Predicting Failure from Failure?

by Giff on September 18, 2014

Shane Snow’s new book Smartcuts is is a master class in weaving anecdotes together to make a point in an interesting way. He’ll take A, add B, weave in C, to get you to D.

I’ll write more on the highly enjoyable book later, but the tricky part is if one component in the mental journey gets taken out of context.

He has a chapter on failure. His point is a good one: failure is not enough; failing fast is not enough; you need to fail fast, and fail small, and know how to evaluate failure. Agreed.

But there’s a section that emerges from a Harvard study: “failing in business doesn’t make us better or smarter. But succeeding makes us more likely to continue to succeed.”

I think this is a dangerous oversimplification of entrepreneurship.

If you succeed, yes, you have shown that you do have what it takes as an entrepreneur. Your second time will be easier — easier to recruit talent, raise funding, and attract customers. But it’s not that simple. One of the most common patterns in entrepreneurship is the “first-time successful” founder crashing and burning the second time around. This is because of two reasons: 1. they try to duplicate the playbook from their first startup, when they should not; 2. they become arrogant, attribute all of their success to themselves, and never learned how to deal with serious adversity when the lucky breaks don’t come.

I actually think one of the most dangerous entrepreneurs to back, as an investor, is someone whose first success came a bit too easily.

There are certainly plenty of people who start a company who are not quite suited for entrepreneurship, and that will contribute to the stats in the Harvard study. But failure is too simple a filter to predict future performance. They might be very well suited to entrepreneurship, but their timing was off or made the wrong call (even if the data supported it) at a crossroads. And if they start a second company, they might fail again — after all, most do — but you can’t predict that failure from the first failure unless you understand the details of the first failure.

The more years you spend around startups, the more you realize that while you must do everything you can to make your own luck, you still need those lucky breaks.

You see this in particular in Silicon Valley because of the density of entrepreneurship. The ex-founder on your left is a multi-millionare. The ex-founder to your right is not. They are both equally smart. They are both equally capable. They both worked insanely hard. They both started with ideas that seemed exciting and promising at the time. Startup success can be fickle, which doesn’t mean you trust to fate, but nor does it mean you should judge based on simplistic criteria from an academic study.

Which Shane isn’t. But others will.

So yes, we should not put failure on a pedestal. You want to fail smart and fail small. But I am firmly in the camp that people tend to learn more from failures than successes, though you of course want to learn from both.

Announcing Talking to Humans (new book!)

by Giff on September 16, 2014

NYU.lowres.unbiased

At the beginning of the year, Frank Rimalovski, who runs New York University’s Entrepreneurial Institute, came to me with a challenge.  While they used my old blog posts on customer development tips and anti-patterns, and they had some videos from Steve Blank’s Lean Launchpad program, but students were still struggling with how to test their ideas through qualitative research.  The problem is that our instincts are too often wrong. People sell when they should listen. They speculate when they should observe. They get intimidated trying to figure out what to ask, to whom, and how.

Frank’s question: what if we created a concise primer, full of practical tips, that focused explicitly on this aspect of lean startup?

I was in, and Talking to Humans came to life.  Steve Blank wrote the foreword. Tom Fishburne drew some hysterical cartoons. We iterated the text based on feedback from two groups of NYU students as well as other practitioners and educators. The book has earned praise from entrepreneurial leaders at places like MIT, Berkeley, University of Maryland, as well as with VCs who get this stuff, like First Round Capital, True Ventures, and Flybridge.

Now you can get the PDF, as well as other useful materials, at www.talkingtohumans.com.  We’re giving it away for free because the whole point was to give something to the community.

I’ll be adding ebook formats and getting a print version available for purchase (at cost) soon.

In the meantime, I’ll end with a 10-minute, impromptu interview I did for Govlab on the topic:

GIFF CONSTABLE 03-SD from The GovLab on Vimeo.

Favorite quotes from Creativity Inc.

by Giff on September 5, 2014

I’ve been obsessed with Pixar for a while, and I’ve never marked up a business book like my reading of Ed Catmull’s book Creativity Inc. I looked on the Kindle website today and realized that I marked 63 passages in the book last May. I had previously posted favorite quotes from Pixar alumni. Here are my highlighted passages from the book:

[click to continue…]

Startup Marketing Is Dead. Long Live Startup Marketing

August 26, 2014

Marketing has become a dirty word in some startup circles, with the name of the day now being “growth hacking.” And frustrations over traditional marketing’s failures to adapt to a new hyper-connected, hyper-communicative world are valid. But demand generation is as important as ever. Stewart Butterfield, the co-founder of Flickr and founder of Slack, understands [...]

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How Not to Design a Mobile App

August 18, 2014

Noah Lichtenstein of Cowboy Ventures recently posted an article to TechCrunch, “What Studying Students Teaches Us About Great Apps“. In their survey of 1,000 high school and college students, they asked about existing mobile usage, and then they asked the question, “if you had a magic wand to create an app that you would use [...]

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Be Suspicious of Metrics

June 25, 2014

People love metrics. I love metrics. I love getting arguments out of opinion and into data. However, I’m also deeply suspicious of metrics, especially since I focus on new products and thus live in a world of constant change and evolution. Some points of discussion: New Employees I have new employees join and ask “what [...]

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Does Occulus Mean That VR Is Finally Here?

March 29, 2014

Occulus Rift and better immersion rigs have allowed the promise of virtual worlds to rear its head again. Raph wrote a great post the other night, and I feel compelled to weigh in as well. Once upon a time, I was a near-expert in the space, obsessing about it from 2004 to 2008. I was [...]

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Lean startup is like a sine wave

March 27, 2014

There are a lot of people trying to do “lean startup” or “lean UX” and fretting about whether they are doing pure lean (there are even more who talk about lean but don’t actually do anything close, but that’s a different story). There is no such thing as pure lean. The right balance takes into [...]

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What Pixar Got Right

March 27, 2014

Pixar is an inspiring place. In addition to prioritizing storytelling, they got a lot right when it came to process and human interactions.  Fast Company has a nice piece interviewing Pixar alumni, and I pulled out my favorite bits: “There’s still a back and forth between creative and the audience, and you can’t be like [...]

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What Lurks Beneath the Surface

March 23, 2014

I’ll believe it with my own two eyes Humans have a tendency to focus on what they can see to the exclusive of other things. Many years ago, my wife and I lived in a shoebox in Manhattan. We couldn’t afford to buy a place in the city, but ironically we could afford to rent [...]

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