homepage

Is Your HomePage Really Your Business?

Is Your Homepage really your business?

The homepage is in the DNA of startups. A lot of people think of tech companies as websites, even when they have little do with each other. That’s as it has been since the “dot com” boom of the 90s, when adding “.com” to a company name was enough to boost its stock price.

These days, a good looking homepage and landing pages are essential for establishing any company’s basic credentials. But the tools for creating such a page in only a few hours are now readily available, and very cheap. For the most part, a dedicated web designer isn’t even needed to make a smart homepage that is sufficient for most early stage startups.

Aside from that, many very successful startups rely very little on their websites to generate business, because they have to find their customers on other platforms, like social media, or through partnerships.

Tunnel Vision

Sometimes though, startups get bogged down in the process of strategizing and devising their messaging, with much of the focus being on how the homepage looks, what the copy says, and how it can be optimized for maximum selling potential. Part of this comes from a phenomenon I’ve talked about before: “over-mentoring,” which is where startups get trapped in a vicious cycle of requesting more and more feedback, and stop being able to make decisions quickly.

And a lot of that over-mentoring happens with the homepage, because it is the first thing that most mentors see from the startup. The conversation often revolves around it, and the messaging it contains, instead of the core problems the startup is really facing in their business (which may or may not have to do with optimizing their homepage).

I’m even more guilty of this than most mentors, because I’m a copywriter, and I love analyzing and optimizing web pages. But the truth is that 9 times out of 10, a simple formula will work just fine: a headline, a sub-header, and a call to action. The classical “triangle” shape that millions of simple homepages use.

homepage triangle

To fight over-thinking, I’ve been finding myself challenging teams to live with an imperfect website. I’ll ask them, “why are you focusing so much of your energy on this? Is that justified by the kind of traffic you are hoping to generate with it?” In some cases, the answer is yes. But often, it’s not clear the founders have given that much thought.

The homepage can be a vital step for onboarding customers. But that’s less and less true today, and many of our startups will never need elaborate pages at all in order to do business. They’ll need brilliant apps, or intelligent and well designed processes, but the homepage won’t create loyal customers- the product/service will do that.

A “Perfect” Homepage is a Moving Target

“A perfect homepage is a moving target. Don’t outsmart yourself.”

Lots of engineers treat their homepages as if they need to “get it right,” on the first try. But that’s putting themselves at a big disadvantage from the outset. Homepages, just like products, are pretty much never right at the beginning. Only experimenting, testing, tweaking, and retesting will yield something that you can be sure is living up to its full potential.  It’s far better to be responsive to how people react, and to what kinds of visitors you attract, than to try and game out an elaborate homepage strategy from day one.

A common mistake is to mix up the “promise” of a startup with the promise of a homepage, although the short term goals of both are often not aligned, particularly at the beginning. This might mean that the messaging veers too close to the “mission statement” of the company, like “make the world a better place,” instead of the immediate goal of the page, which might be to get people interested in an upcoming release.


PRO TIP: Use tools like HotJar.com to better understand how visitors react and interact with your homepage.

It’s natural to want the homepage to look as you want the company to look, making it appear more professional and more established than the company truly is. But “fake it till you make it,” is a dicey proposition when it comes to winning the trust of customers and investors. It’s easy to fail at looking like a bigger deal than you are, and there’s little real benefit outside of ego from trying to.

And while startups are over thinking the design tactics, they’re underthinking basic strategy with a homepage. What is the promise of the homepage? If it is designed to attract leads, then it needs to offer users a very easy and seamless way of getting in contact. If it is meant to generate customers, then it needs to show them a simple and persuasive argument for buying the product, along with an easy way to do so.

These elements cannot be perfected in the lab- they have to be worked on over time, meaning that the work is never really finished. What’s more, these goals will shift over time as the product, customer set, and offering changes. It’s easy to get burned out on the first version of a homepage, and then leave it that way for far too long. For some startups, a homepage becomes like a bad marriage that they’re unwilling to end because of all the work that went into it.

Don’t Outsmart Yourself

I’ll keep demanding that startups build practical, usable, clean, and attractive homepages. It’s really important to devise and employ strong emotional use cases, and communicate them. But don’t make your homepage a blocker for you getting down to the real business, which isn’t just selling to your customers, but serving them something they really want.

If you’re struggling with your messaging, then take yourself off the hook. Create a minimal homepage, and focus on interacting with your customers. Over time, you can optimize to make sure you aren’t scaring anyone away, or missing any big opportunities. But don’t try and use your homepage to define your whole business- your customers shouldn’t be interested in that, and neither should you.

partnerships

Build Real Partnerships as a Startup

Building real partnerships with the right companies is something we emphasize in the StartupYard program. But what is a “real partnership” are all about? Many startups aren’t too sure.

Partnerships and “Partnerships”

A startup in our 2016 cohort approached me this week, with a simple-sounding problem. Could they prioritize a meeting over StartupYard mentoring sessions, if the person couldn’t meet at a time when mentors weren’t here?

Yes, they could if it is was really important. But what was the meeting about?

The meeting was about a potential “partnership,” with the CEO of a company that provided a key piece of technology that this startup was going to need. This was not a huge company, which is why the founders got a meeting with the CEO. But it wasn’t a startup either.

What did they want to get out of the meeting?

“Well, we’re hoping that he will be willing to let us use it for free or for a discount.”

And why would he do that?

“Because we’re a startup.”

Partnerships in Name Only

In a way, startups have become trained to expect this kind of thing from bigger companies. They assume that companies are willing to sponsor them just because they’re a startup, and they’re not always wrong. Many of StartupYard’s partners do give an amazing value in services to startups for free.

But those are our partners. While we have real, and thriving partnerships with some of these companies, this is not because we get free stuff. It’s because our organizations share complementary goals. In this case, it’s getting early access to the best startups in Central Europe, and helping them grow (us as investors, our partners as future providers of a paid service).

But this level of partnership, which looks more like sponsorship than a real relationship between equals, is probably not what many smaller corporates and other startups have in mind when they agree to meet a startup.

Based in Mutual Interest

It’s very easy to agree to partnerships that don’t require a lot of work or follow through. So it’s tempting to do this whenever possible. Many partnerships boil down to two companies putting their logos on each other’s websites.

This happens because in the course of exploring a partnership, one or both of these companies comes to realize that they don’t share a real mutual interest.

This is why it’s so important to pursue partnerships in the same way you pursue your sales goals. Partnerships are a part of your sales strategy.

Partners should have the same sorts of customers you have, but not be directly competing with your offering. Ideally, your partnerships should make the offering of both companies stronger, so that a customer who uses one, gets even more value from using the other.

At the core, a business partnership is about both sides developing their indirect sales channels, sharing, and better serving your mutual clients. It is a force multiplier for sales, because in a true partnership, much of the sales activities that the two companies undertake support the sales funnels of both companies.

This finds its most pure form in online affiliate partnerships, which is essentially an “automated partnership.” But that is only one form of partnership. You can base your partnership on sharing know-how and technology, but ultimately a partnership that lasts is one that makes the two companies interdependent, and stronger as a result, and that means both companies having a stake in the same pool of clients.

What A Company Needs to Be a Good Partner

Again, agreeing to a partnership is relatively easy in theory. It doesn’t take all that much. But in order to be a good partner, a company needs to have a team (or at least one person), dedicated to building and maintaining partnerships.

SendGrid, a StartupYard partner, is a great example of this. Instead of sponsoring accelerators and events directly, they have a dedicated innovation team that travels around the world, meeting with and advising startups and accelerators on issues involving transactional and marketing email infrastructure.

Every company they meet with gets at least a year’s worth of service with SendGrid for free, which is an enormous value for startups. And for StartupYard, it’s of great value to have a skilled and knowledgeable mentor team visit and do a workshop with our startups too. That builds the value of the accelerator and gives our startups a greater chance of success down the road. Meanwhile, SendGrid gets access to potential clients who could be worth thousands of Euros a month in a few short years. Win, Win, WIn.

Companies that have strong partnership programs also know what to look for from startups, which isn’t always just another client. They may be interested in sharing data, or even investing in certain kinds of companies.

A good partnership manager bridges a gap between sales and marketing, and has the pull necessary to bring your company to the attention of executives, even as a prelude to an acquisition, or sharing clients. They aren’t incentivized the way a salesperson is, so they’re more flexible about what they’re willing to bring to the table- it’s not about the bottom line for that person, which frees them up to explore other ways of seeking mutual benefit.

Preparing For a Partnership

One of the key mistakes that startups make when they approach partners, aside from the “gimme gimme” attitude described above, is by trying to “sell” them. A partner isn’t necessarily a customer, and you can’t approach them in the same way. You have to sell them on the mutual benefit of working together, and on your ability to do that; not on your ability to sell your product to their clients.

A good partner in indirect sales offers a few things. One is added value for shared clients, and another is defense against competitors. If you can make a partner’s offering to its clients stronger than its competitors, and if your partners (and competitors) know this, they will be willing to work hard to keep you as a partner, rather than see you support someone else’s sales pipeline.

So when you meet with partners, you need to ask questions. What do your customers need that you can’t provide? Why do customers choose competitors over you? What would make more of your clients stay with you? These can all open up opportunities for you to partner with that company, and those opportunities will be based on what that company needs, not only on what you need from them.

engaging users

Why You Fail at Engaging Users Pre-Launch

The 9 startups in our 2016 cohort are in varying stages of development. Some have paying customers and a working product, while others are still defining their core product, and go to market strategy. Gaining users, and engaging users, sometimes feels like a distant goal. But it starts right away.

One thing all the companies need, now that they’re meeting with investors, mentors, and potential partners, is, at minimum, a landing page giving a sense of the company and product, and prompting visitors to get in touch.

The art of the “Coming Attraction” landing page is not new ground in startupland. You’ve probably signed up for one or two such newsletters yourself, if the concept was interesting enough. Companies at StartupYard with really compelling products can get thousands of signups for a beta launch or a preview of the product. Gjirafa, a Startup from our 2014 cohort, for example, collected upwards of 1,000 email addresses in one week.

But it’s not enough just to collect email addresses. Eventually you’re going to want something from these people. How do you lay the groundwork for that?

Asked-For Emails Get Read

There’s a world of difference between a pre-launch newsletter and a standard marketing campaign. For starters, users only get a welcome email when they do something- such as sign up for your newsletter or request access to a beta product. This email is specifically asked for. This means that right off the bat, welcome emails get opened much more often than other campaign emails you might send, and get read much more closely.

When I was working as an email marketer, sending millions of campaign emails a month, we would hope for a 3% open rate, and perhaps a 0.3% click through rate. Those are good numbers if you can get them, on that scale (0.3% of 1 million is 3000 potential customers).

With a welcome email though, you can get much higher response rates. According to SilverPop’s 2015 Marketing Metrics Benchmark study, which tracked “transactional emails,” (those emails delivered in response to user actions), transactional emails have a median open rate of over 17%, with a median 1.4% click through rate, with data collected from more than 750 companies in 40 countries.

That’s across all transactional emails sent from those companies. When it comes to a well-crafted introductory email, activated by a user signing up for your pre-launch mailing list, the higher performers can get up to 40% or higher open rates, and 10% or higher CTR. Those numbers add up fast when you’re working with thousands, or even just a few hundred users.

Asked For Emails Engage Customers

Getting your emails read is one thing. But it’s not worth much if you can’t identify your most engaged customers, and get them excited about your product offering or content.

I like to tell our startups to view essentially all communication with customers as some form of transaction. In a transaction, you have to give something, and ask for something back.

Many startups will simply send out a confirmation email, and ask their customers to tell their friends about the company on social media. But why would a user do this? What has the user received from the pre-launch startup, to inspire such kind generosity?

Perhaps the users who are rooting for the company to succeed, because they love the idea, will share it with their friends. But that won’t be the typical user. The typical user is focused on him or herself. What’s in this for me? Why waste my time and reputation on Facebook or Twitter for you?

Having already made your ask to the user, you will have spoiled a good opportunity to give that user something they really value- something that is relevant to them, and helpful to them. You will have lost an opportunity to inspire good will, and make sure that same customer will come back when your product or service is ready.

Engaging Users

I wrote last week about the “we problem” for startups. This is what happens when a startup forgets that their customers care much less than they do about what kind of company the startup is or wants to be; their ideals, their purpose, and their core beliefs.

Customers care primarily about themselves. What will this company do for me? What does this company think of me? So your first pre-launch email communication with a user should be focused on that user. It should offer them something they potentially value.

Content

An obvious starting point for engaging users pre-launch is with content. Create or find content that is helpful to users who have the problem that your product is meant to solve. This will get the users thinking about the problem, and it will position you as the company that understands it, and knows how to solve it for them.

Content can be about the problem, designed to get the user angry or annoyed about the problem, and excited for the coming solution. Or the content can be about the user themselves: giving them advice on how to deal with the problem for now, or prepare for when the product is ready. You can also market “around” your product, and tell your customers about other products that compliment your own, and get them more interested in the market you’re in.

“Content,” is not synonymous with blog posts either, though these work with a certain type of user. It can mean something more broad, such as a video, a survey, or a quiz, or even a contest. Anything that brings value to the user, and is worth their time, can be good content for engagement.

Prestige

Something else that engages early-adopters is status. The opportunity to be first to try something, or be the first to react to something new, is a big turn-on for a particular subset of users (ie: early adopters). If you offer users an opportunity to give feedback on your product, and show those users that they have had an impact, you’ll have a much easier time selling to them later on, and they’re much more likely to view you as a company who really cares about them.

Beta users and testers are highly engaged, and likely to become ambassadors for your brand, if they are treated with respect, and offered exclusive benefits.

You don’t have to have a beta-version of your product in order to do this. Simply asking every user to provide specific feedback can yield interesting results. And, as a bonus, if you address the first email that every user gets from the CEO him or herself, you’ll build goodwill with users right away, and show them that you are engaged with them on a personal level.

A Personal Touch

I advocate for startups to be as informal and accessible as they can with their customers, particularly in the B2C sphere. You may be the CEO of a company, but that doesn’t mean anything if you haven’t signed a single customer yet. So don’t act like it does.

Startups should never, I repeat never use “no-reply” emails when sending out their first notes to customers. I also personally detest info@ addresses for the same reason. Ditto for on-site message forms. Your email address is not precious classified information. Share it with your users to build trust. Deal with any spam as the price of doing business.

The address you send from should be one with prestige, such as the CEO or CTO. And if time and volume allows, those people should also personally correspond with any replies they receive. The way you treat people before you’re successful tells them everything they need to know about how you will act when you are successful. So don’t be above talking to your customers directly.

On a personal note here, during the last round of interviews for this 2016 cohort, I asked each company how they had heard about us, and decided to join us at StartupYard. 3 out of the final 9 companies told me that they had decided to join us because when they had emailed us requesting information, Cedric Maloux, our managing director, had personally responded to the message. That’s a relationship you can’t buy. It has to be earned.

Staying on the Radar

Many startups fail at engaging their pre-launch users only because they’re afraid of alienating them by “spamming” them. But someone who signs up for a pre-launch newsletter is already much, much more engaged with your product than the typical user ever will be. The threshold for annoyance from such a user is much higher.

Just think of yourself as a restaurant. The user that signs up for your pre-launch newsletter is the guy who knocks on the door 30 minutes before you open. If you disappear into the back until the exact opening time, that user might leave, or they might wait. But if you come to the door and say: “hey, I’m so glad you’re here. Just give us a few minutes, and then we’ll seat you early,” that customer is likely to be very grateful and understanding if you aren’t 100% ready to serve them right away. At least they feel cared for and special.

It is more often a lack of sufficient communication that will cause you to fall off a future user’s radar, than the fact that you’re sending too many emails. Sending regular updates, which contain real value for the users (and are not just about your team and your company), will ensure that those who are really interested in you will keep tabs, and those who would lose interest anyway will unsubscribe themselves.

mentors engaged with founders

How Smart Startups Keep Mentors Engaged

The smartest startups keep mentors engaged as much as possible. With our next cohort set to kick off their 3-month stay with us next week, we’d like to share some tips on how to do just that.

Why You Need Engaged Mentors

It should hopefully come as no surprise to our startups that they will be getting advice from some of the very best business minds in Central Europe, and around the world. But that advice is only so valuable. A startup team’s ability to execute on every piece of advice they receive, particularly during an accelerator program, is limited. A person only has so much bandwidth, and the scheduling demands that the program imposes, leaves little time for reflection.

A typical comment we get from founders, around the end of the mentoring period, is “I keep hearing the same thing… I just want to fix it now!”

That’s ok. Part of the value of the mentoring period, in the first month of the program, is “shock and awe.” It is a trial by fire for a startup’s ideas, and for their ability to communicate those ideas clearly. It’s meant to shake them up, and wear down their bad habits, eliminating any lazy or wishful thinking.

To some extent, startups do long to go back into “builder mode,” and focus solely on executing all the advice they’ve been given. And they do usually still have a lot of building to do. But one common mistake; something we see every single year, is that startups will treat mentors as the source of individual ideas or advice, but not as a wellspring of continuing support.

I can’t say how many times great mentors, who have had big impacts on the teams they have worked with, have come to me asking for updates about those teams. These mentors would probably be flattered to hear what an effect they’ve had on their favorite startups, but the startups often don’t tell them. And the mentors, not knowing whether they’ve been listened to, don’t press the issue either.

And so time and again, mentors who are ready to offer support, further contacts, and more, are simply left with the impression that the startup isn’t doing anything, much less anything they recommended or hoped the startup would try.

Mentors who aren’t engaged with a startup’s activities won’t mention them to colleagues and friends. They won’t brag about progress they don’t know about, and they won’t think of the startup the next time they meet someone who would be an interesting contact for the founders.

How to Keep Mentors Engaged

This isn’t terribly complicated stuff. Many startupers fear at first that “spamming” or “networking,” is the act of the desperate and the unloved. If their ideas are brilliant and their products genius, then surely success will simply find them. Alas, it doesn’t work that way at all. Our mentors, along with investors and partners, usually appreciate “hustle,” or the appearance that startups are making a special effort to maintain contact, and further relationships.

As always, there are a few simple best practices to follow.

A Mentor Newsletter

Two of StartupYard’s best Alumni, Gjirafa and TeskaLabs, provide regular “Mentor Update” newsletters. These letters can follow a few different formats, but the important things are these: be consistent in format, and update regularly. Ales Teska, TeskaLab’s founder, sends a weekly update to all mentors and advisors.

In the email, he has 4 major sections. Here they are with explanations of the purpose of each:

Introduction

Here you give a personal account of how things are going. You can mention personal news, or news about the team, offices, team activities, and other minutiae. This is a good place to tell small stories that may be interesting to your mentors, and will help them to feel they know you better. Did a member of the team become a parent? Tell it here. Did you travel to Dubai on business? Give a quick account of the trip.

Ask

This is one section which I love about Ales’s emails. I always scroll down to the “ask” section, and read it right away. Here, Ales comes up with a new request for his mentors every single week. It can be something simple like: “we really need a good coffee provider for the office,” to something bigger, like “we are looking for an allstar security-focused salesman with 10 years experience.” Whatever it is, he engages his mentors to answer the questions they know, by replying directly to the email. This way, he can gauge who is reading the emails, and he can very quickly get great answers to important questions or requests.

Wins

Here, Ales usually shares any good news he has about the company. This section is invaluable, because it reminds mentors that the company is moving forward, and making gains. A win can be anything positive. You can say that a win was hiring a great new developer, or finally getting the perfect offices. Or it can be an investment or a new client contact. These show mentors that you are working hard, and that you are making progress and experiencing some form of traction. You’d be surprised how many mentors simply assume that a startup that isn’t talking about any successes, must have already failed.

KPIs

Here Ales shares a consistent set of Key Performance Indicators. In his case, it is about the company’s sales pipeline, but for other companies, it might be slightly different items, such as “time on site,” or “number of daily logins,” or “mentions in media.” Whatever KPIs are most important to your growth as a company, these should be shared proactively with your mentors.

If the news isn’t positive, then explain why. You can also have a little fun with this, and include silly KPIs like: “pizza consumed,” or “bugs found.” This exercise shows mentors that you are keeping track of what is important, and gives them a reliable and repeatable overview of what you’re experiencing in any given week.

Don’t Be Alone

We find this mentor email to be such an important practice, that we will be recommending its use to all of our startups going forward. Ales Teska agrees, and told me that the email had already led to some big wins for TeskaLabs. Not bad for 10 minutes of work a week.

But more importantly, whether you regularly update mentors or not, don’t waste the opportunity that StartupYard provides in making connections. If a mentor doesn’t reach out to you, reach out to them. If you can’t think of anything to say to them, just find something to ask them. The key is: talk to them, and don’t let them fall out of your orbit. The mentors and advisors you have interested in you, the greater your chances that a breakthrough will come when you need it most.

The “We” Problem

As we  welcome our 2016 startups this week, I get to do one of the scarier and more rewarding parts of my job at StartupYard, and that’s helping these companies define themselves, their products, and their customers.

When startups are getting ready to launch, they tend to be very focused on “what type of company” they want to be. That’s normal, and healthy. And it feeds into their ideas about what their “brand” should be, and how they should express that.

And here is where many startups stumble at the beginning. They don’t fully appreciate who their messaging is really for (clue: it isn’t for them), and what it’s really supposed to accomplish.

Where Brands Come From

The word “brand,” comes from the 19th century American practice of burning a rancher’s insignia in the hide of a cow, or other livestock, before moving the livestock to a marketplace. This was done to discourage theft from the ranch, or during the drive season. The word comes from the Norse brandr, which means “to burn.”

The practice of maker’s marks and watermarks goes back thousands of years, all the way to at least the invention of currency in ancient Sumer. In all cases, the practice originated from a need to protect against fraud. A maker, manufacturer, or publisher had to find ways of making sure that customers knew the difference between their products, and fakes.

As the industrial revolution peaked at the end of the 19th century, it became common for manufacturers to “brand” all their products, usually on the packaging, to distinguish them from forgers or look-alike products, which were increasingly common, and threatened profits. It was then that the concept of a “trademark,” and the exclusive right to use a specific brand were introduced into the legal system.

In essence then, brands proliferated as a means of consumer protection. And in fact, that has not fundamentally changed. Brands are still, at the core, about helping people to make safe, fair buying decisions, and protecting them from fraud and danger.

Brands Are About Trust

It wasn’t long of course, before entrepreneurs realized that consumers recognized quality products by brand. And so they began to focus on the way their brands looked, and felt, to customers.

Manufacturers also rightly recognized that a trusted brand could convince people to buy new things from the same manufacturer. If you trust a company to make your radio, you’ll probably trust them to make your television as well. Sprawling conglomerations like General Electric and Samsung were compiled, based largely on this new realization.

Brands have become synonymous with design, with philosophy and politics, and with class, race and economic status. Today, people make statements with their brand choices. This can lead startups to forget that the chief aim of having a brand is not just building recognition, or fitting into a particular culture. It is about maintaining a level of trust with customers, that will follow them from one product to the next, or one year to the next.

The “We” Problem

Today, of course, we’re all very well aware of the effect that brands have on our thinking and behavior. We’re probably too aware of it. We’re told now that everything is a brand, and that every person can be a brand. This can get us off-track when it comes to communicating clearly with customers.

I recently worked with a startup that wanted to launch a new product, under a completely new brand. They needed help putting together their messaging, and writing copy for their homepage and other marketing materials.

At this point, when a company has a good product, knows its customers well, and wants to dive into the business of growth, is often where they stumble on what I began calling the “‘we’ problem.”

Simply, most of the copy they had written, and most of the messaging they were focusing on, was about them. To them, they were expressing the qualities of their brand. They were smart, they were hard working, they were trustworthy, they were friendly. So why shouldn’t customers want to buy from them?

Well, because customers buy solutions to their own problems. They don’t buy the work of your team, or the relationship you have with the product. Those things can be a plus, but they’re secondary to a buying decision.

The central questions you have to answer are these: Does the product do what I need? Am I the target audience for this?

If the problem is that you're thirsty, then Coke has you covered in this classic poster.

If the problem is that you’re thirsty, then Coke has you covered in this classic poster.

People make their initial decisions based on that criteria, not on whether you communicate your attitude or your culture clearly.

Whenever I’m looking at copy for a homepage, I do a little experiment: I do a word search for the words “we,” and “us.” Then I compare that to words like “you,” and “our customers.” If you say “we” more than you say “you,” then you may have a messaging problem.

Startupyard.com, for example, contains 9 mentions of “we,” but 40 mentions of “you.” Also, several of the “we” mentions are directly followed by “you.” In addition, none of the “we” mentions are descriptive. They are active: “we’re looking for,” and “we try to.”

Most of the copy is concerned with either what kind of startup should join the accelerator, or what a startup will get by joining. These are the only two core criteria that matter in a decision to apply. “Does it do what I want?” And, “is it for me?”

Although it isn’t a rule that you can’t talk about yourself, you have to remain aware that to a prospect customer, how you see yourself is not that important. How you see them, how you value them, and what problems you will help them solve, are important.

Solve Problems, Make Emotional Use Cases

This is why we spend the first several weeks at StartupYard closely focused on one thing: the problem that the startup is solving for customers.

We work on positioning statements, which lead with who the customer is, and the problem being solved, and that is what initial conversations with mentors are all about. This helps the teams to stop talking about themselves, and start talking about their customers.

This also helps our startups to focus on emotional use cases. What frustrates customers? What aggravates them? What scares them? What brings them happiness? Saying “we have state of the art encryption,” is an unemotional argument.  But saying: “Our state of the art encryption will protect you against hackers,” is a powerful motivator.

Original-Apple-iPod

When Apple released the first edition of the iPod, it was famously “1000 songs in your pocket,” not “the next generation MP3 player, that can hold up to 4 GB.” This focus on the emotional use case: the feeling a customer gets from the promise of the product, is what makes Apple a powerhouse brand. It’s never about how smart they are, it’s about the experience you will get.

If you think your brand is about you, then you’re likely to focus on use cases that aren’t emotional for users, like efficiency, or price, or sophistication. In effect, you’re likely to make a feature argument, instead of a real value proposition.

It’s important to keep in mind what we talked about in the beginning. The primary purpose of a brand is to serve customers; to protect them from fraud and danger, by establishing a clear sign of quality. Only then can you leverage a brand to be something symbolic.

And that sign of quality can’t be forged. It has to be earned by solving customer’s problems- by offering them something they can clearly understand and want, and by delivering exactly what you’re offering.

The StartupYard Startup Reading List

If you follow us on Twitter, you probably know that StartupYard is constantly sharing great content with our followers. Internally, we also keep a “reading list” of  items we think our startups should read before, during, or after the program. This is the StartupYard Startup Reading List.

With a new acceleration round beginning next week, we thought we’d share the list we’ve compiled. It’s organized into Collections, Launch, Sales and Conversions, Retention, Growth, Marketing, and Free Stuff.

Under each item is a short extract from the link. If an extract wasn’t available, we added a short summary. Enjoy!

-The StartupYard Team

Collections:

http://startupstash.com/

40 categories of curated tools and tips for Startups. A must have.

http://marketingstack.io/

28 categories of curated Marketing advice and tips. A must have.

Launch

Quick and Dirty Guide to Launching your Startup in 2015

There are plenty of blogs out there that talk about paid advertising, social media, offline distribution, content marketing, SEO, SEM, e-mail marketing and so on. But I will be focusing on actionable items you can do to get your first 1,000 users in a weekend’s time and with less than $500 of investment.

16 Startup Metrics

We have the privilege of meeting with thousands of entrepreneurs every year, and in the course of those discussions are presented with all kinds of numbers, measures, and metrics that illustrate the promise and health of a particular company. Sometimes, however, the metrics may not be the best gauge of what’s actually happening in the business, or people may use different definitions of the same metric in a way that makes it hard to understand the health of the business.

The apps that help you bootstrap | Highfive

Wouldn’t it be nice to have a business idea today, and have that business up and running tomorrow? With today’s apps it’s totally doable.

Sales And Conversions

Complete SAAS Guide to Calculating and Optimizing Lifetime Value

Getting new customers is good. Keeping a customer and getting them to continue paying is better.

Conversion Optimization Psychology

Why are contrasting buttons effective? Why should you use 1st person CTA wording?Why (and when) are trust symbols effective?

Conversion Rate Optimization: Startup Growth Lessons

Some call it – *cough* – growth hacking. Others call it optimization. But what we’re all talking about, really, is crazy smart, innovative, results-driven, product-focused marketing that has an outsized impact on your company’s growth and bottom line.

Retention

Hooked Retention

How GrowthHackers(.com) Uses “The Hook Model” to Foster Incredibly High Member Retention

Why You Need Cohorts to Improve Your Retention

You need to dig deeper into your app using a method called cohort analysis. That’s how you’ll identify how well your users are being retained and the primary factors that will drive growth for your app. Here’s how the most experienced and analytical product people like Siqi go beyond your standard cohort analysis to do it.

Growth is Good, but Retention is Forever: 500 Startups VIDEO

A video from 500 Startups on Retention, and why it is eventually more important than growth.

Growth

The Ultimate GrowthHacking SourceBook

30,000 words of modern-day growth hacking strategies for the discerning SaaS growth hacker.

SaaS Metrics 2.0 – A Guide to Measuring and Improving what Matters

This article is a comprehensive and detailed look at the key metrics that are needed to understand and optimize a SaaS business. It is a completely updated rewrite of an older post.  

43 lessons growing from $0 to $1+ million in revenue, twice

I realized the other day that we’ve grown from $0 to $1 million with two separate products (HelloSign and HelloFax). This happened a long time ago, but I was recently reflecting on the lessons.

Growth Hacking:  VIDEO, Neil Patel

Pierre Lechelle: Growth Hacking Strategy

When thinking about Growth, most people think about CRO (Conversion Rate Optimization) on the ToFu (Top of the Funnel). They don’t really understand what is the power of Growth.

How segment models growth for two sided marketplaces

Frameworks help us organize and understand the world, and data helps us stay focused and monitor progress. So, it’s no surprise we use them both to help us project future growth and figure out how to hit our lofty goals.

Build a Growth Machine Like Andy Johns

Andy Johns has had the good sense to ride not one, but FOUR rocket ships. He has been a key member of the growth team at…

13 Growth Hacking Techniques You Can Apply Right Now

Growth hacking is the idea that an entrepreneur can take a clever non-traditional approach to increase the growth rate and adoption of his or her product by ‘hacking’ something together specifically for growth purposes. Most startups find themselves facing the same problem: they build a product that no one ends up using. Say you have…

Video: 10 Habits of High-Growth Startups by Sean Ellis – GrowthHackers

Sean’s talk at the DEMO Traction Conference.

The Ultimate List of B2B Growth Hacks

Marketing

How We Addressed our Main Content Marketing Pain by Outsourcing to Freelancers

Today I’d like to share with you one of the biggest marketing struggles we experienced at Ivalua, the previous company I worked for and where I handled Marketing for over 2 years: content creation – and how we overcame it leveraging freelance writers.

Why You Need to Create a Content Marketing Strategy
The most popular digital marketing mantra in recent years has been “Content is King”, and while the mantra itself may be a touch overused, it is by no means inaccurate. Now more than ever it’s incredibly important to create a content marketing strategy and make it your your own unique content marketing strategy if you hope to drive traffic and boost brand awareness from online channels.

Persuasive Writing Techniques
Design, SEO, and advertising can only get you so far. If you want to accelerate sales online, you need persuasive copy. According to Harvard Business professor Gerald Zaltman, 95% of our purchase decision occurs in the subconscious mind. Most marketers ignore how our brains work and fight against human psychology.

SEO Tools

153 succint reviews of SEO tools, by Brian Dean

Paddle: App Marketing Ebook

Paddle’s guide to app marketing explores the techniques developers can adopt to drive more downloads and grow their apps.

The science behind killer landing pages

A great list of the essential elements of a landing page, and why certain types of things work for conversion.

ViperChill’s Private Niche Project

A fascinating, if amoral, view of online marketing and networking building

What Startups Need to Know About Content Marketing

With content marketing, you can educate and engage potential clients while differentiating your company and positioning it as an industry leader.

The definitive guide to lead generation Facebook ads

In marketing, lead generation is the generation of consumer interest or inquiry into products or services of a business. For the purpose of this article, lead generation refers to the generation of consumer interest. A list of qualified leads is a priceless asset for your company. It’s cheap to build and works great for every kind of business, including “boring” B2B companies.

CopyWriting Tips

  • Which words do you choose?
  • How do you frame the offer?
  • How can you sell without appearing sleazy?

5 Smart Ways To Use Retargeting To Drive Leads In B2B Marketing

Creative ways to use retargeting ads to improve lead generation. Learn how B2B marketers target site visitors based on funnel stage, industry and email contact information.

How to Win Trust from Google and Rank Well

If your website isn’t trusted by Google, you’re basically consigned to the lowly, deep dark depths of search results pages ten and onwards.

A simple SEO guide in 2015 (Infographic)

Is SEO really a harder game to play as KunoCreative’s Dan Stasiewski put it in this excellent SEO guide infographic?

Investment

A map and List of Investors in Europe

TechStars created a map and list of 300+ investors who routinely invest in Seed, Series A or Series B rounds raised by European startups. All in all, it totals about €15 billion worth of funds.

Amy Guttman: Don’t write business plans: Advice for startups from one of silicon valley’s top seed investors

1. Don’t write business plans; instead build prototypes & test them with customers.

2. Don’t create five-year revenue projections; create 12-month expense projections.

3. Do create marketing plans, but focus on unit economics and metrics/analytics of:

a. what customers cost to acquire,

b. what products cost to build/deliver,

c. how much customers generate in revenue and when

4. Test and iterate on your assumptions — turn your business plan into a business metrics dashboard of KPIs, and continue to measure and improve every week.

5. Don’t run out of cash. Check your monthly burn rate, cash in the bank; figure out your remaining runway and try not to get below six months of cash.

The Guide to Finding an Angel Investment

This guide is indispensable for all wanna-be Business Angels and those entrepreneurs seeking Angel Investment! It contains best practices and practical tips culled from Busi- ness Angels around the world. It is a must-ready, easy-to-read, and great-read for all those private investors interested in playing a major role in the early-stage investment eco- system and those entrepreneurs interested in attracting Business Angel Investment.”

– Candace Johnson, President, EBAN (Europe)

Horror Story: How to Build a Unicorn From Scratch and Walk

A cautionary tale about keeping your priorities in order as a startup founder. Great read!

Social Media

15 New Social Media Templates to Save You Even More Time

Our best list of social media templates for scheduling, organizing, analyzing, and sharing better and faster than ever before.

80 Twitter Tools for Almost Everything

Twitter is chaos, but in the midst of this beautiful mess is a ton of data that if you can understand


What You Need to Know About Open Graph Meta Tags for Total Facebook and Twitter Mastery

Marketers create a lot of content. Yes, content is king, but a king is powerless without followers. So, what’s the first thing that comes to mind when you want to reach a broader audience with your awesome new post?


Facebook Data Study Insights

The Facebook pages that are doing wonderfully well with likes, shares, and comments on their posts have so much to teach about new tactics and worthwhile strategies. Our friends at BuzzSumo analyzed 500 million (!) of these Facebook posts, and we’ve learned some amazing takeaways that you can implement on your page today.

Free Stuff

The Design Freebies List
Free Stock photos

A collection of sites that offer with-attribution, or free to use images for your startup. Always check the terms on individual sites before using an image!

https://blog.bufferapp.com/free-image-sources-list

https://www.pexels.com/

Meta-Search for GNU Public and Free Stock Images

Can Central European Startups Compete?

The following was set to appear in a Czech business publication, but was, possibly to our credit, deemed a little too controversial. Thus we’re publishing it here, because we do stand by what we’ve said. 

2 years ago, StartupYard set out to answer a single, vital question. Can Central European, and especially Czech startups compete on the global market? After validating the concept of an internet accelerator for 2 years in the Czech Republic, mostly focusing on local startups, we set out in late 2013 to turn StartupYard into a platform for Czech and other Central European startups to go global. Here are the answers we’ve found so far:

Global Vs. International


To answer this question, first, it’s important to understand the distinction between a “global company” and an international one. Many Czech companies are, by necessity, international. Czech tech companies typically rely on clients and customers from abroad, often Germany, the UK, and the US, who can count on Czech agencies, developers, and manufacturers who are reliable, high quality, and above all, cost effective.

But being the cheap alternative to the local workforce for comparatively rich markets does not make Czech companies global in scale, nor in ambition. 

Instead, a global company is one that provides an innovative product or service, with the potential to disrupt the way all sorts of things are done, regardless of geography. A global company is one that has no borders, and that does not rely on its primary location as its main competitive advantage.

The Curse of Cheap

What we saw straight away as we turned StartupYard into an accelerator for global projects, was that the Czech tech ecosystem was addicted to “cheap.”

Today’s Czech software houses and digital agencies came of age when the costs of development, even for relatively simple products, were significantly higher abroad than they are today. Even now, these companies keep their international edge by keeping salaries low.

But this pattern of subservience to the bottom line has become a trap for the Czech ecosystem. By continually restricting itself to the low-cost alternative model, the ecosystem has encouraged some of the best and most ambitious innovators and engineers to flee to markets where investors have more appetite for risk. Czech startupers who are serious about global growth tell each other to leave the Czech Republic, and seek opportunity elsewhere.

Global is The Future

Czech entrepreneurs have been slow to enter the global market because of some obvious practical and structural barriers. Access to capital, and the ambition to match that access, has been limited by the size of the Czech market. It’s now easier for an American company to launch in Europe than for a European company to launch on the American market. That is owing not only to an imbalance in access to capital, but also to the historical fragmentation of the European market.

Language is another barrier , and the maturity of Czech business practices and the educational system have been another. Czechoslovakia’s long separation from world markets kept this country’s golden hands from important new ways of working for decades.

But today, these barriers are eroding. The Czechs are catching up, as the European economies integrate, and Czechs have several important advantages, not least a strong public education system, a smart and hardworking employment base, and a strong technical infrastructure. Today, as an example, the Czech Republic has faster average internet speeds than the UK and the US, ranked 9th internationally by Akamai Technologies.

No More Excuses

Wannabe Czech entrepreneurs are addicted to excuses, rather than to positive action. And we hear every excuse in the book.  “Investors here are too conservative, there’s no capital,” or “we have no Czech role models,” or “we’re not good at storytelling and marketing,” and “we’re just a small country after all… this isn’t Silicon Valley.”

Identifying problems isn’t solving them. And we could dispute every excuse there is.

Two StartupYard investors alone, Credo Ventures and Rockaway Capital, have 10s of millions of Euros to invest in Czech startups, and they are constantly on the lookout for new opportunities. In our mentor group alone, we have a dozen angels actively looking for smart investments, and willing to invest early on.

And we have dozens of entrepreneurial role models, like Roman Stanek, Tomas Cupr, Michal Illich, and many others who are actively seeking to support Czech startups. The problem, more often than not, is that the startups just don’t reach out, and aim too low to begin with, assuming they won’t be of interest to these figures.

If small countries can’t make big waves in the international tech economy, then someone should inform Estonia, which has given the world Skype, and Transferwise, and is little more than a tenth the size of the Czech Republic. Estonia has turned its tiny size to an advantage by being globally minded for over 25 years. Czechs have no legitimate excuses for not doing the same.

I’m from “Silicon Valley,” which is not a real place in the sense that many Czech entrepreneurs imagine. I was born and raised just south of San Francisco, and I can tell you there is nothing special in the water there; no magical advantage that startups gain when they land at San Francisco Airport. Nor are most of the people there particularly entrepreneurial by nature.

People used to take buses to LA to “become movie stars.” Now it seems they think they can take a flight to San Francisco to become tech billionaires. But it just doesn’t work that way.

San Francisco arose from a gold rush which never really ended, but has constantly changed its focus for nearly two centuries, from gold, to silicon, to smartphones, and now to ideas.

Silicon Valley is a state of mind. It is just full of people who have strong views about the future, and refuse to see limits to their ambitions. Going there won’t change who you are. You can set your personal goals higher, no matter where you live.

Storytelling

The global marketplace has its own demands, and presents new challenges to Czech startups. Chief among them, is the importance of soft skills that Czechs have not yet emphasized sufficiently. The Czech Republic severely lags Germany, Estonia, and all of Scandinavia in English proficiency, and the vital (for a startup) skills of storytelling and brand building are de-emphasized in a business culture that is all about the bottom line, or about technical innovation over customer focus.

Telling stories, the act of constructing a convincing narrative for success that a customer, an investor, an employee, or a partner can engage with and which can inform and inspire people about your company and your products, is a precious and vital skill among startups.  

If Czech entrepreneurs face these challenges head on, they will find that they can win investments, gain customers, and attract talent anywhere in the world. Silicon Valley may be where a lot of startups live, but it isn’t where they all come from, and it isn’t where they will ultimately win customers, and make money.

The Czech Republic has produced generations of ingenious builders, who already have the skills to create some of the world’s best tech products. It must now produce a new generation of ambitious, thoughtful communicators in order to sell those products to a wider audience. Czech startups have to stop doing what comes naturally: they have to stop focusing on being builders for hire, and start focusing on building their own future, with their own customers, and their own stories.

Signs of Success

The Czechs, it seems, are in a constant state of crisis of confidence. But one wonders why that is. The Czech Republic is the only country in Europe that has developed a viable competitor to the global search giant, Google, in Seznam.cz, and it hosts two of the world’s leading computer security companies, Avast and AVG. AVG became the first Czech company to IPO on the Nasdaq just 3 years ago.

Today, the Czech Republic is a net technology exporter, and its name is associated internationally with quality workmanship, efficiency, and creativity.

As barriers to the global market come down everywhere, and as consumers and businesses all over the EU and the world become more used to innovative and disruptive global startups, nothing stands in the way of Czech startups, and their global ambitions.

Today, Czech technology products touch the lives of millions of people, all over the world, in ways visible and invisible. From StartupYard alone, companies like BrandEmbassy, TeskaLabs, and BudgetBakers, to name a few, serve hundreds of thousands of people daily, and are growing fast.

A future in which a local resident of Sao Paolo, of London, of Bangkok, of Delhi, or of San Francisco, can make a Czech technology product a part of their daily lives and routines has already arrived, and there remains no excuse for Czech startups not to compete for the attention of customers and businesses everywhere.

Central Europe Accelerator

The 4 Ways Applications to StartupYard Fail, and How to Avoid Them

With just 9 days left for Startups to apply to StartupYard 2016, we’re going to share a little secret with you.

One of the questions we often get from would-be applicants is: “what do you focus on in the application? What is going to make me stand out?” The answer is of course: “the team, and the problem you’re solving for customers.” That encompasses most of what we care about when looking at written applications to StartupYard.

Aside from that, we’re looking for your sense of awareness. Who are your real competitors? Where could you be in a few years time? What is the grand design?

And here comes the secret: virtually *any* idea with a technology component and a global market could pass the first 3 rounds of our 7 round application process. That’s not to say that getting into StartupYard is easy. We ultimately accept fewer than 3% of applicants to the program. But the vast majority of applicants never get past the first 3 rounds.

Failing at the Easy Stuff

The fact is that if you’re asking us what you need to do to get to an interview with StartupYard’s selection committee, you’re well on your way to getting the interview anyway. We look for people who don’t wait in line patiently. We look for people who ping us via email and come to meet us in person, and treat this process the way we hope they treat everything: as a challenge that can be hacked and optimized, and overcome through hard work and critical thinking.

As part of the pre-screening process for StartupYard 2016, we have already begun reviewing submitted applications. As always, this process is a scary one. We have to make big decisions based on a small amount of data. And that only gets worse when applicants don’t bring their A game to the application process.

Most startups who apply fail at the easiest part of the process. The application takes, conservatively, 2 hours to fill in. But we know that if a person can’t muster the energy to project ambition, focus, and passion through such a broad set of questions, then they aren’t likely to be the kind of founder we are looking for in the first place.

Still, we know that some people just never shine on paper. There have been plenty of applications that have left us very unsure in the past, only to turn out to be from startups who, once the lights were on and the Skype camera rolling, blew us away with their energy and focus.

The sad truth is that there are undoubtedly those who never make it that far, but who probably deserve to be heard.

4 Ways Applicants Fail Before they Start

There are a handful of common failure points for written applications. Here are the ones that will get yours trashed the fastest:

  1. The Grocery list application

Many founders are engineers, and engineers think in peculiar ways. These applicants treat the application like a dumping ground for data, instead of a medium for communication.

So in response to, say, a question about traction, we’ll get a list of data points with no sense of what they are connected to: “50% growth in user acquisition via social media in first 3 months,”

That’s nice, I’m sure, but it doesn’t tell us much.  How much did they spend? What was the original number? A narrative response is helpful for reminding yourself that you’re not talking to somebody who knows anything about you, your product, or its history.

Treat the application as you would an email to an investor. That’s pretty much what it is. Introduce the concept, talk us through the basics, and establish an argument and a narrative as you answer the questions, as to why we should accept your team. If it’s a list of numbers, they may make sense to you, but they won’t mean anything to us.

2. N/A

If we asked the question, assume it means something. Assume it’s important to us, if not to you. But many applicants leave questions blank, or answer “N/A.”

None of our questions are inapplicable. If we ask whether your team has worked together, and you haven’t, then that doesn’t mean the question doesn’t have an answer longer than “no.” How about: “We haven’t worked together, but we know each other because we had mutual friends in X industry, or at Y club or community event.” Tell a story about how you know each other. It isn’t hard.

One of the worst questions not to answer is about traction. We simply don’t take companies that have no traction. That’s because “traction,” is really about more than revenue, users, or sales. It’s about the company as a whole, changing and growing from one month to the next.

Tell us what you’re doing, even if you’re not adding users or making any sales yet. Every company has traction of some kind: “talked to 50 target customers,” or “developed prototypes,” or “raised 5,000 Euros from friends.” That’s all traction. “6 Months ago I had an idea, 3 months ago I found a co-founder, and now we have a business plan and are working on a prototype.” Great. Each of those things move a company forward, and are a kind of traction we want to hear about.

3. The Non-Answer Answer

One of the biggest red flags for us on an application is an inability to connect with the questions being asked.

And I would say the most common question to get a “non answer answer” is the question: “What problem are you solving?” Out of 10 applications, I would estimate that about 3 answer this question in a remotely straightforward manner.

This is of course not a problem with just startups. It’s human nature to answer questions according to what one thinks the questioner really wants to know. Often startups spend a lot of energy justifying their idea by talking about the market, because they think that’s more interesting to us.

But this tendency can cause people to avoid answering the question that is being asked, which is about what problem customers actually have, that you will solve. Many applications jump into a sales pitch which states every benefit their product offers, without addressing the basic problem it is solving.

What problem are you solving? “Well, we allow customers to something something 5 times faster and 3 times cheaper than something something, and we do it using the latest something, which is 30% more efficient and better for the environment than something something.”

Fantastic, but what is the problem? Is the problem that the competition isn’t fast enough? Not cheap enough? Not good enough for the environment? The problem you’re solving says everything about what kind of company you are, and who you want to sell your product to. Is it for people looking for something cheaper? People looking for something more powerful? People looking to save the environment?

A litany of benefits is not a coherent argument in favor of your product. Nor is the size of the market. Those benefits have to be worth it, to someone, to pay for. If not, no matter how big the market is, you won’t be a part of it.

Consider the Consumer

Just consider yourself and your own behavior as a consumer. Do you use Uber, or DropBox, or Google? I’ll assume you use at least one of those services.

Now, some reading this may not remember the first time they used Google, because it’s been a part of the internet since they can remember. But I do remember my first time using it, in the 11th grade. It was just after 9/11, 2001, and I was looking at Yahoo news articles, trying to find information about the terrorist attacks.

“What happened to that 3rd plane they were talking about on the news?” I asked a friend on AIM (this was before the days of Skype). “I can’t find anything on Yahoo.” All my searches were returning bad results. It’s hard to remember now that a search engine couldn’t always be counted on to read your mind.  “Google it.” “Huh?” “Google it, with Google, it’s the best way to search stuff like that.”

And so I, like a few billion other people, typed in www.google.com, and 14 years later, I do more or less the same thing every day.

Consumers react to problems, and only then do they search for features. My problem, on that day in 2001, was that I didn’t have information I wanted, and I didn’t have an easy way to get it. Google solved that problem.

With every product you use, there is an initial reason you started using it. Even if it was a direct competitor for something you were already using, it did something the competition did not do, and you needed. I switched from Yahoo 14 years ago because it wasn’t allowing me to do one thing I wanted. Yahoo had many features that Google didn’t, in those days. But Google could do what I needed, and Yahoo couldn’t.

We are looking for that one thing that you offer, that makes you Google in 2001- the thing that makes someone who uses your product say: “oh, use this, it’s the best for that particular problem.”

Your problem doesn’t have to be a new one either. Google’s wasn’t solving a problem people didn’t know about. Neither is Uber, or DropBox, or many other hyper growth startups. It was just that the competitors weren’t doing a good enough job. There was room for a new solution.

4. Misidentifying the Competition

XKCD's Take on "new products."

XKCD’s Take on engineers and “new products.”

And this leads to the our last great failing. Ignoring or misidentifying the real competition.

I say, the “real competition,” because defining your competition as a startup is a very tricky business. Broadly, your competition should be whatever your target user currently does to solve the problem that your product is built to solve. That’s true as far as it goes.

But where many startups get into trouble is by picking companies that “look like” their own, and calling that the competition. That’s not wrong, per se, but it isn’t very insightful or helpful. It leads to a lot of applications where the competition listed is a handful of companies most people have never heard of, including us.

Think about that:  if your competitors aren’t expanding globally, is that a good argument that there is a strong market for your products?

And by picking competitors that are very similar to yourself, you undermine your ability to define yourself in a broader market. You are not really competing for the small number of users that these smaller direct competitors already have, after all. You ultimately want people who have never used any product in your category to start using yours.

If you’re a car company, you want to sell people their first car. You don’t want to spend your time convincing people to give up somebody else’s car, which is perfectly fine for them, and switch to yours. The arguments in favor of owning a car vs. not owning one are easier to win than an argument over which of 2 very similar cars a person should own, particular when they already own one of them.

When I’m working with startups on product positioning, I often use the example of Uber. Who are Uber’s competitors? The answer is more complex than you think. If Uber thought its competitors were other taxi companies, or other ride-hailing apps, then this would affect its behavior in specific ways. It would try to do just what taxi companies do, only somehow better. Or it would try to do what other ride-hailing apps do, only faster and cheaper. It would be competing for people it knows are in that market.

But Uber’s success has been tied to the fact that it doesn’t hold itself to these lowly ambitions. It wants to compete for much bigger markets- to replace a whole range of consumer behaviors. Uber wants to be an alternative to owning a car, to renting a car, to hailing a taxi or to taking a bus. It want’s to be an alternative to drivers for working for a taxi company, or even having a summer job. It wants to be an alternative to ordering take-out food, or picking your mom up at the airport. It wants to replace many common behaviors at once- not just one or two.

Would Uber say their main competitors are taxi companies? Or is their main competition found in modern car culture itself? Which market is ultimately the more promising one?

So expand your horizons, and pick competitors according to the customers you want; not the customers that you know are already in the market. It is perfectly fine to aim high. We don’t laugh at companies who name big competitors. Big competitors have many vulnerabilities, and the bigger they get, the harder it is for them to keep growing and changing.

Give us Your Big Vision

The real shame is how often we talk to a startup in person, and find out how much better they are than they look on paper. “I didn’t want to tell you the big vision yet, because it’s in the future.” We hear that surprisingly frequently. But why? Tell us your big vision; share your wild ambitions. That’s why we’re in this business!

Your big vision demonstrates your passion and the scope of your thinking, and you shouldn’t be afraid that it will make you seem ridiculous. To some, it will. But there is no highly successful startup that wasn’t laughed out of at least a few rooms before they struck gold. If people don’t buy your big vision, then keep working on it. If you work hard enough on it, it will eventually be realistic, and maybe even achievable.

8 Reasons Not to Join an Accelerator

Yes, yes. We’re always trying to convince people that accelerators are generally a good idea. And they are, for a lot of you out there. But not for all of you.

Here are 8 reasons not to join an accelerator. If any of these speak to you, consider very carefully whether going to one won’t be a frustrating waste of your time and energy.

1. You Need the Money

Time and again, we meet with startups who only have questions about the money and terms we offer to startups. If you’re joining an accelerator for the money it provides, think twice.

First of all, it isn’t a lot of money, really. 30,000 Euros might seem like a lot  -older accelerators like Y-C give up to $120,000- and more in follow on financing. But if your idea is really workable as a business, you can find that money somewhere else. And when you do, it’s likely you wouldn’t have to give up a sizable stake in your company for it.

The money-for-equity equation doesn’t make sense by itself, but the accelerator model makes sense when you look at the results. StartupYard companies are at least 3 times more likely to survive their first year than companies who don’t join an accelerator, and our vested interest is in every one of our companies becoming a success, and fetching a high priced exit. The funding we provide couldn’t accomplish this. It would be a poor investment. But the connections, guidance, and support we provide can make the difference between a company falling off the map in a year or two, or getting seriously funded, and having a shot at real success.

2. An Accelerator Means Instant Growth and Recognition

Sorry, it won’t work that way. DropBox, Twitch, Stripe, AirBnB, Softlayer, and SendGrid (all companies that went through accelerators), did not become successes just because they were in accelerators. Quite the opposite: these companies made Y-Combinator and TechStars famous.

No, they became successes because they had dedicated founders who made the right decisions and just as importantly, worked hard. We can’t make you work hard, but we can help you make the right decisions, and forge important connections. That’s it. It’s hardly rocket science (though some of our alums are rocket scientists).

Every startup, to some degree, has to be in the right place at the right time. An accelerator can help you be in that right place, and help you determine whether it is the right time. We can be a firewall against your worst impulses, but we cannot do any of it for you. If you expect that an accelerator will make you famous and win you funding, don’t be so sure. You’ll be the one doing the work.

3. You’re a Solo Act

You’re a lone wolf, who plays by her own rules. You don’t need a co-founder, because that person would just get in your way. The glory will be yours alone.

That’s all fine, except we’re not interested. A single founder can become a bottleneck for new ideas and input. He or she can also become a blocker for needed action. A single person with too much control over a startup will find it easier and more tempting to resist doubts, and to avoid stopping to reconsider strategy. Beyond that, a single founder usually just can’t handle all the demands of attending an accelerator and running a company at the same time.

Anybody who has ever watched a police drama knows the dynamic. A partner is somebody who can play good cop to your bad cop, and can back you up when you’re in trouble. They’re someone who can tell you you’re crazy, or can confirm that you’re really onto something. Nobody wants to approach a lone wolf, so get a partner you can trust.

4. Your Ideas Are Perfect

You don’t tolerate criticism. Why should you? You’ve been successful all your life, and this situation is no different. You will just make your company work, no matter what, doing what you had it in mind to do.

My advice is, go for it. If it’s a perfect idea, then it really will all work out without you having to question it. But if you’re coming to an accelerator thinking that even the basic idea behind your company can’t change, then don’t come. Stay home.

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Accelerators are for failure as much as they are for success. Better to fail early on, and in a controlled way, than to build an empire on sand. We will push you to falsify all your notions of what will work, and what won’t. Most startups discover basic, critical flaws in their concepts while attending our program, which is exactly when they should discover them.

5. You’re a Tourist

Like a weekend wine-taster in Napa (or maybe Moravia), you’re just dipping your toes in the water to see what this whole startup thing is about. You’re not about to buy a winery and start mashing your own grapes, unless somebody can convince you it’s a good idea.

We don’t have the energy or the heart to sell your own startup to you. If you’re not sure it’s something you want to dedicate your life to working on for at least several years, then don’t join an accelerator. You’ll save everyone, yourself included, a lot of grief.

On the same token, don’t join an accelerator expecting to pick and choose what you’ll get out of it. “I just need the mentors, I don’t need the workshops.” I can’t say how many times I’ve heard words to this effect. And yet, these are usually the founders who need our input the most. But if a founder isn’t open minded and open hearted, there isn’t much we can do to change that.

6. You’re Not a Startup

That sounds a bit silly, but it’s a real thing. Part of the problem is something we’ve discussed a lot, which is that tech companies today seem to think they have to be “startups.”

Startups are companies that need to scale quickly in order to survive. They are companies that are innovating a new technology or business idea or process that hasn’t been tried before in just that way.

But every year, we get applications from game companies, digital agencies, and e-commerce providers who want to tap into the “startup mojo,” and experience hyper growth without having a hyper-growth product.

The line between a traditional business and a startup can be unclear at times- sometimes their products do essentially the same things, but in radically different ways. Make sure your path forward involves rapid growth, and global reach, and that it isn’t, in the parlance of Y-Combinator, a “lifestyle business,” set up to make a small profit over many years of steady business.

7. You’re Looking to Cash Out

Your results may differ.

I wouldn’t compare running a startup to gambling, but there is one parallel that is inescapable. When you go to a casino, the best practice is to give yourself a limit, and expect to lose all the money you’ve committed to gambling. If that’s an amount of money you’d be comfortable simply setting on fire and walking away, then it’s ok to play a little blackjack. Otherwise, don’t play.

So it has to be with running a startup. If you’re not comfortable with existential risks to your business, then you should probably be in a different field. And if you’re drawn to running a startup because you know that some startups get large payouts in the form of acquisitions, then it’s unlikely that you also have enough affinity for the idea behind your startup, to stick with it even when things look bad. And they will, at some point, look bad.

8. You Want to Be Famous

Let us not dwell on this. Just, no.

We Want to See Traction, not Fake Traction

Last week, we made the final stop on our 6 city, 5 country FastLane tour, meeting over 50 startups from The Czech Republic, Poland, Bulgaria, Romania, and Kosovo. In Warsaw, we FastLaned two more startups, giving them the chance to get ahead of hundreds of other applicants. In total, we FastLaned twenty companies.

Highlights from Poland

We had been hearing about the active Polish startup scene for forever, but Reaktor, run by Borys Musielak, was our first real chance of seeing it up close. Over 150 people packed into a house that is strongly reminiscent of an American college fraternity for their monthly OpenReaktor event, where 4 startups pitched to us, and 2 were FastLaned.

What do I have to have to get into StartupYard?

We heard this question a lot from Polish startups in particular, but it’s something many startups or entrepreneurs ask us when we’re on the road. Do I need a prototype? Do I need users? Revenue?

But this is really approaching the question the wrong way around. We don’t establish a minimum cutoff for the progress or stage of the startups we take, because every startups has a different path to take. We look at startups as potential partners. In our partnerships, it’s important that the accelerator can provide value. If we can’t, then there’s no reason for a startup to join us, or to let other startups know that we can help them too.

It so happens that we can most often help companies that are just about to or have already launched a beta product of some kind, and who have a few users or customers to boot. But we have also gone as far as to take a company with only an idea of what they want to do, as well as companies who already have a steady stream of paying customers.

Team and Traction

A really interesting female entrepreneur from India pitched us in Warsaw. She had approached us about pitching, but warned us that she had no product, no team, and no code. Just an idea, and a will to make it happen. She also had set up an MVP without any coding. And despite her having none of these things, she was so convincing, that we decided to FastLane her anyway.

So she asked me: “Thanks for that, but really, at what stage can this be something you’ll consider?” I answered that she had a month to show us how she can execute on her idea.

“But I can’t get a product done in a month!” she said. Well, of course not. And we wouldn’t expect that. But what we would expect to see, if we were to consider her for the accelerator, is some form of traction. People usually confuse traction for user growth and revenue. That’s not the whole picture for us.

Traction means evolution and progress. Where are you today, and where were you a month ago? If you’re the type of person who gets stuck, and doesn’t move forward because something is blocking them, then you probably won’t do well at an accelerator. You have to be willing to move where you can; to flow in the direction of what is possible, and deal with what isn’t yet possible as soon as possible.

How can a non-coder make progress on a technology project in a month? Well, she has to move in the direction of what’s possible. She can spend that time finding and convincing team members to join the project. At the same time, she can begin working on recruiting users for the day when she will have a beta product available. As I often tell startups: you do not need a final product in order to start delivering value to someone today.

If she can convince a team to join her on her quest, and she can convince future users that there is a great product on the horizon, and that they should be the first to use it, then she can earn a place at StartupYard on the strength of her personality alone. When we say it’s all about the founders, we mean it.

We wouldn’t exclude a team that didn’t have a line of code to show us, if the founder could go from an idea, to a team and a list of users in a month.

Professional Startups

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A flip side to this equation is probably the worst breed of startup out there: the Professional Startup.

These startups look great on paper. They can talk about their ideas, and they have a sexy concept, probably good UI, and a slick website. Maybe they have a few clients.

But there’s one tiny problem. They’ve been at that stage for years, and they’ve attended every incubator, accelerator, and startup challenge that would take them in that time. In our scouting for startups in the Central European region, we can spot these startups most of the time by their website’s emphasis on these “credentials.” One website had a timeline of programs and contests the startup had done, going back over 3 years.

The company had no feedback from actual customers. That should not inspire confidence.

This is most often what you’d call “fake traction.” It’s easier to talk to other startup people about your startup idea, than it is to talk to customers and sell your product. It’s sexier and more ego-boosting to talk to investors than to woo users and write content for your website. And I think many of these startups have the idea that the goal in startup life is to get scooped up by some magical acquisition before ever having to deal with the dirty business of doing actual business.

Or worse, they’ve been hoping all this time that the accelerators and incubators were going to do the work for them. No thanks.

But here’s a little secret: acquisitions of companies that don’t have any customers is rare. It happens, but it’s not a realistic goal for any startup. And anyway, if you’re acquired before you even get any customers, there’s not much chance that you’ll be acquired for very much- certainly it will be for less than if you get your hands dirty, and actually prove that you have some product market fit.

So what would we rather take? A 3 year old company with a sexy idea, a crack team, a nice website, and no customers to show for it? Or a woman who has never run a company before, but can pitch like crazy, and convince a couple of guys to help her get it off the ground in a month for no pay? We’ll take the newbie, thanks. That’s somebody we can really help.