The kick of a startup

Yesterday, my startup hit a significant milestone: 10,000 total accounts (trial + paid). And last month marked one year anniversary of launching paid plans for Visual Website Optimizer. I think it is a good time to reflect what it means to me and the business.

Needless to say, I am very happy that we can boast of a small, smart team and big brand customers like Microsoft, Groupon and AMD. However, when I think about it — I was much more excited (and happier) about first 10 paying customers than 10 new paying customers now. Back then when I was launching it, there was an unknown territory to explore and I was a warrior ready to battle the unknown.

Questions and Euphoria

Whether it would work? Or, whether I would need to get a job? I still distinctly remember getting the first paid order and delirium it had caused. Even though I had read almost all essays of Paul Graham and absorbed myself into startup world (perhaps) bit too much, the realization that someone was ready to pay for my hacks was an incredible feeling.… Read the rest

Customer service is not cost of sales. It’s a marketing expense

We had a horrible experience with Airtel, our Internet provider, today. Our Internet line hasn’t been working since morning, I registered a complaint and was promised it would be fixed by 6:30 pm in the evening. The time passed and when I checked the complaint status, it was marked closed. Asked for an explanation, a customer service representative put me on hold for — drumroll, please — full 15 minutes before I gave up. Their IVRS system is impossible to navigate and you are actually asked to dial a gazzilion numbers before. Internet is full of complaints about Airtel and they recently ranked as worst customer service company in India. I’m surprised how the highly paid bosses don’t realize this or don’t do anything to do this. Baffled, surprised and makes me punch myself.

Sadly, Airtel is not an exception. Many large companies have impossible customer service processes. What’s even more sad is that this poor customer service experience has become a norm and there are even funny (but true) comics based on this reality.… Read the rest

Growth startup v/s lifestyle startup: why should there be a difference at all?

Again and again, people try to distinguish between two kinds of startups: growth and lifestyle. Broadly speaking, here’s how people categorize these startups:

Growth Startup

  • Raises VC or angel capital
  • Aggressive hockey-stick like growth
  • Laser focused on an “exit-event” (acquisition, IPO, etc.)
  • Focus on revenue (not profits) or other growth metrics

Lifestyle Startup

  • Bootstrapped of Self-funded
  • Slow growth or no growth at all
  • No exit strategy per se as the business is part of founders’ lifestyles
  • Focus on profits at all times (as they don’t have external capital)

With Visual Website Optimizer, many people have asked me to clarify whether it’s a growth business or a lifestyle business. I’m always baffled with this question because these two categories seem narrow and I don’t see my startup getting pigeon-holed into one of them. It is true that we haven’t yet raised any VC or angel funding. But does it really disqualify us from being a growth business?… Read the rest

What’s wrong with Indian startup scene?

I was at an Indian startup event today and did not enjoy the experience. It felt typical of what Indian startup scene has come to be (it is my perspective, of course. Feel free to disagree). There are two specific things which are wrong about startup scene in India: a) it’s a huge “ego-chamber”; b) most of early stage entrepreneurs are not solving problems for global market.

About “Ego-chamber”

Indian startup community is a tightly knit one and ironically it is also one of the biggest disadvantages. In today’s event, I saw entrepreneurs discussing ideas amongst themselves. One would say: “your idea is cool“. The other would respond: “no man, your idea is cool“. You see — perfect ego boosting so that nobody feels bad about their efforts. The tiny startup community in India has absolutely no connection to outside world and the actual customers are least bothered about these startup events.… Read the rest

How to find startup ideas that make money

I am glad that my previous blog post Sorry, your “cool” webapp is probably not going to make money received good response and generated a lot of debate. What I discussed in that blog post was that most of the so called startups or webapps which are based on “game-changing” or “cool” ideas never end up making any money. So, if your aim is to make money, pursuing such ideas can be risky. While idea-driven startups rarely make money, I professed market-driven approach for someone looking to find startup ideas that actually make money.

Market-driven approach to finding startup ideas that make money

The market-driven approach is quite simple. It essentially means:

Find a startup idea that: a) is already making money for someone else in a growing industry; b) interests you; c) aligns with your skill sets. Once you find such an idea, simply carve out a niche within the industry by a) addressing pains of an under-served segment within that industry; b) or, making it much easier to use than existing solutions; c) or, disrupting the market by making your product accessible to masses at a much affordable price.

Read the rest

Startup: an emotional roller coaster ride

February was a great month for my startup (Visual Website Optimizer). All metrics that you can care about worked in our favo. Increase in number of customers, revenues, users (and yes, Twitter followers too). We also hired our first employee and are looking forward to hiring 2 more. (Please apply if you are in Delhi and someone you know is in Delhi and wants to work with us).

If everything seems great, why do I call this an emotional roller coaster? Well, that’s because just like a real roller coaster there is always a lingering fear that we may not be in existence 12 months down the line. When established companies such as MySpace with hundreds of employees face uncertainty, how can our small team afford to be complacent.

In a single day, we get to see so many emotions. Consider my typical work day:

  • Wake up at 10 am (read below why I wake up at 10 am, we work from India during US hours since most of our customers are in US and UK).
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What Facebook needs? A killer search engine

Let’s face it: many of us are addicted to Facebook. It has all our friends, apps, games, instant chat, groups and what not. In fact, for the younger generation, it is the first (and only website) they visit in a day. I know several people for whom the world revolves around Facebook. They don’t check email as often they check Facebook. And some don’t check email for weeks as all their communication needs are served by Facebook. However, even those people need to visit Google every now and then to search what they are looking for.

What if Facebook incorporates a search engine within its interface?

Now that would be killer feature. Facebook becomes your start page and you no longer need to go outside Facebook to do your search and the website truly consolidates all activities an average Internet user needs to do on day to day basis. Financially, it makes sense for Facebook to go the search engine route because in current form Facebook ads don’t perform that well for advertisers.… Read the rest

Sorry, your “cool” webapp is probably not going to make money

Sorry for crushing your dreams but your web app for tracking happiness levels (or for “social-aware” todo lists) is probably not going to make enough money to let you retire in Hawaii. Many programmers and web developers find making a web app very satisfying and there is nothing wrong with that. As long as you are doing it for fun, it is OK. But making web apps is the trivial part. After all, most web apps are nothing more than a slick interface for CRUD operations. The key to making money is to find a market where people are willing to pay for those simple CRUD operations.

The usual approach for making web apps (or “startup” as some would like to call it) is this:

  • Have a “cool” idea
  • Implement it in X number of hours
  • Try to justify its need by finding users who may use it

I am just making up a statistic here, but I have seen 9/10 efforts losing hope after the third step and the web app just languishes with the creator given up on it after initial euphoria.… Read the rest

Do a startup or travel around the world?

Every time I watch Discovery Travel & Living on TV or read Lonely Planet magazine, I desperately long for travelling around the world. This feeling intensifies after reading posts such as 8 Exotic Destinations You Can Afford. I get all pumped up ready to pack my bags. But then I realize: Oh wait, I have a startup.

Startup requires a lot of sacrifices from you. You have to work extremely hard (think 100+ hours per week) for several years. All this hard work is justified in hope of an eventual big pay-off which may happen in a year, five years or may not happen ever. That big-payoff has potential to make you financially independent and then you can go travel the world (or explore other exotic interests such as taking a stab at string theory). But the big question is what if that eventual pay-off never happens? It is certainly a possibility because majority of businesses will either fail or will become self-sustaining for years to come.… Read the rest

Appointment Reminder: Patrick’s new startup launches!

I usually don’t do startup reviews here (because it is a personal blog) but today I will make an exception for my friend (on Hacker News): Patrick McKenzie. If, like me, you are also addicted to Hacker News you will probably know who Patrick is. He goes by his handle: patio11. Best known for his SEO, A/B testing and marketing automation advice, Patrick runs a niche business called Bingo Card Creator. The most exciting thing about his business is that finances are completely transparent! On his site, you can see all revenues, expenses, conversion rates and other interesting business metrics.

When Visual Website Optimizer (my startup) was in beta, Patrick gave loads and loads of feedback to improve the product. And when finally Visual Website Optimizer launched, he reviewed the tool in a post titled: Brining A/B Testing to Fortune 5 Million. That post alone brought hundreds of early adopters for the beta who then helped refine the product.… Read the rest