Negative feedback to ignore
Thursday, September 8, 2011/
When creating a start-up there is no doubt you will get negative comments. And the more successful you are, the more negative comments you’ll receive. Here are some of the more common ones that you’ll get that you can completely feel free to ignore.
“This looks like a feature not a company.”
Folks will trivialise what you are doing by saying it’s a feature of a product and not a company. They’re always invariably wrong because the feature is like a seed that grows larger with time into a full-blown plant (company).
Being a feature is a legitimate stage in the growth to a company. Your role early on in a start-up is to prove you are solving a problem that people care about. If your single feature doesn’t resonate, then you know right away that’s to blame. If you lock yourself in a room for years and try to come up with a product with 100 features and then you launch and no one cares, which of those hundred are good or bad?
The greater risk is to try and compete on comprehensiveness from day zero. People called Twitter a feature and now it’s a messaging platform but little has really changed.
Looking in from the outside, it’s also easy to think that something is simple. Even a tiny feature takes intense amounts of complexity and thinking to get it that simple. That’s a lot of the reason Apple’s products are so elegant and beautiful – their simplicity.
“Start-ups lose lots of money.”
No business can be unprofitable forever but the goal of start-ups is to prove out beautiful unit economics and not overall profitability in the early stages. It may seem like the easiest thing in the world to see a company based in Silicon Valley raise loads of venture capital and arrogantly boast about losing money and focusing on the product. But they all have a point.
The companies are focusing on the most pressing riskiest question: Do we have a large business that can have a scalable and repeatable way to acquire more customers?
The start-ups are losing money but they are proving out each step of their assumptions around how much it costs to get a customer, how easily they stick around and love the product and how many more of them are out there.
In fact, the money losing piece is even being compressed.
Zynga, a company that will likely exceed $1 billion in revenue in the next 12 months after only being around for less than five years was profitable from the start.
It’s easy to criticise Groupon, who have large GAAP account losses currently, but because of their business model of paying merchants later they can fund a large marketing budget and they are still cashflow positive. Groupon are riding a once in a cycle opportunity of cheap Facebook Ads that will likely be gone in a year or two.
Perhaps it is easy to criticise start-ups because at the time of the observation it does look ugly. But because start-ups advance so quickly before the ink on the criticism is dry, it’s out of date.
So don’t let the negative feedback get you down or deter you from chasing your vision.