The second hardest part
A founder’s thoughts on starting a startup
Say what you will about them, one thing is undeniable: startups accelerate your pace of learning.
Over the past months as a co-founder of Penny I’ve learned a lot about how to run a business. More accurately, I’ve learned a lot about how not to run a business. Trial by error, if you will.
One lesson I’d like to share is why prioritization is so dang hard at a startup. In fact, it’s so hard that I fondly refer to it as the second hardest part of starting a startup.
Before you roll your eyes, allow me to explain.
By definition, when you start a new company you have (a) an abundance of ideas and (b) an abundance of enthusiasm. You want to do it all. Common advice for startup founders at this phase is to focus. focus. focus. on shipping a minimally viable product as soon as humanly possible. Our natural tendency as founders is to do the exact opposite. Why? Because our abundance of ideas is a perfect sink for our abundance of enthusiasm.
Luckily for me and Alex, we had absorbed enough advice to avoid that trap. When we first started, we maniacally focused on the tasks necessary to get a functioning version on someone else’s phone to the exclusion of all else. And it worked! We shipped the first version of Penny one week after writing the first line of code. We were embarrassed by it, but it served its purpose. We got valuable feedback on the product and have been iterating rapidly ever since.
Enter my naiveté.
I had assumed that we were in the clear after shipping that initial feature set, that peak “prioritization struggle” was behind us. I had this (in hindsight, hilarious) notion that we would slowly start to catch up on work after we had shipped that first version of the product.
Boy, was I wrong.
The more we grew, the more moving pieces there were. The bugs got more obscure and took longer to fix. The support tickets began to pile up. The feature list continued to grow. We had to stop working on the product to take care of “business-y” things like incorporating or figuring out how to get users. Conversations with those users became more numerous. The bugs got even more obscure.
You get the picture. As you scale, there are more things on your plate. I don’t care how focused you think you are, raising money, recruiting, making sure you’re squared away legally… they all take time and, importantly, bandwidth.
The greater the surplus of potential work over bandwidth, the harder prioritization becomes.
You quickly end up with a large and growing list of tasks that overwhelms your available bandwidth, no matter how many hours you put in. So how do you choose what to work on?
I’m glad you asked.
Startups are an art, not a science. Even if you know precisely what you want to accomplish—get more users, increase retention, make people love you—the road to get there is not clear cut. How do you objectively compare apples to oranges to bananas to cucumbers? Or put in startup terms, growth tactics to bug fixes to recruiting to new features?
Perhaps you picked the tasks that give you the biggest value per unit of work. Perhaps you let your customers guide your work. Perhaps you choose to only work on things that have immediate, measurable effects on growth or churn. Or, perhaps you think I’m clueless and want to scream at me that the right answer is to hire more people so you don’t have to worry about picking between tasks, despite the fact that hiring more people is expensive and rarely serves as anything more than a band-aid and that it’s mean to call me clueless. But I digress.
There are other complicating factors that any one prioritization strategy won’t be able to account for. Is the task mind-numbingly boring? If you ask your all star engineer to work on mind-numbing tasks week after week, she’s bound to lose motivation. Conversely, does the task recharge your team’s batteries? If you make room for a team outing, it may cost you valuable time but make up for it in the end with increased morale and productivity.
Let’s jump ahead a little and assume — for argument’s sake — that you combed through the list of all 1,000 things you want to do and were able to pick the top ten most important things that you or your company need to do.
You’re hacking away at your list of the ten most important things that you need to be doing at that moment, when you have an epiphany.
“OMG, I HAVE AN IDEA.”
You suddenly realize that your list of the ten most important things that you need to be doing at that moment is not quite so important. This new idea or urge, or question, or concern is begging for your attention right now.
When that new thought pops into your head, it’s hard to ignore. Filing it away in your list of 1,000 other priorities doesn’t scratch the itch either. You’re not going to suddenly stop thinking about it because you buried it in a sea of other things that will overwhelmingly never see the light of day.
Over the course of a given week, you may have dozens of new ideas (or urges, or questions, or concerns). It’s a natural consequence of having your startup occupy all of your available mental energy. Some of these itches can be scratched with a few minutes of effort—a one-off database query, a small copy tweak, a quick Google search. Others could lead you on tangents lasting a few hours—a proof of concept, a fun easter egg, a new dashboard. And still others might represent fundamental shifts in the way you’re approaching your business.
Sure, one solution is to always wait to prioritize them until you’ve finished your current tasks. There’s merit in that approach. If you prioritize tasks after the initial excitement has worn off, you’re more likely to be objective when weighing them against other tasks in your backlog.
On the other hand, it can be counterproductive to always tune those ideas out. Never letting yourself pursue tangents or act on your excitement kills morale, and morale is everything in a startup. Often times, pushing those new tasks aside can be more distracting than pausing your existing work and tackling them immediately, since they’ll keep tugging at you until you give them due attention.
So what do you do? GREAT QUESTION.
If you’ve made it this far, you’re probably waiting eagerly for an answer.
I wish I had an intelligent, concise, playfully witty one-line answer to this problem. Unfortunately, I don’t. Prioritization is a tremendously hard problem that all startups face (the second hardest problem, to be precise 😉).
That said, here’s a hint at how we approach the problem at Penny:
Prioritization difficulty is inversely proportional to growth. The more growth you have, the more obvious your priorities become.
But more on that in another post.
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As always, feedback is welcome: @dontmitch or mitch [at] pennyapp.io.
Mitch, cofounder @ Penny.
