If your cup of joe didn’t wake you up this morning, we’ll try with this controversial opinion—launching a startup in Silicon Valley isn't the slam dunk it used to be, and there’s never been a better time to build outside the Bay Area.
Is California still king? Absolutely (can’t really argue with the numbers below), but a half dozen other US tech hubs have produced a combined quarter trillion dollars in exit value. That’s some serious progress.
On to this week’s playbook, where we take a look at must-reads for CEOs and other startup leaders. Now we expect this reviewed on our desk by EOD... get to it.
⚔️ All great startups have had to get their hands dirty and fight at one point or another to gain an advantage. And most times when you're right and confident you can win the fight, you should too! But there are situations where it makes sense to compromise even when you know you’re right, because the cost of winning might not be worth the hassle. Just try to take your emotions out of the decision making process because if someone wrongs you and you let it eat you up, you lose twice.
💇 Look, we know primping and prepping your LinkedIn isn’t the most exciting part of the CEO gig, but it plays an important role. When businesses consider buying your product (or company) they will google you to try to get a feel, and on LinkedIn, you can craft your own story and put your best foot forward. The only bit of this playbook we disagree with is the relevance of skills and endorsements… no one takes them seriously. Focus more on accomplishments or recommendations.
🖋️ Ever read some leadership blogs and think they’re trying too hard to come off as… well.. leadership? We couldn’t agree more, and think the best writers are the ones who care more about delivering a message which is easy to understand than sounding intelligent. Writing complex sentences is easy because you have room to work with—it's actually much harder to simplify things.
🏒 If you polled startup CEOs on what kind of growth they’re aiming for, 9/10 would tell you they dream of that sweet hockey stick curve. But what we could really use are more linearly growing companies, which require more patience and a group of employees willing to stick with them. These are businesses unlikely to end up being another platform, but that’s probably a good thing, as it avoids producing a monoculture which eliminates market variety. And linear growth doesn’t necessarily mean small scale—just look at Basecamp’s growth trajectory over the last 14 years.
🍎 The product development standard is to run focus groups and gather customer feedback to shape your roadmap. But visionaries like Steve Jobs were a step ahead, and thought that often “people don’t know what they want until you show it to them”. He’s not the only one; multiple studies show that workers produce more novel ideas working alone than they do in groups. Our take: we aren’t all Steve Jobs, so don’t ignore customer feedback, but try to listen to their problems instead of their solutions—it will prevent you from drowning out your own innovation.
📼 CEOs have an increasing number of options when it comes to raising capital, whether it be venture capital, growth equity, or revenue-based financing, which we’ve seen called revenue-based investing in a couple of instances. While the pros and cons of the article are on point, the term investing implies the lender would receive equity for the money provided. Let’s set the record straight—it’s really a loan that will be paid back!
🎶 Skip the CEO management training and start with Ben Horowitz’s The Hard Thing About Hard Things for some practical advice on operating a startup. It’s a realistic look at the extremely tough decisions that CEOs must make when leading a business, and the biting, sarcastic writing style and use of rap lyrics as chapter introductions make it a way more fun read than your standard business book.