Wednesday, March 12, 2008

entrepreneurs and bloggers

There has been a recent spate of posts about startups, hiring, spending, and how you must -- or shouldn’t ever -- hire workaholics. Comment sections have been ablaze and everybody has an opinion. There is a great deal of certainty, although many opinions seem to be extrapolated from a sample size of 1 (and we all know how many lines can be drawn through a single point.)

Much of the advice is of the “buy low, sell hi”-variety. Obvious, known, and tautological:

  • “Startups must hire the right people.”
  • “Working with more interesting people is more interesting than just working.”
History is replete with examples of startups that were formed by whacky creative types, by armies following specific procedures, brilliant kids riffing off great ideas, mad geniuses, and everything in between. There are, in face, enough different and mutually contradictory ways of succeeding that selection bias allows one to defend almost any approach. Nearly every argument in all the blog posts can be supported or negated by examples.

Even though I’m a little late to the discussion, I do have some thoughts on this topic.

Rule #0: Have a Vision Driving Both Product and Company

Know what you are trying to do and why it's worth doing. Make sure the user experience flows from this vision. Duh.

But, remember Conway's Law.

Your organization's structure and culture will be reflected in your products. More than that, how your company operates will shape the possibility space for products you can create, will determine what you can create. So it is critical that Conway be extended. Vision must drive organizational structures capable of realizing the vision.

Rule #1: Don't Be Dogmatic

You won't always be right. Shocking, I know. So, be ready to change. Particularly when you deal with scaling -- whether in company size, code size, product complexity, number of customers, etc -- you need to assume you're wrong about something. After all, very few systems are scale free.

This rule may be the easiest to say but the hardest to follow. It is an example where how your startup is organized, how you work and collaborate, will define what you are capable of.

Rule #2: Tired (and Stressed) Employees Are Stupid Employees

The various posters spent a ton of time arguing back and forth on workaholics while ignoring a great deal of research and evidence that long work hours hurt productivity and efficiency. Studies going back to Henry Ford’s production lines demonstrate again and again that excessive hours reduce productivity and increase turnover. Since nobody was arguing that lowering productivity would contribute to success, how can anyone argue in favor of extended sleep deprivation?

Worse, for programming – especially in the knuckle dragging languages that I’ve spent my life using – the most subtle and difficult bugs to track down are usually memory related. Fatigue mirrors the impact of alcohol consumption and reduces peoples’ ability to assess their own competence. So, tired programmers are like having drunk, overconfident programmers. How much time do you lose to the memory leaks they introduce?

That’s before the costs related to increased turnover.

Now, there are qualifiers. There are lots of times when an all-nighter – whether alone or with the whole gang – can be a productive, bonding, or necessary event. A few weeks of intense effort or a weekend may be what gets you over the hump, but months or years of a culture that demands 60, 70, or 80-hour work weeks will destroy your productivity.

And cause other problems - just ask EA.

Rule #3: Know How to Do Math

This applies to a lot of areas.

Consider financing. At every startup I’ve been involved with, salaries have been the primary cost driver. Burdened programmer salaries in the Bay Area can easily hit $150,000 per year, so almost any discretionary spending will be less than 5% of the salary cost. Sure, it is possible to buy hand-stitched, gold plated toilet tissue and to burn $20 bills in a woodstove to heat your office, but my experience is that you really have to work to waste enough money to notice, especially if spending is transparent so everyone knows about your payments to Emperors Club VIP. The risk of an early employee abusing the company Visa card is way less than the lost time to someone not being able to buy something they really need when they need it.

Worse, refusing to buy a second monitor, laptop, extra computer, comfortable chair, free soda, beef jerky, or whatever it is that is keeping your key employees happy can easily reduce their efficiency by more than 5%. So be smart and do the math.

Again there are caveats. If you are scraping to get a better demo before a funding round, in a dry spell, or whatever, then change the rules. Just be honest about what’s going on.

Math also helps refute correlation-causation errors, which can be incredibly useful when trying to balance vision and change. Demand data and then analyze it honestly.

Rule #4: Have Fun

You’re going to spend a ton of time and energy on your startup, no matter how carefully you plan your time, how much jerky you buy, and how carefully you plan. So make sure the time in the office is fun for you, your coworkers, and your employees. Every company – everyone – is going to define fun differently, but figure out what it is for your vision and culture, then work to hold on to it. If growth means that the old definition no longer applies, spend the cycles to find a new one.

If you find yourself not wanting to come into work on Monday, you aren’t having fun. Figure out the problem and fix it.

But, remember that nothing is more fun than succeeding, so make sure your definition starts there.

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