The one book every startup CEO should read
I like to read. I didn’t read as much as a kid as I do now and I wish I would have. I read all types of books — both non-fiction and fiction. I especially like to read when I’m traveling. However, in the past few years as a startup CEO, I’ve just not invested enough time to read as I should have.
My advice to startup CEOs: make time.
This advice is something I’m taking myself this year and I’m going to try and read a minimum of 6 books this year. In years past, I would read that in a quarter.
One of my latest favorite books is “From Impossible to Inevitable” by Aaron Ross and Jason Lemkin. I first met Jason when I first got funded back in 2008 by Ryan Floyd of Storm Ventures. Frankly, when I first met him at the offices of Echosign in Palo Alto, I came away thinking he was an asshole. I’m sure he was very busy with his own startup to listen to me about mine (and that’s just OK). Over the years, I’ve really watched Jason and I continue to be impressed with what he’s done and where he seems to be going.
I wish I had this book back around the time I first met Jason.
Things could have turned out a little differently than they did. There are a ton of things in this book that every startup CEO should learn and understand.
If you’re a startup CEO, go buy this book right now and read it this weekend. Stop making excuses. It will change your startup for the better and you and your employees and investors deserve that.
Without giving too much away for those who haven’t yet had the opportunity to read it, here’s a rough summary for the book with my own notes:
1. You’re not ready to grow . . . until you Nail A Niche.
This was something a lot of people call “product/market fit”. The book does a good job of walking through the problems I’ve already laid out in my own startup lessons learned. But you really have to figure out what your “niche” is before you start hiring and scaling the company. And the book explains that “niche” doesn’t mean “small” in this case. It means focus. You gotta iterate a lot to nail it. It takes work.
2. Overnight success is a fairy tale. You’re not going to be magically discovered, so you need sustainable systems that Create Predictable Pipeline.
One of the disadvantages to being in the startup world these days is that information (most of it which is wrong or overly simplified) is too easy to receive. Techcrunch is talking daily about new companies literally raising millions of dollars — too which a lot of time you’re saying “that got funded?”. And as the book points out astutely, most of the “success stories” are really not quite what they seem. Slack? Yeah, overnight success after Stewart and team iterated and pivoted numerous times over many years. And same with Sales. Sales just doesn’t “happen” even with companies like Slack or Zenefits. Of course, you might read all the feel good stories out there and think that they literally launched a product and millions of dollars started rolling in … Yeah, not quite. They “Nailed the niche” and then figured out how to predictably repeat converting opportunities into revenue. They worked their asses of to make it “look easy”. And good for them. But don’t believe the hype. It took a ton of work — much harder and much more messy than the articles make it seem.
3. Speeding up growth creates more problems than it solves. Things will actually get worse until you Make Sales Scalable.
We experienced this. You can easily get sideways if you try and add warm bodies before the system is ready to do something with them. I always say: “people at the company will always be busy. they just might not be busy on the right things”. Don’t mistake “busy” with “productive”. Having a bunch of unproductive people will create a lot of problems. And they will burn a lot of money fast. And it’s your fault as the CEO, not theirs.
4. It’s hard to build a big business out of small deals . . . so figure out how to Double Your Deal-size.
This section I agree with in principal but, in experience, this is one of those areas where “buyer beware”. I think each CEO really needs to have a strong point of view on this and really understand what they are ultimately trying to accomplish. And more important, when you should do this. In our case, we did it way too early. Mostly because of #2 and #3 above vs. the reason that the book gives.
5. It’ll take years longer than you want . . . don’t quit too soon or let a Year Of Hell discourage you. Be prepared to Do The Time.
I totally agree with this. I was reflecting with someone yesterday that it took almost 8 years from initial funding to exit with my last startup (and a total of 10 years from the very beginning!). It didn’t really seem that long. On the other hand, it feels like a lifetime.
Our year of hell was between March 2014 — March 2015 at Appcelerator. After many years of aggressive growth and a lot of success, we had hit a wall. Like the book talks about, seemingly everything was working right. But it wasn’t. And we had a few (as you would expect at that size and maturity) unforeseen circumstances you can never plan for which hit us at the same time. But in the end, from March 2015 until we sold, it was an amazing ride (again). Things got much better, the product improved faster and better than it had in 2+ years and we figured out a number of other improvements we couldn’t have made otherwise.
Like the book says, you gotta stick with it and do the time.
6. Your employees are renting, not owning their jobs. Embrace Employee Ownership to develop a culture of taking initiative beyond a job description.
I’ve never quite been able to convey the same ideas in such as simple way to understand as the book does. But I believe this 110%. I like the saying “employees quit their manager/leadership, not the company”. And I lost some really great people over the years because of this. And I think I’ve always done a very above average job around culture.
Culture is very hard or very easy — depending on how you look at it. For me, culture is EVERYTHING. If you focus on it and really understand how to align your core values to your culture, it’s not too difficult. But I believe 99% of the companies on this planet mess this up big time.
Related to culture and another award winning book — another one of my favorites of all times — is Stan Slap’s “Bury My Heart At Conference Room B”. I had the chance to get to know Stan through his work at Appcelerator and he is amazing. This book was a real life changer for me. And another GREAT READ I highly recommend around employee and customer culture.
7. If you’re an employee, you’re letting frustrations stop, not motivate, you. Stop waiting for someone else to fix it, and turn your frustrations to your advantage to Define Your Destiny.
I always tell my team: “bring me solutions, not problems” and this book does a great job of explaining both sides of the equation.
I’ve never met Aaron but he sounds like an incredible guy (he has 12 kids, most of which are adopted) and he’s both humble and driven. I really like that. And it seems that both Aaron and Jason are similar — they both jump in and make sh*t happen. The concept of Define Your Destiny is very apropos for CEOs and startup teams. Just do it. Define your destiny and don’t let anyone hold you back.
If you’re a startup CEO and not trying to listen to other’s advice and learn, then you’re probably going to be headed in the wrong direction. There’s always so much more you can learn — especially from people who’s done it.
The book repeats many times that you have to adapt the suggestions to your own business. This is not a checklist of things to do (although, there are some very good ones you need to consider). Each business and each startup and team is different and you need to recognize that.
As an aside, one of the other mistakes I made too often was not listening to my gut. I brought in over the years many advisors and plenty of investors — and each one had their 1 or 2 things I needed to do. (My co-founder and I often joked, if we just did that one more thing that the new person wanted … dammit, we’d magically be successful). And often, there was a lot of conflict with what others wanted or suggested. I tried too often to please others. I listened to the advice of others too easily. I should have been more discerning, and frankly, listened to what my gut said more often. In retrospect, a lot of the wrong things I did I knew weren’t right deep down inside. None of the people ever had bad intentions — of course they all wanted the best. But nobody knows your business, your vision and frankly, your specific unique circumstances better than you. Believe in yourself. In the end, you’re going to get all the blame and hopefully most of the credit anyway.
