For some reason I’ve been doing a lot of interviews lately. In many ofthem I get asked similar questions, including the inevitable “whatmakes a great entrepreneur?” When I’m on a VC panel, I’m always amused by the answers from myco-panelists as they are usually the same set of “VC cliches” whichmakes it even more fun when I blurt out my answer.
“A complete and total obsession with the product”
The great companies that I’ve been an investor in share a commontrait – the founder/CEO is obsessed with the product. Not interested,not aware of, not familiar with, but obsessed. Everydiscussion trends back toward the product. All of the conversationsabout customer are really about how the customer uses the product andthe value the product brings the customer. The majority of the earlyteams are focused entirely on the product, including thenon-engineering people. Product, product, product.
And these CEO’s love to show their product to anyone that willlisten. They don’t explain the company to people with powerpointslides. They don’t send out long executive summaries with mocked upscreen shots. They don’t try to engage you in a phone conversationabout the great market they are going after. They start with theproduct. And stay with the product.
When I step back and think about what motivates me early in arelationship with an entrepreneur, it’s the product. I only invest indomains that I know well, so I don’t need fancy market studies (whichare always wrong), financial models (which are always wrong), orcustomer needs analysis (which are always wrong). I want to play withthe product, touch the product, understand the product – and understandwhere the founder thinks the product is going.
I don’t create products anymore (I invest in companies that createthem), but I’m a great alpha tester. I’ve always been good at this forsome reason – bugs just find me. While my UX design skills are merelyadequate, I’ve got a great feel for how to simplify things and makethem cleaner. Plus I’m happy to just grind and grind and grind on theproduct, offering both detailed and high level feedback indefinitely.
How a founder/CEO reacts to this speaks volumes to me. I probablyfirst noticed this when interacting with Dick Costolo at FeedBurnerwhen I first met him. I am FeedBurner publisher #699 and used it formy blog back when it was “pre-Alpha”. I had an issue – sent support@feedburner.coma note – and instantly got a reply from Dick. I had no idea who Dickwas, but he helped me and I quickly realized he was the CEO. Over thenext six months we interacted regularly about the product and when hewas ready to start fundraising, I quickly made him an offer and webecame the lead investor in the round. My obsession with the productdidn’t stop there (as Eric Lunt and many of the other FeedBurner gangcan tell you – I still occasionally email SteveO bugs that I find.)I can give a bunch of other examples like FeedBurner, but I wrap upby saying that I’m just as obsessed with product as the founders. And– as I realize what results in success in my world, I get even moreobsessed. Plus, I really like to play with software.
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