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These are the slides from my presentation to the Interactive Media Group on Feb. 16, 2012. I am planning to create a series of blog posts going into more detail about some of the topics raised in this presentation. Read more on http://www.isaacsukin.com/
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How to Start a Web-based Startup
Isaac Sukin
@IceCreamYou
isukin@wharton.upenn.edu
Ego
•5 years of webdev
•20+ open-source projects
•100+ consulting/freelance
•Social communications
•GSOC
•35+ members
•11 countries, 4 continents
•49 awards
•200,000+ downloads
•Entrepreneurship & Innovation
•Information Systems Management
•CS minor & TA
Turntable.fm
Turntable.fm for Shopping
How to Start a Web-based Startup
Why Web-based?
That’s what I’m good at
•Low-cost
•Fast time to MVP
•Easier transition to mobile
•Wider reach
•Accessible
Almost none of this talk is
specific to web-based startups
Bandwagons
It’s a bubble
It’s terrifying
You’ll probably fail
You probably won’t get rich
Fun
Responsibility
Autonomy
Learning
Let’s do this
Idea Generation
Idea Generation
• General areas of interest
• Identify:
– Problems
– Technological simplifications
– Workarounds
• Identify solutions
Inspiration
• Copy something else
– Cross-application
– Different approach
• Professional gripes
• Easy but tedious
• Existing “solutions”
• Invert cliches
Idea Validation
The Gauntlet
1. Is the problem real?
2. Is the target market segment big enough?
3. Is the product/service achievable for you to build?
4. Why you and not someone else?
5. Can competitors beat you if you prove this is a good idea?
6. Will people actually pay enough for this?
7. Is this actually what people want, or just another workaround?
8. Why now? Is the market and technology ready?
9. Is the up-front investment achievable?
10. Is the required time frame reasonable?
11. Are there other advantages to just trying it?
The Gauntlet
1. Is the problem real?
2. Is the target market segment big enough?
3. Is the product/service achievable for you to build?
4. Why you and not someone else?
5. Can competitors beat you if you prove this is a good idea?
6. Will people actually pay enough for this?
7. Is this actually what people want, or just another workaround?
8. Why now? Is the market and technology ready?
9. Is the up-front investment achievable?
10. Is the required time frame reasonable?
11. Are there other advantages to just trying it?
The Gauntlet
1. Is the problem real?
2. Is the target market segment big enough?
3. Is the product/service achievable for you to build?
4. Why you and not someone else?
5. Can competitors beat you if you prove this is a good idea?
6. Will people actually pay enough for this?
7. Is this actually what people want, or just another workaround?
8. Why now? Is the market and technology ready?
9. Is the up-front investment achievable?
10. Is the required time frame reasonable?
11. Are there other advantages to just trying it?
The Gauntlet
1. Is the problem real?
2. Is the target market segment big enough?
3. Is the product/service achievable for you to build?
4. Why you and not someone else?
5. Can competitors beat you if you prove this is a good idea?
6. Will people actually pay enough for this?
7. Is this actually what people want, or just another workaround?
8. Why now? Is the market and technology ready?
9. Is the up-front investment achievable?
10. Is the required time frame reasonable?
11. Are there other advantages to just trying it?
The Gauntlet
1. Is the problem real?
2. Is the target market segment big enough?
3. Is the product/service achievable for you to build?
4. Why you and not someone else?
5. Can competitors beat you if you prove this is a good idea?
6. Will people actually pay enough for this?
7. Is this actually what people want, or just another workaround?
8. Why now? Is the market and technology ready?
9. Is the up-front investment achievable?
10. Is the required time frame reasonable?
11. Are there other advantages to just trying it?
The Gauntlet
1. Is the problem real?
2. Is the target market segment big enough?
3. Is the product/service achievable for you to build?
4. Why you and not someone else?
5. Can competitors beat you if you prove this is a good idea?
6. Will people actually pay enough for this?
7. Is this actually what people want, or just another workaround?
8. Why now? Is the market and technology ready?
9. Is the up-front investment achievable?
10. Is the required time frame reasonable?
11. Are there other advantages to just trying it?
Is it a good idea?
• Is the user the one giving you money?
• Do you have experience with and interest in
the topic?
• Are you scratching your own itch?
• Are there barriers to entry for future
competitors?
Can it be bigger?
• If it doesn’t pass the questions above, can
you tweak it so it does?
• Could you make more money if you
changed the target audience? (Enterprise?)
• Are you envisioning just the product or an
entire new market infrastructure?
• Is there a better niche for your idea?
Concept Statement
[product]
will provide [target customers]
with [desired benefits]
by [delivery method],
which is different than [competitors]
because [new product attributes].
Feedback
• Show people what you mean, and ask if they would pay for it
• Surveys are useful more for uncovering needs than confirming specific solutions
• Research
• Get people using a MVP ASAP
• Fail fast, but don’t correct without data
• Feedback is not the same as commitment
Build It
Design
Test
Create
Ship
Technology
Does it matter?
No.
Well, maybe
• Choose something that:
– you know
– you want to learn
– is Open
– has a large developer community
– makes development fast
– lets you get your data out easily later
– aids maintainability
Being Technical
• If you’re not technical:
– Non-tech-dependent ideas
– Outsourcing
– Technical cofounder
– Learn tech yourself
• If you need to bring on technical
help, recognize:
– They have options
– They might be doing most of the work
Sell it
• Revenue model
• Sell from day 1
• Gather data and use it to change business
decisions
• Build trust
• Pretend to be big
• Customers first
Hiring• Hire when it hurts
• Don’t be greedy
• Be considerate
• Do your research
• Hire engineers
• Brag about numbers
• Know what employees want
• Ask the right questions
• Look in the right places
• Be direct and specific
• Know what you’re looking for– Passion
– Intelligence
– Creativity
– Communication
– Pickiness
Raising Capital
• Capital is an accelerant, raise for the right reasons
– Extract liquidity
– Push the limits of a product
– Gain access to investors
• Pick the right investors
• You’ll get distracted
• Doing it wrong is the biggest cause of failure
Exiting
• Pivoting
• Selling
• IPO
• Failing
• No exit
Q&A / Workshop
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