The @farnamstreet podcast between @m2jr and @ShaneAParrish was full of lessons on leadership, mental models for startups, and building great teams.
Here are 50+ takeaways 👇
Here are 50+ takeaways 👇
Side note: @m2jr is one of the most well-spoken podcast guests I've ever heard.
A company has products, a supply change, resources and processes and values and capabilities that give them a market position.
A startup has none of these.
A startup has none of these.
A startup isn't a company.
It's a set of founders with proprietary insights that come as a result of living in the future.
It's a set of founders with proprietary insights that come as a result of living in the future.
To achieve success, a startup needs to have three or four critical elements.
• One: they need a breakthrough insight.
• Two: they need a great team.
• Three: a breakthrough value propostion.
• Four: they need a breakthrough, killer, predictable growth strategy.
• One: they need a breakthrough insight.
• Two: they need a great team.
• Three: a breakthrough value propostion.
• Four: they need a breakthrough, killer, predictable growth strategy.
All of those things require teams that don't exist in more traditional companies.
How do you come up with a startup idea?
Don't try and think about a startup idea.
Don't try and think about a startup idea.
Most startups come from a great insight.
These come from someone living in the future who recognizes something is missing.
These come from someone living in the future who recognizes something is missing.
Insights are a play on the William Gibson quote:
"The future is already here, it's just not evenly distributed."
"The future is already here, it's just not evenly distributed."
The metaphor for insights is the time traveller: they go to the future, recognize something, and bring it back for everyone.
This also means they have to convince others and build a community of people who believe what they believe.
This also means they have to convince others and build a community of people who believe what they believe.
A common mistake with startup ideas is looking for current market whitespace, when in reality you need to be looking in the future.
Big companies are like a marching band, startups are like improv jazz.
Someone is leading, but no one really knows where it's going, nor will anyone take that exact path again.
In a startup, you're improvising your way to success.
Someone is leading, but no one really knows where it's going, nor will anyone take that exact path again.
In a startup, you're improvising your way to success.
You have to build something based on your insight that people have a desperate need for.
It needs to be an order of magnitude better than what exists.
It needs to be an order of magnitude better than what exists.
This is the "value-hacking" stage, where you're validating your insight.
This stage is about seeking the truth rather than selling.
This stage is about seeking the truth rather than selling.
Once you validate your insight hypothesis, then you're ready to develop your growth strategy.
"If you've validated properly, growth becomes an exercise in syndicating the truth."
"If you've validated properly, growth becomes an exercise in syndicating the truth."
A mistake: jumping to growth before validating properly.
You want customers pulling product out of you desperately.
Then you can start worrying about growth.
You want customers pulling product out of you desperately.
Then you can start worrying about growth.
"You want a value proposition so strong that your customers would be irrational not to buy if they know the truth."
It's incredibly rare to have all four elements, or stages of a startup, led by the same people.
You want a leader who is a learn-it-all.
They absorb new ideas like a sponge and are incredibly mentally flexible.
A combination of determination and a lack of ego around what they don't know.
They absorb new ideas like a sponge and are incredibly mentally flexible.
A combination of determination and a lack of ego around what they don't know.
Some questions @m2jr asks before investing:
Can they explain the market and their insight in common terms?
How committed is the team?
What motivated them to start this?
Can they explain the market and their insight in common terms?
How committed is the team?
What motivated them to start this?
Entrepreneurs are not experts in business functions as most people think of them.
The defining characteristic is they are are an artist—they notice things others don't, and they convince others of their core insight.
The defining characteristic is they are are an artist—they notice things others don't, and they convince others of their core insight.
The best leaders have the skill to move people beyond their logic.
Charisma helps, but it's more about the power of the vision.
They have a vision that compels a set of like-minded people, and they all feel like they're in on a secret together.
They truly believe in what they're working on.
They have a vision that compels a set of like-minded people, and they all feel like they're in on a secret together.
They truly believe in what they're working on.
Mental models: methods to think better.
They are frameworks for making decisions that maximize the probability of the best outcome.
They are frameworks for making decisions that maximize the probability of the best outcome.
The "earned secret": the work you've done to discover something non-intuitive.
Example: Airbnb discovering people would rent a shared room.
In particular, during conferences, and the reason most people stayed in hotels was trust.
Example: Airbnb discovering people would rent a shared room.
In particular, during conferences, and the reason most people stayed in hotels was trust.
"Why now?" has two parts technology inflection and adoption inflection.
Example: Ride-sharing.
Lyft and Uber couldn't have worked without smartphone penetration (adoption inflection).
It also wouldn't have worked without accurate GPS in phones (technology inflection).
Example: Ride-sharing.
Lyft and Uber couldn't have worked without smartphone penetration (adoption inflection).
It also wouldn't have worked without accurate GPS in phones (technology inflection).
Another example: Drones were enabled by the cheap chips developed for smartphones.
"Idea mazes" (coined by @balajis): you generate idea mazes by looking at every previous attempt at the boundary of your idea.
Things like revenue model, market, go-to market, etc.
Why will it work this time when it hasn't before? A poor answer is that your team is better.
Things like revenue model, market, go-to market, etc.
Why will it work this time when it hasn't before? A poor answer is that your team is better.
"Think wrong": incumbents have a harder time retaliating against a startup with an asymmetrical, orthogonal attack.
An example of this is a different metric by which you charge customers.
An example of this is a different metric by which you charge customers.
Thinking wrong is doing something different than the incumbent.
It's more of a thought experiment: if the conclusion you arrive at seems plausible, it could be valuable.
It's more of a thought experiment: if the conclusion you arrive at seems plausible, it could be valuable.
The myth of total addressable market: in startups, you're living in the future, so there is no market yet.
Markets in the startup world are movements.
Markets in the startup world are movements.
You don't want to operate in an incumbent's value network.
Airlines are an example: if you run through the same airport as a competitor, you're subject to the rules of that value network.
Airlines are an example: if you run through the same airport as a competitor, you're subject to the rules of that value network.
Clay Christensen's sword and shield:
The shield is your go-to market strategy is so different that an incumbent doesn't view it as valuable.
The shield is your go-to market strategy is so different that an incumbent doesn't view it as valuable.
The sword is the skills you build that the incumbent lacks.
By the time they realize those skills are valuable, you have too big an advantage to catch up.
By the time they realize those skills are valuable, you have too big an advantage to catch up.
@m2jr is optimistic that every sector of the economy will get reimagined from a hierarchical corporation to a software-defined network composed of machine, platform and crowd intelligence.
Examples:
3D printing will be how we get network manufacturing.
Lyft is a network ride service, while traditional taxis are hierarchical ride services.
3D printing will be how we get network manufacturing.
Lyft is a network ride service, while traditional taxis are hierarchical ride services.
"Disagreeableness" for teams: the great startups are willing to be disagreeable (and the teams are too).
It comes from a lack of mimetic behavior (coined by René Girard). The basic idea is that humans are driven by mimicking other people.
The best startups are led and made up by people who don't engage in this behavior.
The best startups are led and made up by people who don't engage in this behavior.
A novel idea is also a heresy.
These founders and teams seek to find the truth of an idea regardless.
These founders and teams seek to find the truth of an idea regardless.
Being "antifragile": things that get stronger when stressed, rather than weaker.
The best founders get better under stress.
They're antifragile people.
The best founders get better under stress.
They're antifragile people.
"The builder and the persuader": Usually startups have a great storyteller. The other is the builder, who is living in the future but is technical.
Great stories are similar: There's a beginning, a middle and an end. The beginning describes the future, better world.
The middle is tension: this is bad, but it could be better.
The middle is tension: this is bad, but it could be better.
The great entrepreneurs realize they aren't the hero: their customers are the hero, and they're taking them on a hero's journey.
A great entrepreneur is like Yoda.
He helps the protagonist get to the outcome he wants, but he's not the hero of the story.
A great entrepreneur is like Yoda.
He helps the protagonist get to the outcome he wants, but he's not the hero of the story.
The rule of 20: talk to 20 people who are in your target segment.
The first 5, you just are curious. Ask them questions.
The next 5, make some observations about patterns and ask about them.
The 5 after that, ask about a potential solution....
The first 5, you just are curious. Ask them questions.
The next 5, make some observations about patterns and ask about them.
The 5 after that, ask about a potential solution....
...If they say "oh yeah, we tried that, but it didn't work," you're on the right track.
The last 5, you ask about the solution you're thinking about.
You're on the right track here if someone takes the whiteboard marker out of your hand and starts drilling into the solution.
The last 5, you ask about the solution you're thinking about.
You're on the right track here if someone takes the whiteboard marker out of your hand and starts drilling into the solution.
The "Herbie model", from the book The Goal.
To speed up a hike, put your slowest hiker in front, and then find ways to make them go faster (or drop them).
This applies to all systems.
To speed up a hike, put your slowest hiker in front, and then find ways to make them go faster (or drop them).
This applies to all systems.
For startups:
Acquisition: how do we get new customers?
Engagement: I'm a user, am I going to keep using it or not?
Monetization: how do we make money from an existing customer?
Enlistment: how do we get customers to tell other people?
Acquisition: how do we get new customers?
Engagement: I'm a user, am I going to keep using it or not?
Monetization: how do we make money from an existing customer?
Enlistment: how do we get customers to tell other people?
You want all of these gears spinning at the same speed, in as predictable a fashion as you can.
Exponential growth happens when enlisted customers tell other people that your product rocks.
You can listen to the full episode here: fs.blog/knowledge-proj…
If you enjoyed this thread, please retweet and share with your friends!
https://twitter.com/grahamkmann/status/1351589653325950977?s=20
• • •
Missing some Tweet in this thread? You can try to
force a refresh
