the hard truths of entrepreneurship
TRANSCRIPT
The Hard Truths of Entrepreneurship
Rand Fishkin, Individual Contributor, Moz@randfish | [email protected]
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With a StoryLet’s Start
2001: Rand Drops Out of UW, Two Classes Away from Graduating.
Rand in 2001... Thank god for beards.
2005: After 4 Years of Hard Work, Rand & His Mom Have Built…
$450,000 in personal debt
2007: The Blog Rand Started to Learn More About SEO Helps Moz Pay Off Its Debt!
The SEOmoz blog, coded by Rand in PHP (meaning it barely worked).
Nov. 2007: Moz Raises $1.1mm from Ignition & Curious Office to Make Software
7 employees and $80K in the bank!
2009, 2010, & 2011: We Try to Raise Money Three More Times… All End in Failure
An email from an investor telling me not to lose sleep, just days before they pulled
out of our signed term sheet http://moz.com/rand/misadventures-venture-capital-funding/ and http://
moz.com/blog/seomozs-venture-capital-process
2012: Thankfully, We’d Stayed Profitable!
Our pitch deck to VCs in 2011: http://www.slideshare.net/randfish/seomoz-pitch-deck-july-2011
April 2012: We Meet Brad Feld; He’s Dreamy
Brad wrote about TAGFEE: http://www.feld.com/wp/archives/2012/05/seomoz-tagfee-and-me.html
We Raise $18mm w/ Foundry & Ignition
http://moz.com/blog/mozs-18-million-venture-financing-our-story-metrics-and-future
We Raise $18mm w/ Foundry & Ignition
My favorite coverage was from TNW: http://thenextweb.com/insider/2012/05/01/awesome-seomoz-uses-popular-internet-memes-to-announce-18m-funding-round
/
2012-2013: Moz Grows a Lot
Details from our CEO’s blog post on 2013 in review:http://moz.com/blog/mozs-2013-year-in-review
Past 12 Months: We Hit Some Rough Patches
More about this: http://moz.com/rand/cant-sleep-caught-in-the-loop/
Jan. 2014: Rand Steps Down as CEO
http://moz.com/blog/final-post-as-ceo-sarah-bird-has-the-conn
of Entrepreneurship…10 Years
6 Lessons to Share Today.
People & Hiring Matter(but not in the ways you might expect)
1
http://moz.com/rand/what-company-culture-is-and-is-not/
Most companies incorrectly reverse
these two.
Via: http://moz.com/rand/what-company-culture-is-and-is-not/
What Does “Culture Fit” Mean?
What Culture Is Not• Whether you rock climb/surf/ hike/watch NFL/etc• What kind of movies you like• Bean bag chairs• Nerf gun fights• Catered lunches• Mashed potato sculpting contests judged by your auditors at Deloitte (yes, we really did this at Moz, and it was totally fun)
What Culture Is
Shared Values
Shared Priorities
Stylistic Cohesion
ValuesMission & Vision
Hiring, Firing, & Promotion Criteria
Cultural Fit =
Via: http://moz.com/rand/what-company-culture-is-and-is-not/
Common Advice:
Hire slow. Fire fast.- Every management book & guru
Less Catchy, Better Advice:
Hire slow. Fire with a consistent, empathetic process.
- Moz
Why? Because consistency in evaluating people and giving them time to improve is essential to maintaining your reputation internally & externally. When firing happens fast, you create an environment of fear, uncertainty, & mistrust.
Humility is the Most Underrated Attribute
2
In my experience, those who think highly of themselves are
very hard to work with, and those who don’t think about
themselves lackself-awareness.
In my experience, both confidence & arrogance are
correlated w/ poor results, while self-deprecation is often
correlated w/ the right kinds of humility.
Core Values Are Hard(not having them is way, way harder)
3
Moz’s Core Values: TAGFEE
Transparent
Authentic
Generous
Fun
Empathetic
The Exception
We share what we do, what we learn, and where we struggle openly and honestly.
We will be our true selves, never masking our beliefs for commercial gain.
We seek to give without thought of return.
Work is only work if you make it so.
Our most important value – we strive to share the emotions & experiences of others.
We strive to be the exception to the rule, and to take the path less traveled.
http://moz.com/rand/diving-deep-on-tagfee/
Moz’s Core Values: TAGFEE
TransparentAuthenticGenerousFunEmpatheticThe Exception
Real values come from a deep,
personal place in the founders’ past/beliefs.
Real values are disconnected from
opinions about what will make the
business succeed.
When things go well, values are easy.When things get rough, values are important.
“The core values embodied in our credo might be a competitive advantage, but that is not why we have them. We have them because they define for us what we stand for, and we would hold them even if they became a competitive disadvantage.”
- Ralph S. Larsen, CEO of Johnson & Johnson
http://www.jimcollins.com/article_topics/articles/good-to-great.html
Core Values Are the Glue that Holds Vision, Strategy, Team, & Everything Else Together.
http://moz.com/rand/vision-based-framework/
Your Team Is Absorbing Far Less Information than You Think
4
Like most CEOs, I sent emails, presented at team meetings, and expected people to internalize that information.
This is not the face of a smart man.
Note: the percentages on this visual don’t have credible research behind them (though the broader concept does): http://acrlog.org/2014/01/13/tales-of-the-undead-learning-theories-the-learning-pyramid/
Assuming knowledge that’s been shared once (or even a few times) has been internalized by everyone can create fatal pitfalls.
The same type of distribution happens internally at organizations, too.
If Management is the Only Way Up, We’re All F***’d
5
In Many Organizations, the Only Path for Career Growth is to Become a People Manager
Career path illustrations from a variety of companies & fields
See Daniel Pink’s Illustrated Video: http://www.youtube.com/watch?v=wdzHgN7_Hs8
What Makes Us Happy at Work?
Many people are not motivated or made happy by managing others
And, People Managing is NOT the Only Skill of Value to a Growing Company
http://moz.com/rand/if-management-is-the-only-way-up-were-all-fd/
At Moz, We’ve Built Two Tracks with Equivalent Compensation & Recognition
http://moz.com/rand/if-management-is-the-only-way-up-were-all-fd/
Pay ranges at each level are the same across both tracks.
At Moz, We’ve Built Two Tracks with Equivalent Compensation & Recognition
http://moz.com/rand/swapping-drivers-on-this-long-road-trip-together/
I recently made the move from people wrangling to individual contributor myself!
Building a company is really just a cycle of failure & learning that, from a distance, resembles overnight success.
6
http://buttersafe.com/2008/10/23/the-detour/
A lot of days feel like this:
We compare ourselves and our success to outliers rather than norms, and this brings great unhappiness.
We Imagine Entrepreneurship Looks Like This:
In Reality, It Looks More Like This:
Geraldine’s Travel Blog: http://everywhereist.com
Geraldine started her blog in 2009
In Reality, It Looks More Like This:
For 2 years, she never broke 100 visits/day.
In Reality, It Looks More Like This:
This is where most people give up.
In Reality, It Looks More Like This:
These days, she gets 100,000+ visits each month
In Reality, It Looks More Like This:
Every first-time founder I’ve ever talked to shares a story that looks a lot like this one.
You are not alone.
In Reality, It Looks More Like This:
The Price of Success is Failure after Failure after Failure*
* Hopefully, each of those failures provides an opportunity to learn.
1) Moz is by no means perfect.
Critical Caveats:
2) Getting this stuff right does not guarantee success.
3) These lessons were hard learned by me & Moz. I share them in the hopes of saving you that same pain.
Rand Fishkin, Individual Contributor, Moz@randfish | [email protected]
The Hard Truths of Entrepreneurship
Online: bit.ly/mozhardtruths