Cerdafied...startups, people & the variety hour

Two things I can't talk about...

I'm terrible about blogging when there's something I can't quite talk about yet. It's always that one thing I can't talk about that preoccupies my writing mind. There's been a lot of that this year it seems.

-About a month before Cc:Betty raised it's seed round, we had a biz dev deal with a major media and communications company. The deal entailed a special implementation of our product, to reside nicely inside a communications service, but branded as Cc:Betty. It wasn't going to be for our ideal target audience per se, but the placement was going to be worthwhile. About 12 hours before the product was going to launch and the press were going to cover the story, "big co" called me and asked to slow roll the launch, due to some inter-operational concerns on their end. So I called the press off, and thank God they didn't leak the details. To this day, they've respectfully held the story. In fact, it's been so long now, I'll bet the press have probably forgotten. (And no, I'm not going to reveal this company name). Here was a situation, whereby a tiny startup does a deal with a big incumbent, to attract capital and in the name of early and fast growth, but inevitably something goes sideways within the operations of big co, and the startup gets the short end of the stick. (I've actually experienced this before with the Match-Jangl deal back when, but Match were in constant flux so I could see that coming). This time, there was only positive momentum toward a good deal coming together. We had the right internal relationships and they all said the right things. But then we had to slow roll a few days, which became a few weeks, then months, etc.

The moral of this... Don't ever bank your company on a business development deal in the very early stages. Be YOURSELF first, and once you've done that well, only THEN think about what a partnership would look like. It's counter to a lot of things you'll hear, but trust me on this one.

That leads me to another thing I can't fully talk about....

-Last new year's eve, before we all went our separate ways for our party time, the Cc:Betty team launched our first friends and family alpha. Now, almost a year into the Cc:Betty development and validation stage, rather than nurturing the big co deal and others like it, we've done 96 releases on our core product and mapped almost all of that to user feedback/testing/customer development. (We've also built an iPhone app to mirror it which should launch early next year). We've watched the world of tech communications iterate upon itself, in real-time of course, and we've watched people go gaga over Wave, regardless of whether they know what is or whether they can figure it out (the Google halo effect), and we've watched the enterprise begin to adopt once-thought consumer technologies. Most importantly we've learned a whole ton about who our customers are, why they use the product, what interactions work/don't work, what else they want, and even what they'd pay for. This has led us to the ultimate A/B test.

People always talk about doing A/B tests on different home pages, or even user flows. But seldom is it on an entire product. Yes, we are going to A/B Cc:Betty in its entirety. Crazy? Maybe. One thing's for sure, we'll be a hell of a lot smarter about what the NEXT year is going to look like once we complete this test. This test starts with a very limited, private alpha of "B". Later this week we're going to point some friends and family to "B" to get some of their reactions. (If you're reading this, you're probably friends and family, so I'll be glad to give you a peek. You know how to reach me).

The moral of this, don't get hung up on your first thesis, because with or without you, it's going to change. Data always trumps ego.

Technorati Tags: Cc:Betty, lean startups, customer development, product management, startups

the sampling process...get out of the way!

With Internet products it's always a bonus and in some cases critical to be able to get first time visitors into the sampling process. The sampling process an opportunity to try the product and get some level of gratification and understanding of the value proposition quickly.

In some cases, a product is so simple and intuitive, that the sampling process is actually using the product. In other cases, you have to bend over backwards to make it work. (Note to self: if that's the case, overhaul). For instance, when I was at Jangl, we had this ability to let people talk and text on the phone without exchanging real phone numbers. There was a bunch of geeky shit going on there, but it was real hard to package, position and sell on a home page. So much that we began doing things like this. It's funny actually, but it wasn't funny for long. We finally found a way to simplify the product marketing down to reeling visitors into a sampling process. We had a headline that said "Call anyone, now". And then there was a field to enter someone's email address. No matter who's email address you entered, we'd cough up a phone number. When you called or texted that number, your voice mail or text would be forwarded to that person's email. That person would also get a number to call/text you. There was a bit of a wow factor in it, but all in all it was too contrived. The lipstick and the entire Avon collection was all over a solution that was just too complex.

This time around, at Cc:Betty, we started by saying "Hey, just Cc:Betty on any email and she'll organize and track it". Very simple, and gratifying the first time around. But it was hard to get people to just leave the website and open their email client and write a message and Cc:Betty, all to get into our sampling process. That's a lot to expect. So then we added an START flow from our home page, which people could click and fill out a little form without even having an account. This has served us very well. But that method of sampling, however forward thinking, goes against the great laws of people's expectations. The last thing a startup needs is to get in its own way for the sake of the clever. When 90+% of any web service starts with a SIGN UP link or button, that's what people are conditioned to expect, so that's what we needed to do.

We'll learn more soon enough, but I think the moral of the story is

-the sampling process is important
-but make it as natural as possible
-and bust out the lipstick to make it so, but leave the whole Avon kit behind
-get out of your own way (and your customer's way)
-try stuff, measure, learn and try stuff again

Technorati Tags: Cc:Betty, lean startups, sampling process

bad netiquette or social media?

Scott Yates of Denver New Technology Examiner has been one of the many writers covering the Google Wave hype of the past couple weeks. He's written some mindful stuff about it actually, and had some insightful stuff to say via comments at a WSJ story this week.

It was much to my surprise today when my Google alert for Cc:Betty popup a story from none other than Mr. Yates, citing my company as having bad netiquette. "WTF" I said aloud, and I didn't use the abbreviations. Calling someone's hard work a scam are pretty much fighting words as far as I'm concerned.

An excerpt from Mr. Yates article: "I've written before about Google Wave scams, and even Google Wave scams designed to look like they are helping combat other scams.
Now there's another flavor of scam which has the wrappings of something that could look legitimate: Companies offering help with Google Wave invites that is actually no help at all. I've seen a few, but to my mind the worst offender is CC: Betty, which is actually a legitimate company that has a modestly interesting product.
Whoever is running the @ccbetty Twitter page, unfortunately, is breaking the rules of netiquette.
They are finding all the people who tweet about the desire for a Google Wave invite, and urging them to click a link that just goes back to CC:Betty. It's like they are saying to someone who is hungry: "Hey! Here's something that can help: Go outside and with some chalk write down the things you'd like to eat."

----

And then I commented with: I'm the alleged here. You wrote: "They are finding all the people who tweet about the desire for a Google Wave invite, and urging them to click a link that just goes back to CC:Betty". Respectfully, this is just not true.

We're not a Wave invite scam by any means. A Wave invite scam would mean we're saying "Come get your Wave invite here: ccbetty dotcom". That's NOT what we're doing.

Rather we're simply getting in the conversations. When someone says they're desperately waiting for their Wave invite, we're saying: "Hey, while you're waiting for your Wave invite you might like this service Cc:Betty (and we provide a link). It's not quite the same as Wave, but kinda similar".

Most times people @ back and say "thanks this is cool". And later, many of them tweet about it.

Is this really bad netiquette or just social media at play?

Michael Cerda, CEO @ Cc:Betty"

----
It seems as though Mr. Yates had nothing else better to write about today. This seemed like an attempt to keep alive his ongoing coverage of Google Wave. Perhaps a better story would have been:

"Don't have your Google Wave invite Yet? Here are 5 companies you should check out while you're waiting."

Technorati Tags: Cc:Betty, Google Wave, Denver New Technology Examiner, Scott Yates, WTF

RB: Welcome, Google Wave. Seriously.

Technorati Tags: Google Wave, Cc:Betty, Parody

Here's my A/B test

Which interface do you prefer? A or B?

click to enlarge

Technorati Tags: A/B testing, Cc:Betty

Lean teams

Not a day goes by where I don't get an email (or a call) that says: "Hi Michael, congratulations on your recent funding. My firm specializes in helping young companies round out their management teams...." You get the idea.

a) I know who I want to work for me; if I don't, I'm screwed.

b) A startup can't afford to pay 15% of one's salary to a recruiter.

c) I don't want some unknown quantity who interviews well, to later pee in my pool.

d) I don't want someone working for me that thinks it's cool to work for me know that I have funding and some blog coverage.

e) I don't want to "round out my management team" if I just raised a seed round 3 months ago. Doing so would be rounding around the bowl.

Fact is, early stage startups need to keep as lean as possible until things are validated. You need leadership, business acumen, product, and development - that's it. Hopefully you can get multiples in a small handful of bodies.

Cc:Betty is 4 full-time guys. We manage to get a release out each week, of quality stuff, no drama, pure execution. That's the way things ought to be at an early stage. I wish I would have done it this way last time around.

Technorati Tags: Startups

EIRs demystified

EIR = entrepreneur-in-residence. I think the term was lifted from other in-residence conventions. It sounds good, and even curious. In fact, most people have no idea what an entrepreneur-in-residence is, why it is, who it is, what it does, for how long, for how much, for who, with who, and what it means.

EIRs are often executives coming either off of big win exits or long-time big company jobs that have served some sort of scale or meaningful inflection. Often these are folks that VCs feel safe to bet on or place in a portfolio company that's in need of a "proven" executive. It seems even more so the entrepreneur has operated in a portfolio company of the VC. Actually, sometimes the term refers to "executive-in-residence", tailored to distinguish from those that start companies from those that scale companies. In any case, I don't know this role to be one that can be solicited. In my experience its one you kind of have to get the "call" for. Typically there would be a "sponsor" of sorts, someone in a VC firm that represents the industry the entrepreneur is in, and that can vouch for the entrepreneur, and that is willing to potentially put money behind the entrepreneur (right now I'm wondering how many times I can say entrepreneur in the same sentence...).

EIRs tend to get a VC business card, and are encouraged to scour their network and the VCs network to soak up the rays from smart people. It's what you make of it in that first inflection. Ok, so this might sound bitchin' to many of you, but there is a monkey on the back of the EIR. This mode can't sustain, and there must be goods harvested in due time. How much time? It's often vague/open ended. Some say it's 90 days, some say about six months. EIRs ultimately ought to find a home in a portfolio company or 'found' a new one of their own, which the arrangement suggests, the VC has first dibbs on funding. Rightfully so, since they're paying the EIR money to think and figure things out, and in many cases helping think thru idea theses.

Sometimes EIRs don't gel with the VC or don't produce ideas in alignment with the VC. That's ok; everyone is usually happy to go home at that point. Best case, minds meld and new companies emerge. At that point, who's idea is it? It's usually the entrepreneur's idea with influence from the VC along the way, so it's ultimately co-ownership. So if there's a funding, the VC already owns some of the company before equity is even dealt. Fair, since the VC has invested the dollars on the EIR to get to that point.

I've talked to many EIRs who suffer trying to fit into the box of the VC that sponsored them. Others hoped they could sit in on more pitches and actually become a VC. Others don't have a lick of creativity and wish to discover a diamond in the rough in the process. And of course many thrive in new found companies. There are different strokes for different folks.

In the end, it's a good deal for the EIR because it's a great way to validate ideas and finance a company with a biased source. And it's good for the VC because there's risk taken out of a promising new company.

Technorati Tags: EIR, Startups

CEO blogs, transparency, acid wash and mullets

I'm realizing I seldom blog anymore. When I began blogging back in '05, we were dawning the era of transparency... You know the one that says it's a good thing to publish your tell-all story as it happens? And if you're a CEO, even more so. All the social media experts suggest this as a great tool to let people see the real people behind a company.

I really wonder though, are people so over that now? Does anybody care? Who has time to write 'em and who has time to read 'em? Are they going by the way of the acid wash jean and the mullet? Maybe the CEO blog went by the way of Twitter's brevity?

For as many people who might earnestly read a given CEO's blog, there are just as many people reading it for competitive information, there are just as many reading it to make sure you don't say the wrong thing, and even more that don't care. And for that, it begs the question of 'is a CEO's time better spent working on changing the world?' The counterpoint to that is 'well participating in social media should be part of changing the world.' .....Or maybe you just don't have time to think about such a thing anymore.

Technorati Tags: startups, CEO blogs

The Jackson 4

My wife and I were in this little art gallery in Napa several years ago, looking at celebrity art/photos, killing time before a dinner reservation at Buchon. Well I was looking at this picture of Tito, Randy, Michael and Marlon Jackson, posing in front of a Christmas tree.

The gallery owner walks over and says "Yea my buddy Pat Johnson was one of the few that got into the Jackson compound at Christmas time to take pictures".

My response, "But....they didn't celebrate Christmas, it wasn't in their religion. And by the way, where is Jermaine, Jackie and the girls?"

Crickets were chirping. Alas, here's a photo of that photo, which my wife went back and bought for me for Christmas, for story's sake. It remains on my studio wall.

Technorati Tags: The Jacksons, Buchon, Pat Johnson, Studio C

Office space

We are settling into our new offices at "Studio C" (Ooma and Jangl were both here in the early days). There is convenient freeway access, plenty of parking, a private office in a tree, gym membership (pool, badminton, basketball, nature trails) and a cafeteria. It's a good vibe, environment and the price is right!

Technorati Tags: Cc:betty, Startups