Category: Entrepreneurship

Founder journey, startup lessons, and business strategy

  • Keep Moving Forward

    My current project is picking up. The more I think about it the more excited I become about the potential value that will be created with it.

    Things took a significant step forward on Friday with a meeting with an accountant firm and corporate lawyer.  I’m taking the weekend to think through the options they gave me, and will hopefully be able to give them the go-ahead next week to make this business real.

    The important thing to realise is that getting to the initial launch is just the start of things.  Once this website is online the real work begins of trying to attract clients and work with them to iterate and continue to make this thing even better.

    If things are executed well I’m hopeful that I can do a soft launch before the end of May.  The Minimum Viable Product (MVP) is becoming functional.  Just a couple of late night sprints should be enough to push it over the edge.

    As part of getting this new business up and running, I’m going to spin down my old ones, and archive all the old content I have written on Halotis.com.  Amazingly, over the years I have written 593 blog posts for that website since 2005!  As my attention switches to newer ideas it’s finally time to retire that site and focus on the future.  However, I’m still undecided about where to move all that content.

  • Team Communication Overhead Costs

    I’m in the middle of undertaking a large software project – something that could take 200 hours to get to an MVP. I wanted to get things organised. My first thought was to use some of the tools I’m used to – Trello for a kanban style board, bug tracking, continuous integration services, Slack. But on second thought I realised that all of these tools are designed to aid in communication to other team members. With a team of one (me) all the communication can happen within my own head thus the time that would go into configuring all these extra tools and transcribing my thoughts into them is wasteful.

    Instead I’m able to work off off of a simple todo list.

    Do some brain storming, sketch out some ideas on paper then figure out some reasonable list of high level tasks.  I can leave it all on paper so it’s on my desk and in my face and easy to scratch off and add to at any time.

    If I add just one more developer to this project, then suddenly all these things come back into play. It becomes necessary to discuss who is doing what, to understand and verify each other’s work, to maintain consistent code style and quality. Digital platforms like Trello become necessary to stay in sync and the quick and flexible paper approach gets crumpled up and tossed into the waste bin.

    It’s hard to appreciate the cost overhead of scaling from one to two people.  It’s easy to look at a calendar full of scheduled meetings and see how much time is spent talking compared to writing software, but what is harder to see is the amount of time spent chatting on slack, updating trello, and commenting on pull requests. There are communication costs that are hard to measure.

    It’s something to consider when you are deciding to hire your first person

  • Finding a Coach

    Learning new things that affect the core of your being is a challenge not many people take upon themselves.  Yet it could be the personal pivot you need to make a genuine change.

    Many years ago I took a Dale Carnegie course, it showed me a side of myself that I couldn’t get from my friends and family who are always trying to be nice and avoid confrontation. Those people accept you for who you are and will not challenge you to change.  That course taught me that I cannot speak loudly. Through exercises I got better at conversation and assertiveness.  It helped change my behaviour at work and grow as a person.  It’s something that I could not do on my own, nor could I get it from the people around me.

    I needed a coach.

    A coach will analyse you and provide constructive feedback on how to get better by suggesting exercises to do, changes to make, and perspectives to consider. A great coach has a keen eye to spot areas for improvement and will hold you accountable to work on them.  This is something you cannot expect to have from your friends and family who will typically avoid candid conversations. Chances are you need to hire a coach.

    Last year I took sailing lessons. It was a chance to learn something completely different from what I do all day and gave me a very different sense of accomplishment compared to, say, learning another Javascript framework. Part of the difference is that with sailing I had a coach who suggested areas to improve on all the time and with each lap I got better.  At the end of the course it changed me, it had opened the door to many other perspectives which were not even on my radar prior to taking the course.

    This is the power of a coach.  To show you things you cannot see for yourself.

    For years, when I was in meetings I spoke at a low volume which created the perception that I was shy and not confident.  NOBODY TOLD ME!  It took years, and then when fishing for feedback on an annual performance review my boss suggested taking the Dale Carnegie Course to build some assertiveness.  Why didn’t anyone say something sooner?

    We continue to need coaches in our lives.

    Even the best sports players of all times at the peak of their careers still rely on their coaches.  With that in mind perhaps we should all have a coach to help us improve with some aspect of our lives more often. A piano teacher, or speech coach, CEO coaching, or business mentor. If there is something you could say “I am not awesome at X”, then perhaps it’s worth finding a coach for X.

    It’s something I hope to make part of my routine more often, accept that I have areas for improvement and find a coach to help work on them in-person.

  • Brilliance of Elon Musk

    Either you’re trying to make something spectacular with no compromises or you’re not. And if you’re not, Musk considers you a failure.

    Of all the entrepreneurs in the world, none have the same ambition that Elon has to make the future into the present. For that I have a ton of admiration. Science fiction has given us plenty of ideas about what the future might look like with advanced robotics, AI, and city scapes but few people take it upon themselves to make those movie props real.

    Musk is taking it upon himself to lead the world into a future where humans live in space, colonize Mars, have self driving electric cars, solar power everywhere, underground highways, 500mph vacuum tube transport, and digitally connected brains.  These are visions that millions of people around the world cheer on as we continue to be let down by the dreary future many of us perceive (where are our flying cars?).

    The book about Elon Musk provides some insight into the character that it takes to build this kind of future – a level of determination that few in this world have.  It’s inspiring in a way that I never expected.  His leadership drives people to work all hours of the day, give up weekends to solve technical problems, while he himself is leading by example. There is a work ethic, doggedness and hustle in him that is exceedingly rare and it rubs off on those who work for him and those who are inspired by him.

    As an idol Musk raises the bar of all us dreaming entrepreneurs. Can we take the Silicon Valley approach to business and disrupt the entrenched industries? Can we find ways to create better products at 1/10th the price. Where are the opportunities to challenge the accepted status quo and upend the antiquated regulations that stifle innovation. Can we justify the feasibility of our ideas by boiling down to the basic laws of physics? How can we as leaders continually identify the critical path and work to unblock it?

    What I came away with most from the book is that, if you’re willing to work hard on things you can tackle hard problems. However success of this magnitude require stepping stones.  SpaceX couldn’t have started without the success of PayPal which in turn wouldn’t have happened without Zip2.  It’s worth noting that Zip2 was not a trivial undertaking at the time, it wasn’t a get rich quick scheme like affiliate marketing, blogging or YouTube stardom is today.  Zip2 was a meaningful attempt to get more businesses on the internet, but it started small enough in scope that few employees were required to bootstrap the company.  Musk did start with very little in those days – sleeping at the office, showers at the YMCA and a frugal food budgets.

    The world needs more people like Elon Musk who are willing to take risks on bold ideas and provide the sheer will and determination to see them come to life.  It will be a fantastic future.

  • Programmatic Models

    Recently I’ve been interested in finding a business investment – something like a B&B that allows me to put some of my retirement savings into a business that I have some control over its success.  The normal process for something like this would be to write a business plan or at least do some back of the envelop estimations for how much revenue is expected from the property.

    The usual tool of choice is a spreadsheet.  And those are excellent ways to work through the numbers and visually see things.  However, the flexibility of a spreadsheet is somewhat limited for even more advanced analysis.

    I wanted to take things to a different level.

    What information could I get from looking at the market and scraping webpages that I could feed into a bigger model to see how other owners of similar businesses do.  By pulling in 1000+ comparables and running them all through a similar model to estimate each of their profitability it becomes possible to identify the traits of a successful business.

    Applying this sort of ‘big data’ analysis is proving interesting.  There is an amazing amount of information freely available on the internet, but much of it exists in different silos.

    In the example of running a B&B, there are lots of them listed on booking.com and similar travel booking sites.  These provide a partial picture of how popular a place is (from it’s availability) and the revenue (from the cost to stay there). Another big piece of the picture is the costs – which you can estimate by checking real-estate listings.  By putting all this information you can see many interesting things.

    If your model is accurate then you can get answers to these questions:

    • What percentage of B&Bs turn a profit each year
    • Is there an optimal size / number of rooms
    • which attributes of the property correlate most to it’s profitability

    You can take a deeper dive into the best performing properties to see if they do something unique – do they have nicer websites / photos? Do they do aggressive advertising? Are they active on social media?  Answers to these questions can help you find the strategies that are working best in the market – and perhaps things that are a waste of time.

    This type of analysis is something I think more people should be doing.  It provides some competitive advantage in terms of the information that you bring with you into a potentially big investment, and reduces the risk that you inadvertently buy a lemon.

     

  • Experimenting with ECommerce

    Over the last couple of weeks I have been spending some evening and weekends working on building some e-commerce websites. If I were to Define Ecommerce, I’d say that it is the most advanced platform for sales, and which has the higest percentage of reception by customers worldwide.

    Chinese ecommerce companies are now experimenting with direct selling model

    Right at the time that the iPhone 2 came out I was really into buying domain names and picked up iphone7case.com. I’ve held onto that domain for nearly 10 years and finally (fingers crossed) the time is coming to make something of that site.

    The most obvious way to provide some value with that domain name is to put a store on it that sells iPhone 7 specific cases and accessories.  So in trying to find a way to make that a reality I’m doing some web development in the evenings to build up a website and hopefully get something ready to launch before they announce the new phone in September.

    In addition to that I put up a small store on this site to experiment with.  I just put some books and products that I bought off amazon which I really liked and will continue to add links to things that I personally have bought and recommend, I’ll also make sure to add some coupon codes I’ve gotten from websites like Raise.  I’m hoping to offset a bit more of my server costs for hosting this and my other sites.  We’ll see how that goes.

  • Power of Iterative Progress

    Software startups often talk about iterative improvement.  It’s a development model where by you focus on an easy to reach but minimally sustainable business model and then iteratively improve things and add features over time.

    The process of getting to that first product release is perhaps the hardest thing to do.  It requires having a vision, and following through on it day after day without much validation until it’s finished enough to show and talk about it with people.  To build a team you need to convince them of the validity of your vision and get their buy-in to help you build this product.

    Even with great effort it can be tempting to bulldoze something 80% complete.  There comes a time in this long slog of work that we naturally second guess the idea.  “Is it worth pursuing”, “Someone else released something similar before us”, “I think I have a better idea”.  This is a pattern I have fallen into for many of the projects I have started.

    Giving up on an idea before that first launch is like a construction company building a school, getting to the point of hanging the blackboards on the walls and then deciding “Nah! We should have built a stadium! Tear it down!”

    Getting something finished enough to put it on the market is just the first half of the work of making a viable business of of it.  After crossing that hurdle of getting it out there enough to attract users and customers is when you have to tackle another slew of concerns: customer relationships, sales, marketing, accounting, ROI, growth hacking.  But if you don’t make it to that point of launching something, then the rest of it will never exist and all the energy and effort you expended will have been wasted.

    Iterative progress is the idea that if every day you continue to put one foot in front of the other and keep going in the same direction eventually you will have accomplished a great journey.  Even if some days you don’t want to walk, it’s just something you need to keep doing anyway.

    Writing a book requires sitting down and writing hundreds of words per day, day after day, for months.  It is exhausting. It is frustrating at times. But if you give up before publishing, it’ll all be for nothing, nobody will read it.

    Most, if not all, the successful people I have met have this trait. A stubborn focus forward on their vision. They can push a single idea for decades without wavering.  By shear persistence they eventually get out in front of the pack.  It’s something I hope to cultivate in my self, and hope to see more people develop.  The world needs more leaders with the strength and will to see their visions become reality.

  • Making Longterm Plays

    In an age where we expect everything quickly it seems that it can be harder to have the patience to endure long term investments.

    People are career hopping between companies and entire job types more today than at any time in history.  Employees who want to progress up the ranks find that a quicker route is to job hop.  Ambitious employees are not content to put in 10 years at a company before getting a promotion.

    Investors also look for quick gains.  Few are willing to park their money for multiple years in order to get rewarded with modest gains. We look for the quick buck.  Day trading to make 1000’s of dollars in hours instead of months.

    This psychology has repercussions in our endeavours.  It becomes hard to focus for years on a blog to build an audience or create a piece of software in our spare time, or start a business.  These long term goals take time and time is the one thing that we too impatient to wait for.

    However, being conscious of this is the first step to being empowered enough to account for our natural tendencies and make long term decisions that are in our best interest.

     

  • Investing More

    Amazingly we’ve been living in Calgary for 5 years now.  The time came to renew our mortgage and while I was doing that I started the process of opening a HELOC so that we can use some of the equity in our house to invest.

    With today’s low interest rates it has become pretty attractive to borrow money. I expect it will be relatively easy to get a positive spread between the interest rate and the return on any investments.

    Leverage like this is the only way to become wealthy.  This is dramatically apparent for our house value: since buying a house the slope on our monthly net worth tracking doubled.  Unfortunately in the case of house value that equity is not very liquid and difficult to access.

    The plan for the HELOC funds is to invest most of it in a well diversified portfolio of stocks and bonds.  I’ll withdraw funds each month to pay for the interest on the loan.  By the time the HELOC is paid off we should have made a nice profit.

  • Reading about Solar

    I’ve been reading and doing some math on the feasibility of Solar electricity.

    Turns out that costs have dropped significantly over the last few years due to the scale of production in China that actually is currently over-supplying the demand, and new manufacturing technology that is making it much cheaper.  You can find panels for sale in China for as little as $0.30/watt right now.

    The ROI for solar is getting down to a reasonable timescale and is at a tipping point where it’s a worthwhile investment for many people.

    It’s something that I want to do a lot more research on.  But over the next few years I expect we’ll all be seeing a significant increase in the number of houses with solar panels on them.