The ancient Greek aphorism “Know thyself” is very relevant to entrepreneurs. Most founders don’t give much thought to how their own personality type influences how well they run their startup. Remember, your reality distortion field distorts yourself too.

The good news is that for the first time since I’ve been building companies, entrepreneurs share a common framework for guiding their startups: the Lean startup. Sure, some people don’t use the right vocabulary and misunderstand Lean. But I find that Lean thinking has permeated the entrepreneurial community, so much so that some founders are following the principles without knowing the term “lean startup” at all.

The bad news is that there’s still a huge gap between the understanding of lean startups and the practice. It’s frustrating to see and I think one reason is founders don’t take into account how their own personalities influence the process. I haven’t seen anyone ask: “How is my own personality getting in the way of being lean?”

To help answer that question, I’ve created a list of the top 5 personality archetypes I come across, as well as some things to watch out for if you recognize yourself in one (or more than one) of them:

• “Smartypants” – You’re very knowledgeable and you want people to know it. You love complexity. You believe that superior intellect and knowledge will close the sale, investment etc.
• Watch out: you’ll ignore the simple solution (which is often the best one) in favour of something more impressive. You’ll discount what customers say because they aren’t smart enough. You’ll be attracted to innovation vs execution.
• “Intelligent Architect” – Most engineers have this personality type. You like to build machines and you like it when they work as planned. You like the design phase of projects because there are no customers in the design phase…
• Watch out: you’re going to be very uncomfortable when your startup is trying to find a business model vs building a product. You can’t architect a solution when you don’t know what the problem is yet. Pivots will drive you crazy because there’s nothing wrong with the code.

• “The Advocate” – Most sales people (and almost all entrepreneurs) are strong when it comes to selling their vision or advocating what they believe in. In a meeting, especially a brainstorm, you talk rather than listen.
• Watch out: when you’re trying to find product-market fit, you’d better hone your shutting up skills. You can’t hear your customers’ voices when you’re still talking. You already know your own position, it’s time to listen to others.

• “The Dreamer” – I saw a pitch deck recently for a hyper-local startup. Great deck, nice screenshots, but within 5 minutes the entrepreneur admitted he probably would never use the product, nor did he think anyone else would. It’s easy to envision success IF everyone used your product. It’s harder to make it so.
• Watch out: you get excited about building an empire but you have a blind spot when it comes to actual customers and their problems. You’ll overestimate how well your product solves their problems.

• “Mom and Pop” – One great thing about Lean startups is that founders are getting in close proximity to customers to validate their businesses. Most people start with people they know in their community. If you’re a natural hustler, you’ve probably walked down Main Street knocking on doors and signing up beta customers.
• Watch out: You’ll hold as proof of your business the fact you signed up 10 restaurants in your neighbourhood. Instead of using (and possibly abusing) them to test your hypotheses, you’ll want to make them happy and get pulled in many directions. Be careful you don’t lose sight of the goal. You’re trying to build a scalable business, not a local consulting company.

Spend a bit of time thinking about who you are. Better yet, ask the people around you and make sure there are no sharp objects close by. There’s no value judgment here. There are no “good” or “bad” personality types. But the sooner you recognize your own personality type(s) the sooner you can get out of your own way.

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I was having coffee with a founder the other day and we started talking about his hiring plans. Since he’s a non-technical founder (which Ben Yoskovitz claims is a dead-end to begin with) he had several top coders in mind, all of whom were earning big bucks with larger companies.

“I’m paying them a little bit of money but they’ll join full time once I can raise money,” said the founder. It’s something I hear a lot, especially from non-techie founders.

I went back to review some blog posts on Lean hiring, and I came across Eric’s post “Lean Hiring Tips” and Mark MacLeod’s “Fat Hiring for Lean Startups“. Both are worth your time. But I think they’re also written for startups that are already up and running and need to expand. I’m interested in very early stage hiring, e.g. when you’re one person looking for a co-founder or you’re two people looking for your core team.

Companies always take on the characteristics of their founders and in the rush to scale, I find many startups don’t stop to consider how they’re establishing the DNA of their company. The first few hires are the most important ones you’ll make.

• Hire for an experimental mindset – Look for people who enjoy encountering problems, designing ways to solve them, and finding proof of success or failure. Skill at building, whether it’s software or a marketing plan or a sales funnel, is irrelevant at this point. You need people who will volunteer to scrap their plans, not fight you when you want to change course.

How? Join a hackathon, Lean Machine or just create your own (laptop + Starbucks = hackathon). Give your (potential) team a crazy challenge and see who exhibits the right behaviours.

• Hire generalists – A lot of people will disagree with this advice. If you can find the best Python developer in the country go for it. But only if she’s also willing to cold call customers, crank out some Web site copy and help you whiteboard the business model. Your #1 focus is to find a business model that works. The latent technical talent on your bench won’t help you unless you graduate from this first phase

How? Again, hackathons are great practical tests. No matter what their skillset, look for passion about your business model and solving customer problems.

• Prioritize UX over development – This is easier said than done since there’s a shortage of UX talent. But it’s better to have a kick-ass UX person and a mediocre developer than the other way around. UX will help you find your business model and most (good) UX people already have an experimental mindset and generalist attitude

How? Actively seek out UX people, not just developers. You may need to work at a distance if you can’t find local talent. Consider working with less experienced people if they can prove themselves through testing.

• Get skin in the game – Leaving a six figure job to join your startup for a paycut is not skin in the game, or not enough in my books. Hire those people later when you’ve found your business model, have money in the bank, and need to scale. Skin in the game means working full time, just like you are. It means putting their reputation on the line, raising Ramen funding from friends/family/spouses and saying “I’m going to see this through until we fail.”

How? Stop feeling like you’re a poor startup that can’t afford to pay top salaries. Those aren’t the droids you’re looking for. Think of finding your co-founders like raising your first round. You need to get them excited to invest in your business.

I know this advice seems to apply better to “Web” startups than general technology startups, which is a common criticism of Lean startups in general. But I think it applies more broadly. If you hire for the right attitude, you not only solve the critical product-market fit problem, but you set the DNA of your business right from the start. I guess I haven’t seen too many examples of startups failing because they lacked a specific technical skill. They probably think they failed because of it though.

In the end, I guess “hiring” is the wrong word to begin with. You’re looking for people to co-found a business with you. You aren’t buying their skills, you’re asking them to invest in helping you shape the course of your business from the very beginning. Maybe not all of them (including yourself) will be able to scale up with the business. That’s a problem for another day.

It’s a positive development that startups have figured out that metrics need to be at the core of their business and their pitch. Thanks to the Lean Startup, Dave McClure’s “Startup Metrics for Pirates” and investors who are asking for a dose of proof with your passion.

I find that startup founders are more at ease with acquisition funnels, the viral coefficient, and cohort analysis. But many are getting lost in the weeds and losing sight of the big picture. You have a 3D cohort analysis graph (you know who you are…) but I have no idea what it means.

When you’re launching a new product, I think all of your key metrics can be derived from asking three simple questions:

1. What is your core value proposition?
2. How do you know people care?
3. What’s the proof you’re delivering on your value proposition?

A shockingly large number of people still can’t define their value proposition in simple terms. E.g. we do A for B. The problem is, if you can’t even describe the core promise of your business, you can’t focus your product development, or market effectively, or measure your performance.

Customer acquisition is the time to test the promise of your business before actually having to deliver anything. This is where the fake “Buy” button works. If no one clicks on it, you don’t need to build anything. If your Facebook ads get no click throughs and no one makes it through your sign-up form, that’s the market telling you they don’t want what you’re promising and they don’t care if you can deliver it.

“Once I build my product I’ll be able to prove that customers want it.”

          – misguided entrepreneur

If you’re able to acquire customers that’s great news. But now you need to create metrics that prove that users are engaging in your product in a way that demonstrates value creation. This could be daily active use, amount of user-generated content, referrals to other friends or, obviously, spending money.

But you need to avoid the temptation to create vanity metrics that paint a rosy picture. You can’t build a business on 100k tire kickers from TechCrunch. But if you can find a few users that are truly engaged and truly getting value, you can probably find more of them. Make sure you set a high bar for what constitutes an “active user”. It doesn’t jive to say you’re disrupting an industry while making active user = “logs in at least once per week”.

Many products have more than one type of user. Not just “average users” and “whales” but people who derive different types of value from your product. In a marketplace product (real estate for example) you have buyers, sellers and brokers. All define value differently and need to be measured differently. The point is, you’ll probably have more than one metric that constitutes proof that you’re creating value overall.

Some Plain English Metrics

First, write down a 1-2 sentence value proposition. Seriously, stop avoiding it and do it.

1. What acquisition metrics indicate a positive reception to your value proposition? Eg. effectiveness of paid and organic users; virality; activation rate.
2. What is your definition of an “active user” and does this absolutely prove that you’re delivering on your value proposition? More clicks can be due to high engagement or bad UX… This is the toughest metric to design.
3. Are engaged users maintaining or increasing their engagement over time? If not, how come?
4. What % of acquired users never become active? Why?
5. What % of engaged users drop-off? Why?

The most difficult metric to gather is why people stop using your product. By definition, these people are hard to talk to. Bend over backwards to talk to these people: offer them incentives or a personal email from the CEO or a compromising photo of the CEO. The data you get will be qualitative but you’ll be able to spot trends and make changes.

Answering the above five questions isn’t easy. One word of advice is not to worry about getting real-time data (you don’t need it) or perfectly accurate data (which you can’t get). You’ll probably have to throw in some qualitative data and wild guesses. That’s ok because at the beginning you’re looking for big obvious things. You’ll have plenty of time to optimize later.

Also, it’s expected that many of your metrics will suck. You’ll be trending down, not up. This is information you can use to change, fix, and pivot your way to success, or at least the next release.

Conclusion

Get back to basics by defining some plain English metrics for your business. If they’re well designed and information gathering isn’t crazily difficult, you’ll not only have a better view of your business but you’ll find it much easier to create meaningful projections. You’ll be able to have more intelligent conversations with your team and your investors, which hopefully are also taking place in plain English.

SREDFacts (www.sredfacts.com)is a new blog that delves into all aspects of SRED, from determining eligibility to claiming expenses to living through an audit. It’s a useful blog for startups, technology companies and anyone else interested in learning more about this tricky program.

Flow is looking to hire an experienced SRED Writer in Montreal, Ottawa or Toronto to work with us on a contractual basis, possibly leading to a permanent position. Your role would be to help us take raw data and information to help us create R&D technical documentation for SRED claims as well as other government grants and subsidies that Flow prepares for our clients.

Responsibilities include:

• Translating raw data into key concepts to create content for technical documentation

• Writing technical documents for SRED claims

• Writing and filling in government forms for grants and subsidies.

Skills and experiences required:

• Previous experience with SRED

• Exceptional English writing skills

• Capable to write creative and well structured documents

• Previous experience in software development

• Deep understanding of web based & internet technologies

• Ability to work independently

• Excellent interpersonal skills

• Meticulous attention to detail

Please send your CV to pbailey@flowventures.com

Please note that only qualified candidates will be contacted

There’s never been a better time to be an entrepreneur. Building a product is cheap and fast thanks to Open Source frameworks and the Cloud. Getting to market is easier than ever with app stores and affiliate programs. Super Angels and VCs are stepping on each other’s toes getting into early stage deals! Early exits are on the rise offering lower risk (but life changing) ‘outs’ for entrepreneurs.

But what I’m most excited about is that we’re beginning to have a set of best practices, thanks to the Lean Startup. Yes you need to have passion and vision (equally true whether you’re an Evil Genius or an entrepreneur). What’s been missing is a way for entrepreneurs to know what questions to ask and how to interpret the answers, especially when they don’t conform to the original vision. This is a lot tougher than it sounds.

That’s why we created Year One Labs with Ben Yoskovitz, Alistair Croll and Ian Rae. We want to help you realize your (huge) vision of the future by focusing on achieving the important things in your first year. Things like finding out who your customers are and building a product that solves a problem they care about. You’re not building a business (yet). You’re searching for a repeatable and scalable business model. We’ll do whatever it takes to get you there including getting you in front of the right customers, helping you build your product, and being brutally honest when your metrics don’t agree with your vision.

So what are we looking for?

1. Passion – You love solving big huge problems (not just creating big huge companies, or Evil Empires)
2. Ability – You have incredible knowledge and skills, and you can just get sh*t done
3. Focus – Nothing distracts you from your goal, certainly not failure

The best way to ‘pitch’ Y1L  is to sit down with us face to face and talk about the problem you’re going to solve. Ideally without Powerpoint. Oh, and you should read Four Steps to the Epiphany and everything in Eric Ries’ blog.

Jumping on this internship opportunity at Flow Ventures was a no brainer for me. I’m an MBA student with startup aspirations, so I’ve decided to take a break from the classroom for the summer and get my hands dirty in the startup world. I’ve requested to help out with all of the unsexy, seldom-blogged about things that are required to run a company — the payroll, bookkeeping, tax remittances, government documentation, SR&ED credits, and even the filing! If I’m going to found my own startup after graduation, I need to know how to manage the nuts and bolts that I don’t learn about in school and I certainly don’t read about in the blogosphere.

This internship also requires me to get out into the community and meet as many interesting startup people as I can, so feel free to introduce yourself if you see me out. My first stop will be at Mondev, the open-source conference taking place in Montreal, May 24-28. The full schedule is here, and if you see me at any of the events be sure to say hi.

Finally, I look forward to bring some fresh ideas, operational muscle, and strategic thought to Flow and help out any way I can. It’s going to be an awesome summer!

So, as you can see, Jeff’s really as keen as can be. He’s already been invaluable putting his weight behind Startup Drinks CA and saving my hide by diagnosing my PC with a network card problem! As they say, the best job security is making yourself indispensable.

Flow Ventures is looking for some amazing entrepreneurial interns for the summer.

You will fit a multi-tasking niche in a tight knit team located in Old Montreal.

What we do:

• We are angel investors and grow startups from concept to execution.
• We accelerate startups in Canada and the US.
• We are startup community agitators (Startup Drinks CA, Startup Digest Montreal)

What you’ll learn:

• You’ll learn how to research and critically evaluate a business model and contribute to its quick iteration.
• You’ll learn how to run successful events and meet hundreds of entrepreneurs and investors in the process.
• You’ll learn how operations fit strategy.
• You’ll learn that sales is tough but that you’re tougher.

Who you are:

• Approaching the end of your bachelor’s degree
• Self motivated and independent
• Able to juggle projects and priorities
• Comfortable with the web and social media tools
• Good networker

This is an unpaid internship that will begin as soon as your exams end and when your next semester begins. Through this process, you will meet startup founders, CTOs, angel investors and VCs. It will be rigorous and demanding and thoroughly rewarding.

Send your CV and a cover letter to Robin Ahn at rahn[at]flowventures.com. Only qualified candidates will be contacted.

www.flowventures.com

www.artanywhere.com

www.startupdrinks.ca

South By South West Interactive was, in a word, epic, especially as a n00b and a non-road warrior. This is what I learned in (almost) chronological order:

• Choose your seatmate well for the flight into Austin – This way, you’re at SXSW even before you land. Mine was Scott Heiferman, CEO of Meetup.com who is an all-round nice guy. Bonus: see if you can get your plane turned around 30 minutes into the flight due to cabin pressure issues to ensure maximum face time and fear of dying.
• Get some rest – have the airline lose your luggage. You can fritter away your first day pottering around your hotel room in your travel clothes and not unpack your things.
• Party “plans” - treat them with the same disrespect as you do your business plans. Roll with the posse you find.
• Shatter your iphone – it makes for a great icebreaker, pun intended (“what the hell happened?”, “how does that thing still work?”, “HOLY CRAP! I HEARD ABOUT THAT PHONE”) Photo credit: Evan Blaustein
  
• 
• Run into Sean Power randomly and frequently – highly recommended.
• Use a car service – Just because you call a cab doesn’t mean it has neccessarily been dispatched (512-573-2486)
• Have DJs rock your world – namely Flosstradamus (Chicago), Wants Versus Needs (Minneapolis) and Table Manners Crew (Austin represent!)
• Drink early, Drink often - It takes effort to avoid drinking at SXSW so why fight it? Stumbleupon party and Cheezburger party were both excellent. Driskill has great beef jerky (thanks Aidan!) and lots of legit people to meet – just follow the smell of riff raff.
• Gatorade - the true breakfast of champions
  
• Talk about something other than tech – entertain people with videos of your dog Boomer! (thanks John!)
• Panels – ignore the title, research the speakers (thanks Stevey!) and/or go to things you know NOTHING about and expand your mind (thanks David!). If you’re on a panel, encourage people to participate by offering them free beer (thanks Grace!)
• Warm up your vocal chords if you’re going to a panel with Tara Hunt. She will probably make you sing and dance. You’ll appreciate the energy boost it gives you.
• Bring a Sharpie – you never know when you might need one.
• 
• Extend your stay – have your homeward bound flight canceled due to technical issues and stay in Austin an extra day. Don’t forget to cancel your next day’s meetings! Bonus: try to be stranded with David Dufresne (what a mensch!) and hit the music festival. Super Bonus: make sure it coincides with St. Patrick’s Day and watch the chaos reign!
  
• 
• Duct tape – bring it or buy it at 7/11. Your choice.

But enough about me though. How was your week?