Decoding the Startup Genome

What makes startups successful? The Startup Genome project is attempting to gather useful data to hopefully find some good rules of thumb. They looked at over 650 startups and some of the findings include:

Investors who provide hands-on help have little or no effect on the company’s operational performance.  But the right mentors significantly influence a company’s performance and ability to raise money. (However, this does not mean that investors don’t have a significant effect on valuations and M&A)

Solo founders take 3.6x longer to reach scale stage  compared to a founding team of 2 and they are 2.3x less likely to pivot.

Balanced teams with one technical founder and one business founder raise 30% more money, have 2.9x more user growth and are 19% less likely to scale prematurely than technical or business-heavy founding teams.

Most successful founders are driven by impact rather than experience or money.

Startups need 2-3 times longer to validate their market than most founders expect.  This  underestimation  creates  the  pressure  to  scale prematurely.

Premature scaling is the most common reason for startups to perform worse. They tend to lose the battle early on by getting ahead of themselves.

B2C vs. B2B is not a meaningful segmentation of Internet startups anymore because the Internet has changed the rules of business.

Note: I have not delved into their methodology, you may want to look at that yourself if you are interested.

Get the full report here for yourself:
Download the Startup Genome Report – Startup Genome.

Working on CrowdPlace

Well, I have not been posting a lot to Tomorrow’s Trends lately, I have to admit. I also have slowed down posting on my personal blog. One reason is that a chunk of my “free” time has been spent working with a small founding team on a site called CrowdPlace. We are working on the exact way to explain what we do – so far I have:  “CrowdPlace helps you save, sort, synthesize, share and search your everyday data and information.”

Basically, we are engineering a new and better way to save your information and communicate as well. Pretty interesting stuff. I recommend going to CrowdPlace.com and signing up for the beta launch/ newsletter. Most people who read this blog are early adopters and will be be really interested in getting in early on what we are doing. Can’t say much more right now – except that we are almost ready to launch our basic product. Once launched in the next few weeks, we will be making improvements based on your feedback. But, even at its most basic, it is pretty useful.

Have your say!

I am working on a really interesting Web startup. Basically, it allows you to save and organize your information in a new, original way. This will allow for you to find information about things you care about and also share (if you want to) information with others in new ways.

We are getting a lot done on the design and development of our site. We expect to launch our beta within the next couple months. The site is looking really great. We think that our site will be really useful for everyone immediately after release.

Have your say! If you don’t mind, click on the link below to complete our quick survey. You can help shape this emerging product as we move towards publicly releasing it soon.

Click here to take a quick survey

Want to know more?
You can also follow us on Twitter for future updates.
You can sign up for our email newsletter at our site: CrowdPlace

Self-driving car

Take a ride inside Google’s self driving car.

 

YouTube – Inside A Google Auto-Driving Car.

Optional: Business plans and market research

Inc. has a great article concerning the differences in thought processes between big corporate leaders and entrepreneurs.

Corporate leaders, dealing with known markets, and incremental innovation – are much more plan-focused and step through more solid, mathematical, logical process. Innovative entrepreneurs – working with a lot of unknowns in customers, markets, designs – and seeking ground-breaking innovation – seek immediacy and flexibility. Less time is invested in academic exercises like market research and business plans – more time is invested in building stuff.

Sarasvathy likes to compare expert entrepreneurs to Iron Chefs: at their best when presented with an assortment of motley ingredients and challenged to whip up whatever dish expediency and imagination suggest. Corporate leaders, by contrast, decide they are going to make Swedish meatballs. They then proceed to shop, measure, mix, and cook Swedish meatballs in the most efficient, cost-effective manner possible.

That is not to say entrepreneurs don’t have goals, only that those goals are broad and—like luggage—may shift during flight. Rather than meticulously segment customers according to potential return, they itch to get to market as quickly and cheaply as possible, a principle Sarasvathy calls affordable loss. Repeatedly, the entrepreneurs in her study expressed impatience with anything that smacked of extensive planning, particularly traditional market research. (Inc.’s own research backs this up. One survey of Inc. 500 CEOs found that 60 percent had not written business plans before launching their companies. Just 12 percent had done market research.)

How Great Entrepreneurs Think

4 Types of Entrepreneurship

Steve Blank has a good breakdown of the 4 types of entrepreneurship in one of his posts. It’s important to remember that there are several types of entrepreneurship. Many may think that “entrepreneurs” are only people that start venture funded, fast growing companies.

Below is the list:

1. Small Business Entrepreneurship
Today, the overwhelming number of entrepreneurs and startups in the United States are still small businesses. There are 5.7 million small businesses in the U.S. They make up 99.7% of all companies and employ 50% of all non-governmental workers.

2. Scalable Startup Entrepreneurship

Unlike small businesses, scalable startups are what Silicon Valley entrepreneurs and their venture investors do. These entrepreneurs start a company knowing from day one that their vision could change the world. They attract investment from equally crazy financial investors – venture capitalists.

3. Large Company Entrepreneurship

Large companies have finite life cycles. Most grow through sustaining innovation, offering new products that are variants around their core products. Changes in customer tastes, new technologies, legislation, new competitors, etc. can create pressure for moredisruptive innovation – requiring large companies to create entirely new products sold into new customers in new markets. Existing companies do this by either acquiring innovative companies or attempting to build a disruptive product inside. Ironically, large company size and culture make disruptive innovation extremely difficult to execute.

4. Social Entrepreneurship
Social entrepreneurs are innovators who focus on creating products and services that solve social needs and problems.

Steve Blank

Real time visual translations

This a pretty cool looking app. You point it at a sign and it translates visually in real-time. You must see it- in the video.

YouTube – Introducing Word Lens.

Diminishing reality

Interesting video where they atually remove objects from a video…

via YouTube – The incredible world of Diminished Reality.

Random Thoughts Newsletter

I am going to try an experiment. I am launching a “Random Thoughts” email newsletter. I will use it to post random ideas for the blog concerning business, innovation, technology, etc. – and also read your thoughts and responses. Many ideas may not make it to the blog. You will get more than the blog offers, but will get more raw thoughts, I think. Not sure, this is just an experiment. But a lot of you may find the email newsletter interesting. This is not the Tomorrow’s Trends newsletter based on this blog with many subscribers – this newsletter will have more random thoughts.

Sign up here

The Startup Toolkit

This looks like a cool tool for startups. It says that is is for “for founders in search of a business model”. I like this visual business modeling tool. This is based on some solid startup customer development background. From the site:

Basically, a bunch of smart guys who have been kind enough to write down and share their learnings. The worksheets and questions are from Steve Blank’s book The 4 Steps to the Epiphany. The visual layout is based on the work done by Osterwalder, covered in great detail in the beautiful Business Model Generation book. Ash Maurya has also contributed his own twist on the canvas specifically for web startups. The risk dashboard is straight out of the pages of Komisar & Mullin’s Getting to Plan B.

The Startup Toolkit – for founders in search of a business model.