Tag: startup

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Making Money isn’t Enough: Considerations for a digital company in 2017

I’m starting a new company, with Steve Fisher. I can’t reveal just yet the first product we’re building, but don’t worry, there’ll be more on that in the not-so-distant future. This post is focused on deeper considerations about the company we’re building and why those matter.

In 2015, at The Design & Content Conference, I watched Sara Wachter-Boettcher give a career-altering talk on designing for kindness.

In 2016, this theme was built upon at the same conference by virtually every speaker, but I want to call out two in particular who’ve stuck with me:

Anil Dash’s talk “Storytellers” — particularly the unintended consequences of design decisions, and accountability at a personal and organizational level for them. The Alexa Story, starting at 3:45 is such an excellent illustration.

Ron Bronson’s talk “Designing for Empathy: Context Matters”, largely about the idea of recognizing one’s own blinders and working through them to discover other context, other uses. The story about Pokemon Go/Ingress starting at 6:35 is solid example.

These three talks in particular have informed a pretty massive shift in my approaches to: code, operations, design, business, etc. Positive shifts that also come with a set of concerns that I hadn’t been as focused on.

Concerns we will address:

Geophysical Portability

We’re going to have customers, at least to start, across North America. I also recognize that where your data resides has become more important than ever. For many companies and organizations, where their data is stored, and the locations of libraries they use matters. In BC (Canada!), government entities aren’t allowed to use US-soil services. Governments will use our product, and so we need to ensure that every piece of code we run, every piece of data we store resides in their country. So, from the get-go, we need to write software that is portable and works with third-party-hosted libraries, tools or services that are similarly portable. It’s an interesting and exciting constraint.

Our Privilege

We’re two middle-aged, middle-class white dudes from Canada starting a tech company that is mostly self-funded. The privilege in that is staggering. Basically, we’re walking around with blinders on when we think about the product, the company. We need to do the work to see past our own biases and blinders. First step for us is to engage with a set of advisors who are significantly more diverse than we are, to provide alternative insights and voices in our planning. AND, most importantly, pay these advisors fairly for their time.

Protecting the Vulnerable

The product we’re building exists to help our customers. But it only took a few minutes to think of how someone could abuse our product to help them advance their less-wholesome objectives. Unintentionally so, but it would be easy to use this tool for bad. It is our responsibility to build in constraints, restrictions, community, etc that could prevent this. But, how far does that go? Not everyone is going to do things I like or agree with — but they’re not necessarily bad. Nothing is politically neutral, but do we want to have “neutral” software, run by an opinionated company? We’ve seen first hand the damage that can cause with companies like Twitter. We need to dig in and discover what tools, features, guidelines, legalese we can, and should, build into the product and company. It should be part of our job to build tech that protects the most vulnerable.

Data Security

We will be tracking lots of activity within our product. This is for growth targets, sales, insights and customer support. All good reasons. And we will require user accounts. For most use-cases that’s not an issue, but I can’t guarantee that’s true for everyone who might see a use of our product.

Some guidelines we’re working from:

  1. Data security must be baked-in at every level.
  2. We hold our customers’ data in trust, and data should only be used for our collective greater good
  3. Our customers’ data remain theirs, and they should be able to remove it as needed.
  4. Data available online is vulnerable. It is our duty to both minimize that vulnerability and to act responsibility if it is ever targeted.
  5. Privacy doesn’t mean the same thing to everyone. We must support various levels.

Tools & Software

We’re building the first version of this software on our own, but hope to be able to hire engineering staff quickly. Cutting edge is less important than broadly known — for both hireability and learnability. Our team will leverage, and contribute back to, existing and potentially new open source projects. Where possible, we will prefer open-source tools over proprietary (particularly given our concerns about geophysical location). We’re building a web-app first, but I expect we’ll soon see use for both a mobile-native app for at least parts, and, perhaps less expectedly, a desktop app.

HR

We need things such as revenue, first, but I’ve learned from my previous companies that hiring happens faster than you’d expect, and having values and policy in place is essential.

Some things we’re thinking about:

  1. Both Steve and I have dogs, who we want to have around the office.
  2. We have kids, and we like to see and hang out with them.
  3. We like to travel.
  4. Be able to offer valuable perks like full parental leave, childcare and flexible hours.
  5. Encourage and support community involvement and personal passions.
  6. Collaboration and conversation is better than competition and direction.

But, I don’t want an office full of perks and free things. There’s some middle ground of “recognize your staff have lives and accommodate fully” and “your staff should be treated like adults” Be passionate, stay passionate, engage and encourage passion, but leave work at work. A few years ago, I wrote a piece about finding other paths to success (“A million dollars isn’t cool, you know what’s cool?”), and the ethos behind that still resonates with me. I want to build that into this new company.

Utility

I’m confident we’ve identified a need and a niche that we can work in, but there’s something to the axiom “the greatest minds of my generation are figuring out how to make people click ads”. There are real problems that people can, and are solving. Teams at Code for America & the USDS are solving real problems, for real people, using tech. We need to make sure we’re contributing too — if not directly through our product, through our expertise, our staff, our community.

A Company for Good

Starting a company is hard. Most fail quickly, so adding additional constraints, or targets could feel like a fool’s game. I’d like a company that structurally contributes back to our community (see HR, above). And I’d like a company that isn’t just building a product and selling it. Existing isn’t enough. We need to put our effort, success, and privilege towards something more. We’re not totally sure where we’ll draw the line, but it’s something to figure out. It’s too easy to leave these decisions to later, and then later never comes. We need to start these as we start everything else.

These are not in order of importance and jostle from day-to-day in my head for position. As we move forward I will to write more about how we embrace these challenges and opportunities How each point becomes not only part of the product, but of our new company, and more part of ourselves as partners in this. And finally to talk openly about where compromises were made, where things are left to do, and how we’re changing.

“All we have to do is go to first principles and what you all know every single time you ship something, every single time you put something out in the world. You know what it looks like when it counts. You know what it looks like when you care about it, and all we have to prioritize, one simple thing, that the story we tell includes the most vulnerable people. If we do that much then we can be worthy of all the things that people say about the transformative potential that technology has on the world.”
Anil Dash at The Design & Content Conference

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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.

 

 

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