Archive for November, 2011

Quotes For Entrepreneurs–November 2011

Written by Sean Murphy. Posted in Quotes, skmurphy

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“To give real service you must add something which cannot be bought or measured with money, and that is sincerity and integrity.”
Donald A. Adams

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“Abbot Zerchi smiled thinly. ‘You don’t have a soul, Doctor. You are a soul. You have a body, temporarily.’”
Walter M. MillerA Canticle for Leibowitz

hat tip to “My Small Boat” blog.

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“Advice is like snow; the softer it falls, the longer it dwells upon, and the deeper it sinks into the mind.”
Samuel Taylor Coleridge

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“If you do not expect the unexpected, you will not find it; for it is hard to be sought out and difficult.”
Heraclitus (Fragment 18)

I used this as the opening quote for “Customer Interviews: Allow Yourself to Be Surprised

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“When someone makes a decision, he is really diving into a strong current that will carry him to places he had never dreamed of when he first made the decision.
Paulo Coelho “The Alchemist”

I used this as a coda to Customer Interviews: Allow Yourself To Be Surprised

h/t to Johnnie Moore’s “Decisions” where he offers this additional insight:

“People are easily preoccupied with the idea of making a decision as if it’s all about creating certainty. What it’s more about embarking on an adventure? And if it is, are we looking to press gang the crew or are we taking willing volunteers?”
Johnnie Moore

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“I need to get some sleep. People on the Internet will still be wrong tomorrow.”
Jim Treacher

A riff on xkcd’s “Duty Calls” that I used for Late Night Comments and E-Mail” but Treacher offers better advice.

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“The long tail is for organizations that own warehouses.”
Seth Godin in “The Starfish and the Long Tail Have Trouble Getting Along

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“We are responsible for actions performed in response to circumstances for which we are not responsible”
Allan Massie

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“When in doubt, choose to go deeper rather than faster. Accept the idea that reflection and understanding your own nature, including the dark side, is the key to effective action.”
Peter Block in “The Answer to How is Yes

I used this quote to close “Record to Remember, Pause to Reflect

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“Not only should you calculate the Lifetime Value of your customers, but also their perception of the Lifetime Value of your solution.”
Chris Hopf

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“Health is not valued till sickness comes.”
Thomas Fuller

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“We can only be said to be alive in those moments when our hearts are conscious of our treasures.”
Thornton Wilder

I used this as the opening quote for my Thanksgiving 2011” post.

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“Without a clear vision of the goal state, I expect movements to devolve into identifying enemies and engaging in wars.”
Jason Yip

I took this to relate to the Lean Software, Lean Startup, Agile Software movements because those are the topics he commonly blogs about.

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“We are confronted with insurmountable opportunities.”
Walt Kelly in “Pogo

I used this as inspiration for the title to “In a Wilderness of Free Association Surrounded by Insurmountable Opportunities

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“Work while you have the light. You are responsible for the talent that has been entrusted to you.”
Henri Frederic Amiel

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“To achieve great things, two things are needed; a plan, and not quite enough time.”
Leonard Bernstein

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Mastermind Group Open House Wed-Nov-30 in Sunnyvale

Written by Sean Murphy. Posted in Events

On Wed Nov. 30 from 6-8pm, we are brainstorming with some folks about forming a mastermind group for technology firms.  We want to take stock and evaluate what will impact our bottom line.  Join us for the upcoming Open House. Bring your 2012 plans and let’s brainstorm on what this mastermind meetup could be.

If you are looking for a group of peer entrepreneurs to compare notes with on your business on a regular basis this may be of interest to you. You can register at http://www.meetup.com/BayAreaMastermind/events/39869532/

We are meeting at

Pacific Business Centers

1250 Oakmead Parkway Suite 210, Sunnyvale, CA

Better Interfaces: Interview, Treemap, Tornado Chart

Written by Sean Murphy. Posted in 1 Idea Stage, skmurphy

Innovative user interfaces have helped a number of products get adopted, here are three examples to stimulate your thinking.

1. Interview Metaphor: early tax preparation software automated a literal view of the paper forms. Intuit, I believe, was first to switch to an interview format that captured the information in a way that was easier to understand and manage/update. This was a clever reconceptualization of the problem that has been widely adopted. It was “better” in the sense that it was more easily understood by a consumer who only filled out one tax return a year.

2. Treemaps: developed by Ben Shneiderman compress a lot of information on quantifies that differ by orders of magnitude and are more useful at presenting it than bar charts or pie charts. One of the more successful examples is Smart Money Magazine’s “Map of the Market” which you now have to subscribe to see. Some references

3. Tornado charts: also called Tornado Diagrams, these  are a compact visualization of the impact of different variables on the outcome of a sequence of decisions (or a decision tree).  In decision analysis they obsoleted tables of numbers and probability distribution plots, offering a succinct encapsulation of the relative potency of a number of control or input variables. They have migrated over time from an esoteric technique in specialized software tools to one easily generated in Excel.

I don’t have specific suggestions for how to develop better ones beyond asking prospective customers how they represent the problem: what metaphors, paper aids, and mental models are useful in managing the problem they might hire your application to solve.  One author worth reading this is Edward Tufte: he has written four beautiful and insightful books on presenting information:

He periodically offers a one day course that presents material from all four of these books.

Thanksgiving 2011

Written by Sean Murphy. Posted in Quotes, Rules of Thumb, skmurphy

“We can only be said to be alive in those moments when our hearts are conscious of our treasures. ”
Thornton Wilder

It’s very early in the morning on Thanksgiving Day and I wanted to reprise my short list of what I am thankful for; it’s been the same for the last few years:

  • Health
  • Family
  • Friends
  • Opportunity

It’s been a difficult year for health, but only because I have finally had to sit down to my “banquet of consequences.” As I tell people when they ask me how I am doing:  “I remain above ground and moving around, and intend to continue to do so  for another three or four decades.”

My younger brother turned fifty last month and posted this short note to friends and family:

“Thanks for all the birthday wishes. I’d like to respond to everybody but it’s now officially past my bedtime. I hope to be an ever gushing fount of wisdom now that I’ve dedicated myself to the pursuit of excellence for a half century. I’ll leave with this thought – the first chunk of adulthood was an adventure because I had no idea what was coming, but sadly I know what’s coming for the second chunk.”

It reminded me in a strange way of Achaan Chaa’s answer to Mark Epstein’s question “what do you mean by ‘eradicating craving’?”

“You see this goblet?

For me, this glass is already broken.

I enjoy it; I drink out of it. It holds my water admirably, sometimes even reflecting the sun in beautiful patterns. If I should tap it, it has a lovely ring to it.

But when I put this glass on a shelf and the wind knocks it over or my elbow brushes it off the table and it falls to the ground and shatters, I say, ‘Of course.’

But when I understand that the glass is already broken, every moment with it is precious.”

Mark Epstein’s Thoughts Without a Thinker (pages 80-81)

Which is the way that that this year has left me feeling. that the second half of my life has started and it’s time to appreciate all that I have and be more forthcoming in my gratitude to everyone who has touched my life so far.

Your mileage may vary but that’s my plan.

“Ancient Greeks defined happiness as the exercise of vital powers, along lines of excellence, in a life affording them scope.”
Edith Hamilton in “The Greek Way

Great Demo Workshop on February 29, 2012

Written by Theresa Shafer. Posted in Demos, Events, Sales

Create and Deliver Surprisingly Compelling Software Demonstrations
“Do The Last Thing First” — the recipe for a Great Demo!

When: Wednesday, February 29, 2012 8 am – 5 pm
Where: Moorpark Hotel, 4241 Moorpark Ave, San Jose CA 95129
For out of town attendees: The Moorpark is located 400 feet from the Saratoga Ave exit on Hwy 280, about 7 miles from San Jose Airport and 35 miles from San Francisco Airport Hotels Near Great Demo! Workshop

Cost: $620
Before Feb. 8: $595

This is an interactive workshop with Peter Cohan geared especially for you who demonstrate B-to-B software to your customer and channels. Bring a copy of your demo and be prepared to present it — we’ll help you turn it into a surprisingly compelling demo!

Register Great Demo

This seminar outlines a framework for the creation and delivery of improved demos and presentations to enable increased success in the marketing, sale, and deployment of software and related products. Whether it’s face to face, in a webinar, as a screencast, or as a self-running demo the ability to present the key benefits of your software product is essential to generating prospect interest and ultimately revenue. Peter Cohan of The Second Derivative gives us the recipe for a Great Demo!

“I am confident that with the insights gained from your workshop we will land more customers in fewer iterations.”
Lav Pachuri, CEO, Xleron Inc.

“Peter Cohan’s Great Demo method really works. It helped us win DEMOgod, and it has allowed us to explain our offering much more clearly to prospects.”
Chaim Indig, CEO, Phreesia
(See “DEMOgod Winner Phreesia Praises Peter Cohan Training“)

ABOUT THE SPEAKER: Peter Cohan, Principal at Second Derivative
Community Web Site: www.DemoGurus.com

Peter Cohan is the founder and a principal of The Second Derivative, a consultancy focused on helping software organizations improve their sales and marketing results. In July 2004, he enabled and began moderating DemoGurus®, a community web exchange dedicated to helping sales and marketing teams improve their software demonstrations. In 2003, he authored Great Demo!, a book that provides methods to create and execute compelling demonstrations. The 2nd edition of Great Demo! was published March 2005.

Before The Second Derivative, Peter founded the Discovery Tools® business unit at Symyx Technologies, Inc., where he grew the business from an empty spreadsheet into a $30 million operation. Prior to Symyx, Peter served in marketing, sales, and management positions at MDL Information Systems, a leading provider of scientific information management software. Peter currently serves on the Board of Directors for Collaborative Drug Discovery, Inc. and the board of advisors for Excellin, Inc. He holds a degree in chemistry.

Peter has experience as an individual contributor, manage and senior management in marketing, sales, and business development. He has also been, and continues to be, a customer.

Agenda:

  • 8:00 AM Breakfast & Registration
  • 8:15 AM Workshop begins
  • Noon Lunch
  • 1 PM Workshop Continues
  • 5 PM Wrap up

Seating is Limited These are intensive sessions and we ask that you arrive at least 15 minutes before 8:30AM start time to ensure you will have a seat and won’t disrupt the session once it is underway.

For more information: Theresa 408-252-9676 events@skmurphy.com

Pictures Are to Words as Conversations are to Surveys

Written by Sean Murphy. Posted in 3 Early Customer Stage, Customer Development, Rules of Thumb, skmurphy

Q:  I am having trouble getting people to fill out my customer discovery surveys, how many do I need to be statistically significant.

I think the following approaches burn time and social capital without generating much in the way of insight:

  • Using surveys for “customer discovery.”
  • Landing pages for signups where little if any information is provided about the team or product but many answers are required of a prospective user to signup.
  • Launchrock style landing pages that require your prospects to invest their credibility by tweeting, blogging, or otherwise announcing their interest in your offering to their friends before you give them access to your beta. This is destroying the value of any endorsement you might ever generate.

One conversation is worth between 100 and 10,000 survey responses, provided that you are listening and prepared to be surprised.

A dozen to two dozen conversations with relevant and knowledgeable individuals will put you will be well ahead of any survey based approach.

Start Black Friday at the Bootstrappers Breakfast in Mountain View

Written by Sean Murphy. Posted in Events, skmurphy

Do your shopping on-line and avoid the crowds, then drop by the Bootstrappers Breakfast® in Mountain View this Friday at 9am at Red Rock Coffee. We will be upstairs in our usual location in the corner to the left of the staircase. A Bootstrappers Breakfast allows you to

Compare notes with entrepreneurs who eat problems for breakfast.
  • Take part in a serious roundtable conversation among bootstrapping entrepreneurs
  • Compare notes and exchange ideas
  • Learn from others’ mistakes
  • Find potential business partners and co-founders

With three work weeks left in 2012 it’s time to assess: lessons learned in 2012, key objectives to accomplish before the end of the year, and  plans for 2013.

RSVP and join us at the Bootstrappers Breakfast at Red Rock if you are in town.

A little bit about Black Friday from Wikipedia:

Black Friday is the Friday following Thanksgiving Day in the United States (the fourth Thursday of November), often regarded as the beginning of the Christmas shopping season. In recent years, most major retailers have opened extremely early and offered promotional sales to kick off the holiday shopping season, similar to Boxing Day sales in many Commonwealth nations. Black Friday is not a holiday, but California and some other states observe “The Day After Thanksgiving” as a holiday for state government employees, sometimes in lieu of another federal holiday such as Columbus Day. Many non-retail employees and schools have both Thanksgiving and the day after off, followed by a weekend, thereby increasing the number of potential shoppers.

Panelists Announced for Bootstrapper’s Manifesto Book Club Webinar

Written by Sean Murphy. Posted in Events

We have two bootstrappers as panelists for Wednesday’s Business Book Club webinar on Seth Godin’s Bootstrapper’s Manifesto.

  • Neal Tovsen, founder of TelemetryWeb.com
    Neal’s fifteen years of professional experience have focused on the architecture, design, and end-to-end development of highly available, distributed, scalable, software-as-a-service platforms.  His understanding of how to integrate sensor networks, remote monitoring, and mobile devices and his appreciation for the importance of security and data privacy have informed his design and development of TelemetryWeb. TelemetryWeb’s AgSphere allows famers to harvest and manage a rich set fo data from remote sensors and remote monitoring solutions in a cloud-based device integration platform.
    Neal is a member of the Minneapolis Bootstrapper Breakfast group.
  • Sarah Gray, co-founder of MercuryApp.com
    Sarah Gray is a technical co-founder and entrepreneur with a background in theater directing. She’s been developing software professionally for 10 years and worked for a number of early-stage startups before dropping out to build her own products. She is currently working on MercuryApp.com, a life-tracking journal; and has co-founded Technical Advocates, a consulting practice that gives advice to non-technical startup founders. She is bootstrapping a life where she can dream up and prototype projects then set them loose in the world. She lives in Chicago with her partner in crime, Corey Haines, and her cat, Zak.
    Sarah is a member of the Chicago Bootstrapper Breakfast group.

This on-line roundtable discussion encourages active audience participation and is moderated by Sean Murphy of SKMurphy, Inc., with Francis Adanza of Zephyr, Inc. coordinating audience participation.

Date: Wednesday November 16
Time
: 12:00 p.m. Pacific / 1:00 p.m. Mountain / 2:00 p.m. Central / 3:00 p.m. Eastern
Registerhttp://skmgodin111116.eventbrite.com/
Bootstrappers can register at no charge at http://skmgodin111116.eventbrite.com/?discount=SundayOffer

The E-book version of “The Bootstrapper’s Bible” by Seth Godin is available at no charge from

The Bootstrapper’s Manifesto is on pages 3-4, and the rest of the E-book is worth reading as well.

Veterans Day 2011

Written by Sean Murphy. Posted in skmurphy

“In war, there are no unwounded soldiers.”
Jose Narosky

“Do you know what a soldier is, young man?
He’s the chap who makes it possible for civilized folk to despise war.”
Allan Massie

“Today is Veterans Day, the day we honor those who have served in the military and lived. Memorial Day is the day we honor those who died while serving in the military. While that seems like a big difference, the reality is that chance plays a huge role in which soldiers live and which soldiers die. So to all you veterans out there, thanks for the willingness to put your life on the line for all the things I hold dear.”
Kevin Murphy “Veterans Day

Seth Godin’s “Bootstrapper’s Manifesto”

Written by Sean Murphy. Posted in Books, Events, skmurphy

In Seth Godin’s “Bootstrapper Bible” he has this short manifesto that really is worth reading periodically. We will be discussing this at next week’s Book Club for Business Impact with several bootstrappers:

I am a bootstrapper. I have initiative and insight and guts, but not much money. I will succeed because my efforts and my focus will defeat bigger and better-funded competitors. I am fearless. I keep my focus on growing the business–not on politics, career advancement, or other wasteful distractions.

I will leverage my skills to become the key to every department of my company, yet realize that hiring experts can be the secret to my success. I will be a fervent and intelligent user of technology, to conserve my two most precious assets: time and money.

My secret weapon is knowing how to cut through bureaucracy. My size makes me faster and more nimble than any company could ever be.

I am a laser beam. Opportunities will try to cloud my focus, but I will not waver from my stated goal and plan–until I change it. And I know that plans were made to be changed.

I’m in it for the long haul. Building a business that will last separates me from the opportunist, and is an investment in my brand and my future. Surviving is succeeding, and each day that goes by makes it easier still for me to reach my goals.

I pledge to know more about my field than anyone else. I will read and learn and teach.  My greatest asset is the value I can add to my clients through my efforts.

I realize that treating people well on the way up will make it nicer for me on the way back down. I will be scrupulously honest and overt in my dealings, and won’t use my position as a fearless bootstrapper to gain unfair advantage. My reputation will follow me wherever I go, and I will invest in it daily and protect it fiercely.

I am the underdog. I realize that others are rooting for me to succeed, and I will gratefully accept their help when offered. I also understand the power of favors, and will offer them and grant them whenever I can.

I have less to lose than most–a fact I can turn into a significant competitive advantage.

I am a salesperson. Sooner or later, my income will  depend on sales, and those sales can be made only by me, not by an emissary, not by a rep. I will sell by helping others get what they want, by identifying needs and filling them.

I am a guerrilla. I will be persistent, consistent, and willing to invest in the marketing of myself and my business.

I will measure what I do, and won’t lie about it to myself or my spouse. I will set strict financial goals and honestly evaluate my performance. I’ll set limits on time and money and won’t exceed either.

Most of all, I’ll remember that the journey is the reward. I will learn and grow and enjoy every single day.

Perfectionism vs. Mastery

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, skmurphy


Randall Munroe’s “The General Problem” embeds this observation:

I find that when someone’s taking time to do something right in the present, they’re a perfectionist with no ability to prioritize, whereas when someone took time to do something right in the past, they’re a master artisan of great foresight.

When we look back at a significant accomplishment we miss all of  the groundwork, the necessary trial and error, the sequence of working prototypes giving way to working solutions that were successive approximations to the final masterpiece.

Bootstrappers make this same mistake either when they try and proceed directly to a business model that maps to a large and successful business or they focus only on the final fully instantiated version of their idealized business or product.  We have to become comfortable with making things viable and then better over time.

Customer Interviews: Allow Yourself to Be Surprised

Written by Sean Murphy. Posted in 3 Early Customer Stage, Books, Customer Development

“If you do not expect the unexpected, you will not find it; for it is hard to be sought out and difficult.”
Heraclitus (Fragment 18)

A few more thoughts on customer interviews and why are preferable to surveys and landing pages when you are doing early exploration in a market.

You can’t have a conversation with a landing page, so while you can validate your assumptions it’s less useful in my experience than actually talking with prospects. You can be surprised in a conversation and improvise additional questions or even your own new answers to unanticipated questions from a prospect.

Surprise means you are learning.

I find that many entrepreneurs with a science or engineering background tend to focus on what’s most efficient–for them–and prize automated or mechanical interaction over conversation. No one likes surprises but if you appreciate what it really means you can become a little more comfortable starting a conversation that may lead into unanticipated areas.

“When someone makes a decision, he is really diving into a strong current that will carry him to places he had never dreamed of when he first made the decision.”
Paulo Coelho in “The Alchemist”

h/t Johnnie Moore’s  “Decisions


Notes

  1. Roger von Oech wrote a great book “Expect the Unexpected Or You Won’t Find It” that riffs on 30 epigrams from Heraclitus to encourage creative thinking. He blogged about the “expect the unexpected” epigram in “Be Willing to Be Led Astray.” Here are a couple of Heraclitus’ more famous quotes to give you a flavor:
    • “All is flux, nothing stays still.”
    • “A man’s character is his fate.”
    • “Nothing endures but change.”
    • “You could not step twice into the same river; for other waters are ever flowing on to you.”
  2. I have written several other posts on customer interviews and customer discovery:

Stay Tuned! We Are Being Purposefully Vague Right Now

Written by Sean Murphy. Posted in 2 Open for Business Stage, skmurphy

I came across an interesting tool this week in the collaboration area. The web page invited me to apply for membership, prompting me to enter my e-mail, twitter handle, blog, and a brief bio.

There was no about page, no physical address or phone number, and none of the founders were listed. I read through a few blog posts and one listed a generic e-mail address I could use to contact the team in lieu of the application form. I sent in the following e-mail:

Subj: You need an about page and team bios

It looks like an interesting service but it’s difficult to determine where you are headed or the basis for your commitment to collaboration and collaborative problem solving.  I am on the fence as to whether I should take the time to apply since it’s difficult to judge your pricing model.  If you are looking for folks to come forward and participate–beyond those who already know you–then you need to turn over some cards.

I got the following reply in about 30 minutes.

Thanks for reaching out.

We are being purposefully vague right now.

But you are completely right that we’re going to need to be more clear and forthcoming when we are ready to grow.

Stay tuned!

It’s an interesting response on a number of levels.

  1. They are not in stealth mode, they have working examples of what the workspace looks like (but no pricing or business model so it’s difficult to determine their real intent and future vector).
  2. As a startup you should be ready to grow from the instant that you open your application up to outside users. They spent some amount of time trying to create a viral loop (for example I could tweet the fact that I applied to join) so they are trying to add users.
  3. “Stay tuned!” implies they have something so revolutionary that I should bookmark the site or setup a Google Alert so that I don’t miss their real launch or next major announcement. I think it’s a mistake when you have someone’s attention to tell them to come back later.

Related

  • Startups Should Sign Their Work
  • In “Stealth Mode, Schmealth Mode: The Real Reasons Why Startups Don’t Talk” Dharmesh Shah outlines some reasons why startups say, “We’re not talking about our plans just yet.”
    • Lack of Direction
    • Lack of Focus
    • Lack of Commitment
    • Lack of A Solution
    • They Have A Secret
  • NuSym De-Cloaks 3 which highlights  some guidelines for improving the credibility of a website from the  Captology team at Stanford;  here are the first four:
    1. Make it easy to verify the accuracy of the information on your site.
      You can build web site credibility by providing third-party support (citations, references, source material) for information you present, especially if you link to this evidence. Even if people don’t follow these links, you’ve shown confidence in your material.
    2. Show that there’s a real organization behind your site.
    3. Highlight the expertise in your organization and in the content and services you provide.
    4. Show that honest and trustworthy people stand behind your site.

Geva Solomonovich of Fraud Sciences at Fri-Nov-4 BB

Written by Sean Murphy. Posted in Events, skmurphy

Bootstrapper Breakfast
Geva Solomonowich, an early employee at Fraud Sciences and several other startups joins us tomorrow to share lessons learned getting early customers and growing the business. Francis Adanza interviewed him on the Bootstrapper Breakfast blog in mid-October, here are some excerpts:

Francis: Prior to Fraud Sciences, what were you doing?

Geva: Before Fraud Sciences I worked in several other startups. One was SofaWare which built small office Firewall and VPN appliances. SofaWare was partnered with CheckPoint and the initial code base was derived from CheckPoint’s Firewall code. Another company was Savantis – a pioneer in Database Virtualization systems. Savantis closed down after 2.5 years. I learned a valuable lesson there – it’s almost impossible to sell datacenter critical solutions to large enterprises when you are a small startup. Duh. Even though the startup didn’t succeed, it was a great experience, and I was even able to get an algorithm I built filed for patent.

Francis: How big was Fraud Sciences when you joined?

Geva: I joined the company when we were still sharing half a floor of a small building with 3 other startups. I was the fifth employee at the time with one other developer, an analyst and the two founders. Seeing the company grew from this early stage to being acquired has been really inspirational.

Francis: What were some the early sales/marketing challenges you faced during the first couple of years in business?

Geva: The biggest challenge is getting through the first door. Online merchants are pretty busy people and they get a lot of offers from startups to fix/change/improve/solve/expand their business. Then comes the question of trust:  who is this small startup that wants us to share our checkout information? How can I trust their recommendations to approve/decline a transaction? “I have my own fraud management system…”

Francis: What did the company do to overcome these challenges?

Geva: To overcome these challenges we started selling to very eccentric and non-mainstream merchants – people who really have high-fraud and funky businesses. Some of our initial merchants were selling anonymous web-browsing services. As you can image that attracts a lot of fraudsters who want to be anonymous on the web. We actually saw that fraudsters are using the anonymizer services to fraudulently buy more subscriptions from them! Another genre of merchants we integrated with were e-gold brokers. E-gold is like a virtual currency – where there is money there is always fraud. After we had a proven record with these types of merchants we continuously worked to revisit and improve our offering. We simplified the integration process to a 10 minute exercise. We simplified the feedback to the merchants to a simple Yes/No. We slowly grew to the 100% fraud chargeback guarantee. In parallel, the sales force continued improving their sales pitch, and we worked very hard to get supportive feedback from top-notch merchants (like www.ice.com) that we used in order to reduce new merchants objections.

For more on Fraud Sciences see “The War on Fraud” by Neal Sandler, a 2007 Business Week article that profiled the firm. Fraud Sciences was acquired for $169M by Paypal in 2008.

Please RSVP Join our roundtable conversation with Geva on November 4 at 7:30am. The back room at Hobees only holds about 14 people: we ask that you please RSVP so that we can guarantee everyone a seat.

Book Club: Brian Arthur’s “The Second Economy”

Written by Theresa Shafer. Posted in Books, Events

Call-in Book Review  Recorded on WednesdayDecember 14, 2011Anne Rozinat of Fluxicon and Sean Murphy of SKMurphy discuss the impact of the pervasive digitization of business processes on cloud business models.

View the recorded session

The Second Economy

by W. Brian Arthur

This McKinsey Quarterly article provides the context for a thought provoking discussion of the emerging digital infrastructure for our world. It’s a trend that has been evident for a while but is now having a powerful impact. We will discuss W. Brian Arthur claim that, “digitization is creating a second economy that’s vast, automatic, and invisible—thereby bringing the biggest change since the Industrial Revolution.”

GET ARTICLE HERE

View the recorded session
Complete SKMurphy’s book club list
Remind me of upcoming events

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Additional Book Reviews

Managing Oneself Article
Boyd-OODA The Lean Startup
Moore's Darwin and the Demon HRB article
Cohan Great Demo
Origin and Evolution

The Startup Mythology of Silicon Valley

Written by Sean Murphy. Posted in Silicon Valley, skmurphy

A post on Matt Wensing’s blog alerted me to an atypical post on TechCrunch by Mark Hendrickson “Startup School and the Instigation of Entrepreneurship.” It’s an insightful critique of the startup mythology of Silicon Valley. Some excerpts:

“We are experiencing a generation of entrepreneurs who prioritize the phenomenon of entrepreneurship over its justification; we ought to be concerning ourselves as a community with teaching folks not only how to get into the entrepreneurship game but how to find their purpose as well.”

I think the dominant myth of Hollywood is to be part of a movie. Silicon Valley’s default aspiration is to be part of a venture backed startup. How do you know you are in a venture backed startup? You secure investment from a venture firm and are celebrated in the pages of TechCrunch. This detracts from a focus on value creation, as Jeff Nolan observed in January 2009, writing in “Why the TechCrunch Economy Will Falter” (bold in original):  “…a fundamental flaw in the startup economy promoted by a wide swath of pundits and proponents, that starting is more important than sustaining.”

Hendrickson continues, using the phrase “deliberate practice” which echoes Anders Ericsson‘s “The Role of Deliberate Practice in the Acquisition of Expert Performance

We should develop and promote a more deliberate practice of discovering passions worth pursuing and problems worth solving in a less haphazard way. [...] But without it, institutions like YC and its Startup School will likely continue receiving and channeling ever-more entrepreneurs who may be well-versed in tactics but who lack anchoring values that drive their efforts. And that will be a shame not only for those individuals but the investors and customers who await the fruits of their labor, which otherwise could have amounted to so much more.

Tim O’Reilly has also suggested to  entrepreneurs that they “Work on Stuff that Matters.” Alas this is easier said than done but essential to making a significant contribution. In “Overnight Success”  I recommended that “if you define success as making a lot of money quickly you should go into sales and cut out the middleman”.

It’s easy to lecture other people about their shortcomings, or at least your perception of their shortcomings.  I think the celebration of financing events as accomplishments instead of as a sometimes necessary precursor to the start of real efforts is one problem that Jeff Nolan, among many others, has already touched on.  One of the differences between the 80′s and today is a condensed time frame caused by a “built to flip” mentality that focuses on “cashing out” in a year or two instead of five to ten years building a real company.

I am reminded of the movie “Hoop Dreams” which documented how an entire generations of inner city boys are aimed at a few slots in the NBA. Most that miss are left with few if any marketable skills or fallback options for earning a living.  But all along the way they are encouraged by coaches, scouts, and others who are paid to fill the pipeline with new recruits.  I worry that a lot of what passes for entrepreneurial advice is given by folks who profit from their participation in the venture ecosystem and it is encouraging an “entrepreneurial lifestyle” that bears little resemblance to what’s needed to create and manage a going concern.

People ask me why we work with bootstrapping entrepreneurs and how we make any money at it. I like the orientation that most bootstrappers have toward creating value for their customers (it’s the only way they can get paid so it’s also a matter of enlightened self-interest). We run our practice on a “low intensity long duration” model that assumes success is going to require perseverance, intelligent experimentation, and a commitment to solving problems that will make a difference in people’s lives (a shorter answer is that we make less than we might serving other firms but we enjoy it more so it balances out).

See also

Book Club: Seth Godin’s Bootstrappers Manifesto

Written by Theresa Shafer. Posted in Books, Events

Recorded Discussion on Bootstrappers ManifestoSteve Hogan moderates a discussion with Neal Tovsen of TelemetryWeb.com and Sarah Gray of of MercuryApp.com on Seth Godin’s Bootstrapper Manifesto. This recording starts after the panel introductions please see

The E-book version of The Bootstrappers Bible is available at no charge from The E-book version of “The Bootstrapper’s Bible” by Seth Godin is available at no charge from sethgodin.com/sg/docs/bootstrap.pdf The Manifesto is on pages 3 and 4. The text of the manifesto is also available from skmurphy.com/blog/2011/11/10/seth-godins-bootstrapper-manifesto/
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Bootstrappers Bible

Bootstrappers Manifesto

by Seth Godin

There’s never been a better time to start a business with no money. This article will provide insight into growing a business.

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