Duh Factor

I’ve been working on three big startup ideas over the past 2+ years.  I’ve come to appreciate the Duh Factor for B2C projects.

The duh-factor is how long it takes to get from describing your idea to the listener to them getting it and wanting it (how long does it take for you to get their eyes to light up).  It usually involves a feeling of duh…why hasn’t anyone done this already?

A truly underappreciated aspect of startups is the effort it takes to get people to change their behavior (overcoming the inertia problem — getting people to change their habits).  This is where a high Duh Factor plays a critical part.  If people get your idea immediately it will be much easier to sell.  I pretty much give up on an idea if I have to explain it for more than 30 seconds and if people don’t get it right away…and more importantly, want it right away.

Don’t Make Me Think and JTBD

Lately I’ve been thinking about simplification and how much of the startup idea iteration process involves simplification, especially the UI and UX aspects.  I’m such a big proponent of this approach that I realized that it’s at the core of my approach to most things in life.

I like taking things that are hard and figuring out how to make them easy.

An inspiration for me has been the concept behind Steve Krug’s great UI/UX book called “Don’t Make Me Think” which I think when combined with the Jobs to Be Done approach is at the center of almost all web based B2C applications and businesses these days. How do I get the job done without having to think!

We are all overwhelmed with having to continually learn new approaches and methodologies which explains why an interface that is familiar or simple is so powerful — it doesn’t require you to think. Let alone learn something new.

The process usually involves relentlessly minimizing your product to its bare essential.  What is it doing and is that one thing compelling enough to get people to change their behavior — it’s a high bar.  See my post on the Duh Factor for more about deciding how hard an idea will be to sell.

So if you have a startup idea, focus on how you can get the job done for your user without making them think and simplify, simplify, simplify.

Good JTBD design read here.

Venture and Angel Funding

I was thinking about the wide gulf between having a great idea and going to Angels and VCs for money while listening to the “Meet the Investors” panel at Maker Works in Ann Arbor.

It struck me that VCs, Angels (and SPARK) are essentially like banks and mortgage lending — something we are all familiar with.

What I always heard about banks growing up from my father was that banks are happy to lend money to people that don’t need it. Meaning that if the borrower already had collateral for the amount borrowed or had a large enough income that there would be no risk in paying the loan back, the bank was happy to loan the money. (It’s been my experience taking many loans having been rich and poor that this is oh so true. No criticism here — it is business.)

Everybody knows you won’t get a home loan if you have no collateral and don’t have a job — forget it!

One has to think of a startup going to a VC or Angels like he’s going to the bank asking for a mortgage loan…what’s the collateral, and what kind of job/take-home pay do you have?

Here’s where some shorthand thinking occurred to me that people may find easier to grasp – someone has probably already said this somewhere else but here was my thought:

Your startup team is like the collateral – your team is the intrinsic value in your company.

No team = no collateral

Your customers and income (traction) is like your job and earnings.

No traction = no job

So in the startup world you may think, if I had a great team, customers and earnings then I wouldn’t need to ask for money…exactly! The best time to seek funding is when you aren’t desperate – assuming you have a good reason for seeking funding in the first place.
That leaves us with the wide gulf between a good idea and asking for funding. I would suggest the Lean Startup method/books, the Business Model Canvas, and some time learning about the process.
Then work your idea. Get to at least a mockup. Then try to build your team and test your idea on real potential customers. Then bootstrap your way to traction, then think about asking anyone for money, but not before. (This may not be possible for all circumstances but it would be my default plan without having any other).

Of course this is a very simplistic explanation, and I’ve posted a link to a great article on the subject here.


18 Rules

Some rules I wrote in 2014 and presented to a group of developers. Just an attempt at give a bunch of great kids some advice I’d learned over the years.

18 Rules