Mixed Signals

Earlier this year, Jason Fried and David Hansson from 37 Signals released Rework, a book of advice to entrepreneurs. Several weeks ago, Darmesh Shah of HubSpot wrote a post at OnStartups listing his 37 favorite insights in the book.

Now, I’ve read a bunch of posts from Darmesh Shah and he’s a bright guy. And I respect 37 Signals for challenging conventional wisdom. However, the comments from the post and the reviews of the book tout this book as the new conventional wisdom. And that I think is dangerous.

There are no absolutes in life, and there certainly aren’t any absolutes in starting up a company. And while the insights may work for some startups, they can be disastrous for other startups. The key to successfully using insights like these, is knowing when they apply. So this post is a devil’s advocate post that attempts to provide some context to these insights, based on my own experience starting and running several companies over the past 13 years.

To be clear, I have not read Rework. I’m specifically commenting on the insights posted by Darmesh, since these are similar to many nuggets of wisdom I’ve been told over the years without being told when they apply. It’s not that these nuggets were wrong; they were just incomplete and lacked context. Many of the mistakes I’ve made have come from applying the right solution to the wrong problem.

2) Writing a plan makes you feel in control of things you don’t actually control

While this is true, it’s misleading. Yes, writing a plan biases you toward feeling in control of things you don’t control. But writing a plan can also give you control of the things you can actually control. It helps you think through all the steps needed to achieve a goal, determine which steps you can affect, and take actions to improve the outcome.

The wisdom here is not that you shouldn’t write plans. It’s that you should understand the inherent psychological bias we create when writing plans and discount the level of control you feel. The mark of an experienced entrepreneur is one who has a better understanding of what things they can control and what things they can’t control, and plans accordingly.

4) Stuff that was impossible just a few years ago is simple today.

This is a nice one because there are so many interpretations of how to put this into practice. A common interpretation is to focus on the simple. But you’ll make a lot more money and have a lot more impact on the world making the impossible simple, than doing what is simple today.

5) Failure is not a prerequisite for success.

True. There are always those who win the lottery on the first try. But success without failure provides no wisdom. Failure, and the ability to learn from that failure, increase the odds of later success. Statistically speaking, it is incredibly rare for anyone to have success with no failure ever. Lessons from failure can often be applied across to other problems (though as this post is trying to demonstrate, not always), so failure in one area is not a prerequisite for success in that area.

6) Don’t make assumptions about how big you should be ahead of time.

A common interpretation might be that you shouldn’t plan to be big. But don’t necessarily plan to be small either. Many startups fail because they planned to be small and couldn’t handle getting big.

7) Don’t sit around and wait for someone else to make the change you want to see.

Being action-oriented is good. But action must be balanced with priorities, perspectives and roles. If the change has a lower priority than other items on your list, sit around and wait. Take into account that the change you want to see, others may not want (or be apathetic about). And don’t use this as an excuse to step on someone else’s toes and do their job.

More importantly, when deciding to create a startup, this can lead to one of the biggest problems of entrepreneurs: making a change you want to see and solving your own problem, then thinking you have a business. Which leads us to the next bit of insight…

9) Solving your own problem lets you fall in love with what you’re making.

Falling in love with what you’re making leads to a key problem: Everyone thinks their baby is the most beautiful in the world. Be passionate about what you’re making, but don’t fall in love with it. Love will blind you to its faults.

More importantly, solving your own problems often leads to you solving problems that have already been solved hundreds of other times. Which duplicates effort, wasting time and money, and if it’s a problem you’re building a business around, likely puts you in a highly competitive, low-margin business.

Which is why there are so many time management, project management and bug tracking businesses. Few of which make any money. 37 Signals being one of the key exceptions here, which is why this piece of advice works for them. But as a general rule, it can be dangerous. See The 10 Most Tempting Software Startup Categories. If the problem you’re falling in love with is on this list, you probably don’t have a business, and can probably buy a better solution than you can build.

15) Huge organizations talk instead of act, and meet instead of do.

To some degree, yes. But don’t let this lull you into a false sense of security. Huge organizations have huge amounts of resources and are often incredibly efficient at extracting money from markets. They’ve spent years optimizing their business models, building barriers to entry and developing a highly competitive workforce.

Sure, there’s lots of bloat in huge organizations. And certain organizations have an overabundance of useless managers scheduling meetings where they can talk about the latest buzzwords. But many large organizations spend the money to hire the best and the brightest, then train and groom those people into smart managers who can trounce you in the market. Find the weaknesses of huge companies, but don’t underestimate them.

16) Build half a product, not a half-assed product.

Poorly stated. Build the minimum viable product, but make sure it’s a whole product. And the “whole product” is almost always more than the “technical product”. When building a software company, your product includes not just the software, but your training, consulting, sales, payment methods, contracts and more.

20) Decide. You’re as likely to make a great call today as you are tomorrow.

Not necessarily. Being action-oriented is good, but not understanding when it’s better to wait is bad.

If you’ll have more information tomorrow that will help you make a more informed decision, and there will be no difference in the outcome of your decision if you wait, postpone your decision. There’s no need to make it today, and you’re more likely to make a better decision tomorrow.

If a decision is low priority and will require too much time to decide or too many resources to implement, postpone until it becomes a higher priority. Keep as much of your time and resources available to implement the high priority decisions and ignore the rest.

Finally, certain decisions can be delegated or may not need to be made at all. Learn to identify when to delegate and when avoid decisions entirely.

21) The longer it takes to develop, the less likely it is to launch.

Yes, but the quicker it takes to develop, the easier it is for someone else to also develop and start competing with you. Easy problems are easy to launch quickly, and if they are valuable, quick to build competition and erode margins. Hard problems take time, and bringing a half-solved hard problem to market can be disastrous.

Of course, the fun part is that hard problems are often easier than we think and easy problems are often harder than we think.

25) When you make tiny decisions, you can’t make big mistakes.

Sure you can. Happens all the time. If you’re out on the sea and make a series of small adjustments to your heading, a couple hours later you can suddenly find yourself way off course. Same happens in business. A series of small decisions can easily add up to one big mistake. Make decisions in the context of your overall strategic goals, and whether big or small, you’ll at least be headed in the right direction.

27) You rarely regret saying no but you often regret saying yes.

I can’t disagree with this one and I am calling this one out because I think it’s so important. Too often I’ve regretted saying yes. There are so many opportunities out there, you need to learn how to say no to 99% of them; otherwise you lose focus.

The key to this piece of wisdom are the words “rarely” and “often”; they are not “never” and “always”. One key to success is knowing your odds, which this piece of wisdom exemplifies. If you can learn when the odds of success are good, you’ll know better when to say yes.

29) You can’t paint over a bad experience with good marketing.

No, but you can with good customer support. If someone has a bad experience with your product or service, and you address it promptly and with honest caring, you’ll usually create a much stronger bond than with the customers who’ve never had any bad experiences with your business. That’s not to say you should create bad experiences; just that if they happen, address them quickly and personally.

Unfortunately, that’s all I have time for. The others I either agree with or don’t have any opinion about.

To end this post, I’ll leave you with a bit of wisdom I’ve learned:

Success too often gets attributed to skill and effort and not enough to forces beyond our control, while failure too often gets attributed to forces beyond our control and not enough to skill and effort.

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