David S. Kidder is a serial entrepreneur and angel investor. Currently, he's the co-founder and CEO of Bionic, an enterprise innovation platform. Prior to Bionic, David served as the co-founder and CEO of Clickable (acquired by Syncapse). Prior to Clickable, Kidder co-founded SmartRay Network (acquired by LifeMinders), and Net-X (acquired by Target Vision). In January 2013, he published The Startup Playbook, which leverages his insider access to reveal the experiences and advice of over 40 of the world's leading entrepreneurs.
When I interviewed David last week, he shared some amazing advice on starting a company, hiring, and more. I've summarized my key takeaways from our conversation below.
Starting a Company
- When starting a company, trust your innate gifts. Mold the company around these gifts so you're working towards something that's at your highest level of interest and purpose.
- Entrepreneurship is a career, not an outcome. It takes a long time to become good at it.
- In The Startup Playbook, David asked the entrepreneurs what percentage of their economic outcome they attribute to good fortune, timing, or simply luck - across the board, all answered that 70% of their success was due to luck. Luck is the intersection of hard work and good fortune. An incredible amount of things need to go right (or not go wrong) at exactly the right time for you to succeed.
- Being a successful entrepreneur is a hero's journey. The uncertainty and possibility leads to incredible learning and growth for you as a person -- it's about who you are capable of becoming, not who you are. The fact that there is no safety net at all forces maturity on you.
Silicon Alley vs. Silicon Valley
- Silicon Valley is 20 years ahead of New York City's Silicon Alley in terms of network, capital, acquisitions, etc. This is because it takes a long time for communities to evolve. You need institutions, large acquiring companies, and a strong network of talent. New York has been steadily improving in these areas; there are now significant investment cohorts coming through NYC.
- However, Silicon Valley also has a downside: it's an echo chamber. Everyone has similar experiences and influences, which can lead to groupthink. New York City has more cultural diversity and a more open community than Silicon Valley, which is more insular.
- In the Valley, larger established companies will acquire startups just to gain competitive technical advances, or because the smaller company's technology or intellectual property is appealing. Business in New York City is much more finance-driven.
- If you need sleep, you shouldn't start a company. You have to be able to work more hours and juggle more things than the average individual. This requires exceptional productivity skills.
- Delegating is key. Quit areas of weakness and commitments that don't drive growth. Don't do something just because you can do it well; go with what's going to add the most value to your product or service.
- Relationships are key when selling into the Enterprise marketplace. If you have a relationship with a C-level executive, it can take days for a deal to happen. But if you're going in at the VP level, it can take a year or more. Selling effectively requires more than just a great product. You need great reputational signaling and great relationships.
- Not for a lack of desire or talent, large companies haven't been able to grow at a startup's pace. They've been in the efficiency game too long, acting as administrators of what they have instead of creators of something new. They're accustomed to seeking growth through mergers and acquisitions, as opposed to new ventures.
- Startups have a high failure rate, and that's generally not acceptable in the world of enterprise. But in today's rapidly changing economy, more big businesses are finding that they need to foster a culture similar to that of a startup.
- Be extremely careful about selecting and curating your team. Making a mistake in this area is one of the only things that can be fatal, as one wrong hire in the beginning can screw up an entire company.
David's favorite interview questions for potential hires:
1. "Tell me something I don't know about my business." By their answers, you can tell if people have done their homework or not.
2. "On a scale from 1 - 10, how fortunate are you and why?" With this question, you can get a better picture of the individual by learning about his or her whole life. You can also get answers to questions that you're not legally allowed to ask.
3. "What did people most misunderstand about you at your last job?" While a candidate will often tell you why their former teammates didn't like them, the way they explain themselves can reveal much about how they would fit into your team, and the company's overall culture.