The sad passing of Contour reminded me of an important lesson: it is hard to create.

Reading the pages of comments explaining how Contour needed to build x feature, or y marketing campaign, or z strategy, brought back years of emotions. Remembering the uncountable hours we spent crafting a product we believed in, I couldn’t help but realize just how easy it is to tear something apart.

We live in a unique time period. A time period where innovation appears to be happening by the day, instead of the decade. An outcome that has driven consumers to expect greatness at an even faster rate than we can create it. Leaving many people to falsely wonder, have we stopped innovating?

With computers in our pockets, cameras on our bodies, and cars that can nearly drive themselves, we have come to expect the world at our fingertips. A sharp reminder that no matter how many hours you spend pouring your heart into a product the world has never seen, your customers will be expecting it. As if your product should have always existing, delivering the exact features they want, customers have come to believe it is their given right to have new, better, and cheaper.

What most customers will never understand is this: to truly create it takes your everything.

Much more than your time, your effort, or your sacrifice, to really create something you love, it takes your soul. That feeling you have at the end of the day where your head hurts and your body is tired from the inside out, knowing you can’t quit until millions of people love your product. Putting your heart on the line you lose countless hours of sleep wondering if you made the right decisions, every inch of the way. Dealing with setback after setback, you push a small collection of people to the brink, relying on belief to drive them to the end.

To be a product creator is different than any other type of artist. Not celebrated like an athlete, a musician, or an actor, there is no standing ovation when you deliver your work. Except for Steve Jobs, there is no auditorium filled with fans. Just a collection of customers who tell you in person, through reviews, and on forums what they think of your product.

In a society that wants more for less, we have come to believe that if we spend a dollar, we are entitled to greatness. Even if a customer only spent 20 hours earning money to buy your $200 product, they will compare their effort to the nine months you spent creating what they now hold in their hand. A difference in time people quickly forget.

To be a creator is not the norm, it is the exception. To be the 1% doesn’t mean you are rich, it just means you live your life on a quest for perfection. Starting in a garage, on a blank piece of paper, and without the comforts of a paycheck, the commitment to create is an incredibly rare group of people.

Putting everything on the line, it is no wonder that Steve Jobs put his life into his work. Showing the world a level of perfection few will ever experience, Steve raised the bar higher than the rest of us are willing to commit.

But just because you aren’t Steve Jobs doesn’t mean you aren’t a creator. Even if it takes a lifetime to deliver your best work, don’t stop. And just because customers, who have never created, tell you everything you did was wrong, doesn’t mean you should quit.

Because to deliver greatness takes time. It takes getting a lot of products wrong to get one amazingly right. It takes hearing you suck before hearing you are a genius. It takes being boo’d long before you are cheered. It takes a broken heart in order to understand true love. It may even take getting fired before you can change the world.

The passing of Contour represents the struggle to create. The pressure as a number two brand to keep up with a market leading force, its story is filled with lessons about product, brand, capital, people, and strategy. Recognizing that to create a category leading, sustainable business is hard. Starting in a cold warehouse in Mountlake Terrace nine years ago, Contour came a very long way.

Whether Contour rises from the ashes or not, I want to leave you with this…

To the thousands of customers who took a chance on a small brand in Seattle, thank you for believing. To the hundreds of people who put their heart on the line to support, work, and partner with Contour, thank you.

To the employees, you deserve to be honored. Like a great team, walking off the field for the last time, I give you a standing ovation. For playing the game with everything you had, I applaud you for the quality you displayed and the effort you showed the world. I am proud of what you created.

As Steve Jobs so eloquently said, “Being the richest man in the cemetery doesn’t matter to me … Going to bed at night saying we’ve done something wonderful… that’s what matters to me.”

In the start-up race, purpose isn’t talked about. Unless a founder is determined enough to drive home their beliefs, the conversation always starts with, “So what do you do?”

Having a clear purpose takes guts.

It’s not even the effort that is the hardest part. No, the hardest part is putting yourself out there for everyone to see. Your beliefs might be rejected, and risking that takes a confidence that few people can muster. It’s much harder than coming up with a business idea because declaring your purpose makes you incredibly vulnerable.

Contrary to the growth-driven, capital-celebrated world, having clarity of beliefs is often reserved for the “lifestyle” businesses. A business stereotype that is thought of as “nice,” but unable to change the world in a billion-dollar kind of way.

Especially in the beginning, having a purpose can be terribly lonely. Finding others who share your same beliefs takes a lot of time. If you have a consistent commitment to start with “why” instead of “what,” you will spend a lot of time meeting people who just don’t understand.

I spent a lot of years at Contour talking about what we did but I was afraid to step back and really understand why. Having started Contour right out of school, I remember telling myself, “If this doesn’t work out, at least I will learn a lot.” Hardly a rallying cry to galvanize a company, I kept my feelings at surface level.

It wasn’t until my time at Contour was nearly over that I realized we needed something more. Making plastic products that people loved was fulfilling, but hardly a focus that would keep us around for a very long time. Proud of what I had come up with, I quickly realized that a deeper purpose didn’t align with anything I had built. Selling the promise to be a fast-growing company, there was no way to shift our priority to the world first, growth second.

Simon Senick says it best, “people don’t buy what you do, they buy why you do it.” It’s a powerful TED talk in which he demonstrates why companies with a clear purpose can create a movement.

Here is a guide I wish someone had shared with me before I started Contour.

Understand the Why?

”FIRST TO FIGHT” ~ Marines

The Marines are an incredible organization. Whether you believe in the military or not, there is no denying that Marines have an unwavering sense of purpose. Whenever I see a Marine in uniform, I can’t help but notice because they have such a presence to them, a strength that leaves no doubt about the reason they wear their colors. Adopting the mark, Semper Fi (Always Loyal), members of the marines are clear about why they exist.

Most startups don’t have this same loyalty or this same collective unity. The startup culture has become one of minimal viable convincibility. A culture focused on quantity over quality, we are in a rush to convince a lot of people that what we are building is meaningful. Because if not, the best talent won’t join, investors will pass, and we will spend a lot of time coming up with new ideas until something sticks.

For some entrepreneurs, understanding why you started the company is incredibly clear, but for others it’s a mixture of emotions and ideas garbled up into something you can feel but can’t clearly articulate. Figuring out your purpose often requires you to go back to the beginning to remember the reasons, emotions, and desires you so strongly felt.

Here is a simple exercise I took myself through.

• List all the reasons you started your company.
• List all the emotions and desires you felt when you began. Frustration, hope, happiness, wanting freedom? These emotions and desires are personal, but you can also list feelings you want your customers to experience.
• List what you want to change, improve, or make better in the world. It could be literal to the activity (i.e., make something easier), the feeling your customers will have (i.e., make people happy), or something you want to change (i.e., make the world better).

Now comes the hard part, distilling everything you listed into a single promise. Some people like to call it a mission or a vision. I like to call it a promise, because promises you keep. The key with your promise isn’t to make a lengthy sentence. It’s a single statement with the key word being single.

Your company will stand for one thing, which means you must be clear about what it is.

To provide inspiration…

“We make things that work for people.” ~ Nest

“Tools for living the city.” ~ Chrome Industries

“Enhance each life we touch.” ~ Apple

Build Something With Meaning
Building another web tool or another plastic camera is hardly a proposition to change the world. But just because your product doesn’t save lives, doesn’t mean you can’t have a deeper purpose.

Personally, I love photography and as a former camera maker I definitely believe that the world is a better place with beautiful pictures. Even if I was going to add more plastic to the world by making another camera, I would want to tie its existence to impacting the world through beautiful pictures.

“Making the Web a Better Place and Loving Every Second of It.” ~ Moz

A simple purpose, Moz is focused on making the web a better place for its customers. Empowering people to optimize their business, Moz is consistently telling the world what they believe in. Whether it’s their purpose, their TAGFEE values, or their complete transparency, Moz is clear about what they believe in.

Having spent the last six months on the sidelines I have had plenty of time to think about the next company I will build. Passionate about the intersection of hardware and software, I want to build a company that makes people happy and the world a better place. Every product we create must enable this.

Measure Your Consistency
Nothing matters unless you measure it. Sticking a purpose on the wall that is not tied to what you track, is pointless. If all you measure is revenue, customer engagement, and profits, then you should just change your purpose to, “We are leveraging our customers so we can make as much money as possible.”

Tracking the metrics that drive your business is important, but tracking how you deliver on your purpose is even more important. If your purpose is to make the world a better place, how are you doing that? How are the decisions you make as a company consistent with your purpose?

You will have to get creative in how you measure your purpose. And even more creative in how you demonstrate the importance to your investors. It’s easy to get caught up in the financial numbers, and so you will have to spend a lot of time thinking about how to make your purpose important to your board. Because decisions from the top to the bottom need to be consistent with why you exist.

The Marines talk about 6 hours, which is how they measure their purpose of “First to Fight”. Their collective ability to understand the problem, plan, confirm, stage, and attack is critical to their ability to deliver.

Conclusion
You can get by without ever creating a deeper purpose. Having a clear direction for the company with a culture that cares about its people, is enough to building a massive organization.

But if you want to build something that matters and if you really want Marine caliber loyalty, then having a clear purpose that everyone believes in, is the only way.

When you are winning people will follow you, but when you hit a massive bump in the road having a team with shared beliefs is the only way to survive it.

*Image Credit: No Author via Creative Commons

Most people in the startup world don’t understand brand. They think it’s something you check off the list, as if it’s a one-time job to be outsourced to the lowest bidder. Having a cool logo, catchy tagline, and differentiated features have nothing to do with building a real brand.

Because it goes much deeper than your external facade, defining your brand is hard. Not that it’s hard to understand what you believe in, but the process of defining your brand runs counter to the energy of the fast-paced startup world, where quantity is valued over quality.

Even if you hire a professional firm to create your brand, it doesn’t mean you actually understand it. Creating a final presentation that wows your Board and gets your team excited has no connection to being able to live it everyday. It’s like putting values on a poster and then never mentioning them again.

I only know this, because I followed that same path.

Creating an authentic brand takes time. Like a fine wine, it starts with your most basic ingredients and over time matures into something people can feel, smell, see, touch, and even taste. You are providing an emotional connection that can’t be described with words, only memories.

As a startup founder, you probably know nothing about brand. Other than a handful of articles, your reference to brand is from the outside in. Wondering how amazing brands are created, it’s easy to buy into a creative pitch that has a bunch of logos you admire, as if those agencies created the soul of those brands.

Although you will never gain the 10,000 hours Gladwell says is required to become an expert in the field, you do have to understand this: You are creating a brand.

No matter what type of product you are building, or how disruptive your technology is, or how much money you have in the bank, the most important metric is your brand. Don’t be fooled, size doesn’t mean better. Just ask Sony who has fallen from a premium brand to irrelevancy, losing trust along the way with cheap product, security meltdowns, and a “me too” mentality.

So before you blindly hire an agency or send your marketing person on a wild goose chase to create the wrong brand, here is a framework you can use to help you answer the question, “How do you define your brand?”

Start With the History

“Study the past, if you would define the future.” ~ Confucius

The only way you know who you want to become is to understand where you came from. Digging deep to reveal the reason you started this company requires you to be vulnerable, talking about feelings you never verbally expressed before. The best brands are connected with the company’s purpose, and anchored in the emotions of the beginning stages of the journey.

Even to this day, Nike never lets us forget about Coach Bowerman and Phil Knight. Iconic black and white photos capture the emotion of the sport and the pursuit for improvement. Despite evolving to neon shoes, crazy social campaigns, and memorable advertising, Nike is clear about its past.

Beyond understanding the motivations of the original founders, you need to study the history of your product category. Everything has been done before, which means there is a tremendous wealth of inspiration around the original culture, products, and brands.

At Contour we studied the origins of filmmaking and the artistic use of perspective. Because we didn’t understand this early enough in our history, we struggled for many years to define the clear voice of our product against the 90-second action videos that GoPro produced. Outside of our iconic design, we failed to consistently tell our own story, bringing film making to the digital world.

Pick an Archetype
Archetypes have existed throughout the history of storytelling. Dating back to the ancient and Roman times, archetypes formed the bases of myths, in which they were depicted as gods and goddesses.

One of the best books I have found, “The Hero and the Outlaw,” talks about 12 different archetypes and how they apply to building your brand. The book helps you transform a lifeless idea into a real character that you can picture, describe, and imagine. Broken into sections focusing on the four human drives of stability, mastery, belonging, and independence, the book does an amazing job of explaining the different archetypes that exist and the brands they represent.

At Contour we focused on the Creator. Found in the artist, the innovator, the musician, and the dreamer, the creator was inspired by any endeavor that taps into the imagination. Trying to sit at the intersection of engineering, design, and sport, our archetype was in stark contrast to GoPro’s depiction of the Hero, an individual on an action-packed journey that always ended with a conquering feat.

[Download a free pdf version of the book.] (http://ravantahlil.com/Files/Contents/40/the%20hero%20and%20outlow.pdf)

Define Your Attributes
Defining a brand is like defining a person. No different from how you would describe a friend, brand attributes are the adjectives you choose to define the personality of your brand. It’s helpful to stick to single words with short descriptions, as these attributes help your team understand the values your brand stands for.

Although the words you use might be simple to pick, you want to think about how these adjectives can come to life in everything you do. From the products you make, to the out-of-box experience, to the service you provide, these attributes have to be abundantly clear with everyone involved with your brand.

Anchored in the Creator archetype, at Contour we created attributes around being personal, creative, connected, empowering, and authentic. Using words with simple descriptions, we tried to paint a picture that everyone across the organization could understand.

Create Stories
Stories aren’t marketing campaigns. They are simple descriptions of what you want people to feel when they interact with your brand. Connected to your history, archetype, and attributes, these stories can change over time as you create a deeper understanding of your brand and what it represents.

Born in Encinitas, California, Nixon does an amazing job of telling stories. True to their Southern California roots, Nixon has successfully turned a boring category, watches, into a +$400M brand. Consistent in who they are, Nixon tells rich stories through words, athletes, imagery, product design, and retail selection. Infamous in the action sports community, Nixon even concludes every retailer contract with “I am stoked to open this door.” Because Nixon understands something that most startups miss: They are building a brand.

“We make the little shit better. The stuff you have that isn’t noticed first, but can’t be ignored. We pay attention to it. We argue about it. We work day and night to make the little shit as good as it can be, so when you wear it, you feel like you’ve got a leg up on the rest of the world.” ~ Nixon

Bring It to Life
Now you can hire someone to bring your brand to life. Whether you hire a designer or an agency, you want to find people who have taken a brand from a piece of paper to reality. Polishing existing brands is nice, but creating them is so much harder.

Remember, the brand framework you create will never leave your company’s walls. It’s simply a guide to make sure the tag lines you create on top of it, or the crazy marketing ideas you come up with, are consistent with your brand.

Constantly Be Inspired
Admiring other brands is a healthy thing to do, especially as you think about what you want your brand to represent. I’m passionate about great brands and here are a few of my favorites.

• Nixon
• Chrome Industries
• Red
• VSCO
• Arc’teryx
• Nike
• Travis Rice

Conclusion
Defining your brand takes time. It requires you to dig deep, making yourself vulnerable in ways that make you uncomfortable. Great brands create beliefs regardless of the competitive landscape. They are clear about who they are and more importantly, who they aren’t. Especially when everyone wants to change your brand, being consistent is worth more than being fresh.

If you think that brand is as simple as hiring an agency to create your logo, you have a very long road ahead of you. Understanding that brand is everything you represent, is the first step towards a long journey in creating something that matters.

Have you ever seen a story about a startup firing its investors?

Me neither.

The reality is that investors don’t get fired. They may get squashed in a recapitalization, minimized in a down round, or bought out, but they don’t get removed.

Because the minute they give you money, they aren’t going anywhere. Unlike an employee that quits or a founder that gets replaced, your investors aren’t walking away until they get their money back, regardless of how painful the process is.

Investors are professional at one thing: Investing. Yes, some of them can bring incredible operational experience to help you grow the business, but at the end of the day their job is to return capital. Not only that, but it’s your job to help them do that. Which means the investors you let in the front door are more permanent than the co-founders you originally chose. Especially when their legal rights are almost guaranteed when you took their money, something you probably glossed over at 11pm when you read the term sheet.

Don’t be confused, if you’re raising money you’re not only saying that you want to accelerate the growth of your company, but that ultimately you want to sell the business. And to be successful at that financial transaction, you are choosing investors you believe can help achieve attractive growth and a significant return. Saying you’re trying to do anything different from eventually selling the business, is a lie.

What nobody admits, is that the contributions you provide aren’t specifically measured. While dollars can be modeled on excel spreadsheets, your time can’t. Which means that if you made the wrong investor choice, too bad. Your only options are to buy them out or find an investor that will replace them, both incredibly hard things for a startup to manage.

Taking money isn’t a bad thing, to the contrary it’s incredibly important if you want to create a category winning company. Just recognize the relationship you are choosing to begin: grow or die.

Here are a few things you can do to make sure your investor relationships stay strong.

Don’t Speed Date the Process
Getting to know someone takes time. No different than getting to know your spouse or your co-founders, you want to take time to get to know your investors. Unless your business is Pinterest hot, your new partners will own a significant chunk of what you are building, which means you want to find someone you like.

The right investors will want to take their own time getting to know you. As Mark Suster likes to say, he invests in lines, not dots.

A similar mentality you should have as an entrepreneur, is that you want to spend time with a handful of investors long before you need to raise money. Sharing the strategic decisions you are wrestling with and asking for their input, is a great way to see how they think about your business. Having helped their portfolio companies through similar issues, they could instantly provide you with insight as to the value they can provide.

Trying to close a round as fast as possible is a fantastic way to wake up in the morning hating who you just married.

Control Your Board
If you don’t know how a board works, it’s pretty simple. There are x number of seats with x number of votes. Unless you are a magician, each seat comes with one vote. If the investors have one more seat than you, guess what, you just sold your company.

An important negotiating point with any term sheet, you only want to give up board seats for significant capital raised, anything else is just giving up control too early. It’s not an easy discussion. Investors who are focused strictly on board ownership are giving you signs that control is incredibly important to them.

It is true you want to put as many independents on the board as possible, but don’t be confused about who owns which seat at the end of the day. Hopefully you will never get to this point, but you may need that one extra vote to keep your company alive.

Constantly Communicate
Bringing on professional investors means you are ready to be a CEO. No longer a founder, your time instantly shifts to spending a significant amount with your board members and key investors.

Although they say they want you focused on the business, what they really mean is that they trust you to keep them lightly informed until something goes wrong, at which point they want to know what’s going on minute-by-minute. This is a place that you never want to end up in, and so creating a consistent communication process early in the relationship is super important.

Every entrepreneur has their own format, but providing the same weekly update will keep you in a consistent rhythm. Sharing key metrics with a simple update about what you did, are doing, and need help with, is a sound foundation. Your investors are no different than your leadership team, they need to know the details so they can provide the most value.

Don’t be naive in thinking the partner on your board is responsible for keeping the rest of his partnership up to speed on your business. Yes, he will provide summaries on a weekly basis, but expecting the single partner to defend your performance is a slippery slope, especially when times get tough.

Building trust is a full time commitment.

Keep Dating Other Investors
The only way to keep your investors honest is to have other interested investors around the table. That’s why it’s important for you to spend time building relationships with new investors you don’t yet have. Even after you close a round, you need be thinking about the next capital inflection point and which investors you think would be a good fit.

If it comes time to raise capital, and no one else is around the table, the terms will get incredibly expensive. No matter how much your investors like you, they will do what’s best for them. Capitalism is based on what the market is willing to bear, so if there aren’t any new buyers to set the price, your existing investors will set it for you. This process can quickly take control of your company.

Beat Your Numbers
At the end of the day, you have to beat your numbers. No matter how much pressure your investors place on you to provide aggressive targets, resist. Because if you miss those targets they will punish you.

You may not realize this, but most investors don’t remember the conservative numbers you originally provided. Instead your aggressive plan becomes THE plan, shifting stretch goals into expectations.

The simplest way to understand this is to ask an investor about how one of their portfolio companies is doing. “They’re crushing it,” can be translated into “They are beating their numbers”.

Conclusion
Selecting your investors is a monumental choice, that often looks fantastic early in the relationship when the company is moving up and to the right. But none the less a choice that has permanent consequences, because unless you find new investors along the way, you are stuck with the ones you have until the end.

And the end doesn’t even mean the lifetime of the company. The end really means until your time is up.

Image Credit: Gage Skidmore via Creative Commons.

“Don’t ship crappy product.”

An obvious statement to the rest of the world, it’s not that simple.

Shipping a quality device is by far the hardest part of building a hardware company. I’m not even talking about the extra work it takes to deliver an amazing customer experience. I’m just referring to a product that doesn’t break, feels great when you use it, and delivers on the promise. Not just once either, but multiple times over, across thousands of units.

To put hardware life into perspective, a Contour camera has over 200 parts inside. That’s over 200 opportunities to make a product that is misaligned, loose, or dead on arrival. Tested by hand, you never have a 100% guarantee of knowing your device will last for the hundreds of hours you promise, until enough customers tell you it does.

The unfair advantage that hardware startups face is that every consumer has an Apple product in their pocket. Comparing your crooked and under polished device to a product that required an army to build it. Managing a single Apple factory line with more people than your entire company.

To make matters worse, consumers don’t give a shit about how small you are, how hard your product is to build, or that you are running out of money. All they really care is that they paid you and now they expect your product to not only deliver on the promise you offered, but surpass it.

I still remember the first VholdR camera that came off the production line. Envisioning that it would be as beautiful as an Apple device, my heart dropped into my stomach when I realized we weren’t even close. The switches were loose, the rotating lens wouldn’t lock into place, and the back door didn’t “click” when you shut it. Yes, it was an action camera, but it didn’t carry the craftsmanship I had been dreaming about.

Running out of cash, we had two options. Ship and stay in business. Don’t ship and go bankrupt.

We fixed as much as we could and we shipped.

Replacing customer’s cameras as needed we constantly made small improvements, turning a near death experience into something manageable. A never ending quest it took almost six years and seven devices to make the product F’ing great.

Now if that introduction didn’t scare the s@#*! out of you, the financial impact will. Even with a lot of capital in the bank, a defective product can drain your cash, and quickly.

Assuming you retail your product at $100 and it costs you $50 to deliver the finished product to your customer, you have $50 in profit.

Each time you deal with a defective unit it costs about $15 in shipping (to and from the customer), requires you to replace the defective product with a new unit from your warehouse that you can no longer sell, and spend about $5 to ship it back to the factory in buik. Even though your factory says they will reimburse the costs, it will take 60-90 days from the time you send the product back to agreeing on the root cause and in turn the financial reimbursement. In the meantime you are wasting your limited inventory and cash reserves replacing defective units.

On top of that you drop to a 3 star product on amazon, which means you sell less units, lowering your overall profitability.

Here is what the math looks like…

So as a hardware startup, how do you ensure you deliver a quality product?

Nail the Basic Experience
In a rush to build the next amazing product, a lot of startups develop right past the features they have to be great at. Always wanting to do “the new thing” it is incredibly hard to keep a team focused on delivering less features, at really really high quality. Because to do this, you have to work on the same few features over and over and over.

Nail the basic features and you will have a solid product. Miss them and customers will punish you.

At Contour we realized we had to be really great at capturing action video, which meant it had to be rugged, easy to use, produce amazing video, and be mountable on a variety of locations. Often trying to push the envelope, our customers made it clear when they felt we missed these basic features or half delivered on what we promised. Blinded by the technology arms race, it was hard to just focus on the basics when we wanted the product to do so much more.

Although your scaled back features won’t impress the media, your customers will reward you with much higher reviews. A result that Amazon can prove drives higher sales.

I wish I had done this more.

Work With Production Engineers Early
The moment you begin to design your product, you should be working with a production engineer. An under appreciated expert, their years of producing high volume product, can save you thousands of dollars down the road.

If not, you will get to the end, hand the factory your beautiful design and realize it can’t be made. It’s not that it’s impossible, it just means that with a yield rate of 80% they are not willing to make your product. The 20% loss is not something you or the factory can afford to cover.

So what happens if you design a product that can’t be reliably produced?

They start changing your beautiful design, turning your elegant product into a frankenstein pile of plastic. Or even worse, you have to start over because you forgot to ask someone if what you are designing can even be built.

The first VholdR camera was a beautiful design. So beautiful it couldn’t really be produced.

Constantly Be Checking Quality
Quality isn’t a job title or a single department in a startup. No doubt you should absolutely have people who are 100% focused on testing, but as a startup it takes the whole organization to help deliver a quality product. Always understaffed you need all the help you can get to test the product, document the issues, and fix them. Although you hope a ‘quality process’ will help you find a lot of bugs, most of them are found by accident, using the product in random ways.

Shifting the company’s mentality from expecting the product to be flawless to expecting to find mistake, is a small step you can make to keep everyone focused on constantly checking for issues. Assuming someone else on the team will find the bug is a fast way to a massive defective rate.

Even without the expertise in house, you can hire great third party companies who will work with your supplier on their quality process, evaluate their test fixtures, and sample units as they come off the production line. Most frustrating of all, is just because a bug didn’t exist before, doesn’t mean it won’t magically appear down the road. A slight change in production process or parts ordered can turn into a massive problem that isn’t caught until you have thousands of units sitting in your warehouse.

Have Amazing Customer Service
Every company should have fantastic customer service. But if you don’t, it will become very apparent when your product sucks. Read any Amazon review and you can see the customer process goes like this.

• The customer buys the product, uses it, and breaks it.
• The customer calls the retailer who tells them to call the company.
• The customer calls the company and unloads on the first person who answers the phone. Or if no one answers the phone they unload on every voicemail they can reach and every email address provided on your website. Continuing to rant on every forum and in the comments on every article about your company, until you address their issue.
• After a few exchanges the company sends a replacement unit.
• This process repeats until either the product works or the customer gets so fed up they return the fifth replacement to the retailer.
• The customer then gives you a 1 star review online and tells the world how broken your product and customer service are.

You will produce poor quality product along the way. Regardless of the process, you will have customers who unfortunately get their hands on a defective unit. An angering experience, how you handle the issue will speak louder about your company than the broken device in their hand.

Faulty product is understandable, crappy customer service is not.

Conclusion
It’s easy to critique a hardware startup from the sideline. Expecting every device to be Applesque in quality, most people don’t understand how a massive number of defective units could have ever made it into customer’s hands.

Unfortunately the ticking clock and draining bank account force these startups to make decisions they would never want to admit. Ship or go bankrupt, every hardware startup finds itself at a quality crossroads.

A crossroads that can be mitigated with advanced planning, you eventually realize that producing quality product is the heartbeat of your company. And just because you make it to billions in sales and millions in capital raised, doesn’t mean you are immune from this constant battle. The bigger you get, the more expensive the mistakes become.

A lot of startups get this backwards.

I know I did at Contour. We spent our money on great product and distribution, leaving nothing left to compete against GoPro in the marketing arms race.

Even though you started your hardware company to build an amazing product you quickly find yourself doing everything but building product. Which is both confusing and frustrating, especially as the Kickstarter buzz wears off, leaving you wondering how you grow your business.

Unfortunately this is where a lot of startups head the wrong direction. Focused on growing, they ask themselves the wrong question, “How do I sell more units?” A subtle difference, the right question is to ask, “How do I get more customers?”

When they prioritize more units, startups end up down the wrong path of growing distribution first, brand awareness later. They proceed to spend all of their energy, profits, and capital to reach the retail shelf only to realize the retailer then expects them to pour millions into marketing to sell the product off the very same shelf. A tough reality, they eventually figure out that retailers are simply order-takers for the demand already created.

The right question, how do you get more customers, is much harder to answer. It requires you to spend a lot of time understanding your customer, why they bought the product, and what influences them to tell their friends. Never a single answer you spend a lot of time trying, measuring, retrying as you push towards the magic point of Product Market Fit.

If you get this question wrong, you’ll end up where I did. The best product, with lots of distribution that no one knows anything about. But get this question right and you become a marketing powerhouse (i.e., Apple) that can profitably dictate the terms to its retailers.

So, if you survived your Kickstarter experience and are wondering how you get more customers, here are some things you can do.

Understand the Funnel

A simple framework to help you identify who to target, the marketing funnel helps you prioritize the most profitable path to paying customers who influence their friends. The funnel has three parts:

1. Ready to Buy – closest to making the purchase decision they are by far the most familiar with your category and specifically with your product. Generally their friend has the product, they have touched it, and now they are researching it online.

2. Have Heard of You – their level of familiarity will vary, but they have heard of your product and remember your brand name. Perhaps they saw an advertisement, read about it in the media, saw a Facebook promotion about it, etc., A general rule of thumb is that people need to see the brand multiple times before being ready to buy.

3. Everyone Else – ignore this group for a very long time. They have no idea that your category exists and they aren’t likely to buy until the price is affordable and everyone else around them has made the purchase decision.

Start With Existing Customers
Most startups skip right past this group of people and try targeting potential customers who have never heard of them. Having existing customers is fantastic, so facilitating them to tell their friends is critical.

The best way to enable existing customers is to understand when they talk to potential buyers. At Contour we realized this was happening on the chair lift when the person sitting next to them would ask, “What is that?” Unfortunately the conversation ended when they got off because we failed to enable the Contour customer to sell the product and/or send them a special offer. The fact that our customers already had an existing Contour mobile app, should have helped to turn these conversations into sales.

Outside of direct word of mouth you can try any ideas that get your existing customers talking about you, reviewing the product, sharing photos, or receiving credit for bringing you new business. E-commerce companies have been rewarding their customers for a long time, even offering discounts, credit, and cash for bringing new buyers.

Regardless of which tactics you choose be sure to learn how your existing customers heard about the product and what influenced them to buy. It will help you prioritize which channels are most effective.

Online Search
These people are the most ready to buy, already searching online for your product. Strong SEO and SEM strategies are great ways to make sure people don’t miss you because they couldn’t find you. Or worse, they find a competing brand because you show up way too low in the search results.

If you don’t have this experience in house you can hire a consultant who can set up your system, figure out the most important key words, and help you manage your campaign. Just keep in mind that the volume of interest is correlated to how well your other marketing tactics are working. Search captures the interest you created elsewhere, it doesn’t create new demand.

One last point, search is a basic way to measure the impact of your overall marketing. If more people are searching for your brand name it means the rest of your marketing efforts are working.

PR
PR will continue to be one of the most rewarding channels, sworn by everyone who has successfully built a consumer brand. Not only because the press keep the brand relevant, but because they provide third party recommendations for the product. A double edged sword, negative press can bring you down as fast as positive press can bring you up.

A lot of startups try to outsource this from day one, which I think is a massive mistake. Even at Contour we didn’t hire a PR firm until years down the road when we understood what stories the press liked and who was most likely to write about us. Being great at PR takes time, patience, and willingness to understand which editors like you and what stories they find interesting.

If you can target a variety of publications you can begin to learn which verticals are most interested in your product and convert into sales. Thankfully most of the PR efforts are done online, providing you valuable data on which media sites bring the most traffic. Something you want to know before you start advertising.

Trial and Error
The rest of your marketing tacts are a continuous cycle of trial and error. A horrifying realization, you have no idea what is going to work until you try it. Even if you copy other successful brands, you have no understanding of how it will impact your own sales until you see the results. This is where the Lean Startup mentality of try, measure, and repeat is valuable as you learn to listen to customers and measure the results.

Tactics that have been successful….

• Building Community. You had this when you launched on Kickstarter, so figuring out how to carry this forward to build a larger group of passionate people is super important.
• Product. Announcements for new versions and new features can be powerful to reaching more and more customers.
• Content. Whether it’s content to entertain, educate, inspire, or inform content that people are willing to share is especially effective.
• Give Aways. Unfortunately free stuff does work and being consistent about it through social media does drive people to sign up.
• Email Blasts. Finding new email lists and partners who will help you target their users is a fast way to learn which demographics will buy your product
• Retargeting. Focusing on people who visited your website but didn’t purchase is an awesome way to stay present, making them think your brand is everywhere!
• Events. High touch and high cost, they are great for talking to real people to learn what they think, what questions they have, and what ultimately influences them to buy.
• Creative Ideas. Anything out of the box that gets people talking about your brand, including the media.

Limited Distribution
What do you do with all the retailers who want to sell your product?

The answer is to limit the distribution, opening up select new retailers.

First, make sure it is easy to buy and fast to ship from your own website. Focusing on english speaking only, you eventually want to make it convenient to buy your product from anywhere in the world.

Second, open up a handful of e-commerce partners who can hep you reach customers, deliver a great experience, and provide data. You need online retailer partners who can use a variety of marketing tactics to help you reach different demographics, while providing you consistent data on what is and is not working.

Third and only when the two channels above are working really well, can you add select specialty retailers with a high touch experience. You are looking for partners that will experiment with you on point of purchase, training, packaging, local events, etc. You have a lot to learn in being successful at retail so assuming you can just open a national account without any understanding of what works, is a massive recipe for disaster. Remember, retail is expensive..

Keep in mind that if you hire an internal sales team they will blow this distribution strategy up. They will push you to open every door saying, “We have one shot with this retailer, we have to do it now!” You can always find consultants or independent reps that can help you open these initial doors until you are ready to grow distribution.

Conclusion
Focusing on brand awareness first enables you to deeply understand your customers, while having real data about which tactics convert into sales. Only until your select points of distribution sell through at increasing rates, for several months, should you think about growing your distribution.

Most startups severely underestimate the cost of opening and supporting retailers, including the missed opportunity to grow your brand awareness. Every dollar spent on a retailer is one less dollar spent on telling the world you exist.

I learned a very hard lesson at Contour. The best product doesn’t always win, the product everyone knows about does.

Craftsmanship seems to have skipped a whole generation.

Especially in a Lean Startup hyped world, where throwing code against the wall and iterating until people use the product is promoted as the way of the future. No doubt, the movement towards small teams, quick iterations, and listening to your customers is part of building a great product.

But to believe this is how you craft thoughtful experience with a clear purpose, is wrong. It’s like telling an artist to smear colors on the wall until people buy the painting.

True craftsmanship has a purpose.

Originally called Artisans, these builders spent their life time shaping experiences with their hands. Perfecting each product, they weren’t afraid to take their time. And although the tools have changed (keyboards for pens, power tools for hammers, mass production for sewing machines) it doesn’t mean the art of the craftsmanship has to be lost.

So in a startup paced world, how do you embrace craftsmanship?

Understand the History
Everything you are doing has been done before.

Humans have been communicating, building, eating, making, working, living, and reproducing for a very long time. The only thing that has really changed are the tools we use.

And the best artisans understand this. They understand the history of their products and the intent behind them. They understand how they were made and how they evolved over time.

Facebook is the modern day coffee shop.

Twitter is a faster way to send a telegram.

Rain Shadow Meats, a butcher in Seattle, makes it clear they understand the history of being a butcher. Their fresh meats, open kitchen, big chopping blocks, simple language, and amazing smells take you back in time. Even if you only read about what butchers used to be like, you instantly feel comfortable.

Chrome Industries, famous for their seat buckle messenger bags, knows its history. Started 17 years ago, they still use military duffle bags as their inspiration, sewing machines to make their products, and American factories to hand craft. Despite the pressure to grow, they have stayed true to their purpose of utility and mobility. And you can feel it everytime you touch their products.

Even software makers are thinking about the history of writing code. [The Pragmatic Programmer(http://pragprog.com/book/tpp/the-pragmatic-programmer) and the Software Craftsmanship relate software engineers to original artisans.

Before you can craft, you have to understand the artisans before you.

Pick a Metaphor

Metaphors are a powerful way to bring the past to the future. No more evident than Apple’s use of Dieter Rams’ design as a source of inspiration. It’s no mistake that the iPod looks alot like an old radio. Because when you see it, you are instantly familiar with the shape, size, and expectation.

Outside of designers, what a lot of people don’t realize is that you subconsciously recognize familiar experiences the minute you see them. The sights, smells, and the smallest of details instantly become comforting.

To make history clear to your team, pick a metaphor they can understand. Something in the past that is directly connected to what you are doing in the future. Not easy to do, the right metaphor will help make your brand, design, and customer experience authentic.

Contour’s metaphor was a movie camera. Especially when GoPro was a picture camera, it was important our product and brand went back to the origins of film making. Where perspective was important, the shape was long (not square), and you could feel the quality of the materials.

Take Your Time

“If you don’t have time to do it right, when will you have the time to do it over?” ― John Wooden

Building a masterpiece requires incredible patience. It requires you to prioritize quality over quantity. Less over more. Simple over complex. Even worse, it requires you to be consistent, even while the pressure to ship grows like a tidal wave over your head.

Don’t be confused. It doesn’t mean you perfect your work, void of feedback. The Lean Startup methodology of iterating with people is right. And although Apple doesn’t iterate in public, they do spend years internally crafting and recrafting until it is perfect.

I missed this at Contour. The financial need to ship with the fear of falling behind in the technology race created unnecessary illusions that shipping was more important than crafting. Easy to critique after the fact, there were times we shipped when I knew the experience wasn’t even close to perfect. Saying I wanted to create amazing product experiences, my actions spoke louder than my words.

It took almost nine years to get the experience right, but Contour Roam2 finally delivers on the original promise, to make action video easy. A compact, single button, bulletproof action camera. A nearly five star product, I’m incredibly proud of this work.

Conclusion
The hardest part of craftsmanship is being vulnerable. Pouring your soul into your work is like opening your heart to be broken multiple times over. A necessary experience in finding true love.

Recognizing they will spend their lifetime building, true Artisans aren’t in a hurry to move on. They are willing to open themselves up against the struggle of failure until finally they get it right.

Image Credit: jfeathersmith via Creative Commons.

Just thinking about the last one you worked with makes your stomach turn. The negative energy you felt in their presence is enough to make you want to throw up and remembering the damage they caused is something you shove so far back into your subconscious, you just hope it goes away.

Unfortunately there are assholes all around you. Enough of them that they find their way into companies, marriages, families, and friendships. A trait everyone can recognize that often goes unchecked for a long time until someone is willing to stand up and say enough, no more assholes.

Dealing with them in the start-up world sucks. They can tear a team apart and if they happen to invest, an entire company. Their quest for power is a zero sum game where their winning means someone else is losing. A game that works in the short term, but never in the long term.

Asshole is a subject so popular there are 154 million results on Google and in the business world interesting enough that Robert Sutton’s book, “The No Asshole Rule” became a best seller, everywhere.

What Motivates Them

“Real power can’t be given. It must be taken” ~ Godfather III

The simple answer is power. Driven by the belief that their winning is all that matters, they are willing to destroy everyone and everything around them to make their quest come true. Their lack of empathy comes through in how they speak, talk, and treat people.

At a more fundamental level, assholes engage in behaviors that intentionally cause emotional harm to others. In their mind, this is winning and the reaction you show or the anger you return only fuels their motivations. Your response is validation that yes, they are winning.

But where does this come from?

Fear.

Fear of losing control. Fear of being rejected. Fear of opening their heart and being hurt. Fear that if they trust, they will be let down. Fear of the unknown.

Often anchored in past experiences that rocked their soul, assholes use intimidation and manipulation as a defense mechanism. They have a distorted perception that these are the only tools available to them when connecting with others. A false sense of reality they don’t realize until years down the road.

How To Detect Them

“Where there is fear, there is power” ~ unknown

Your gut instinct is the best indicator. Often pathological liars, assholes can be hard to detect, until they are faced with adversity. A loss of control quickly brings out their true self, at which point your detection is pointless because removing them from your company will be incredibly hard.

Outside of your gut instinct, here are a few signs I have found along the way.

• They talk about themselves first, your problems second. Many assholes are narcissists. They do not have room in their attention span for the concerns of others.
• The story they tell you is a far cry from what everyone else says. Even people you know will be hesitant to tell you what they experienced, out of fear of being a tattle tale. But when the story the asshole shares is very different from everyone else, there is something wrong.
• Everything is perfect on the outside, but f’d up on the inside. They work really hard to make it appear as if everything is great, but behind closed doors they make everyone’s life hell.
• You can’t find people in their past who will recommend them. Assholes either don’t have solid references or references willing to tell you the real truth. Few people will raise their hand and say “stay away at all costs.” And because you took them at face value, you failed to dig deep enough to find the truth.
• In talking about their past they blame other people. The outcome was the result of mistakes everyone else made, while they avoid talking about their own mistakes and what they learned from them.
• They dominate the conversation. Being in control is important to them so out talking you or over talking you is a sign that their concerns come before yours.
• They don’t listen. Even in the interview you can tell they aren’t actively listening and aren’t thoughtful about your company. Instead they will be more focused on their role, salary, budget, and team available to do their job. A faint sign, you will find poor listening will lead to much deeper problems.

What makes this detection so hard is that assholes can be incredibly calculating. The web of manipulation they weave can be so thorough, you don’t even recognize it until you are wrapped up like a fly in a spider’s web.

What They Aren’t
Don’t be confused. People who are opinionated, direct, and assertive are not necessarily assholes. They are a rare breed of people who actually tell you what they think. Something the start-up world doesn’t have enough of.

Just because someone doesn’t agree with you, doesn’t mean they want to see you lose so they can win. Going by you because you go to slow is what successful people do. And since startups are a sink or swim world, you have to paddle fast.

But if you are wondering if someone is an asshole or just assertive, look into their heart.

Non assholes care. They want people around them to succeed. They are obsessed with the joy customers experience with their work. They have principles that don’t change. They want people to love them back. But above all else, when they finally trust you, they will make themselves vulnerable to you. Something assholes will never do.

How to Remove Them
Carefully and Quickly.

Assholes are vindictive and being told no, is not what they want to hear. What will amaze you is that when you do finally cut them out of your company or your life they will act surprised, as if you are mistreating them without any reference to the wake of people they left behind. They will feel wronged and threaten to take down what you have built.

If you founded a company with them, you have to start over or have very understanding investors. If they are an employee it will cost you severance and the threat of a lawsuit. If they are a friend or family member, you will lose people close to you that they managed to manipulate. If they are a customer, they will rant publicly about how poorly you treated them until you offer them something in return. If they are an investor, they aren’t going anywhere until you find a new investor to take them out.

Your best friend in parting ways are legal documents. Assuming you aren’t being physically threatened, finding a mutual understanding that is legally documented is super important. A third party, like your lawyer, can be incredibly helpful in this situation. Especially when the smell of you only further enrages the asshole.

Whatever route you take, do it quickly. Don’t let the feeling in your gut linger. Burying your head in the sand and ignoring the growing evidence is only a recipe for a massive problem down the road. Like a time bomb waiting to go off, the sooner you remove them, the easier it will be.

Conclusion
Navigating through assholes is another superhuman skill you need as an entrepreneur. Avoiding them is worth a lot because learning where they live, how they communicate, and the faint signs they give off will take some painful practice. If left undetected in your company, assholes will become some of your most expensive mistakes.

I wish they didn’t exist. It would make building a company just a little bit easier.

Image Credit: Chuck Evans via Creative Commons

Solving the wrong problem, sucks. You spend all this time thinking you are building something everyone is going to love, only to find out no one gives a S@%#.

Uh, so what happened?

This past weekend I had the fortunate opportunity to coach at Startup Weekend. A first time attendee, I left the weekend impressed with how Startup Weekend (a non profit) is changing the way entrepreneurship is taught, inspired by what you can build in 54 hours, and amazed at how much time people spend building a solution for a problem that doesn’t exist.

A 54 hour time constraint makes it painstakingly clear that you have to understand the problem, and quickly, if you want any chance of building a real product and a presentation that wows the judges. Banging your head against the wall as you constantly pivot is a recipe for disaster.

The following is a short guide about how to nail the problem, so you can build the right product in a 54 hour Startup Weekend style blitz.

Start With Why
Friday night of Startup Weekend is speed dating of ideas, personalities, and skill sets, turning a room full of disconnected people into 15 weekend projects. Of the 50 ideas that got presented on Friday night, almost all of them started with “my idea is….” Very few started with the problem they wanted to solve and even fewer talked about “why,” which left the audience with little information to decide which projects they believed in joining.

“People don’t buy what you do, they buy why you do it.” ~ Simon Sinek @ Ted Talk

Almost everyone has seen Simon’s Ted Talk. Most people like it, share it, and the go back to building products that have no purpose.

At Contour, I built stuff. Beautiful stuff that thankfully customers loved, but it didn’t have a purpose other than stuff for our customers. Yes we had values, but those weren’t ever tied to a deeper purpose about “why” we were all there, other than the camaraderie of building a company together with easy to use products.

Understanding “why” doesn’t have to be a painful process and it doesn’t mean you have to build a non-profit. It’s true that not every product can be given away for free, like a pair of Tom’s shoes, but every product can be started because of something you believe in. Tom’s purpose is simple, “We are in business to help change lives.” You can build almost anything under that purpose.

To find why, start with what you are passionate about. List out what you love to do and more importantly, why you like to do it. Generally, your motivation comes down to basic needs: happiness, improving, changing, making better, loving, feeling, or any emotion that makes you feel good. Even if the purpose is just to have a lot of fun, be clear about that. Tie everything you do to ensuring everyone is having fun.

With a clear why, you can inspire the best people who also believe in your same purpose.

Finding Real Problems

“The problem is we don’t understand the problem” ~ Paul MacCready

Visiting with teams on Saturday afternoon, with only 24 hours left to go, it was scary to see the different discussions being had. Some were clear about what they were building and others were still on the white board trying to get a group to agree. The most frustrated groups weren’t clear about the problem they were solving and instead were pivoting around their ideas. An exercise that rarely goes well when you mix 5-10 people.

One of the original “ideas” was an app to help you remember what you learned from the digital content you consume. It was a fun idea that was interesting enough to gather 10 people on the team. Borrowing this idea, lets see how you could have discovered the problem.

Customer Journey: In order to discover the most important problems to solve, you would start by mapping out a customer journey, from beginning (finding the content) to the end (remembering what you learned).

Identify the Problems: Within the customer journey you start to recognize patterns, i.e. insights, based on what is hard to do or could be done better. Making some assumption you might discover that you are inundated with too much information, you are consuming content on multiple devices so you are using multiple systems to remember what you consumed, you forget what you learned, and when you want to recall it there is no single place you can go.

Picking a Single Problem: Now that you have identified a handful of problems people have in finding, remembering, and recalling content, you can narrow the scope to a single problem you want to solve. Especially at Startup Weekend, your product and pitch will be way more impactful if you solve one problem really well, even if you plan to solve the whole journey after the weekend.

Validating the Problems
Startup Weekend prides itself on getting out of the building, a philosophy I completely agree with. Talking to people is a fantastic way to validate the problem you are solving, even before you build anything.

Many people don’t understand the point of customer interviews. People generally ask questions about their theoretical product hoping to hear positive comments that maybe, if they build it, they would buy it. Answers that make you feel good, but are irrelevant to building the right product.

“A lot of times, people don’t know what they want until you show it to them.” ~ Steve Jobs

The real goal of the interviews is to validate the problem you are solving. Talk to enough people and you will hopefully find insights that are consistent with the journey and problem you already mapped out. If they aren’t, then you missed the real problem they have.

When interviewing random people on the street you only have a few minutes and therefore enough time for only a handful of questions. No easy task, but it can be done.

Continuing with the same app example, here are some questions you could ask.

Q: On a weekly basis how many hours of digital content do you consume with e-books, articles, and videos?
The intent of this question is to understand the profile of your potential customer and to get a sense of how much content you need to be worrying about.

Q: Do you take notes, highlight, or save the content in any way?
You want to understand what percent have an existing behavior to bookmark or save what they are consuming.

Q: If no, why not?
The answer to this question will help you understand what is preventing people from attempting to save what they read.

Q: If yes, why?
Validating why they are saving all or part of the content is super important. Assuming they save the content to remember it is a dangerous assumption you don’t want to make for the customer.

Q: How do you currently save and recall the content you save?
We will get a variety of answers, but here we want to hear the different ways people solve this problem today. This begins to tell us what solutions already exist, the process people use, and potentially what is/isn’t working today.

Notice, none of these are leading questions or anything about your solution. They are strictly focused on trying to understand the customer so your team can go back and figure out the best solution to solve the problems you have now validated.

Don’t be fooled by the variety of answers you receive. Finding an incredibly narrow, but passionate group of people with the same problem can be a fantastic way to get your company off the ground. Sometimes having a lot of people NOT fit your profile is exactly what you need to narrow your focus and keep your product simple so it gains sticky traction with a single customer type.

Conclusion
Nailing a real problem is hard. It’s why a lot of entrepreneurs build products based on problems they are passionate about because it means they know the issues, inside and out.

Understanding the why, helps you make it through the moments you want to quit in frustration. Mapping out the customer journey opens your eyes to a series of interesting problems to solve. And validating those problems with real people, makes sure you aren’t building something that no one needs.

Startup Weekend was an amazing experience that validated just how hard it is to nail a single problem. There were plenty of ideas being thrown around when the weekend started and by the end there were only a handful still standing, solving a real problem.

Thanks to @Zacharycohn for the help on this post.

This post originally appeared on Geekwire. 

A lot of founders don’t make it as a CEO. Not that they can’t, but they don’t. None more glorious that Andrew Mason and his middle finger salute to the capital markets.

“Just kidding – I was fired today.” ~ Andrew Mason (Former CEO of Groupon)

So why don’t they make it?

Well, it’s complicated. Based on the flood of recent posts from founders, CEO’s, and investors, it’s clear that every situation is different. Ben Horowitz believes in teaching founders to become CEOs. Reid Hoffman and Jonathan Strauss made the decision that replacing themselves as CEO was the right move. Mark Suster, both a VC and a CEO, is asking the question if you should replace yourself. There are professors like Noam Wasswerman studying the founder dilemma to understand if founder CEOs are more successful than hired CEOs.

As a former first-time founder and CEO, I didn’t make it. I didn’t understand, until it was over, just how hard the transition is from a founder to a CEO. A completely different role from getting a company off the ground, I learned that becoming a CEO is even lonelier than being the CEO. Few people know how to teach it, even less think about developing you, and even worse the people that saw you as a founder aren’t always ready to see you as a CEO.

I have come to believe that you will always be a founder. You can be a founder and a CEO. But you can’t be a CEO while you are trying to be a founder.

What it Means To Be A Founder
Being a founder is incredibly hard in its own right. The internet is littered with these stories, especially details about the spectrum you are expected to cover from visionary to janitor. These horror stories of personal struggle are true. Willing everyone to help, buy, join, support, and invest in your company takes every ounce of energy you have. Surviving really is your only solace.

A founder, especially in the early days, is the soul of the company. The initial spirit and visionary who sees an opportunity in the market that few people around them can see, until you turn it into a cash generating machine. And even though your card says CEO, the organization really needs your founder magic to get off the ground.

Of everything you do I think there are a few areas that are the most important.

Evangelizing – The job that never stops, you have to constantly convince everyone to be a part of your vision. No easy task, you use energy, charm, will, tenacity and anything you have to convince people that what you are building is special. Most tiring of all, you are the emotional leader for the entire team, willing them not to quit, even when things look most bleak.

Driving to Product Market Fit – Marc Andreesen is right, getting to product fit is all that matters and your job is to do anything it takes to get there. Changing the team, the product, direction, to the point that people think you’re crazy just may be part of the game. The product is all that you have, which means it takes a significant majority of your magic, until it clicks.

Hiring Carefully – As a founder you aren’t yet building a company. That sounds crazy but until you reach product market fit, hiring any roles that don’t actually make your product better, are forcing you to manage an organization you aren’t yet ready to manage. Yes it’s incredibly important to lay the foundation with values and a simple definition about your culture, but just as important is hiring carefully, piece by piece.

Finding Capital – This role never goes away, even when you are a CEO. The job you probably hate the most, it is incredibly important. Spending before you have the money is a path to bankruptcy or investor terms that no longer make it your company.

What It Means to Be a CEO
Being a CEO is a very different role. Still the visionary and champion of culture, they are the ultimate leader. Yes a founder is a leader, but this type of leadership is not the same thing. What works as a founder to lead by example, has the opposite effect when you are the CEO. Leading not by doing, but by inspiring, enabling, and holding people accountable. Everyone has a slightly different definition, but I have found the following to be key areas of focus.

Leading – Doing the work yourself is easy. Enabling your team to do better work than you is painstakingly hard. Giving direct, consistent feedback is important to getting the most out of your team. No longer a hub and spoke model, the best CEOs are objective, critical, and people focused.

Thinking – Different from being a founder, thinking is valued over doing. No longer in the weeds, you should be designating significant time to understanding and thinking about the businesses. Because the larger your company becomes, the more disruptive pivoting is on the culture.

Evangelizing – Still important, this role shifts from one-on-one belief building to evangelizing at scale. While your personal touch still matters, the quality over the quantity is the biggest change you have to make.

Prioritizing Relationships – The people you spend time with are completely different. Being a real CEO means your leadership team and your board members take the majority of your time. Rob Bailey demonstrates just how much time should be spent on your board.

Capitalizing – A never-ending proposition, ensuring the business has enough capital is one of your sole jobs. Spending time with investors and potential acquirers, lays the ground work for future transactions.

Deciding You Want Out As CEO

“This is your last chance. After this, there is no turning back. You take the blue pill – the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill – you stay in Wonderland and I show you how deep the rabbit-hole goes.” ~ Morpheus, The Matrix

It’s perfectly acceptable to decide that becoming the CEO is not what you want to do. It is a completely different role and taking the red pill is agreeing to learn a whole new set of skills you don’t possess today. The journey to find the right path is long, unforgiving, and lonely.

Unfortunately a lot of founders are fired without any opportunity to “decide” they want out. Not every investor is as thoughtful as Brad Feld and Mark Suster, who clearly understand the emotional impact on the founder as well as the delicate position it puts the company in.

I didn’t have this at Contour. Instead I experienced a stomach-jarring, soul-crushing end realizing I had one choice. Stepping out. An emotional good bye, I could barely read my speech without tearing up. It still hurts.

If you are considering whether to step down or continue, I would suggest thinking about these topics.

Passionate About Building A Company – Your love for product and customer has to shift to a love for building the best company in the world. You have to be passionate about leading and managing people, process, and organizational structure.

Willing To Re-Learn – It takes a lot of energy and a continued commitment to being vulnerable. You will be relearning how to communicate, setting expectations, and holding people accountable. Skills that will feel incredibly awkward for a very long time.

Supportive Board Members – You can’t fire your investors, which means if they can’t help you make this transition or don’t have the patience to watch you learn, bringing in an experienced CEO isn’t a bad decision.

Quality Leadership Team – A lot of the team you built will not make it in the next phase of the company. Strong doers may not be great managers so you need to be ready to constantly reevaluate your leadership team. The stronger your team is now, the easier the transition will be.

Making the Transition to Being the CEO

“It generally takes years for a founder to develop the CEO skill set and it is usually extremely difficult for me to tell whether or not she will make it.” ~ Ben Horowitz

A lot founders never actually make the decision they want to be the CEO, at least I know I didn’t. Like a lot of founders I just assumed it was my calling. A misunderstanding that doesn’t enable you or your team to begin seeing your role in a new light.

Assuming you consciously make the decision to continue the journey the first step is recognizing when to make this transition. Not always clear, I have found two points to consider.

1. Product Market Fit

2. Raising Institutional Money

Whether you are ready or not, as soon as you bring in venture or private equity dollars they expect you to act like a CEO. Even if they invest early, they will be comparing you to the experienced CEOs in their other portfolio companies.

The good news is that when it’s time to make this transition, the founder magic you harnessed to reach product market fit is the same magic you need to create a great company. Yes, there are process focused leaders you may not have on board today, but I do believe you can learn to be a great CEO.

The bad news is that few people can teach you how to make this transition. Unfortunately most investors have never been a CEO, which means the common answer to the learning curve dilemma is to replace you. Right or wrong, it’s the only option they know how to do.

As you make the transition, here are a few things that can help.

Define Your Role – Make it clear to your team and the organization that your role needs to change. An outside consultant can help to facilitate the discussion, but you will need to define your role, the role of the leadership team, and ask for everyone’s support as you do your best to switch from a doer to a leader. Recognizing you are no longer a peer with your co-founders, your job is to be the CEO, a change that can be hard for everyone involved to accept.

Find Mentors – Ideally, find a few CEO’s that you like, who have extra cycles, and who are great at teaching. Hiring a CEO coach is highly recommended to provide both mentorship and an emotional outlet. The best sports players in the world have coaches, being a CEO is no different.

Stop Doing – You have to complete your leadership team and hand over the reigns. As hard as this is, and believe me I struggled big time with this, you have to stop doing roles that make you a peer with your leadership team. It’s their job to run the business, not yours. Yes you will have influence and you will have the final say when needed, but if you don’t complete your team you can’t even begin to really lead. If there is a role you just love too much to give up, then maybe you should step down as CEO and just do that role. A filter that can help you in the decision process.

Get Feedback – Create ways for your organization and board members to constantly give you feedback. Being direct is not a common communication style, so expect to ask for the feedback. Listening and being vulnerable are essential for internalizing and applying the feedback you receive.

Conclusion
Not everyone will agree, but I believe you can learn to become a CEO. The qualities you need to successfully found a company, against all odds, are relevant to being a great CEO. I also agree with Ben that founders have a distinct advantage in knowledge, moral authority, and total commitment to the long term. Advantages you can’t just replace with an executive search.

The decision to grow into this role is critical for you to make and for everyone to support. Deciding it’s not for you is perfectly acceptable and hopefully your board enables you to make this decision.

Your development is an incredibly important conversation you should be having with your investors from the minute they invest, even if it’s on you to force the conversation. Mapping out what everyone expects and what happens if you don’t successfully make this transition is equally important. Firing the founder is never a positive experience.

Just remember that if you do choose to make this transition, recognize your job is no longer the founder. It’s to be the CEO.