100 companies and have 5 block-busters like facebook or Google that returned $100 each! That’s the nature of Venture Capital – taking risks on 20 companies so that one becomes facebook or Google or Microsoft and makes up for all the losses in those 19 other companies.

This is as much an indictment of Indian start-ups not being bold enough as much as VCs turning into Private Equity investors. They did not find enough companies that were bold enough or thinking big enough!

First, some disclaimers! If you are building an Indian version of a successful US company or targeting a unique vertical in India with your SaaS or Cloud solution or trying different Consumer plays, all success to you! You can still be very successful and thrive!

This is not an indictment of the Software Services business! It helped enormous numbers of Indians stabilize and improve their lives and others that depend upon them, building a huge economy around them. But we need to move to the next stage. The thinking needs to be different this time. When the first services companies like Infosys, Tata Burroughs and Tata Consultancy Services started, you needed lots of  money to buy mainframes and minicomputers. Today, it does not take the same amount of resources to get started in the software business. The only thing that will make a difference now are Innovative Ideas!

This article is for people who wonder what it takes to build a global blockbuster like facebook and Google!

That has to do with NOT THINKING BIG ENOUGH! It does not mean just doing products for the Global Market or going for a huge blockbuster IPOs! That may come later. It has everything to do with going after BIG problems. Big What-Ifs! Big Experiments, Big Thinking!

This has to do with our general instinct to jump too quickly into “how do I make money” and risk aversion and the inability to postpone these questions and address some fundamental problems and find innovative solutions for them, not thinking about immediate payoffs!

Opportunities are everywhere if ONLY we stop being followers and start being leaders! In Consumer oriented startup companies, everybody is still dealing with information – work and social in many different platforms – smart phones, laptops, desktops. They are trapped in multiple formats that are incompatible with each other and causing endless frustration. Documents, status updates, photographs, videos, spreadsheets, presentations, databases are all still in many repositories leading us to waste enormous amounts of time just shuffling all of this!

On the enterprise side, Cyber Security is still a large, large problem! Nuclear facilities, Utilities, Government systems of every kind are subject to Cyber Terrorism more than ever before!

Companies are moving rapidly to the cloud; cloud security is even more scary than internal systems that can be cutoff from external access if someone suspects break-ins. Credit card information and online banking have only led to even less secure places to handle money.

Two days ago Amazon Web Services in Virginia ground to a halt because a monitoring system developed a memory leak and brought many, many companies’ servers to a grinding halt for hours!

Backups and Disaster Recovery are still problems that many enterprises have not found good solutions for yet, globally! There are technologies like Cassandra databases that can have three or four copies of the database automatically synched and updated. No need for backups – they are already backed up in real-time in multiple locations. You can almost build indestructible computing if you wanted to, if you choose cloud resources in multiple geographic locations, even across continents. The video streaming service NetFlix already does this with databases synched up across the Atlantic between US and European Data centers of Amazon!

Companies are just getting into collecting lots of Big Data – social media mentions of their companies, products, detailed information about what every visitor to their websites and online presences did when they are there and wondering how to use all of this information with customer and order information they already have in traditional database systems.

All of these are BIG PROBLEMS begging for BIG THINKING!

When Thinking Big, pick any of these above or other problems, they could lead to the next Microsoft, Google and facebook! It requires an obsession with ONE of those problems and a relentless drive to solve that, first.

When you solve big problems, you don’t need to worry about sales, investors and global blockbuster status. They will come as surely as night after day and high tide after low tide.

We have a tendency to equate technical knowledge, prowess and hacking with success. In software services they are important. But not elsewhere in the software business!

They are important tools but not your mission when it comes to building fast growing, large companies. You need to address problems and create innovative solutions that have clearly identifiable benefits. The benefits are the only things users care about. They do not care about Java or Python or Oracle or MySQL. They have a problem; do you have a solution?

The thing that is holding us back is our own thinking! Getting out of that box is the first step towards THINKING BIG! Thinking big takes the same amount of effort as thinking small but the payoffs are disproportional.

Think little goals and expect little achievements. Think big goals and win big success – David Joseph Schwartz.

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Do not decide what your REAL Product Strategy is until you have Version 1.0 ready! Be Ready to Pivot!

In 2006, folks at the company Odeo were brainstorming ideas for a new software product that they wanted to develop. They came up with the idea for “Twtr” for sending SMS-like messages to groups of people who may be interested in receiving it. Then they hit upon the word “Twitter” that stood for chirps from birds that also stood for “spreading inconsequential information”! That’s how Twitter was born! For a long time, Twitter was made a lot of fun of, with many people denigrating it for exactly the same thing – useless stuff for people who have too much time on their hands and not much to do!

Fast forward a few years! Try telling how “inconsequential” Twitter is to the thousands of people who sent huge numbers of tweets from Egypt trying to highlight atrocities committed by Mubarak’s people before he was overthrown!

As you read this article, Twitter is being used in Syria by both sides in the conflict to get news, pictures and other information about the conflict that is happening there to their own supporters worldwide, in real-time!

It is no longer inconsequential and has become a real-time, short, quick mechanism to get information, images out to those interested. If you have lots more information to convey than 140 characters you place them on sites and send the URLs out! Now you can send it to additional people by attaching tags!

Documentum was a document management company that was started in 1990 and grew solely as a US FDA drug approval document and workflow management company. They had their first version ready and found that pharmaceutical companies in the US were needing a system that centralized all drug approval documents, and provided document versioning when many folks, distributed geographically, needed to contribute and edit others’ edits.

Documentum was a FDA document management software for a long time before they penetrated other verticals and became a general document management software company!

Our own company started out as a Real-time Business Intelligence software company. When we showed our partically completed first version to some Business Process Outsourcing companies in Chennai just on a lark, they said that that was exactly what was needed to process their BPO SLA monitoring activities. So we became a BPO and Call Center Analytics company from a Real-Time Business Intelligence company!

From our next version, the software was dedicated to having the features that was tailored specifically for that purpose, and took a different course!

What are the  lessons from all these examples?
If you are passionate about solving some problem, go ahead and implement something first. Show it around, gather users, have them use your product, and gather feedback. See where your sweet spots are – whose pain does it solve? Does it solve that pain immediately? Is the pain large enough for them to pay something in some way immediately (or monetization in case it is a consumer oriented software product like facebook or Twitter)?

If you get the same kind of positive feedback from some subset of your users consistently, you have found your sweet spot! Focus more on that market, be ready to pivot your direction towards that for a while forgetting all other markets! You can always come back to those other ones, once you are successful in that market.

Product startups may not be able to completely predict accurately who exactly might use their software and result in revenues for you in some way, right out of the gate! So get something out early, sign up users and get feedback and observe!

And be ready to pivot towards where you are finding your sweetspots! As a young startup it is very easy to get distracted and start going after all markets and all directions, but paradoxically the right strategy for rapid growth is always narrower focus! Focus in one area, one market, one group of users. Make it successful there, and then you can explore the other areas.

It is very easy to invest too much of your ego in your original direction and get stuck. This is especially a problem with technical founders. If your objective is just to do some hacking and have some technical fun, that may be OK. But if you want to build a successful business, you need to keep your ego in check and be ready to change direction nimbly, especially in the beginning.

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Want Software Product Success? Narrow the gap between the User and Technology!

Guess what’s the #1 Business Intelligence Tool in the world is?

Oracle BI?

Microsoft BI?

Informatica? Cognos?

None of the above! The ugly and the real truth is that the #1 Business Intelligence tool in the world today is…..

…… The Spreadsheet!

Yes! The lowly spreadsheet is the most used BI tool in the world, including every Indian IT company that we have come in contact with.

Companies invest millions of dollars (or rupees) on expensive Data Warehousing and BI tools but secretly everybody is using spreadsheets to download the data from these data sources into spreadsheets and doing their own Business Intelligence!

The simple secret is that the lowly spreadsheet bridges the last mile gap between the USER AND THE TECHNOLOGY!

The formalism is very simple – you, as the user can get very far by doing your own programming, as long as it is something simple, with formulas and macros!

Now with support for Pivot tables,  they allow this self-programming to go even farther than that! You can drill-down and see how composite numbers are made of simpler numbers!

That’s the real secret of software product innovation. Bridge that last mile gap between the user and the technology and you have a winner!

I have personal experience with this!

BPO and Call Centers in India were struggling with Key Performance Indicators (KPIs) and SLAs. Clients in the US and Europe write BPO and Call Center contracts with Incentives for meeting SLAs with KPIs and penalties for not meeting them!

There you go – if your product is directly tied to money, you have a winner already!

If your Average Handling Time for a call is within 3 minutes you get an additional incentive. If not your total payment got a penalty deducted from it. If your Customer Satisfaction Index average for a process is less than 3.0 on a scale of 1  to 5, you got a penalty. If it is more, you got an incentive!

Every large BPO company had anywhere from 1 to 20 clients, each client has 1 to 20 processes, each process had about 5 to 20 KPIs, each KPI was calculated with about 2 or 3 pieces of information.

That was a lot of information to process, more so, when the information came from backend databases, excel spreadsheets and just simple text information reports or CSV file extracts from clients’ systems in the US and Europe.

So we built an ETL framework that handled inputs from may different sources, we used Microsoft SQL servers, built automated tools that built data cubes automatically and populated them automatically using MDX queries. Drill-down Queries got translated into MDX queries automatically.

When you queried stuff or imported raw data , we built tools that were friendly with Excel spreadsheets, allowed export/import, since we knew that was the most popular mechanism used.

Yes. we were successful in selling enterprise licenses to Indian companies that were trying to find a comprehensive solution for this problem for a long time.

We bridged the gap between the user and the technology and were successful!

That’s always the secret, whatever your passion is, software product innovation for the consumer or business!

Figure out what that gap is , between the user and the technology, and bridge it, you have a winner!

 

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Is Software Innovation an Art or a Science? It’s Artful Science or Scientific Art!

When we think of Software Product Innovation, we imagine getting “Eureka!” moments 3 am in the morning, getting up and writing down inspired thoughts and coding them the next morning!

Reality is much more mundane and is more of evolution rather than sudden insprirations from the sky!

Yahoo started because Jerry Yang and Filo just wanted to create a searchable directory of information first at Stanford University and then San Francisco in general!

facebook started as a teenage testorone-fueled comparion site for Harvard students to post pictures of fellow girl students and rate who’s hot and who’s not! From there it evolved into directories of students in universities to find each other for dating more than anythingelse. For a long time, facebook signed up university by university and not the general public-oriented thing it is now!

This stands for enterprise software products also – Oracle Relational Databases were less expensive, clumsy knock-offs and replacements for Digital Equipment Corporation’s RDB/VMS relational database system.

Before Microsoft Word and Excel spreadsheets, there were Lotus Ami Pro and Lotus 123!

Before Google search, there were DEC Alta Vista search engine and Yahoo!

What made all the successful ones innovations in their own right were not just technical superiority but they took useful innovations and products before them and fixed annoying problems with their usages or expanded the concept of who can use them additionally or fixed usability problems with them.

Or they took an older concept and applied it to a new platform!

Or took an older concept and applied it to a newer market!

So if you want to innovate, you don’t necessarily to invent something new. You can innovate by doing one of these:

—- Is there something useful but not so easy to use? Can I fix it by making it easier to use? (Google’s single search box in the middle is a great example – Alta Vista got lost in boolean searches and requiring ANDs and ORs when specifying search. Google said – don’t worry about all of that stuff. We will take care of it. Just type in what you want into that box!)

— Can I take something useful and apply it to a new market? eBay India was another company before it became eBay bought it and made it eBay India. Flipkart is India’s Amazon. Cleartrip is India’s Expedia! Make no mistake. They are not just copies. Flipkart uses courier delivery. Cleartrip is useful for buying train tickets less painfully than when going to the IRCTC website. They all add some value and difference!

— Can I take something in one platform and make it suitable and applicable to another platform? Mobiile versions of applications may need to be differently designed and executed than an online, browser version of something.

— Can I build a family of products around one idea with more features? Personal, Professional, Enterprise versions of software is a fairly standardized way of adding additional features but orienting them towards different markets.

— Can I build a family of products that are related to each other but different from each other in functionality? Word, Powerpoint, Visio, Excel are all examples of slightly related products but providing different kinds of functionality.

Many times, we think that innovation is coming up with something completely new,. Successful innovations have all fixed or fine-tuned something useful but had some problems that were preventing widespread adoption.

Sometimes it is as simple as figuring out what these are and fixing them. And also thinking about related things so that you are thinking about a “family of products” rather than a single “one hit wonder”.

Wikipedia provides a clear definition of Innovation:

Innovation is the development of new customer value through solutions that meet new needs, unarticulated needs, or old customer and market needs in new ways. This is accomplished through different or more effective products, processes, services,technologies, or ideas that are readily available to markets, governments, and society. Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself. Innovation differs from improvement in that innovation refers to the notion of doing something different (Lat. innovare: “to change”) rather than doing the same thing better.

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Is your company dependent on Innovation? Grow the right Culture First! The rest will take care of itself!

There is a reason, Mark Zuckerberg sits right next to the Summer Intern from University of Waterloo (True Story – Daughter of an Indian friend of mine!). No separate office, no glass windows to look out of!

Sergei Brin and Larry Page are worried sick of “Not Enough Innovation” out of Google!

They all focus on building the right culture for their people so that they can out-innovate their best competitors in the world!

Netflix, Google, Facebook all encourage and even require their employees to engage about 25% of their time in some pet technical project of their own. Some of these turned out to be big money makers, many failed!

Their philosophy is that if you have not failed enough number of times, you are not trying hard enough!

It all goes back to the company culture you build from Day 1! I have done it a number of times putting together engineering groups in multiple companies in Silicon Valley and I have done the same thing in India! If anything it works even better in India, if it is any consolation! Employees loved it and so very highly motivated, especially if they came from other companies in India!

Do you view yourself as the Captain of the ship who just makes very high level decisions and leave your first officers and people who report to them alone to do their jobs? Do you trust them from Day 1 to make the right technical decisions, stepping in only to guide them if they are straying too much from your mission?

Many of us come from a technical background and as engineers, our first instinct is to jump in and make the right decisions for our employees. Wrong!

In other words, do you treat that employee who just joined you straight from college as an adult, expect a lot from them, make sure that they have the hardware and software tools and leave them alone to do their jobs?

High expectations does something magical! The same employee comes in on their own on saturdays and sundays to try out something they have been thinking about. It stops being work for them and becomes something they take ownership for!

Do you praise them in meetings for even minor accomplishments but correct things they do wrong in private?

Do you tell them everyday that you are depending upon them to contribute great ideas to the company, give them time to try them out?

Then you have the right culture for innovation!

However, there are other things that go into this culture working correctly! You need to spend a lot of time hiring ONLY the right people! Make no mistake – Silicon Valley, India or Timbuktu, only 5- 10% of any population are really really good and suitable for innnovative companies. Do you look through 100 resumes and filter out that 5 to 10%? The wrong people can make your innovation train go off the rails, right from the beginning!

You are saying – I am this small company in Chennai – I am competing for talent with Infosys, Wipro and others. How do I get that 5 to 10% cream of the crop.

Guess what? I have done that! Spread your search to Tier 2, Tier 3, Tier4 colleges. Go to Bangalore, Delhi and Mumbai to hire. Simple science, really! If you are trying to hire the 5 – 10% of the best in a population, to increase your chances, you go to more populations. I hired two people from Delhi to come, work in Chennai. Did wonders for my employees. They learned how to help, interact with someone from another language, culture.

There is another reason how diversity helps your innovation. Men and Women think about the same problem differently. Punjabis think differently than South Indians. Assamese and Bengalis are different in thinking than Mumbaikars! All these differences are your real assets. Walk into facebook and Google, you will see employees that represent the United Nations. There is a reason to that madness! Innovation comes from thinking differently and people who solve the same problem in many different ways are your real assets, your keys to innovation!

If you encourage them, give them the broad direction, tools and step away to let them do their jobs, fail often but try different things nevertheless. Works in Silicon Valley, New York, Washington. Works even better in India, if you try it without skipping any of the ingredients.

You never realize how much the Indian work culture has borrowed all the wrong things from our British masters before us. Separate dining rooms for different levels of executives, the “Yes. Sir. No Sir” culture. This kind of thinking is more harmful to your goals than you think!

It can be changed. It all starts with a few companies that start doing it. I am sure there are many companies in India that already do it actively today and are seeing the results.

Culture is often pooh-poohed as something touchy-feely stuff and not suitable for a goal oriented, task oriented company. It is everything in a startup, especially one that wants to Innovate!

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Enterprise Applications – Thousands of app “snacks” instead of “full meal” applications?

Today was the second time I am hearing that the future of applications in enterprises are thousands of small apps instead a hundred or two applications!

I was listening to the CTO of Computer Associates who forecasts the future of applications in enterprises as stringing together lots of small apps that do something very well rather than developing something from scratch fully!

Here is the article that covers his talk that is provocatively labelled “Video Killed the Radio Star and Cloud Computing Will Kill the Programming Star”

Donald Ferguson, CTO of Computer Associates makes the very interesting point that you can STITCH together bigger applications with small focused apps together to do something larger in an enterprise.

Very true! Here is the website I created for our local networking group Healthcare Innovation Programs – Kentucky which is a networking group to educate each other about innovations happening here in Kentucky.

I put this together in 30 minutes! THIRTY MINUTES! Ten years ago this would be a three month project with hacking HTML by hand!

About a year ago I put together another website for another networking group usingNing that took me three hours to figure out and set up!

Here is the second article that argues for enterprises using thousands of small apps rather than developing large apps! – On Deploying Tablets in the Enterprise


The discussion panel in this article also makes the same point – “Don’t turn tablets into PCs,” Todd Barr said, meaning that IT departments shouldn’t try to manage them as closely. Since apps are cheap, organizations should encourage experimentation and individual work styles.

Seems like that’s where things are headed – small apps stitched together to do something bigger!

It’s happening in mHealth already – Withings Body Scale enters into partnership with BodyMedia FIT Armband.

Be faithful in small things because it is in them that your strength lies. – Mother Teresa.