Every year when people start applying to Techstars (now in 3 cities!), I get emails and phone calls asking for my advice.
I always ask the same question, “Do you have a Hacker and a Hustler?”
Sometimes, I get the response, “Im both.”
To which I suggest that they rethink their application. Its nearly impossible for a single founder to have much success building his startup, let alone getting through a program like Techstars (or Y-Combinator or any of the dozens of others). One person can not do it all. Its really that simple.
What do I mean by a Hacker and a Hustler?
A Hacker is more than a code monkey, who can quickly build software and find interesting ways to hack together code. Thats a developer. Thats someone who is definitely an important part of a startup, but not critical to its success. A Hacker is someone who looks the problem, and solves it in a unique and special way. A Hacker finds the process of problem solving exciting and interesting, and spends the majority of their time looking at the problem in multiple ways, finding many potential solutions.
Often the Hacker is a coder, but not always the best coder you have on your team. Nate and Natty, of Everlater, are decent coders at best. In the last couple of years, they have taught themselves, by trial and error, how to code. I would imagine if you asked either one of them if they considered themselves amazing developers, they would probably indicate otherwise. But as Hackers? They are amazing.
A Hustler on the other other hand is a relationship builder. Someone who can build direct relationships with their customers. They arent really promoters, although they do a lot of promotion. They arent salespeople, although they do a lot of selling. They are passion people. They have the ability to articulate their passion clearly and in a way that gets other people equally passionate.
A true Hustler can get people using their product, or raise money, with little to no capital expenditure. Any one can run a Google Adwords campaign, or buy a billboard. Only a Hustler can get you to love their product in a way where you will speak passionately about it to your friends. A true Hustler is patient zero in a viral campaign.
My favorite young Hustler is Garry Tan of Posterous. Their recent campaign about switching from “dying” services to Posterous is genius, and a great example of the Hacker/Hustler dynamic. To figure out how to import data from one system to another is never easy, yet Posterous has hacked together some great importers. Rather than just releasing an “All-in-One” importer, Garry decided to release one a week, and build some noise around it. Not only has their been noise, but Posterous’ growth has been reported on (since they are self-proclaimed not dying) several times.
Was it just Garry’s idea? I would guess that with investors/advisors like Tim Ferriss, Chris Sacca, Paul Graham and others that it may have originated from the larger group, but his execution of it has been perfect.
A Hacker and a Hustler. Every great startup has a pair. Woz and Jobs are probably the most successful Hacker and Hustler tandem out there, there are thousands.
Ask yourself, as you begin down the path of building a great startup, are you a Hacker or a Hustler? Does your team have both pieces?
If you lack one or the other, your ability to be successful greatly diminishes.
(BTW: A topic for another post, but a company doesnt need a Hacker and a Hustler forever. Its why most startups see at least one founder leave.)
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I just walked out of a comic book store for the first time in probably 20 years. It took me 30 minutes to find the place, and once I got there, I felt so out of place.
How could this be? I used to ride my bicycle to the comic book store to add to a comic collection that numbered in the 6,000s. I knew what was coming out when. I knew the people that worked there. I felt like it was a place I belonged.
This comic store was pretty empty. Most of the people in it were older (at least mid-twenties) the only kid there was with his dad. There were more collectibles than I remember, and it was silent. Dead silent. On a Saturday.
Now, one of the companies I helped advise this summer was TakeComics, which is building an “iTunes for comics.” I wanted to know if such a thing mattered.
Disruption is a concept that many professional investors love. Things that shake up an industry can often lead to immense returns — if they are timed correctly. Napster was a disruptor in the music industry, but Apple was the first to really make big money selling digital music.
Theming is an interesting art to managing concepts and more importantly thought processes. At Lijit, we apply a theme to each quarter, and each department adjusts their goals and efforts to match that theme. Foundry Group, a Lijit investor, famously invests in companies that fit within their thematic approach to investment. I can only imagine that pitches to Foundry now begin with: “As a company that clearly fits in your Glue theme…” Notice the focus it brings pitches. Dual win for Foundry.
I have begun to look for the themes within a business to determine its potential, and the potential of the management team. Can the business be boiled down to a single metric (revenue per pageview, for example)? Does the management team think thematically about the problems they are trying to solve for? What is the theme of the company?
Which leads us to Techstars theme. If you look at the ten companies in Boulder, they broken down into two themes: Market Efficiency and Industry Disruptors.
Everlater, Rezora, Mailana, SendGrid, Spry and TimZon all were applying efficiency to inefficient markets. Everlator (travel memories); Rezora (email marketing for the real estate industry); Mailana (connection discovery); SendGrid (improved transactional email delivery); Spry (product management); and TimZon (online customer service).
In each case, they have built interesting applications. Will they get funding? Probably. They may find the path a bit more difficult, given that while each solution is unique, because it is an improvement on current offerings, they are not completely defensible against competition. For example, if TimZon proves to be right (that customer service is better over video or audio), what stops players like Get Satisfaction, or other large CRM tools from adding video/audio to their offering?
I love this definition of disruption from wikipedia:
When a company truly disrupts an industry it literally tears it apart. Look at the RIAA‘s reaction to Napster and its ilk. Think about how blogging and other online news sources have effected the newspaper industry.
A true disruptor tears apart an industry with verve and violence in a way that, regardless of the success of the company, changes the industry forever.
Next Big Sound are looking to provide band management and artists with two things that are currently unavailable or difficult to gather: performance data and interaction data. Artists, more and more, are becoming businesses, and are learning what business has known for a long time: Data rules.
Companies like Soundscan and others provide artists with data thats predicated on the belief that the greatest effect on a band’s success is the marketing efforts of their labels. What artists like Chamillionaire and companies like iMeem, MySpace Music and TopSpin are showing is that the greatest effect on a band’s success is the ability of the artist to go direct to fan. Next Big Sound is providing access to the data that proves out this disruption in the industry.
After all, dont artists (and businesses) want to know what their fans care about, and where they are interacting with their music (or brands)?
Vanilla and Retel are similar in that they are providing both improved market efficiencies (Vanilla with online community tools and Retel with retail employee management and intelligence), and industry disruptors.
While forums and forum software is often forgotten behind the noise created by Facebook and other similar social networks, there is a large amount of focused community interaction and growth that continues to occur on forums. Companies tend to shy away from building community around themselves because 1) most companies pay community lip service; 2) they dont understand how building a strong community filled with fans can create a long-term customer base that grows organically through word of mouth; 3) they dont know how; 4) they are unaware of the ease of a product like Vanilla.
If companies would leverage their own web presence to build community rather than rely on social media tools, they will be better served in the long term, as most people are fickle about sites like Facebook and Twitter, but not about the brands they love.
Retel is similar to Next Big Sound in that they are providing unique and difficult to obtain data to retail store owners that will allow them to make decisions quickly. With Retel, eventually, retail store owners will be understand where the “hot spots” are within a store, perhaps being able to make determinations on how a store should be laid out to optimize things like cleanliness and worker efficiency.
In an industry where the majority of optimization and efficiency decisions are made by “feel” and “experience,” the level of data provided by Retel will have a transformative, disruptive effect.
There are three major indicators that the comics industry is ripe for disruption: its a $6billion industry (big); increase in non-core revenue–movies versus print (focus shift); lack of cost-efficient alternative to core business (no strong digital replacement for print). You could also argue that the comics industry, other than with manga and anime, have leveraged the internet at all.
TakeComics provides an iTunes-like interface for digital comics (including the digital conversion), as well as social tools for interaction around the titles and characters. In addition, TakeComics also uses the comic books as the “center of the pinwheel” providing access to associated merchandise and content to the title and/or character.
Which brings me back to my comic store experience. All I kept thinking about while I drove around Boulder trying to find the stupid comic store, that I wished there was a digital solution for buying comics. I am no longer a collector, I just want to experience the story and then talk about it with my friends. I also, wanted to know how these current stories intertwined with the stories from my youth. I got none of that from walking into that store.
Disruptive technologies and companies tend to fundamentally change how we view and interact with an industry. Will these companies be able to be agents of change?
They have certainly started from some interesting places…