Building insanely great apps and companies

Opportunity Refinement

Building Insanely Great Products & Startups

Lessons learned from 4 startups, 18 years and an $80 million MBA

Eric Olden – FounderClass of 1995 UC Berkeley

Intro to EntrepreneurshipL&S 5 (UGBA 96)Monday September 23, 2013

A little about meGraduated 1995 – Sociology (almost pre-law and business too)

Startup #1 – The Web Years• Started first security software company in 1995 senior

year on 4th street• As CTO grew Securant to 300 employees and #2 market

share• Securant acquired for $140M

My venture capital years• Angel investor• Startup mentor – TechStars and Sky Deck

Startup #2 Cloud years• Founded Symplified in 2006• CEO for 7 years – now Chairman

Content Marketing & Big Data years- Founded Launch Sciences and Deep Content in 2013- McKinsey for startups- Inbound marketing agency- Stealth project in Big Data analytics

Worked deeply with more than 22 startups over 18 years

Product Guy:• Designed and built 3 industry leading products• Secure billions of ecommerce transactions

Technical Guy:• Co-authored SAML which is world’s most widely

used standard for identity

Strategy Guy• Invented Bought Not Sold strategy

Finance Guy:• Built $225 million in equity value with 2 startups• Raised $80 million in venture capital

My heroes:Michelangelo, da Vinci, Machiavelli and Sun Tzu

Four Rules For Opportunity Refinement (aka Building Insanely Great Products)

1.Nobody cares about your product

2.Find a simple solution to a big problem

3.Respond to what the market tells you

4.Build a killer team

THE PHYSICS OF EGO IN MARKETING

ME – ME – ME

Notice that your product isn’t anywhere.

Most people only focus on Top 3 things to solve.

The way to succeed is to get inside the head of your buyer and understand what her needs are and solve those problems.

Nobody cares about your product

• Field of Dreams – Build It And They Will Come This just doesn’t work today because there are far too many choices for buyers today.

• Good work on Innovation Accounting by Steve Blank and also Eric Ries / Lean Startup– Be deliberate about how you profile your customers’ pains and needs

• Focus on and talk about problems and not about your product.– Customers need to know how working with you solves their problems.– Investors first need to understand how big your market is and that’s defined by the

problem.

“There are 200 million cats in USA and each one has a smelly litter box. We make smells go away organically for $10 a year.”

“Our cat litter is made of sodium bicarbonate that has been specially treated with polymers and can absorb 1 milliliter of airborne carbon every 24 hours.”

Find a simple solution to complex problems

In 1965 NASA needed to write in space….

Zero gravity prevents normal pens from working…

So they spent $12 million dollars and….

Years of research…

To build the Space Pen!!

Russiansused a pencil!

Find a simple solution to complex problems

1. Complexity is the enemy of scale. More things to isolate and test.

2. Complexity is expensive. More things to isolate and test.

3. Simplest solution that solves the problem will be most likely to win.

4. As you get traction you know where to invest because your customers are telling you what they care about.

5. You should be able to boil your value add into a single sentence. Think Twitter.

Solve the maze fastest by working back from the solution

The Double Diamond Design Model

Outside In – The Power Of Putting Your Customer At The Center Of Your Business.” H. Manning

Skills For Getting To The Truth

1. Use Personas not just for product but for sales, marketing and support

2. Read “Outside In – The Power Of Putting Your Customer At The Center Of Your Business.” H. Manning

3. Learn how to do great interviews

4. Use tools like Google Analytics (free) and Mix Panel ($)

5. Be systematic – Qualitative and Quantitative I like checklists

6. Encourage intellectual honesty great ideas hold up under scrutiny and weak ones don’t

“Everyone has a plan till you get punched in the mouth”

- Mike Tyson

Respond to what your customers tell you and how they behave1. You are probably not the Steve Jobs of _______ People know what they like they may

not know how to ask for it. You need to be great at empathy and understanding.

2. Henry Ford’s famous quip “If I asked people what they wanted they would have asked for a faster horse” He asked the wrong question. How would people respond if asked what their needs were for specific things?

3. Beware of human nature because people often tell you what you want to hear. Measure actions not words (analytics) and use rough prototypes to get functional feedback.

4. Beware of chasing your competitors They are probably just as clueless as you are. Instead chase your buyers’ needs.

5. Do not be stubborn or overly proud. I think of being a coin-operated product cook.

It comes down to the team. One person can’t do it all.

Building A Great Team

1. Specialized skills minimum tech and marketing and operations. Focus on what is totally unique and not outsource-able

2. Support each other you’ll need to make it through some dark times

3. Slow to hire and quick to fire must focus constantly on solving the maze

4. Culture really really matters be deliberate here. Not an inspirational poster

5. Be careful to hire the right attitude you can learn skills but not passion

6. Sometimes experience can be a limiting factor Big Co vs. startup

Startup Founder Reading List

Founder Dilemmas Do More Faster Made To Stick

Sales Learning CurveMark Leslie

Revenue Disruption Founders at Work

3 Take Aways

1. Know Thy Problem

2. Always focus on your customer. Always and everywhere.

3. The simplest solution (almost) always wins

Questions?

This presentation will be available on SlideShare – please follow me!

You can find me on LinkedIn at www.linkedin.com/in/boughtnotsold