08 1 / 2014
The only 3 things that matter in building a startup
Happy 2014! The beginning of this year marks 5 years since I left my cushy product job at the GOOG.
Although it sounds like a long time, these past 5 years have zoomed by super quickly. I’ve grown and changed a lot over the last few years. I’ve learned a lot of things that are important in building a company. It can be easy to get overwhelmed with all the things that you need to do or need to figure out.
But, after 5 years, if you simplify all those things that matter in building a company, it actually only comes down to 3 things. Here are the only 3 things that ultimately matter in building a startup:
1) Morale is king. (for you, your family, your teammates, your teammates’ family, your dog)
A lot of people think cash is king in business. This is largely true. Money makes your life more comfortable. It makes it easier to recruit. But money isn’t what keeps you or your team going. In fact, just because you have cash doesn’t mean that your company will survive.
In the first year of my startup adventure, my now failed company Parrotview was on the verge of signing a five figure deal with a Fortune 1000 company. This would bring money in the door to build our product and pay everyone on our team who had gone so long without pay. But, instead, we fell apart. My teammates were just no longer excited about the business anymore. Money didn’t matter. Morale is king.
img credit: aliwest44
The flip side is also true. When Jennifer, my now co-founder, and I first started working on side projects together in my second year after leaving Google, we had no money. In fact, to get some money in the door, we did random odd and end things. One time, we had researchers follow us around for two days as part of a scientific study that we got paid for. I also categorized whiskeys in Excel as a side gig. (I knew nothing about whiskey at the time.) We barely made ends meet by dipping into our savings. But, morale was immensely high.
I’m so excited about Shiny Orb and jquery -Jennifer (10/13/09)
But, morale is not just about your own morale or your co-founder’s morale. It’s also about your spouse’s morale. And your family’s morale. And your co-founder’s spouse’s morale. And your team’s morale. You need to do everything you can to keep everyone around you (and everyone important to those people) excited about the opportunity you’re pursuing. In running a startup, everyone goes through difficult times. There are so many ups and downs, and while there may be a lot of pressure on you as the CEO or a co-founder, your whole team and the people important to them are also with you on the startup roller coaster — not just you.
There have been times where we’ve lost a team member, because his/her family member didn’t think that working with us was the best idea. In those cases, I didn’t do a good enough job trying to keep morale up with everyone who mattered. I wish I could quantify morale, because morale is the most overlooked metric in startupland, but is the most important.
2) It takes a village.
This brings me to my next point. Starting a company is a lot easier when you have a village of support. Your village could be your family. It could be your friends. It could be your professional network.
img credit: Ramon Cahenzil
Honestly, LaunchBit only runs because of our village. It’s true. As much as I want to pat myself on the back for all the hard work I’ve done, I know that we’re nothing without our village.
In the very beginning, when we had no money, my parents took me back under their roof. When I still had no income, my husband, on his post-doc salary, made our household work. When Jennifer gave birth to her now two-year old, her parents took care of her son so that she could work. And, then after that, Jennifer’s husband Tim took over. My friend Vidya once helped me make a demo video. Hell, she also volunteered her other friend Vidya to help us with some of our code for one of our initial projects. And, she even introduced us to a couple of our investors. My friend Albert consulted for us every week for quite a while. There is a long list of friends and family who have helped us tremendously in some capacity for free over the years. Everyday, I’m thankful for our village.
3) There’s no silver bullet — just persistence, tenacity, and grit.
The tech media often highlights overnight-success companies. There are certainly a handful of these kinds of companies that exist. But the vast majority of them, including the ones who are highlighted as overnight successes in the press — such as GoPro, Pinterest, Pandora, and Rovio — are just plain and simply successful after years of uncelebrated hard work.
img credit: ljm2007
There’s no silver bullet. You solve one problem, and another one crops up. You earn revenue from one partnership, and then you have to form another one to grow your sales. You find one customer acquisition strategy that works really well, but then it saturates, and then you have to find a new channel.
Building a startup is hard. There are always problems every step of the way. I used to think, “if we only hit ABC milestone or raise XYZ money or hired QED people, we’d be set.” But, after 5 years, you realize that you go and conquer those things, and you have a whole new set of problems and milestones that you need to tackle next. You have more teammates to worry about. Bigger challenges. Bigger customers. More money, more problems. It doesn’t get easier — it actually gets harder.
But, don’t get me wrong. This isn’t to say that you should be down in the dumps. But, it does mean that you should enjoy the journey of tackling difficult challenges, because that journey doesn’t stop. Each mountain you climb with your startup can be immensely rewarding, because you know that it was a hard climb that you accomplished, a feeling that isn’t quite the same at a larger company.
There are a lot of things that are important in building a company. Preserve your capital. Invest in good people. Be scrappy. Validate your market. The list of good advice and important things to do goes on. But, keeping track of all these things is difficult to do. And, you won’t always do them correctly. I know that at LaunchBit, we’ve made a lot of mistakes and taken a lot of detours and wrong turns. There are times that have been tough. There are times when we’ve run out of money. Or we didn’t know what to do or where to go.
But, it’s ok. Time and again, if you can just do these three things: 1) keep morale high, 2) build a loyal village to support you, and 3) be tenacious, you’ll be just fine. I’m sure the next 5 years will present us with even greater challenges and even higher mountains to climb. I don’t know how to climb all of those right now. And we’ll probably take more detours and more wrong turns. But, I do know that if I can do just these 3 things, we’ll be all set.
Here’s to a good 2014 and may your journey be both challenging and fun.
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03 6 / 2013
How to live comfortably in NYC on a $30k per year salary
image credit: Grufnik
Lately, there’ve been a lot of news articles talking about people who have lived comfortably on seemingly small amounts of money such as this journalist’s article on NYC living and this coverage of Mr. Money Mustache’s retirement at age 30. A lot of people I know have been arguing that the people cited in these articles must live really uncomfortable lives, and I know a lot of entrepreneurs who have a hard time making ends meet even in a small suburb (such as Mountain View) let alone a big city. Frankly, it’s pretty easy to live comfortably in a big city like NYC on a < $30k per year salary. Here’s how I did this.
image credit: chrissam42
I lived in Tokyo (supposedly the most expensive city in the world according to the Economics Intelligence Unit) right after college graduation from 2004-2005 for almost a year. All numbers in this post are amortized for 1 year of living. I actually did not optimize for saving or scrimping at ALL and yet accidentally saved a lot of money.
Breakdown of my expenses (per month)
- $1000 housing + gas/water/electricity
- $600 food + drinks
- $50 cell phone
- $40 one-time furnishings (divided by 12 months in a year)
- $50 toiletries
- $60 vacation (I took one $700 vacation while there)
- $300 misc entertainment (books, cds, day trips)
= $2100 per month or $25,200 per year
Including taxes/medicare/social security, that comes out to a $30k per year salary. You might have some question marks about these numbers, so let’s dive in.
1) I lived close to work
When I moved to Tokyo, my goal was to optimize for happiness, not savings. Time and again, studies show that commutes make people miserable. In some cases, you actually know you’re miserable in your commute, because you are cursing at all the other people around you. But, at other times, commute-frustration is more subtle. It manifests itself in the frustration of having wasted 1-2 hours of your day that you don’t realize you could otherwise have.
image credit: tokyoform
Living close to work is a big part of my own happiness, I’ve found. So, when I got to Tokyo, I paid $1000 to live in a nice part of the heart of the city (in Meguro). I would take the train, ride my bike, or walk to work. (My company covered my train tickets so if I were really optimizing for savings, the right thing to have done would’ve been to live far away in a cheap place and commute in saving even more money)
image credit: GaijinSeb
My apartment was 5 years new and a few minutes walk from the train station. So why was my apartment so cheap? Well, it was only 300 sqft - just slightly bigger than my dorm room in college. I never threw parties there, but in big cities, people go out to party — why would you stay at home? When I was deciding on whether to get a bigger place, I knew that in the end I would not be spending most of my time at my apartment, because I would either be at work or out and that getting a bigger place wouldn’t increase my happiness. I also underestimated how much of a perk a small apartment could be: cleaning and tidying only took ten minutes each week!
2) I cooked a lot
My food/drink expenditures were really low, because I mostly cooked. The first month I was in Tokyo, I ate out A LOT. Every meal. And then I felt awful. Those obento boxes actually have a lot of grease. And even a sushi dinner can make you feel terrible, because many meals don’t have a lot of vegetables. So, I started to cook out of health reasons, which ended up saving me a lot of money. I spent about $100-200 per month on groceries and would cook up a storm of veggies and meats each Sunday that I would eat for lunch and dinner on the weekdays.
image credit: willposh
I went out every Friday and Saturday, and spent about $100 each weekend on eating out, drinking, karaoking. I had some friends who were bankers who would go out a lot more and spend a lot more money. I would often join them a bit later — such as after dinner or at the 2nd bar, because spending money on an extra 3 cocktails would not have made me feel happier or better about myself.
3) I bought furniture from rich ex-pats
image credit: epSos.de
This is a tip that I don’t read about at all on money-focused blogs. The best way to get good stuff is to buy them slightly used from rich people. Major cities are great for finding rich ex-pats who are selling stuff for cheap, because they are always trying to get rid of their stuff in a hurry. Heck, I was at a party at the US embassy once, and they were giving away kimonos worth thousands of dollars!
I used the Tokyo Metropolis to buy my TV, bed, washer/dryer, microwave, rice cooker, utensils — basically everything! No item cost me more than $50, and many items were free since people were in a hurry to leave. So I furnished my apartment for well under $500, which comes out to $40 per month. The nice thing about living in a rich area is that I was often close enough to pick up these items and carry them on the subway or get help with a drop-off.
I also made my own decorations. I printed photos of my friends and family and hung those on my walls. I bought material to make my own curtains for $20, and hung those using lots of paper clips and pins — they looked like real curtains.
The general tip here is to be resourceful. Don’t just blindly buy stuff from a department store.
4) My friend built me a bike for free
The other perk about living in a rich area is that rich people would often throw away nice things that were still functional. My friend Jason often found really nice mountain bikes worth thousands of dollars in people’s trash and would clean them up and add/change out a few parts. It was nice of him to give me one of his findings, and honestly, that was the best bike that I’m sure I will ever own!
image credit: Manic Street Preacher (Note: this was not my bike)
Having a bike then made it easy to explore the city. Every park and event happening anywhere in the city was then easily accessible. One of the best investments for happiness, exploring, and finding very cool things.
5) I didn’t have a smart phone or internet at home
This is a bit ironic, since I run an internet company now. I had meant to get internet installed at my apartment but ended up spending so much time either at work or out in the city that I didn’t have time to wait for someone to install my internet at home! It turned out that I did not miss being connected for an extra 3 hours per day.
image credit: James Nash
I also had a dumb phone, and frankly, I would revert back to a dumb phone again today if I didn’t have customers I need to keep up with on the weekends. When you have no car, you have no need for driving directions. Personal email can always wait. And, I that’s about all I use a smart phone for.
tl;dr — this is how you save a lot of money to live comfortably in big cities
- Cook a lot - healthier and saves A LOT of $$
- Buy used things from rich people. Ex-pats, in particular, give away lots of free, nice stuff
- Bike everywhere - healthier, makes you feel better about yourself, and saves $$
- Hang out with friends who spend the same amount of money as you and when you hang out with friends who spend more money, join them later
- Get a small apartment in an ideal location
What would a larger salary get me?
By optimizing for my happiness, I ended up spending the equivalent of a $30k salary (post taxes, etc) even though I made more money than that. I found that when I went out to eat everyday, in the beginning, it was a special treat. But, then it became a habit — I wasn’t deriving more happiness from going out to eat more — it was becoming something that I just did. It was also way more unhealthy. I also tried to buy cool gadgets while in Japan, and at first, the extra gifts for myself made me feel excited, but after a while, I just got used to them. It was just more stuff that I had. I could’ve probably spent more money going on vacation, but I didn’t have enough vacation days to go for more than one trip that year, so I couldn’t have spent more in that category either.
In the end, there wasn’t anything else that I could’ve bought that would’ve made me feel happier. To be fair, if I had made $30k per year, I would’ve had 0 savings, and that would’ve been problematic in the long-run. But if the question is whether you can live comfortably on $30k in a big city without scrimping — definitely.
In the end, I found that what increased my happiness wasn’t actually material: meeting new people, spending time with friends, exploring new places in town, and seeing events and cultural activities. These are all things that make your life comfortable and happy and that money can’t buy.
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12 5 / 2013
Connecting the dots forward
As graduation season comes around again, I’m reminded by accomplished entrepreneurs that you can only connect the dots backwards, not forwards. But, this isn’t always true. While others have published different stories on Startup Edition on why they were inspired to start a company, my story is all about connecting the dots forward.
During my freshman year of high school, my best friend Jennifer asked me what my plans were for Winter Break.
"Not much. Why? What’s happening?" I asked.
"My cousin is starting an internet company — do you want to help out for a bit?"
"Sure. I have relatives staying with us, but I could probably go for a day or so."
I had no idea what an internet startup was, but I had nothing else going on. So on the second day of Winter Break, my uncle dropped me off at the Caltrain so that I could go up to San Francisco. I was excited! I had never taken the train by myself before. Jennifer and I met up on the Caltrain and hopped off at 4th and King, the final stop on the Caltrain in the heart of the SOMA district in San Francisco.
image credit: lsc21
We walked a few blocks to her cousin’s company. When we got there, it looked a bit like an old apartment. The conference room was what looked like a kitchen. There were leftover pizza boxes strewn about. Desks were sorta put together but not really. It didn’t look like an office. There also wasn’t anyone there.
It was just after 9am, and we could not find anyone. Jennifer had been there the day before and had already started working. She had been building rolly-chairs and crimping ethernet cables from scratch.
image credit: olivander
She showed me how to do both, and I started helping her. Soon, our supervisor Aaron arrived. Since it was taking me way too long to crimp cables, he quickly reassigned me to write internal webpages for the team to stay on the same page. I loved how there was such a variety of projects — I had only been there for about 2 hours, and it was already very exciting.
Around 11am, the rest of the company started showing up in a trickle. I got to meet everyone but largely stayed out of everybody’s way. I watched employees bustle about — writing code, hopping into meetings, cleaning the office, and ordering food.
image credit: roboppy
And, there were a ton of external partners coming and going and meeting with Jennifer’s cousin in the kitchen. It was all very intense and exhilarating. Here were a group of friends that came together to build something. They did a variety of things. And, they could eat all the pizza they wanted. I was so inspired that from that day on, I knew that I wanted to start an internet company when I “grew up.”
There are lots of things about your destiny that you can’t control. But, you can try to steer your life in the direction you want it to go. A couple years later, Jennifer and I made a pact to start a company together. Then life happened — we went our separate ways — went off to college, work, and grad school on different coasts and in different countries.
But, 10 years later, Jennifer and I did start what would become LaunchBit. To make that happen, we each did long distance with our now spouses. We moved our families across the US multiple times. And, we roped our families into helping us…A LOT. But when you’re so inspired to build a company with your friends, you’ll persist to connect the dots forward somehow.
Check out fellow entrepreneurs’ stories on how they were inspired to start their companies on Startup Edition. What inspired you to start your company?
03 5 / 2013
3 awesome sales tools to help you make $30M
1) Streamline sales with Gmail Canned Responses
Using canned responses is a great to cold-email people efficiently. At LaunchBit, we use Tout and YesWare for our canned responses. Literally, with just two clicks, I can send a cold email in 2 seconds. Tout and YesWare additionally offer deep email analytics and tracking, but if you are just looking for a free way to send canned responses, Gmail’s got you covered.
1) Log into your Gmail account
2) Go into your settings (look for the gear icon in the upper right corner of your inbox)
3) Click the “Labs” tab at the top
4) Search for the Canned Responses feature
5) Click the “Enable” radio button and save.
1) In your Gmail account, press “Compose” to compose and email.
2) Type the canned response you want to save in the body of your email.
3) Click on the “Canned responses” dropdown menu. Select “Save” and save your new template.
4) The next time you compose an email, instead of typing the same message again, you can just insert this canned response from the same drop down menu.
2) Insert invitations quickly in Gmail
So, now you’ve cold-emailed a prospective customer, and you’re figuring out the best time to talk. Do you ever spend a ton of time just exchanging emails with someone trying to schedule a freakin’ time to talk by phone? Gmail has an invitations feature that can help you add times to your calendar in a spiff.
Setup & Use:
1) Log into your Gmail account. Compose an email.
2) Click on the “Invitation” link. It’s next to the “Attach a file” link.
3) Add your invitation details and insert the invitation.
4) When you send the invitation, it will automatically add the invite to the recipient’s calendar.
3) Use your browser editor to personalize your product for your potential customer
Sometimes it’s hard to visualize what you’re offering. But, you can use your browser editor to quickly make changes to an existing web product to personalize it. Your potential customer will be able to better understand what your product when personalized might look like.
Setup & Use:
1) Go to the product page you want to personalize. In this case, I’m going to Hacker Newsletter.
2) Find the elements that you want to change. In my case, here’s one of our existing advertisers, and if I were prospecting a new customer, I would want to change this section to show them what their ad could look like here.
3) If you’re using Chrome, go to View->Developer->Developer Tools. You should now see an HTML bar pop up.
4) Click on the text or the image that you want to edit in the HTML. Double click and start typing to change the text. Or copy and paste a new image link into an existing img tag to replace an existing one. (Obviously, if I were doing this with a potential customer, I wouldn’t use our LaunchBit logo…I would use theirs!)
5) Now, this change has only been made locally in your own browser not on the actual website. Take a screenshot of your work and send it to your potential customer to show them what your product could do for them.
Sales tools speed up sales
Sales is a numbers game, and you need enough top-of-funnel prospects to hit your sales goals. The tools that Noah shared are an awesome way to make your sales process more efficient.
For more sales tips, check out my other posts on How to write a cold-email, Why you should cold-email Steve Ballmer, How to find email addresses to cold-email for free, and How to create an efficient sales process. Noah is also offering a course on How To Make Your First Dollar, which dives into more depth, which you should check out.
Have any sales tips to share?
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01 5 / 2013
The biggest mistake I made with my startup(s)…
image credit: Victor1558
I’m going on my 5th year of running my own company, so it’s been fun to look back at all the mistakes that I’ve made.
With my first startup Parrotview, the biggest mistake we made was not using the Lean Startup methodology to see if anyone even wanted our product that we spent so much time building. (No one wanted it.)
I started my second startup LaunchBit, an ad network for email, only after experimenting with many other ideas with my friend and co-founder Jennifer. For LaunchBit, from day 1, we’ve been able to sell ads and get feedback to improve. And, since then, we have continued selling and growing. But, it’s taken us a while to get on the growth curve we’ve wanted to be on. In large part, it’s because it takes time to forge friendships with potential customers and partners — you don’t get to be best friends with people overnight. And with that trust follows business. In other words, we’ve grown recently, because we’ve gotten to know our audience and vice-versa.
I don’t regret the time it’s taken to cultivate these relationships. But, in so many ways, the biggest mistake I made with both Parrotview and LaunchBit are the same. I didn’t build an audience or relationships in my market before starting my company. And, your ability to do this is really what puts you on the right track to understand how to build a successful company. Build relationships with your key partners and target audience before starting your company.
What is the biggest mistake you’ve made with your startup?
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29 4 / 2013
How to create an efficient sales process
I’ve been writing a series of posts on how to sell. Previously, I’ve talked about how to write a cold-email, whom to target, and how to find your target audience for free. This post is on how to set up an efficient sales process.
From cold-email to phone call
In my experience, about 25-30% of people respond to my cold-emails, and almost all of them are willing to hop on a phone call with me. I find it to be a lot easier to set up calls in this way than doing straight-up cold-calling.
Structuring a sales day
Once a prospective customer responds, I’ll propose a couple of times that are good to speak for 20-30 minutes. Phone calls can really disrupt a day — it’s so hard for me to switch between taking a call to what I was doing prior to taking a call. So, to make my calls efficient, I do blocks of sales calls. This limits switching time.
This is what my schedule looked like on 4/3. (There’s one slot open, because that person canceled her call with me, but otherwise, I tried to pack calls together.)
The phone call
By packing meetings together, it forces each conversation to have a hard stop.
image credit: zigazou76
This means that I usually cut to the chase almost immediately. I don’t use a script, but my calls are structured in my head as such:
- Give quick context for why I reached out - 30s
- How I think we can help at a high level - 30s
- Ask how the prospective customer does his/her marketing today. What’s worked? Who his/her target audience is? Learn everything I can about what his/her pain point is. (3-5 min)
In general, I try to spend about 75% of the time listening and learning. I want to understand if we really can solve my prospective customer’s problems. Once I learn about his/her pain point, then I can address specifically how we can help. After talking through a number of details, I’ll end the call with next steps. Typically, if it makes sense for the prospective customer to try a test with us, the next step is for him/her to take out an ad campaign with us.
Backing off on a sale
But sometimes, it turns out that we can’t help. Perhaps their target demographic is someone we can’t help them reach. Or perhaps they don’t have budget for a test. I cut these calls really short. In my view, there isn’t any point in trying to convince people to buy something that wouldn’t be helpful. This might be contrary to how other salespeople call, but the point of these calls isn’t to force people to buy useless things. It’s to help them buy something that will help, and if we can’t achieve that, then I won’t waste my time and force a sale.
The interesting thing is that if the roadblock is related to lack of budget, but is otherwise a good fit, sometimes backing off on a sale actually drives a sale forward. When I say, “This probably isn’t a good fit right now, and it might be better for me to follow up when you guys are investing more in marketing,” sometimes a prospective customer will suddenly want to make this work. I’m not fully sure about the psychology behind this, but I suspect this works because, 1) in essence, I’m rejecting the customer before he/she can reject me, and no one likes to be rejected. And 2) I’m also indirectly suggesting that the customer currently isn’t growing his/her company, and most people want to prove that their company is growing a lot!
The follow up
After the call, I’ll follow up with prospective customers, reiterating a couple of key points of our conversation and next steps on how to get started using our ad network.
I’ll also fwd my email to email@example.com. Followup.cc resends me the email thread in a week to remind me to follow up with the prospective customer if he/she hasn’t done anything. I’ll continue reminding myself to follow up for a few weeks until the prospective advertiser has taken out a campaign or has said it doesn’t make sense to take out a campaign either at this time or in general.
What sales process works for you?
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12 4 / 2013
How to find email addresses to cold-email (for free)?
1) Use Rapportive
Cristina Cordova, who does Business Development at Stripe, writes about using Rapportive to guess a person’s email address. Having tried this trick a number of times, it’s quite effective.
Ok, so let’s use this method with Steve Ballmer. After a bit of quick guessing. Steve_Ballmer@microsoft.com, firstname.lastname@example.org, etc, I hit gold. But, let’s say this method didn’t work.
2) Message via LinkedIn
Even using the free version of LinkedIn, you can often message people without being a first connection with them. If you know who you want to email, check out his/her LinkedIn profile. Find the groups he/she has joined. Join those groups. You can very often message people who are in the same group.
Even better is if a mutual contact feels comfortable introducing you over email or via LinkedIn.
Applying this technique to find Steve Ballmer’s email address, it appears he has 0 contacts on LinkedIn, so we have no known friends in common. And, he does not belong to any groups. So this method was a bust this time.
3) Search through online alumni networks
If you attended a school that has an online alumni directory, you can easily find contact information of alums. Didn’t attend Harvard or Yale? Beg and plead with a friend to help you look through his/her account.
Applying this technique to Steve Ballmer, who attended both Harvard and Stanford, I was able to find an email address and a phone number for him (not shown on screen).
But, let’s say we didn’t. Moving on…
4) Search on Google
When in doubt, guess on Google. These days, email addresses of high-level people, can be found on the web. High-level people will often give presentations and post their slides on the internet. It’s common to post contact information on the last slide.
But, beyond that, if a company has ever had a problem or an issue (all companies do), high level executives will often post their email address in forums asking unhappy or confused customers to email them.
You can use the same technique that Cristina uses with Rapportive to guess email addresses on Google. Let’s guess Steve Ballmer’s email address.
You can see that he gave out his email address to the public at a Microsoft event on 2007.
So, 3 of 4 of these methods have successfully given us Steve Ballmer’s email address. But, what if we still couldn’t figure it out? You may argue that Steve Ballmer has a much greater web presence than perhaps an executive at a non-tech company. This leads me to my last point.
If all else fails, guess
If we could not find Steve Ballmer’s address, I would try to look for other employees who work at Microsoft to see if there are patterns in the structure of their email addresses. A lot of companies use a standard pattern such as email@example.com or firstname.lastname@example.org or email@example.com etc. I would then take my best guess and send an email to that address.
But, I would NOT email 7 different guesses like this:
This cold-email I received looked so desperate! If you guess incorrectly and it bounces, you can try again with a different guess. And, even if your email goes to the wrong person, it can still make its way to the right person. I once guessed an email address incorrectly, and recipient replied to me and included the right person I wanted to reach on that email.
What methods do you use to find email addresses of people you want to reach?
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05 4 / 2013
Why you should cold-email Steve Ballmer
image credit: Microsoft PDC
I’m continuing my series on sales tips that have worked well for me over the years. Yesterday, I wrote about how to cold-email. Today I’ll talk about who should get your cold-email. Hint: it should be (someone like) Steve Ballmer.
For my company LaunchBit, I sell ads. But often I don’t know who the decision maker is at a given company. And sometimes, even after looking through LinkedIn, there can be so many potential decision makers. What to do?
If you don’t know who your decision maker is, email high up in an organization. I’m talking really high. Like the CXO level. (SVP and VP levels are ok too) This can be REALLY DAUNTING, especially if you are emailing a CXO at a large company. For a previous company, I used to email a lot of CXOs at Fortune 1000 companies, and the first several emails made me quite nervous. I was afraid to say the wrong thing. I was afraid I would hear a mean response. I was afraid I would hear nothing at all. But after a while, each email started to mean less and less.
When you email these people, the goal is not to get a meeting with them. The goal is to get an introduction to your decision maker. For example, for LaunchBit, I might cold-email the VP of HR at a company, and my call-to-action will be: “Who is the best person to speak with for 20 min about this?” Even though the VP of HR may know nothing about marketing or ad buys, my hope is that he/she can simply cc the person I want to reach. Then, this person, my decision-maker, is basically obligated to speak with me, because a higher-up added him/her to the email thread.
Higher-up people are more responsive
Aiming high has other benefits, too. Not only is it easier for them to delegate down, but there is also a reason people in high positions are where they are. Even though they may be busier, do you think you get to be VP of HR if you’re not responsive to emails?
You are the CEO. Act like one.
Still sound daunting? Even though you may feel small, you should remember that you’re the CEO of your startup. And you should be dealing with others at the same level.
In my next post, I’ll talk about how you can find Steve Ballmer and others’ email addresses.
Who do you email when you don’t know who your decision maker is?
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04 4 / 2013
How to write a cold-email
image credit: kevin dooley
Building on my link-baity post on the importance and under appreciation of sales, I thought I would write a few posts on sales techniques that have worked well for me over the years.
Have an intriguing subject line
Amidst cluttered inboxes, it is HARD to get noticed. So, it’s important to have a standout subject line. The best way to do this is to write something slightly weird.
- Use symbols. ”?” is a good one. New customers?
- Use uncommon words. Like "tidbit." Such as Random tidbit?
Build Rapport in 1 Sentence
Once people open your email, it’s important to keep your message short — I use no more than 3-4 sentences in the email body.
I use the first sentence to build rapport — any of these will work:
- I’m a big fan of your blog
- Congrats! — I read about your project in TechCrunch
- I’m a fellow 500entrepreneur
- We met at the GeoSocialMobileInnovation VC BBQ last summer
It goes without saying that everything you say in your email should be genuine and honest. If you hate the person’s blog, don’t say you like their blog.
Help Them in 1-2 Sentences
I use the second and third sentences to cut to the chase on why my reaching out can be beneficial to them. It helps to tie this to something they care deeply about such as vanity or money. I also throw in social proof.
- I think we can help you get new customers through our technology. We’ve helped a number of companies do this to date including BigCo, SmallCo, and InnovativeCo.
- I think we can help you increase your profit margin by x%+ and have been featured in BigFamousNews and GossipyTechBlog for our technology.
- I think our technology can help you increase your traffic from prominent bloggers through our technology which was built at FamousNationalLabs.
I usually use the words “I think,” because I do think my product can help, but I can’t guarantee it. Again, sales has a bad rep but it’s important to keep things honest.
Have a strong ask in 1 Sentence
Finally, close your email with a solid ask. The purpose of this email is to pique interest not to sell. Do you want to meet with them? Do you want to talk with them over the phone? Do you want to get in touch with the right person on their team?
- Use a who/what/when/where/how/why question
- Have a specific ask — do you want 20 min of their time? Do you want an email intro?
- What is the best way to talk by phone for 20 min?
- Who is the best person on your team to speak with for 20 min by phone?
I like to keep my emails short, not only to pique interest but also because they can be easily actionable on a mobile phone.
Practice, practice, practice
I used to be really afraid of cold-emailing. I would get nervous about how people would respond. Or that they wouldn’t respond. But after sending about 500 emails, I don’t think twice about it now. When you start to send so many, you stop caring so much about each one.
I use ToutApp to streamline the cold-emailing process. It allows me to write my email message just once and helps me send more cold-emails faster.
Lastly, I think my response-rate over all-time and projects is around 25%. I’d be happy with anything over 10% though. But, just know that not everyone will write back, so cold-emailing is a numbers game. Email 10 people if you want a couple of responses back.
What cold-emailing tips/tricks have worked well for you?
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03 4 / 2013
Why Dave McClure is wrong about MBAs in startups (sorta)
While these posts make good arguments, I can’t help thinking that everyone has totally missed the point of getting an MBA in the first place.
An MBA was never supposed to help you turn cute birds into a hit game. No one said it was going to help you increase sheep-throwing in your social network. It wasn’t going to help you get a $1B acquisition for a photo-sharing app. The traditional MBA that made so many old-school software entrepreneurs successful didn’t teach any of this. It taught you how to sell.
Sales. Not product management. Not product development. Not UX. Sales. This is what a good MBA program should teach you. It should teach you how to cold-email. How to cold-call. How to choke back on a sale in order to increase the likelihood of it going through.
It is true that you can learn skills on your own without school. We see this in computer science — there are successful hacker-entrepreneurs who didn’t need a computer science degree. Similarly, there are natural-born hustlers who will never need formal schooling to be a good salesperson. But for the remaining 99% of successful hacker-entrepreneurs who are not Bill Gates or Mark Zuckerberg, an engineering degree is helpful (sometimes :) ). And, likewise, formal sales-schooling can be helpful for many people who are not naturally good at sales (such as myself).
Moreover, contrary to popular belief, sales isn’t just hustle. Brute force will drive more sales, but they aren’t necessarily optimize sales. There is a science to sales. Good sales schools will teach you these best practices. Since we’re a big fan of split testing at LaunchBit, we’ve sometimes held cold-email competitions within our company. My co-founder Jennifer will write a cold-email template for me to send. And, we’ll pit that against one that I’ll write based on the best practices I learned in my sales courses at MIT Sloan. My pitch has yet to lose. It’s not because I’m a naturally gifted with words. It’s because there really are best practices to selling.
Sales education isn’t taught at startup incubators (though I think they should teach this — hint hint, Dave). So, incubators are NOT the new MBA. But that said, sadly, many MBA programs are canceling their own sales programs and shooting themselves in the foot. I believe at my own alma mater, there are now fewer sales courses than when I was in school just 6 years ago. And, MBAs who do have the opportunity to take these sales courses no longer do. Sadly, it’s just not what people want to learn. In the startup world, entrepreneurs magically think software sells itself. At Google, the ad sales org is physically situated away from the rest of the company. So many former colleagues of mine don’t even realize what feeds them at night. Hint: it’s not Google Plus… It’s sad — all-around, we’ve lost sight of how important sales-education is.
So here we are, in an era where software is eating the world, and there are more Saas companies than ever. Unless you’re the rare company like Atlassian who doesn’t need salespeople (frankly, I find that hard to believe — why do they have salespeople listed in Linkedin?), most of these Saas companies will need sales to at least get off the ground if not thrive. I think most hustlers could really benefit from a sales education. Traditionally, the MBA has been a great way to learn sales, but these days, I’m not sure this is the case. There certainly is a need here to make hustler-entrepreneurs more successful, and EVERYONE appears to be missing the boat on it by focusing solely on product development, product management, UX/UI, and design.
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