I was an early Facebook employee. I joined Facebook in 2006 when the company only had 150 employees. I helped create Facebook Ads, which generated $7 billion of revenue in 2013. It was an incredible experience and, when I left Facebook in late 2011, I was cocky.
I thought I knew how to run a company. I thought I could apply the principles I learned from Facebook and make it work anywhere. I started my company Fundastic about a year ago.
Just a few months into my startup, reality hit! I realized I had to unlearn a few things to improve my odds of succeeding. After all, my company, which only has 3 people, doesn't have millions of dollars to burn through and is still searching for that product market fit (PMF). The following are three things I had to unlearn from working at a hot-shot company like Facebook to start a company from scratch.
1. Success is all about Execution. Just do it.
In the early days at Facebook, there was a lot of low hanging fruit -- you could just grab a project, work hard on it, launch it and see the results. In a startup, it's a much more complicated story. It's very important to do thorough market research before diving into building a product. The main reason is that you don't know if it can successfully acquire users and customers since the product hasn't existed before. I believe entrepreneurs should make deep efforts to understand the market, competitors, users and customers, and make a plan based on the best guess before spending resources on incorporation and product building.
Fundastic learned this the hard way. We started out trying to be a new lender to small businesses without surveying the landscape thoroughly. We ended up spending $40K on the legal and accounting fees associated with being a lender, and eventually pivoted away from it (without obtaining the lender license). If we had done our research more thoroughly, we wouldn't have wasted all the money and energy. Yes, we executed and got things moving fast, but without a well thought out plan, it was not fruitful in the end.
2. Always hire the best talent
At Facebook, one of the top priorities is to constantly recruit the best talent. There are two reasons why this doesn't work for startups in their infancy. First, you need to have the financial resources to hire the best talents. Second, you need to know how you can leverage their talents. If you are still searching for your product market fit (namely, you don't really know what the heck you're doing), it can be hard to fully utilize people's skills.
Fundastic realized this pretty quickly and we only hire when we know there's a clear need and make sure people understand we are always changing. Some really talented people like structure, which often just doesn't exist in a startup environment. It's important to set expectations, especially for people who have only worked for companies with 100+ people.
3. Be ubër-analytical
At Facebook, we run A/B tests on everything! It's great to be analytical. I think startups should be ubër-analytical on their marketing efforts, but they cannot be analytical for everything. There are just too many pesky decisions entrepreneurs have to make on a daily basis. It would be silly to use a spreadsheet to decide which payroll service to use or spend a week to find the right software for internal communications or task tracking. You have to keep the ball rolling. Yes, you will make mistakes, but you need to focus on the right things -- be analytical on those things, and just make good-enough decisions on everything else.
Starting up a company taught me so many things. It's very different from joining a modestly successful young company (like Facebook) and making it ultra-successful. It's about blazing your own path and turning down the comfort, structure, wealth and prestige of a corporate job to do something you are passionate about and make a living out of it. I have deep respect for entrepreneurs who make it work. I hope these lessons I have (un)learned so far can be helpful for people who are considering starting up their own company.
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