“It doesn’t have flash!”

“Who’s going to buy a computer that sounds like a feminine hygiene product?”

X million iPads later, everyone is now a copycat.

I recently saw a talk by Youngme Moon, Chair of the MBA program at Harvard, where she talked about embracing the negatives and how being different can, counterintuitively, create extreme loyalty.

Mini Cooper, for example, embraces its diminutive size, and people love it so much they get Mini Cooper tattoos. Twitter embraces its character limitations, and it topples totalitarian governments. Google embraces the fact that you can’t even change the font on its ads, and those ads fuel a $100 billion business.

If any of those companies had listened to the early critics who said, “It’s too small,” or “That’s dumb,” they wouldn’t be the runaway successes they are today.

That’s why “The Customer Is Always Right” is bunk. Moon explains:

“As a manager, the knee-jerk reaction to seeing the weakest area of your business is to try to become more well-rounded. Most brands do this, so everyone in the market starts becoming the same. If you are competing in a crowded market it’s unlikely that the way you’re going to achieve true differentiation through well-roundedness. In a crowded market, differentiation almost always comes from lopsidedness.”

If someone told you he was a brain surgeon, and pediatrician, and a plastic surgeon, you’d be skeptical that he was a good doctor at all. By nature, we expect true experts to be lopsided.

And that’s why it’s not only just OK to embrace the negatives in your ideas, but it’s genius to emphasize them.

Haters are going to hate. You’ll never win them all over by adding the features they want or changing your idea into the familiar one they clamor for.

“What makes great original ideas so fragile at birth is not that they seem so bold, it’s that they are so indistinguishable from crazy stupid ideas,” Moon says.

If you saw the movie Inception, you know that the ending stopped short of when you were expecting it to. The genius in that ending was that it was different than the cozy wrap up or the obvious twist. And some people hated it. But they didn’t stop talking about it for months.

Which is exactly what they wanted.

Embracing the negatives

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But our friend and investor, Eric Paley, said something interesting the other day that struck me: “Building stuff isn’t always the cheapest way to test [a hypothesis].”

We tend to get in this mindset that we’ll just “bust out a feature and test it” with our customers, see if it works, and then iterate or throw it away. The “build minimum viable product, test, and repeat” can be fast and effective, but sometimes it’s a complete waste of cycles.

Why not hack your test first?

Vin Vacanti, founder of Yipit, likes talking about hacking the product development cycle by doing completely unscalable things to prove hypotheses fast. He said he and his cofounders gave themselves literally a couple of days to prove whether or not Yipit would work, and to do so, they woke up at 4am to manually collect data they would have built a robot to do.

By doing the dirty work themselves for a couple of days, they were able to prove that people wanted what they were “selling”, and that justified the time and expense of building software to do that data collection.

Josh Kopelman, Managing Director of First Round Capital, recently gave a talk at my office about an electronics buyback company called TechForward. In the beginning “they had a ton of unknowns,” Kopelman recalled. “What’s the right pricing? Will people buy it? Will stores accept it?” In order to figure out the answers needed to create enterprise value in their business, they needed to do some tests. But as a small company with limited resources, they had to be scrappy with their tests, building as little infrastructure as possible to prove or disprove their theories.

So, rather than trying to run big, costly campaigns with the BestBuys of the world, they tested their buyback program with seven small electronics stores, saying the stores could keep all the profit. All TechForward wanted to know from them was how many laptops they sold, and how many guaranteed buybacks they sold. In a short amount of time they found out that people bought the guaranteed buyback three times more than they did extended warranties. They also figured out that as long as the buyback guarantee was 3x what the buyback cost, people were willing to pay for it.

“It was a hack to collect data,” Kopelman said. After TechForward received some validation in what they were doing and figured out the right price points for their product, they canceled their agreements with these stores and went out to the big electronics retailers and pitched TechForward as a profit center.

Thinking about our own product and our desire to test different use cases among customer segments we think could be very lucrative, this advice make perfect sense. Why spend a week building a feature when you could draw it on computer paper and ask a dozen customers if they’d use it? Why not do what a good reporter would do and jot down all the questions you’d want to know, then hunt people down and ask them for the answers?

To some extent, I fully believe in using your gut to decide what features will be clever or psychologically sticky, despite what early feedback might indicate. And I love building stuff. It’s exciting.

But on the other hand, saving yourself from the agony of banging out a product you’ll never sell is pretty awesome.

Hypothesis Hacks Q&A

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Photo by Olly via Shutterstock

I’ve been told by several investors that since our startup is in that rare segment of early stage tech companies that already makes revenue, we’ll be judged hard on revenue when raising more money, even though at the same time companies with no business model will be able to raise just as much (or more) money on a promise. And many of those pre-revenue companies will have an easier time doing it.

That doesn’t quite seem fair.

Two investors I respect very much recently helped dispel the gloom from the reality of this injustice: our own investor, Eric Paley of Founder Collective, and Union Square Ventures’ Fred Wilson.

Eric told us in a board meeting that having revenues to benchmark against may seem like it makes it harder to sell early stage investors, but it also gives you leverage in negotiating with investors. For example, when we get ready to raise our next round of funding, we’ll be making enough money to be able to walk away and maintain a great, if smaller than it potentially could be with more venture capital, business. And we’d own a huge percentage of it. As my Business Strategy professor in undergrad used to say, “Whoever has the most options in a negotiation, wins.”

That in itself is comforting, and it will help us when raising money. But when it comes to building a business with billion-dollar potential, you still have to sell the dream – regardless of how you’re doing revenue-wise – or you’ll get nothing.

Fred said, “Investors that are sold only by numbers are always going to be that way. If you’re both aligned around the dream, it will always be about ‘how can we get there.’”

Basically, if investors believe in what you’re doing, they’ll be ok when the numbers have their inevitable hiccups. “Find investors who think what you’re doing is exciting,” Fred continued. “Numbers can help prove you can execute, but shouldn’t be front and center.”

So, ironically, despite being able to brag about million-dollar run-rates or sexy reference clients, the startup with revenue needs to sell the big dream and downplay the numbers as simply proof the team can make stuff happen.

In other words: take over decabillion-dollar industries while disrupting advertising and journalism? Yes we can!

Selling The Dream Q&A

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This got me thinking about my own startup pitch and how I constantly fret about articulating it well and conveying the correct message. As with any aspect of a startup, my pitch is constantly evolving as I’m testing out new approaches, optimizing, and adjusting back when things don’t resonate.

That’s all great, but when you’re in front of an audience or an investor, the time for practice should be over. Like an Adwords headline, you need to optimize. every. word.

Yesterday, Fred Wilson came and spoke to a group of startups at our office, titling his remarks, “How To Simplify Your Pitch.” He advocated a “less is more” mentality when it comes to pitching, and as it usually goes when The Fred drops knowledge, everyone shut up and listened.

He told the story of SoundCloud, a Berlin-born music hosting startup that pitched him two years ago. The SoundCloud founders initially gave Fred a long spiel and a demo of their array of tools for musicians, and later officially pitched his partners at their office. He barely understood what they did. Dropbox or something or other for musicians?

Basically, they didn’t stand out at all.

Then last summer, SoundCloud’s CEO pitched Fred again. This time he showed Fred a single powerpoint slide. The slide showed a bunch of well-known web services and the medium they dominate: Video = Youtube; Status Updates = Twitter; Long Form = Wordpress; Flickr = Photos; Audio = ?. In the “Audio = ?” section, they inserted SoundCloud.

In an instant, Fred knew what they did, and he was sold.

“Don’t complicate the story with facts,” Fred advised. “Get one sexy idea rattling around in the heads of the investors.”

It took Fred’s own venture fund 4 weeks to take their slide deck they showed their investors down from a zillion slides to just 6, but after that, he raised his whole fund on that one slide deck.

If you can do yours in just one slide, even better.

Fred Wilson’s 3 Key Ingredients To An Investment-worthy Company
1. A big vision that can fit on one slide
2. Genuine chemistry between the founders and the investors
3. A track record of success (in this startup or previously)

Simplify Your Startup Pitch Q&A

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It turns out I lost the title for the smurfvan, so I had to send away for a duplicate in order to be able to sell it here. The van is registered in Idaho still, so I mailed the proper form to the Idaho State DMV, and even paid $26 extra for “Rush” processing.

Upon calling said DMV, it turns out that “Rush” processing means they decide to hit 3 keystrokes on their computer and print out your new title in 5-6 business days, and then snail mail it back to you. I can’t fathom how long non rush processing ends up taking.

Sadly, long distance DMV interactions are apparently just as painful as the in-person ones. I’ve been waiting for 18 days.

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A 70-year argument among scientists concerning lemurs and other furry inhabitants on Madagascar may be over, according to a study published in Nature in January. Scientists Jason R. Ali and Matthew Huber, from the University of Hong Kong and Purdue University, respectively, claim that the isolated collection of mammals that arrived to the island millions of years ago did so in almost cartoon-like fashion. They rafted in.

This theory was first proposed in 1940, though it had been previously dismissed as impossible. Paleontologist George Gaylord Simpson proposed that the lemurs, tenrecs, carnivorans, and rodents which showed up in Madagascar in distinct batches starting 60 million years ago floated unwittingly across the ocean channel on large logs or vegetation mats washed off eastern Africa. Other scientists disagreed, saying the area’s ocean currents rule out such a possibility and that the mammals must instead have walked across some sort of land bridge. But no one has been able to recreate a scenario where this is possible either.

The ocean bordered by Africa, Asia, and Australia flows in what scientists call a “supergyre,” essentially a big counter-clockwise swirl between the continents. Madagascar is located near the top-left portion of this giant current, which means the water flowing between the island and the African continent flows south and west. A raft launching from Mozambique, where scientists agree the Madagascan mammals originated, would be quickly swept away past the island.

However, the continents themselves are constantly migrating. Africa and Madagascar have drifted some 1,650 kilometers north in the past 60 million years. Using climate system models from the US National Center for Atmospheric Research, Ali and Huber took a look at various recreations of what Earth would have looked like in the days the lemurs and their cousins would have set sail. The scientists discovered that, unlike today, 60 million years ago Madagascar sat toward the bottom of the Indian Ocean gyre, meaning currents would swirl across the coast of Africa and back east toward Madagascar. Floating debris from Mozambique could reach Madagascar in less than a month. And if a tropical storm came around, currents would flow faster, allowing even more rapid transport.

Large floating “tree islands” have been known to wash off the African coast during storms, so it’s entirely possible that animals 60 million years ago washed away with them. Though rafting mammals clinging to logs while crossing hundreds of kilometers of ocean may sound like a scene from a Disney movie, it’s now the most plausible explanation scientists have for the Madagascan mammal phenomenon. The next big puzzle: Why are these lemurs so darn cute?

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Now that I’ve made it through grad school, and my band mates are off having kids and working their lives away 9-5, my dreams have crossed over to a different platform. I’m building tech startups and dreaming of making it big, landing VC funding, and having geeky Rails programmers whisper as I pass them in the hall at NerdCon.

Perhaps it’s not as sexy, but it’s glamorous in its own way. And I’ve realized the parallels between starting a rock band and starting a web company are pretty spot on:

I can see the natural progression I made in the music world closely parallels my progress in the tech world. My first band was a crappy punk band, Lynette. We thought we were awesome, but we weren’t very unique. We just played local venues until other bands stopped inviting us when they realized we sucked. Then I started an electro-punk band, Jersey City Fire, which was more innovative, especially in our live show setup. We got to play some shows out of town, but the team didn’t work out in the end. Then I started a dance/pop-core band, K&TK, and we blew people’s socks off (at least comparatively). We toured across the west, recorded some songs, and had a lot of fun. We had the perfect combination of team members, a unique but poppy sound, and lots of drive and hard work. We would play our songs acoustically at random parties to gain fans when we weren’t playing real shows, run online campaigns to drive traffic to our Myspace, and practice relentlessly.

Then people got married and stuff, so we let that dream die peacefully, knowing we might have had a shot if we wanted it.

My first website post-college was a sort of Digg for UFO nuts, AlienUFOBelievers.com (I made it after one of the band guys “saw” a UFO in Montana). It was a cool idea, but there wasn’t a whole lot of market potential. The site was buggy and got hacked, and I sold about $200 in stickers by the time I quit. I started some other sites, which were better constructed and had more potential for ad revenue. They still make me a little money, but I won’t be buying a yacht anytime because of them. Then I started PrintingChoice.com, a Travelocity-style search engine for business card, flyer, postcard, and brochure prices. It has a solid revenue model, and has done quite well. I put that on autopilot and started Scordit.com, a social site that pivots around products people are obsessed about. Users joined, creating thousands of pages of content, and I felt vindicated when sites like GDGT and Hollrr launched with similar ideas and gained a lot of attention. My bands were starting to suck less and less.

Now I’m working on two projects pivoting off of Scordit: mainly Dino.sr, a site for gamers that revolves around games you’ve beat/played/want and lets you created game-specific microblogs of your game progress (and the site is a game itself); and on the side I’m helping with isWearing.com, a real-time stream of people answering the question “What are you wearing,” which aims to help people dress better. Both of these have clear paths to monetization and sort of culminate the experiences I’ve had in my previous ventures. I’m sure these won’t be the last web products I create either. I’ll keep working hard and building better stuff every time, and one day one of my “bands” will get picked up by that major label — I have no doubt about that.

Starting a rock band is a very entrepreneurial experience. I’d be interested to see how many tech companies have been started by people who played in bands. Really, I think being an entrepreneur is all about executing creative ideas — being the guy (or girl) who actually starts a band rather than sitting around with friends and talking about how cool it would be, or being the one who actually sits down and builds a prototype rather than just talking about it for years until someone else builds it.

Sorry Lollapalooza, but NerdCon here I come.

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Guest comic by Jason Grover

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Robert Boyle

Every year as the sun clears the horizon on April 1, a handful of people awake with glee. About an equal number of people rise and shine completely unaware that the previously mentioned people are about to trick them into believing Portugal has invaded Massachusetts, or the value of Pi has changed, or that they should park their car six blocks away from work.

The rest of us remember that April 1 is a day for keeping one’s guard up and Gullible Radar on. We get a good laugh when an unlucky coworker moves his desk across the office to make way for the “new septic drain” or finds his cubicle full of packing peanuts. On this day more than any other, people engage in well-meaning pranks on their friends, and even retailers play tricks on each other, such as when Crate and Barrel placed an ad in the New York Times declaring that one of its competitors would be giving away free full-body waxes all day. This tradition, known as April Fools’ Day, is widely accepted as a day of friendly gags in every major country except Canada.

April Fools’ Day dates back to the late 15th Century, the time British physicist, Robert Boyle, built one of the first pneumatic engines. Tradition has it that one of the hand maidens of Boyle’s wife, Persephone, claimed to have had an affair with Boyle, while in the midst of penning New Experiments Physico-Mechanicall – his seminal work based on air pumps – at his country retreat in Devonshire. When it was later revealed that the alleged affair was a lie (though some experts still contend it may have been true), the young girl attempted to acquit herself by claiming it was all a joke. British law was clear, however, that such an accusation was punishable by death, joke or not. The execution – which for women in those days was trampling by livestock – was carried out on April 1, and the foolish “prank” by this servant girl resulted in the words “April Fool” being etched into her gravestone rather than her name, leaving modern historians to wonder about the rest of her story.

“April Fool” wasn’t the only idiom coined from the tragedy. Though it only endured as an English expression until the early 1900s, the term “Persephone’s folly” derived from the same experience and was used to indicate a poor hiring decision.

Like many brilliant scientists, Boyle was seen by peers as at times bizarre and unconventional. He was amused by the irony of the “April Fool” in his household. Each year on the date of the trampling he would conduct an elaborate prank, thus perpetuating April 1 as a day of humor and mischief. He would place garden snakes in his friends’ trousers, pencil in made-up scriptures in Bibles, and cover himself in flour to appear as a ghost. Among the more outlandish jokes Boyle played included painting every one of King Henry VIII’s swans (he kept nearly 100 of them in the royal courtyard) the color purple in 1591, and streaking naked through Buckingham Palace with a dozen local scientists from the astronomers’ guild in 1595. (Had it not been for his prominent status in the kingdom, Boyle would certainly have been hanged for either event.) The latter prank set the stage for the modern day “flash mob,” as well as initiation practices held by a number of North American fraternities.

By the end of his life, Boyle had become known himself as “The April Fool,” for his antics. On his deathbed was awarded the honorary royal title of Chancellor of Comedie. King Henry was recorded that day saying, “A joke is a very serious thing.” Henry VIII was never a very good jokester himself, though his son Reginald IX seemed quite opposite; on one occasion he managed to convince the entire Church of England that the moon was made of solidified tea.

Five hundred years later, 98 percent of the civilized world pays respect to Robert Boyle and Persephone’s poor hand maiden, although most of us have no idea our jokes are based on a centuries-old story of deceit and possible adultery.

I guess that would make us the fools, wouldn’t it?

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