The art of balancing
One year ago we started Proxloop. The first twelve months have been a unique learning experience with pretty massive ups and downs. It isn’t getting any less hard, it’s just hard in different ways and with new things. Still, there is one thing we consistently find hard, and that is how to balance different decisions and priorities. There is an endless stream of decisions that needs to be made, data points to take into consideration, advice to follow, trends to get in front of, mentor sessions, etc. Most of the time these things want to take you in different directions: Two mentors might not give the same advice, different customers want different features, deciding a hire amongst several great candidates, and many more.
Some of the areas that are hard to balance is quality vs quantity of features, value vs growth, vertical vs horizontal customer growth, fundraising vs organic growth, building towards a vision vs listening to customers, sales vs engineering, etc. One of the hardest decisions is where to spend your time and capital, and how much to spend. A company spends capital to gain momentum either with marketing, recruiting, or product development, but you still need to restrain you cash burn. Where and how to spend your money is a very hard balancing act as you need to balance both momentum and runway. The list goes on and on. Here is our take on it:
Doing the right things
There are 5 things that matter in an early phase that you need to get right: Product, product-market fit, role of the founders, culture and hiring your first employees, and staying financed and solvent. You can solve most other problems later, so don’t worry about building a board of directors, dashboards etc., until you have done/or planning to do a Series A. How well you are able to target those 5 things is going to be what decides how well you will do.
Rushing slowly
We have always had the approach of “rushing slowly” into the decisions we make and how to solve them. For instance, we believe in a lean approach on doing product development, but we try to keep it based on data and feedback from the market. We see several startups iterating beyond meaning and reason, which is not going to get them very far.
As Paul Graham says: “It’s okay to do things that don’t scale early on”. You want to be able to move fast because you are on a clock, so if you choose to use excel over Salesforce for a while that is okay. Doing the least amount possible for maximum results is what make sense. Note that in no way am I advocating that you compromise the long-term quality of your product. Quality is absolutely important, but if your minimum viable product is successful and sticky you have a lot more leverage.
There are several ways to do things quickly: Try to always ask how something can be done faster or how to automate it. Look for a shortcuts and ask mentors specifically for these. Many mentors have found very good techniques on how to do things quicker. Do you really need to build the product before you get your first customers? Why not sign them up in advance and sell them on the concept? Do you really need to build the app to test the market or could you just test the design? Do you really need to have the full database in place or can you just enter a few rows?
Realize that you are on the clock — your runway is your clock. This means you can’t afford to waste time. Don’t write extra code. Don’t waste time chasing customers that take too long to close. Quickly decide what is important, prioritize and go fast.
Delegating responsibility but also authority
We are following one of the well-known clichés: Hiring people that are smarter than us. There are several reasons for this, but our main reason for doing so is because we delegate both task and authority to make decisions. If we didn’t think they were better than us at their specific area of expertise we would both question and second guess their decisions. Having people judge and execute in their own fields is almost always smarter than having someone take decisions for the entire team. That way you get better decisions and a faster execution, but the team is always ready to pitch in if they want out opinion. People with different areas of responsibility also take part in setting their own budgets. That way they are a part of how we allocate our resources.
Get advice from mentors, but mind the whiplash.
Asking mentors for advice is a key part of running a startup, but it’s important to spend some time in selecting your mentors. Key industry experts, and super conductors are a good place to start. People with intimate knowledge about your field can guide you through problems and obstacles and put you in touch with the right people.
In most situations when you ask for advice you are going to get contradictory advice and feedback from different people. It can be a frustrating and mind-twisting experience. The key thing is to turn this into a positive. Remember that all advice is coming from their personal experience, and is very situational. No one knows your business as well as you, so you have to figure out what to do.
Take all the feedback that comes your way. The good, the bad and the ugly. Synthesize and process it. Combine and distil it. Hear mentors out, then decide for yourself and execute. Don’t be too rigid and stubborn or too twistable and flexible. The point is to realize when a lot of people are telling you the same thing — pay attention. At the same time, have the gut to follow your vision and have data to back up your belief.
Author: Øistein Sonstad
