Stay focused!
One of the things that an entrepreneur hears most often is, “Stay focused.” At The Family, we repeat it so often, and about so many things, that people can maybe get confused about what exactly “focus” means. If you’re staring at a tiny spot of paint on the wall, you’re focused — but you’re not doing anything that contributes to the success of your startup.
And that leads us to two key points: being focused isn’t simply concentrating on a single task, and it needs to be in the service of growing your business. Being focused starts with clearly understanding your goals, the path to achieving them, and what steps bring you further down that path.
Two rules for being focused: first, never do anything without intensity. And second, be very smart about prioritizing.
The first rule, do everything with intensity, is a question of fully applying your powers to whatever you’re doing. If you’re in the process of talking to customers, you need to be completely focused on how you can get them to purchase or install your product. Do it with urgency — the more efficient you are, the more information you have about who is interested in your product, and the faster you can apply that info to your next sale. If you look around and find yourself doing things in a half-assed way, you need to reevaluate how you’re working, or reevaluate the value of the task.
That reevaluation is part of the second rule, prioritize smartly. What provides value? An entrepreneur is constantly faced with things to do. Some of those things provide value, and some don’t. Some things contribute to growth, and some don’t. What manual tasks are you doing that could be farmed out to others? As an entrepreneur, why would you spend your time entering data into spreadsheets or keeping the accounting straight? We’re living in an age of software, upwork, freelancing, e-lancing — use them. There are people out there who can help you to save time (which, as I’ve talked about elsewhere, is the #1 commodity of every entrepreneur).
This doesn’t mean that you can ignore those tasks that don’t impact growth.
Your accounting, for example, is a legal responsibility that you have no choice but to do. Just because you aren’t focusing on something doesn’t mean that it doesn’t get done. But you have to be smart and recognize the 20% of things that don’t grow your company but that have to be done anyway. Get good at streamlining and automating that as much as possible. It’s what allows you to maintain focus on the things that only you, the entrepreneur, can handle.
What should you be prioritizing as an early stage startup?
Talking to customers and developing your product. Period. We’re always impressed by entrepreneurs who understand this instinctively. One of our most focused — and most successful — teams is Algolia. Day one, you could see their focus, as their absolute priority was installing their software solution on as many computers as they could. That didn’t mean meeting people, talking to them, and then sending them a link in their email that they may or may not click. That meant the Algolia team was going around, meeting people and right there opening up their clients’ laptops so that the team could install the software for them. That was how they built traction at the beginning: they were focused and left nothing to chance. Now, people install Algolia’s software on their own, and the team can concentrate on other tasks. But that’s the type of focus and energy that you need at the beginning.
What’s the biggest distraction for an entrepreneur? Your inbox.
Today, the big problem with email is that many of us cling to an archaic idea, namely that if someone writes to you, you’re obligated to write back. This goes back to older customs, from when it wasn’t all that easy to write to someone. Writing took time, you had to buy paper, you had to get a stamp, go to the post office, all of that. So if someone did all of that and wrote to you, it was polite to write back. Now, there’s no barrier involved in writing to someone. There is absolutely no barrier to entry for an inbox. You can copy/paste, you can send a quick note, there’s nothing to it. And because that’s the case, because anyone can write to you, you should feel free to ignore anything that is outside of your focus.
At the same time, you should focus on part of your inbox: the mail coming from your customers. I don’t understand a company where customer emails go to a support email address managed by some intern. To me, these are the most important pieces of communication that you deal with, because it gives you precious user information and it creates a bond with your customer. We tell it to every company in our portfolio: the support email for your company should be the CEO’s inbox. And the CEO should reply to every client email until the moment comes when she finally can’t do it all. At that point, you have to delegate and install a happiness support team. But the same amount of care should still go into it, because it’s important.
All of these things come back to a big benefit of being focused — in the end, focusing is the best way to see whether you’re right or wrong.
For example, every young entrepreneur faces the question of, “Well, who’s your user? What’s your market?” And what’s the response — “My project is great, everyone’s going to love it, my market is everyone!”
That’s unfocused thinking, thinking that won’t tell you whether you’re right or wrong. If you’re aiming at all users, you’re aiming at teenagers, at college graduates, at middle-aged females, at retired seniors, the data that you gather is going to be extremely diluted. It won’t give you any conviction about what you’re doing. It won’t help you train your hunches about what’s going on deep inside your business.
Instead, let’s say that you decide, “My market is teenagers.” And you really focus on teenagers. But none of them are using your product. At the same time, you notice a spike in users between the ages of 30–35. You see very quickly that the teen market isn’t for you, and you won’t waste time moving forward with trying to sell to them. You were focused and now have data that helps you change your market segment. That information helps you develop your product and see the next steps to take.
So being focused reveals if you’re right or wrong, and it helps you do it faster. A good and focused entrepreneur is able to identify strengths and weaknesses quickly.
Another place where entrepreneurs are often unfocused is in hiring.
Focused hiring can bring great things to your company, and unfocused hiring can suck away your time, energy, money, and opportunities for success. Almost every startup makes the mistake of hiring too fast, too often, and too early. There’s a reason for this: hiring people can be very gratifying. You meet people, they want to work for you, you have a sense of power and accomplishment — even if you haven’t actually done anything yet.
Let’s be clear: bad companies try to solve problems by hiring. They realize that they have a problem, and they try to solve it by hiring. A good company hires because it’s going to translate into growth. Knowing the difference is a result of being focused.
What other distractions do startups give themselves? Don’t incorporate too early.
It gives you administrative issues that don’t translate into growth. Don’t have an office, don’t print business cards. Many entrepreneurs think that these things legitimize them, they can tell their family and friends, “See, I’m not crazy! I have a real job! We have an office and everything, here’s my card!”
But that search for outside approval doesn’t get you any closer to the two things that will actually legitimize what you’re doing: building a product and finding customers. That means that yes, being an entrepreneur is a lonely enterprise. Don’t look for ways to be more comfortable as an entrepreneur: look for customers. Don’t look for articles in the press about your startup. There’s no article, no outside voice that can truly validate what you are doing. Validation comes from inside, from what you know and no one else knows. So set your own goals, set your own internal celebrations. These may be goals that no one else understands. But if you have a solid internal roadmap, you can maintain your focus on the things that truly matter.
And most of the time, for an entrepreneur, success and failure can go on a chart. Get used to tracking your KPIs, and know the differences between them. There are basically three types that you can track: your life metrics, your operational metrics, and your vanity metrics.
The life metrics are the most important, and for 99% of companies, they come down to revenue.
It’s never too early to think about revenue and it’s never too early to focus on revenue growth. You can point out examples where user growth is important, those few companies that can put off thinking about revenue until later. But two things to remember: one, no first-time entrepreneur is in a position to do that. Not focusing on revenue is a luxury reserved for people who have already been successful in building a company. And two, aside from Facebook, take a look at what’s been happening with social media company valuations lately (and the key there is that Facebook pursued revenue — and found it — from day one).
So you need to track your revenue, and that number needs to keep going up. Think in terms of absolute numbers: if you sold $100 this week, next week you need to sell $120, and the week after that $140. That’s what you need to track.
The second type of KPI is operational. Just ask Google, there are thousands of operational KPIs you can use, it’s a question of finding what’s right for you. But choose a few, and focus on those. Be harsh with yourself, and don’t look for reasons to say, “Oh, look, that metric is good, things are going well!” Track a few operational metrics that are actually contributing in direct ways with your life metrics.
The last set of KPIs are vanity metrics. These are the ones that you need to look at when you’re about to send out a press release or when a journalist calls, but really, they don’t mean anything. The number of likes on your Facebook page, for example: journalists are blown away by Facebook likes, but they don’t really have any effect on your company. A like is not a sale, and sales are the only thing that matters. Vanity metrics can sometimes have their place, they can help your company at times; but don’t confuse them with your life metrics, and don’t be as impressed with them as the outside world may be.
As an entrepreneur, KPIs become your best friend, the person who tells you when things are going well and when things are going badly. They’re there to give you a baseline reading of success and failure. Focusing on them, even at the beginning when you have to push through the fact that there isn’t much of interest to see, trains your brain to understand them. You’ll start to see the little variations, and connect them to whatever you did that week. You’ll understand how you can impact the numbers, implanting the ups and downs of your business in your unconscious.
I’m saying all of this because it’s good advice based upon my experiences and the experiences of the startups that we work with at TheFamily. But in the end, it’s not simply that I can give you a list, focus on this, not on that. You have to feel it. In that way, entrepreneurship is a bit like learning to ride a bike. Your parents can try to tell you how to do it, they’ll use words like “balance,” “equilibrium” — but those are words that you don’t understand until you actually do it. You keep falling, and you get frustrated. But you keep pushing, and all of a sudden, you’re upright and keeping the bike going steadily along. That’s the “click” moment when you fully understand. And after that, you never forget how it’s done.