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8 successful startups with non-technical founders

You don’t need to be technical to launch your tech company although it definitely helps. There are many other success factors like drive, vision, creativity, the ability to communicate them and excite others, sales know-how, business savvy, financial smarts, negotiating skills — and a bit of luck doesn’t hurt. All these are necessary to turn a finely-engineered product into a successful business.

Last week I posted about getting your tech startup going if you are not technical.  This week I will cover some examples of successful tech startups that were founded by non-technical people.

Pinterest

Ben Silbermann,  Pinterest founder, is not a typical tech dude. The Iowa native worked for Google but didn’t come from an engineering background — he was designing products like display ads. Hе graduated from Yale with a degree in political science and later took a consulting job in Washington. He began reading technology blogs and enjoyed learning about what people were building: “I would read about things like Digg and Kevin Rose.”  Plus, Silbermann was exposed to people who built amazing products. 

And then came Pinterest –  the website and mobile app enables users to collect and share their favorite images.

Silbermann and two friends, Paul Sciarra, who worked in venture capital, and designer Evan Sharp,  launched Pinterest in 2010. Members use the site to “pin” products to collections called “boards,” an activity that’s become so popular even President Obama is doing it.  

It caught fire and quickly skyrocketed to success with more than 30 million users globally and a $1.5 billion valuation. What started as as a fun side project has became one of the fastest growing social networks on the web.

Linkedin

Reid Hoffman  is one of the most successful entrepreneurs in Silicon Valley, as well as an investor and writer. He graduated from Stanford with a B.S. in Symbolic Systems in Cognitive Science and holds an M.S. in Philosophy from Oxford. He served as an Executive Vice President of PayPal where he was in charge of business development, corporate development, international, government relations, and banking/payments infrastructure.

In December 2002 Hoffman launched a professional networking site that became a $20 billion-plus company  called LinkedIn.

Zappos  

Did you know that Tony Hsieh did not actually found Zappos? The actual founder was Nick Swinmurn. Here is the story.

Nick Swinmurn graduated from the University of California, Santa Barbara  with a degree in Film Studies. He founded Zappos in 1999. His initial inspiration came when he failed to find a pair of brown Airwalks at his local mall.

Swinmurn shares his story: ”I was fresh out of college. I got out of college, worked for the San Diego Padres for a year. There I realized it was taking forever to advance, and was kind of slow paced, so I moved back to the Bay Area, entered a job at an actual Newspaper, for Autoweb, and that was my introduction to the internet. I didn’t use email in college, this was 1996. I think I went to the library and signed up for ucsb.edu email address but I couldn’t quite figure out how to use it, you’d go to the terminal and use it and all that.

My Dad told me, you know I think the one you should focus on is the shoe thing. That’s a real business that makes sense. So I said okay, focused on the shoe thing, went to a couple of stores, took some pictures of the shoes, made a website, put them up and told the shoe store, if I sell anything, I’ll come here and pay full price. They said okay, knock yourself out. So I did that, made a couple of sales”

That same year, Swinmurn approached Tony Hsieh  and Alfred Lin  with the idea of selling shoes online In July 2009, the company announced it would be acquired by Amazon.com in an all-stock deal worth about $1.2 billion. Since its founding in 1999, it has become one of the world’s largest online shoe stores. Continue reading 8 successful startups with non-technical founders

How to get your tech startup going if you are not technical

NYC and Silicon Valley have a wealth of business people with solid business experience in many important, fundable sectors, but they face a major barrier finding comparable technical talent to form great startup teams.

If you are one of these non-technical co-founders one of your first moves is to decide who will do the tech side. I think 4 options are at play here.

Fake it till you make it

In many cases the first thing that a startup should do is to validate the market – do the consumers really need your product; is someone willing to pay for it; etc.?

In many cases, you don’t really need to build the product to test the market. Building a great landing page or a simplistic prototype and getting some traffic to it often provides enough market validation to raise the angel investment that enables you to hire a team of developers and build the product.

A great example is the story of Aardvark, a social search startup acquired by Google back in 2010. Liz Gunnes writes:

In order to find out, they got users to test-drive their ideas. For the first six months Aardvark prototyped ideas, gave them to 100-200 people, and if they saw they weren’t taking off, abandoned them (a slide of five abandoned ideas is pictured on the left). Once they figured out that social Q&A was the ticket, they didn’t pull back on user testing, bringing in 6-12 users a week over the 30-month span of the startup.

 But Aardvark didn’t actually build products right away. The service connects people with questions to those in their broader social network with corresponding answers, but for nine months a human being was involved in every single interaction — a kind of “Wizard of Oz” that classified the query and otherwise managed the conversation from behind the scenes.  

In the meantime, Aardvark recruited its core team and raised $7.5 million. ”

Learn how to code

Fred Wilson’s advice is: “If you aren’t technical, I suggest you get technical”. He provides a good success story on this point

Even better is the the story of Instagram founder Kevin Systrom: Не went from being a hobbyist to being able to write code that would go into production .

If you want to try going this route, here are links to massively open online courses which provide an opportunity to learn programming:

  • https://www.codecademy.com/completely free with interactive platform. languages: SQL, HTML & CSS, JavaScript, jQuery,PHP, Python, Ruby
  • https://www.udacity.com/ – free but offers paid certificates for course completion. Languages: HTML, CSS, Javascript, Python, Java , Mobile Development. Advantages include short courses for 4-8 weeks
  • https://www.coursera.org/ – free but offers paid certificates for course completion. It boasts a large base of computer science courses covering most of the popular languages; Most courses are 2-6 months.

Find a technical cofounder

Since you are the one with the original idea, you would need someone to drive the tech side. Start searching for a cofounder by asking your friends and querying your LinkedIn network, “I’m looking for a technical co-founder who does X. If you know anyone please introduce us. Also, feel free to pass my request and contact info on.”

Additional places to look are

  • Founder2be.com you can join here more than 40.000 co-founders, designers, marketers, developers, etc;
  • Namesake.com – a new social network where you can ask for recommendations for a tech co-founder; the site is focused on real time conversations and professional recommendations. It is still in closed beta so you will need an invite;

If you are one of them, you can take Fred Willson’s advice and try to pair up or stop only looking for a technical co-founder and focus on building your company instead.

Hire an external team.

Non-technical founders can hire a remote team to build an MVP in short the term, while continuing their co-founder search.

There’s a cottage industry of freelancers and development shops that are willing to take a combination of equity and capital to help you get to an MVP.

Offshoring often offers considerable cost savings. Fred Wilson is sharing his experience, The two primary reasons one company will outsource work to another company are cost and skill set. The third party outsourcing company can provide the required work at either lower cost or higher quality or possibly both. Sometimes time is also a factor. It is often the case than an outsourcing company can get the job done faster.Labor costs in emerging markets are often a fraction of the labor costs in the developed world. And you can often tap into highly educated and skilled labor pools. We have companies in our portfolio that have built world class engineering teams in places like Belarus, Slovenia, and India. These teams cost less and often produce amazing work.”

While many Silicon Valley founders say they would never outsource any significant part of their software development to another company or individual abroad because of various outsourcing horror stories, others swear by it and have achieved notable success.

Here are examples of tech companies that were started by non-technical founders and succeeded spectacularly. Some hired in-house developers, others prefered remote teams and overseas development.

  • Skype
  • Pinterest
  • Snapchat
  • Groupon
  • Alibaba
  • Amazon

The story of Digg is classic. Digg was developed by a freelancer found on Craigslist, who later became Digg’s lead developer:

In the fall of 2004, Rose withdrew $1,000 — nearly one-tenth of his life savings — and paid a freelance coder $12 an hour to mock up a Web page. He got a deal on server space over the Web for $99 a month.”

There are dozens of other stories. Less famous but still successful startups that used remote teams to move forward faster.

  1. The first version of Readyforce.com was entirely outsourced and is being used by customers, while the newly-recruited in-house engineering team builds the second gen product.
  2. Squidoo was founded by Seth Godin (non-technical) who hired a team (Viget) to build the first version.
  3. Glamsquad worked with Applico to build their MVP. After that, Glamsquad was named one of the Top 10 Startups to Watch in NYC by Time Magazine.
  4. The initial version of SumoMe was famously built for $60 by a freelance developer hired by Noah Kagan.
  5. Wanelo was developed by an overseas 3rd party who eventually accepted a small buyout when she rebuilt the code.

Mike Dorsey, entrepreneur & advisor shared his success story about being non-technical and founding his first company with outsourced developers. Leads95.com is a profitable lead generation and CRM company, with a web-based lead marketplace.

Unemotionally discussing options for non-tech founders is all well and good, but doesn’t really solve anything. Hot ideas need to be acted on fast; that’s the nature of the entrepreneurial beast.

The best solution may be a combination of the three.

  • Post co-founder requests wherever possible.
  • Simultaneously, get referrals for remote team vendors and start your due diligence on the one or two that best fit your needs.
  • Finally, as time permits and if you are math-oriented spend some time on the coding sites.

Just remember, you have only so much time and physical/mental energy, so spend them in ways that have the highest ROI.

 

Founder Essentials

Over years of working with startups, as well as doing my own, I collected a large set of articles on important aspects of running a startup. I asked Yana to categorize them for easy reference in a “Founder Essentials.” Here is the first installment.

Co-founders, Building Teams, Hiring and Managing People

As you start you need to know that your founding team is properly configured. Finding tech co-founders could be the biggest challenge for a non-techie entrepreneur; a better solution may be to hire an external team to avoid wasting your time.

If you are a technical co-founder yourself you have to pay more attention to humanities like the corporate culture and learn to manage people and to hire.

As your company grows, you need to make sure that your company’s culture keeps working. Take a look at famous Dharmesh Shah’s presentation on Hubspot culture and you may want to delve into Miki Saxon’s writings about the importance and how-tos of culture in startups. You may also want to read an excellent essay on corporate culture by Dana Ardi

Processes and Lean Startup

Eric Ries‘s Lean Startup is the  methodology to build and launch products. The idea is to build and release fast and then iterate through customer feedback. In your first iteration use the Lean Startup principles and develop an MVP as a core component – then keep it lean

Business Models

The business model shows the logic of how a company intends to drive revenue and profits. The old school is to write a business plan; the style is to used an online tool to build the Business Model Canvas . You do still  need a model that links your metrics, so that you can do some what-if research – you will start with a wrong model but gradually as your understanding of your business grows it will become more and more close to the reality.

And be sure to watch your burn rates at different stages like a hawk.

Marketing and Growth Hacking

Today’s startups go beyond traditional marketing strategies; the key is being metrics-driven in your marketing efforts.  Classic presentation on the topic is Dave McClure’s – wasn’t he awesome until he started doing presentations about startup ecosystems?

Growth hacking is the current hot marketing buzzword. For example, here are three different growth hacks, with track records of strong results regardless of a company’s particular product or niche. Note that inbound marketing has been the most effective method for doing business online since 2006.

Content marketing is another rising marketing star. Generating interesting, expert content is an excellent way to develop your brand image and attract your target audience.

Sales

No matter your startup idea you need to sell. It is important not to confuse sales with marketing, although both are important. Generating sales leads on a small budget requires a good framework for evaluating sales solutions. Crucially, you need to be able to quickly convey the benefits of your products/services, recognize customer buying signals and learn how to close the sale.

While it is important to remember that marketing drives sales, there are 5 principles to help you to build your sales culture and numerous sales techniques that can be learned. Consider these four factors when hiring to decide who will work best, industry newcomers or proven veterans.

Follow (again!) the Lean approach and start marketing and selling your product before you even have anything built to avoid the worst outcomes for your startup when people aren’t willing to buy your product after you’ve built it.

Legal and Incorporation

Startup Lawyer covers most incorporation issues. The content is from 2014, but legal matters do not change that fast. 

 

Finance and Accounting

Fred Wilson’s archives provide a wealth of knowledge, including a general understanding of accounting for non-accountants, profit and loss (P&L) statements and balance sheets.

He also explains why cash flow can be negative when a business is actually profitable and vice versa, and how to analyze financial statements. Note that although accounting practices differ widely in countries other than the US, you still need to understand these as well when talking to investors.

 

Communities — where to find more/newer information and ask your own questions

Silo

Startups Anonymous

Quora

 

I hope this short overview provides the resources to help you move forward with your own startup!