I’ve been trying to write fewer posts that are simply re-quoting stuff that others have written.
Today is the exception.
Here are some quote from three excellent “How To…” articles that I’ve stumbled across in the last few weeks, written by Paul Graham and Joel Spolsky.
If you’re working on, or investing in start-up companies, or would like to be, I recommend you read all three…
How to be a Start-up Founder – by Paul Graham
“I’ve figured out how to express the quality [of being a good start-up founder] directly. I was writing a talk for investors, and I had to explain what to look for in founders. What would someone who was the opposite of hapless be like? They’d be relentlessly resourceful. Not merely relentless. That’s not enough to make things go your way except in a few mostly uninteresting domains. In any interesting domain, the difficulties will be novel. Which means you can’t simply plow through them, because you don’t know initially how hard they are; you don’t know whether you’re about to plow through a block of foam or granite. So you have to be resourceful. You have to have keep trying new things. Be relentlessly resourceful.”
“If I were running a startup, this would be the phrase I’d tape to the mirror. “Make something people want” is the destination, but “Be relentlessly resourceful” is how you get there.”
How to be a Program Manager – by Joel Spolsky
“Having a good program manager is one of the secret formulas to making really great software. And you probably don’t have one on your team, because most teams don’t.”
“[Jabe Blumenthal, a programmer on the Mac Excel team in the late 80s] noticed that software development was getting so complicated that none of the programmers had the time to figure out how to make software that was either usable or useful. The marketing team was ranting and raving about customer needs and nobody had time to talk to them or translate their MBA-speak into actual features. There was a lot of product design stuff that took a lot of work: talking to users, running usability tests, reviewing competitive products, and thinking hard about how to make things easier, and most programmers just didn’t have the time (nor were they particularly good at it).”
“A good rule of thumb is that it takes about one program manager for every four programmers.”
“The number one mistake most companies make is having the manager of the programmers writing the specs and designing the product. This is a mistake because the design does not get a fair trial, and is not born out of conflict and debate, so it’s not as good as it could be.”
“… being effective as a program manager means you have to (a) be right, and (b) earn the respect of the programmers so that they concede that you’re right.”
How to be an Angel Investor – by Paul Graham
“Don’t spend much time worrying about the details of deal terms, especially when you first start angel investing. That’s not how you win at this game. When you hear people talking about a successful angel investor, they’re not saying “He got a 4x liquidation preference.” They’re saying “He invested in Google.” That’s how you win: by investing in the right startups.”
“How do you decide what valuation to offer? If you’re part of a round led by someone else, that problem is solved for you. But what if you’re investing by yourself? There’s no real answer. There is no rational way to value an early stage startup. The valuation reflects nothing more than the strength of the company’s bargaining position. If they really want you, either because they desperately need money, or you’re someone who can help them a lot, they’ll let you invest at a low valuation. If they don’t need you, it will be higher. So guess.”
“Ultimately it doesn’t matter much. When angels make a lot of money from a deal, it’s not because they invested at a valuation of $1.5 million instead of $3 million. It’s because the company was really successful.”
“To be a good angel investor, you have to be a good judge of potential. That’s what it comes down to. VCs can be fast followers. Most of them don’t try to predict what will win. They just try to notice quickly when something already is winning. But angels have to be able to predict.”
“The most successful angel investors I know are all basically good people. Once they invest in a company, all they want to do is help it. And they’ll help people they haven’t invested in too. When they do favors they don’t seem to keep track of them. It’s too much overhead. They just try to help everyone, and assume good things will flow back to them somehow. Empirically that seems to work.”