Paul Graham’s Top 13 Tips For Startups
By Anna Johnson on April 2nd, 2009Paul Graham, co-founder of startup accelerator Y Combinator, recently posted a great blog article, listing his top 13 tips for startups.
Prior to Y Combinator, Paul Graham co-founded Viaweb, the online shopping cart that Yahoo acquired in 1998 and turned into Yahoo Stores. Aside from starting Y Combinator, Paul Graham is also proficient blogger with a LOT of great advice for Internet marketing entrepreneurs.
Last month, Paul listed the 13 top things he would tell startups. Check out Paul’s article for a full explanation (http://www.paulgraham.com/13sentences.html) but here, in a nutshell, are his 13 tips, along with my comments on a few:
1. Choose good co-founders.
Starting a business with one or more partners is a bit like getting married… you’re going to be stuck with each other to build this thing, so you better choose wisely!
2. Launch fast.
Get people using your product and giving you feedback so you can change, modify and IMPROVE it into something your customers want.
There are many examples of products and services that started off as one thing and then morphed into something else as customers used it.
One that comes to mind is Yelp.com, which started off as a service to allow people to send emails to their friends asking for their feedback on local services.
That didn’t work, but because Yelp was there for people to use, the developers got the feedback they needed in order to change Yelp into the local review site that people DID want.
3. Let your idea evolve.
Paul Graham calls this the second half of launching fast. It’s about getting something out there, getting market traction, generating feedback and maybe also making some money, which can be reinvested into making improvements.
4. Understand your users.
This should go without saying for Internet marketers!
5. Better to make a few users love you than a lot ambivalent.
Passionate people buy, ambivalent people do not.
6. Offer surprisingly good customer service.
This is one of my hobby horses. And guess what, because so much customer ‘service’ is so poor, you can really turn good customer service into a competitive advantage. What’s more it’s also an opportunity to further understand your customers.
7. You make what you measure.
In other words, you improve what you focus on. I also like Paul’s warning: be careful what you measure.
8. Spend little.
9. Get ‘ramen profitable.’
In other words, make enough money to fund your living expenses… and reinvest everything else into the business. This may not appeal to you if want to take the money and run… but there is likely to be a close relationship between how much you reinvest in your business, and how much it grows.
10. Avoid distractions.
Paul says the WORST type of distractions (i.e. worse than watching television) are those that pay money! Yep, that’s day jobs, consulting and profitable side-projects.
11. Don’t get demoralized.
12. Don’t give up.
13. Deals fall through (so don’t get your hopes up).
Which one of these 13 tips would Paul choose if he could only choose ONE? I won’t ruin it – check out the article.
Okay, here’s a hint: Paul may not think of himself as a marketer, but his number one tip is music to a marketer’s ears…
Source: Paul Graham, “Startups in 13 Sentences,” February 2009, Paul Graham
