Building a Company in Ten Easy Steps

1. The Idea

“Write what you know” “Let’s do the big thing.” “We’ll figure it out.” Every airplane has something wrong with it

2. Roll Up Your Sleeves

Two types of entrepreneurs…

“What’s your prediction for the fight?”

Or, Put Another Way…

“Now, for some of you it doesn't matter. You were born rich, and you're going to stay rich. But here's my advice to the rest of you: take dead aim on the rich boys. Get them in the crosshairs. And take them down.”

3. Assemble a Team

Don’t be a lonely freakBuild it and sell itFind the maniacs & give ‘em a reason to believe

“You want to win a World Series? Give me nine players in their contract year.”

4. Raise Money

Pitch: keep it simple & short– Lots of people will pay for it– We can build it & no one else can– We’ve thought about the financials

Customer validation Presentation

– Wiffy’s: keep moving– Don’t leave without the ball– Answer the question (“why do you ask?”)

http://www.sequoiacap.com/process/stepthree_howtoformat.asp Dilution: you have too much risk, plenty of upside (minimize risk)

5. Don’t Screw Up

Undue concern over dilution, loss of control COO, CFO, GC, BD: your friends A large office, an assistant Patented business models The pogo stick, the futon “It’s complicated” Big-company DNA

6. Build a Culture

Everyone is a leader We are excited by ideas We value speed in everything we do Everyone sweeps the floors Everyone is respected We never say “I” We put the customer first We do the right thing

6. Culture: (Some Tactical Stuff)

The lunch gadget Safeway Large monitors Private offices Scenic offsites

7. Build the Product

A picture: worth a thousand words 1st and 2nd moments of customer delight What can we do that they can’t?

8. Crazy, Do-it-Yourself S&M

1st customer: find someone crazy Radical openness: the truth will set you free DIY PR: think like a journalist, after 2 beers Start something: tradeshow, magazine Be yourself Be a competitive monster

– “Don’t worry about the competition”– “What do they not want me to do?” (speed)– “Why can’t we do that?”

9. Manage Others

“Do you have a minute?” “What’s wrong?” Keep your door open; be available at consistent times Plenty of sleep: No Hulk Be on time, no e-mail or cell Go to them Gather information, make decision Little-league rule Shackleton rule “Do you trust me?” Fire early “Be interested in everything, and nothing else” “Give, control, sympathize”

10. Manage Yourself: You Don’t Have to Have the Job

“It’s my fault.” “I don’t know.” “What should I be doing?” “What’s important now?”

11. If You Lose, Lose Nothing

“The operative word is, I think, love” “If I lose, I lose nothing.” “There the fault lies all in the not-done, all in

the diffidence that faltered.”