A million dollars isn’t cool, you know what’s cool?

There’s been a lot of chatter locally about startups, startup culture and startup support in Vancouver. (See: Boris, Jesse, Allen, the twitters of @kaler & @igorskee for a quick round up). I’ve also been chatting a bit with Lauren about work-life, and recently caught up with my former boss Jason, where we chatted a bit about how we’ve come to define success.

With all the conversation about startups, I find myself wondering what makes a startup a startup. Must a startup be a product company? What about a Drupal-theming company? My company, Pencilneck Software is sort of a hybrid: We’ve built products – internally, our CMS is now on version 5. I’ve installed it on well over 250 clients’ websites; the newsletter module, before we retired it, sent some 10 million enewsletters. Our eCommerce module has processed upwards of $3 million in sales for our clients; Some 10,000 people have registered for events via our event registration module. 50,000 news articles & blog posts have been published in our News module. (Aside: Man do I love being able to quickly pull aggregate data)

We also build products for other people. But we call ourselves a service company, because the reason we keep getting work is for that: we provide a service – custom code, done right – to a wide variety of people. Also: we’re 9 years old. We’re self-funded and have never not been profitable. We’re now international (well, offices in Vancouver & Dallas). But we face a lot of the same challenges that start ups seem to face: where’s the talent? where’s the money coming from? who’s our audience? Where’s the space? Who can we talk to? Where’s the time?

We started like many startups do: I was employed at another company, but was under-utilized. I had an idea of how to do something differently. I met Jeff, and we combined our forces at started Pencilneck. Initially, we rented space from my former employers. Then we shared space with another small company. Then we got our own office in Yaletown (& man, did I ever feel like I had made it when that happened).

A Somewhat lengthy personal digression

Now I admit I’m not the best member of the local startup scene. I don’t go to events. I don’t blog much about company culture. I don’t look outwards that much. But the very reason why I don’t do all that is what I feel is missing from a lot of this recent chatter: About 6 years ago, I decided that growing big, getting bought, getting rich wasn’t what I wanted. This decision coincided, not even remotely coincidentally, with the birth of my first child. And suddenly that weekend’s worth of work to push out that latest revision just seemed pointless. And squeezing in that extra deliverable for the client this week by pulling a few late nights wasn’t worth missing Liam splashing around in the tub.

When I first told my business partner that I wanted to work only 4 days a week, we had a huge argument – only a few weeks before, we were both still working 60, 70 hour weeks, doing stellar work. But our corporate culture had come to expect and depend on this. & this wasn’t unusual – most of my friends were working similarly. And then Liam was born and I took a couple of weeks off. When I came back though, not only did I no longer want to work weekends, I didn’t want to work evenings. I wanted to leave work at work and come home and be present for my family. Given that I was the main production engine (our partnership has always been Jeff on the sales &  UX end, me on the technical end), this had some dire consequences. And it was rough. But we made it work. And I started working only 4 days a week, which has been amazing.

& Back to the Subject At Hand

The title of the post is of course lifted from The Social Network – you’re probably already thinking the answer is “a billion dollars”. But no. You know what’s cool? Living your life. Enjoying it. Spending time with family & friends. Making money is good, but if you’re good enough, you don’t need to be wildly successful and get bought and make millions. You can make enough and relax and chill and be happy. You can’t build a silicon-valley-style successful startup without being a selfish asshole willing to sacrifice everyone around you. Harsh? Sure. Hyperbolic? You bet. But somewhat true. Because that sort of success takes time. All your time. Whether it’s time at the desk coding, refining your product. Time travelling to sell your product. Time online to support or promote your product, nothing can reduce that time. And that’s time away from everything & everyone else. And maybe that’s a trade you’re willing to make – but you can’t say it’s not a selfish one. Every interview I’ve ever watched with a successful founder talks about their passion for the project and the crazy things they’ve done.

What this all has to do with Vancouver’s startup scene

A common thread amongst all the commentary linked to above is finding the special sauce that will encourage a startup culture here. I think a mistake across them all is to think that we need a startup culture that resembles the American startup culture at all. I’ll admit a personal bias to the lean startup model, but more than that, I bias to the Vancouver model: laid back, just as interested in what’s outside and around as what’s happening in town, and to beat a dead horse just a little more, sustainably. Vancouver’s got a decent number of tech firms that not only have done great work, but have been around for an astonishingly long time. Not only that, but we’re all interwoven. Vancouver’s web-tech community is quite small. My company is built on the idea of partnerships – we don’t do design, so we partner with design firms. Other’s just do strategy. Some just do hosting. And in my experience, we all hire each other as needed. I’ve worked in partnership with at least a score of local companies to either provide expertise or pull theirs as I need it. And you know what’s so great about this? By handing off work as needed, I get to continue a nice lifestyle and get to contribute to theirs too.

Coworking spaces are ideal for the small or solo company. Incubators are great too. So are mentors and advisors. But maybe let’s not teach a culture based on getting big, getting bought, getting out. Maybe let’s teach a culture of being a sustainable business: You want to grow an idea, and need funding? Do something to fund it – trade services, sell something. Hootsuite may be a freemium model, but it grew out of Invoke – a successful firm who could likely afford to fund it – particularly if they built it to solve a problem on a project, or internal use. There’s also the “practice makes perfect” idea to follow: if you want to make money, practice it. Find a business model. Companies that succeed without a business model are few and far between. Get one and get one quick.

There is room in a world of sustainable startups for funders – we’ve always used client work to fund projects, but once, for a particularly out-there idea, we got BDC funding. What I liked about it was that it was a loan – we didn’t have to give up ownership or control to get it. But I could imagine a scenario where taking funding would be beneficial to allow focus. But let’s look at small-batch funding models that enable focus, not massive burn rates.That suits Vancouver more too – we’re a small city with small amounts of capital. Funding a few people for 3 months doesn’t cost that much  – let’s say $20K – and 3 months should be about enough time to get pretty much anything software-related at least demonstrably functional, if not complete. If it isn’t, you’ve probably suffered feature creep. Or don’t have enough focus. You only need to do one thing  well to launch and start making money. I don’t want to sound like I’m shitting all over Jesse (who’s done way more to foster a community and more importantly, exchange, than I ever will) or Boris (who’s arguments around the #MadeInVan and #WeAreYVR at right on point), but I think the focus on funding & acquisition is off a little. There’s more important things. The Mayor’s Greenest City initiative is about green tech, but it’s also about lifestyle: cycling, walking, transit, healthy eating, locavores. Let’s encourage a start up culture that reflects our city, where lifestyle is equally important. When I was first starting Pencilneck, the so-called triple-bottom line was a popular measurement: social, environmental, economic should be equally weighted. Our start up culture, what we want to promote and produce locally might do well to reflect that more.



6 Replies to “A million dollars isn’t cool, you know what’s cool?”

  1. Allen says basically the same thing in his recent Lining Things Up interview. “make stuff and sell it” and “old fashioned” were words that he used.

    Making a mil is cool, but sustainability seems more _meaningful_, if you know what I mean. Also note that creating sustainable businesses I the goal of the Lean Startup process.

  2. Great post, @Stv:disqus . For the record (and as we discussed over IM), my counterpoint to Jesse was simply “build more startups” – nothing around funding or acquisition.

    So let’s talk to @mayorgregor:twitter .

    1. You’re right – I had inferred intent where in a second read I don’t see it. And I agree. I’d be excited to see more startups. I just want “better” startups, as I define them 🙂

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