reecepacheco

Features Don’t Win

@robgo:

This is a continuation from my previous post about fast followers.

Several times a week, I hear a pitch from for a company that is fairly similar to existing players in the market.  When I ask the entrepreneur how they expect to win vs. the various competitors, I’ll often hear something like:

“Well, they don’t have feature x, y, and z which has been built into our product from the beginning.”

These same folks usually include some sort of Harvey Ball chart to show how differentiated they are from their competitors.

My advice: if you need a Harvey Ball chart to show how you are different, you aren’t different enough.

In my view, winning as a startup doesn’t have that much to do with individual features.  Features do drive success, but great teams and great product development processes drive features.

I saw a talk a while ago by Mike Maples.  In it, he encourages entrepreneurs to “be different, not better”.  I completely agree.

Being different means being WORSE than competitors in some dimensions.  It’s a very intentional decision to forgo some areas of potential strength and choose the 1 or 2 dimensions that no one else is thinking about and absolutely destroy the competition in those areas.

Some examples?  Tumblr, Zappos, Milo, Polyvore, etc.

Be different.

I completely agree here.  This is the way we think about HomeField in terms of some of the competition.

We actually think of most of our competition as market validation and differentiate ourselves by our lack of features. We see it as a strength that enables HomeField to become the ubiquitous video platform for sports (and achieve some other stealth goals as well).

The Season is Here… it’s Always Here.

Lacrosse, per NCAA definition, is a “spring” sport.  I know it’s February and there’s snow on the ground outside my window, but games have started so to me, it’s spring.

Five years ago, I’d be cranking through classes all day before a team lift (always legs on Monday), then I’d put in 2.5 hours battling through drills on a turf field on the roof of the Brown gymnasium, (Yes, on the roof.  No, it wasn’t cool.  It was cold, windy, and half the field was covered in building exhaust… ok, yeah, we sort of relished it), then we’d head inside to watch game film for 30 minutes and finally sit in the ice bath to soak up the soreness.

The coolest part was I did all of this surrounded by 40 other guys who all had the same mission as I - win game #1.  Then #2, #3, #4 and so on…

These days, my competitive career is entirely different.

I probably stay more active in lacrosse than my teammates on the NYAC.  Already this year I took a trip to Miami to play in a tournament.  I had a blast playing with some other amazing players, the competition was solid and I even took an 80mph shot in the ribs that has been painfully reminding me of the trip for a month now.  (Seriously, this bruised rib is one of the most nagging injuries I’ve ever had).

And last weekend, I headed back to Brown with some other alums for a preseason scrimmage against the current Bears team (Unsurprisingly, Providence hadn’t warmed up since I graduated.  Wind chill had the temp around 7 degrees).  Still, it was a great day and us veterans were able to pull out a close win over the young pups.

The win was fun for a moment, but there was still a fundamental lacking for me and I’m realizing how much I miss the bonding of a team working towards a common goal and the inherently high level of competition on a daily basis.

Sure, when my NYAC team starts up soon we will all be focused on winning our 4th straight A.L.L. Championship, but we don’t even practice.  We just show up on Sundays and play.  It’s easier on the calendar, but I know deep down every teammate of mine, and every true competitor out there, needs that battle and that feeling of true team.

But since my lacrosse career won’t last forever, I’ve assembled a new team (different “sport”), uber-competitive, we all have the same mission… and this game is played 24/7.

Its not the size of your market, its what you do with it that matters.

As an early stage company with a product we consider somewhat disruptive, this is so refreshing to read. Thing is, we know our core market, we know we provide value, and we know we can scale to reach a much wider customer base, but at this stage there’s so much ‘guesstimating’ involved.  Read on…

@bryce:

One of the most pedestrain of questions that arise in many VC meetings is that of market size. How big is your market? Really. I’ve found that should this question arise more than once over a series of meetings, you’re better off looking elsewhere for funding than the blue shirt and khaki MBA staring at you pointedly from across the table.

If history is a guide you will not be able to answer this question with cleverly constructed Excel spreadsheets or elegantly cascading waterfall projections. For seed and early stage investors I’ve found that you either fundamentally and instinctively believe that something is a big market or you don’t. Because, often, the most interesting companies are operating in as-yet-undefined markets or are attacking and existing market from some niche that the large incumbents dismiss as not being big enough to warrant their attention and resources.

I posted a link a graph sizing the mobile ad market today at $215M. Now, most VCs say they won’t even look at markets that aren’t well north of a billion dollars in size. Also note that AdMob was funded pre-iPhone which seems to be making mobile ad networks a more reasonable bet. That market barely exists today and was even less obvious for the VCs who wrote the original checks to back a company in an undefined and, wait for it, small market.

The same could be said of the VCs who wrote the first checks for Facebook (social graph, wha?), Twitter (no, what you doing?) Zynga (a niche inside a niche) and many others.

Of the two new investments I made last year, I believe the current market sizing for each would be some approximation of zero. And that’s the point. Its not about the size of today’s market its what you do with it that really matters.

an entrepreneur’s reading list

I like to read as much as I can.  It’s not as much as I’d like, so when I do, I want to read something great.  My pal @JoeYevoli is also an avid reader, and we share a lot of books back and forth, particularly about business.

A while back, we decided to start the “Overtime Media Library” - a collection of great books for our startup company that we would reference for new employees and such.  Sure, we don’t really have any employees yet, but it’s a part of our corporate culture moving forward.

Also, I get asked for advice on startups a lot, especially since Fred said I’m doing something right.  I’ve found myself continually referencing and emailing this list, so I figured I’d just post it once and for all and I’ll update it when appropriate.

Books - there are a bunch that I love, but these are the ones that have helped me most in entrepreneurship.

Getting Real - mandatory at Overtime Media Inc

The Monk and the Riddle - career choices

Made to Stick - effective communication

Atlas Shrugged - capitalism, entrepreneurship, amazing story

Good to Great - how to build a great company

Purple Cow - marketing/product

Deep Survival - awesome book on survival mentality (great for startups)

Crossing the Chasm - business development/market strategy

Let My People Go Surfing - by Patagonia founder, a very different view on business and building a great company

Blogs - there are tons of blogs out there, but these are the ones I return to most often.

AVC.com (Fred Wilson - arguably #1 VC in consumer web, and generally awesome blogger)

paulgraham.com (Paul Graham - entrepreneur, hacker YCombinator founder)

feld.com (Brad Feld - entrepreneur/angel/VC)

bothsidesofthetable.com (Mark Suster - entrepreneur/VC)

bijansabet.com (Bijan Sabet - entrepreneur/VC)