Category: Interviews

An Unexpected Entrepreneur’s Success Story

Posted on by Drew Neisser

The following is an interview I had with “unexpected entrepreneur” Emily Lutzker, founder of OpenInvo, a start-up with an innovative approach to innovation.

 

What prepared you for being an entrepreneur?
Before launching OpenInvo I was an artist and academic, and felt more comfortable at an art gallery doing a performance work in the nude, or moderating a panel of cultural theorists than in a boardroom. But not only now have I discovered that being an entrepreneur is one of the most exciting and creative things I have ever done, but my former life was the best preparation for bootstrapping a business that anyone could ask for.

As an artist, I created sculpture, video and performance works and showed my work internationally. Like many early career artists, I did not make much money from my work, nor did I have big budgets for any productions. When I needed to recruit 5 other performers, costume them, organize rehearsals and film, I normally did it on a shoestring. I can’t remember spending more than $500 on a project. Out of necessity and drive, I managed to wrangle people who were enthusiastic to help and resources that got the job done without spending much money. It does take time, attention, and people skills to get such projects done — the same skills needed for managing a startup. I can go on about this at length, but I think you get the idea.

Since I began OpenInvo, I’ve approached it with the same budgetary constraints and understanding as I did as with an artistic production. I know that the people involved are my greatest assets. That, even though 3 people give you high estimates for a job that there are always alternatives, but most importantly that people like to help. (I like to help people too).  They especially like to help when they see enthusiasm and drive for a project — those things are contagious.

Now, OpenInvo has been in live beta since the end of September, and growing at a steady pace. I do hope that in the near future we won’t we bootstrapping it quite to the extent that we have been in the past, but I do know that just about anything is possible with a little creative problem solving.

 

Where did the idea for your business come from?
My friends were tired of hearing me come up with ideas for new products and services. They all said, “why don’t you do this business or that one — that’s a great idea!” But I had an art career and didn’t want to be a business owner, although I would have loved to prosper from my ideas. Then my (now) co-founder said to me, “Why don’t we have a business selling ideas?” I said, “That can’t be done!” With a mountain of research I happily discovered I was wrong. It’s the only business I ever wanted to be the owner of — so far.

Why are you doing this?  I mean why not just get a job at a fast growing company and stop killing yourself?
I only had a “real” job once. At some point, I was told I was disruptive to the workplace. I’ll admit it,   I was bored. I’m sure I was disruptive. Actually, It never occurred to me to work at a “fast growing company” or hardly a company at all.  Besides, I’m sort-of un-hirable… my resume says PhD, artist, media producer. My web presence says a combination of crazy naked person and esoteric cultural studies scholar. Companies see “troublemaker.” Sure, I’m good for a university Art or New Media department, and I did love teaching, but I’m not a true academic in my heart.

What does success look like for you personally and for your company?
This is a trick question! Success means changing the world, no?  Seriously… to have a thriving marketplace where people with great ideas get valued for their ingenuity, where companies get true fuel for innovation. Success for the OpenInvo is to be a center for innovation, a support system for the innovation process, and to constantly keep growing and evolving from within. I’d like to think that success is still a starting point, not only a result.

On a large scale, I think that the wonderful things that people dream up should be seen as a commodity. Over the last 50 years, any art form that can be reproduced has become increasingly cheap or free — music, films, books, etc. The people who suffer from that phenomenon are the independent thinkers, not the pop-culture successes. But independent thinking and creation are the assets of humanity, and not to foster that aspect of culture is a shame. I don’t believe we should return to a pre-mechanical reproduction culture, but instead move forward and reinvent. On a philosophical level OpenInvo can inch us towards valuing people’s creativity, rather than valuing “stuff.” Seeing that kind of shift occur will be success for OpenInvo as well as for me personally. I’m a bit of an idealist, and I want to live in a world that fosters and rewards the things that make us human and celebrates our differences.

How long have you been at it and where do things stand right now?
The original conversation that inspired the company occurred more than 2 years ago. I was living in Tel Aviv. A year and a half ago I moved back to New York to start OpenInvo, mostly because my network is here and the innovation business, in terms of content, should be here. I then had a bit of a learning process in the business and startup arenas — it’s still not over, but I’d like to think that I gained some skills and had some that I repurposed from the art and media world. In a way, I could say that I’ve been at it all my life, I just didn’t know what “it” was. It took me until March 2010 to officially form the company, and the first public release of the platform went up in late September.

 

Other than money, what are the biggest barriers to your success right now?
Gaining trust from the would-be Idea Provider community. To have those users understand that not only does OpenInvo NOT want to “steal their idea,” but we actually don’t want ideas to be “stolen” at all.

Describe some of the highs you’ve experienced thus far
I didn’t ask anyone for money, they volunteered. I raised a small amount from friends and family who felt my enthusiasm and believed in me, saying they wanted in. That was an amazing high — to be heard and supported like that.

And what are the low points?
The low points are only the few days when it’s more of a struggle than an adventure — realizing what I don’t know and how much there is ahead. I have an impatient streak, which makes me frustrated when things don’t go as fast as I would like. Also, it would be a relief to not spend time worrying over the lack of budget. It is a bit of a roller-coaster ride… Ohmmm…

 

Where has the money come from to get you this far?
Friends and family.

 

How hard has it been to raise money?
The small amount I raised I got without asking. Now I’m just starting to look for the right investors to grow with. I’ll let you know how hard it’s been when it’s done.

 

Looking back, what would you do differently?
Who has time to look back?

 

Did you think it was going to be this hard?
Struggle isn’t something I was ever afraid of. Yeah, sure I knew it would be hard. When are worthwhile things not hard?

Has you business taken any major pivots from concept to where you are today?
Major, no. Minor for sure. And I’m sure there are some to come. I thought i would raise money earlier, but instead just blasted ahead. I wouldn’t have been able to without the amazing support of the people around me, and perhaps a touch of insanity.

How much money do you need to raise now to get you to the next stage?
Need? I’ll make it work with whatever I have. But with 500,000-600,000 OpenInvo would be able to grow at an optimal rate.

If your friend was about to start a business, what advice would you give them?
I’d just make sure she/he  knew the level of commitment and drive it takes. I would load a bunch of resources into her/his hands, spin her around three times and, say, “go get em! Call me when you need me — for advice, a shoulder to lean on, or a drink.”

 

Do you see yourself as a serial entrepreneur or is this your one big idea?
I can’t imagine not having another big project ahead of me. Whether that will be a for-profit business or not, who knows. Do we have a name for someone who embarks on one big project after another that are not necessarily business ventures? I’m a serial one of those.

Someone said that “any idiot can learn from his/her own mistakes, it takes a genius to learn from the mistakes of others” — what lessons do you wish you’d learned from others?

That business isn’t boring at all. That the language may be different for different industries, but often the skill set is easily translatable. And that when someone offers you a breath mint, take it.

Innovative Start-Up Making Products Out of Recycled Materials

Posted on by Drew Neisser

This is the transcript from my interview with Ashok Kamal, founder of Bennu, a start-up dedicated to making new products out of the stuff you throw away.  This is the first in a series of interviews I conducted for a FastCompany.com post on entrepreneurship that will go live later this week.  I also have Ashok to thank for the pearl metaphor I’m using for my larger story with his comment, “bu diamonds and pearls are made under pressure, and so are great businesses.”

Where did the idea for your business come from?

Like any good business, the idea behind Bennu was born out of a problem. The difference with Bennu and other social enterprises is that our problem affects society as a whole, not just individuals. We wanted to address the obscene amount of garbage being dumped into landfills. Therefore, we started Bennu to make products out of recycled materials, both solving a practical consumer need and protecting the environment for all of us.

Why are you doing this?  I mean why not just get a job at a fast growing company and stop killing yourself;-)

To me, entrepreneurship is another word for freedom. Freedom to live your values, freedom to work with people you care about, and freedom to innovate. Once you’ve experienced the freedom of running your own business, conventional employment feels like a prison sentence.

What does success look like for you personally and for your company?

When your lifestyle revolves around your business, the line between personal and professional success is blurred. In the short- and medium-term, my success entails creating a stable enterprise that delights both employees and customers. Bennu’s mission is greening the standard for a new lifestyle so our goal is also to influence peoples’ behavior by promoting sustainability. Over the long-term, I hope the business will outgrow its founders and operate as a well-oiled machine.  At that point, personal success would mean being in a position to help aspiring entrepreneurs to achieve their dreams.

How long have you been at it and where do things stand right now?

My partners and I began working on Bennu during our first year of business school in the fall of 2009. We entered and won the Baruch College & Merrill Lynch Invitational business plan competition and officially incorporated in July 2009. We continued to develop Bennu during our second year of business school and committed ourselves full-time to the venture upon graduation in June 2010. Currently, Bennu is a fully operational, revenue-generating company and we are focused on establishing our brand, designing products and creating marketing programs.

Other than money, what are the biggest barriers to your success right now?

Business is about seeing around corners. As a socially responsible company, Bennu caters to the green consumer segment, which is growing rapidly but still represents a fraction of the mainstream market. At present, the volatile demand for green products is a threat to our business, especially since sustainability adds cost. We’re betting on a green tidal wave that changes consumer preferences such that corporate social responsibility is the expectation, not the exception. The risk we assume is that we’re peering too far around the corner, waiting for a paradigm shift that may or may not occur.

Describe some of the highs you’ve experienced thus far:

As student entrepreneurs who made the leap from classroom to market, a definite highlight was being selected to compete in the 2010 Rice Business Plan Competition in Houston, TX. The event is considered the most prestigious student business competition in the world and participating validated our concept and potential. Additionally, making our first sale was a thrill. The idea becomes viable when a customer agrees to pay for it, suddenly making the business real. As a corollary, it was equally fulfilling to successfully deliver our first order. When customers are consistently made happy, it signals not only the start of a business, but also its likelihood to thrive.

And what are the low points?

Running a startup involves constant troubleshooting. From supply chain disruptions, to managing cash flow, to technical glitches — almost every problem could spell the end of the business because there is little room for error. While no single crisis stands out in my mind, the persistent challenge to withstand shocks and survive can be stressful. Entrepreneurship is an emotional roller-coaster and some days the low points compound. But diamonds and pearls are made under pressure, and so are great businesses.

Where has the money come from to get you this far?

Bennu was awarded $40,000 in seed money by winning the 2009 Baruch College & Merrill Lynch Invitational business plan competition. This capital injection allowed us to start up and earn revenue, and also compelled us to put skin in the game and invest in ourselves.

How hard has it been to raise money?

Bennu is a bootstrapped startup by design. Rather than exhaust resources chasing money for an unproven business, we decided to operate lean and focus on proving our concept. Raising external capital to support an unconventional business model in a down economy would have been extremely difficult. Now that we have an emerging brand, company infrastructure and base of customers, we hope that growth capital will be more accessible than if we had fundraised out of the gates.

Looking back, what would you do differently?

Bennu took too long to evolve. We launched by selling customized backpacks made from recycled plastic bottles. While these Greenpacks have been successful, they don’t suggest the growth of a successful company. A singular product focus is risky and nothing is safely protected from imitation. By listening to both our champions and critics, we realized that our core competency was developing marketing programs for recycled products, which could include but were not limited to children’s backpacks. Our business model became an integrated product development and marketing company focused on the recycled market.  We can help larger companies deal with their waste by offering structured corporate social responsibility solutions based on our diverse products and marketing programs.

Looking back, did you think it was going to be this hard?

When you feel fear, you can either run from it or confront it. Obviously, an entrepreneur is someone who faces fear head on. The psychological leap forward is scary and nothing can prepare you ahead of time. Accepting that all responsibility falls on your shoulders and there is no safety net is something you can only digest in real-time. However, the anxiety becomes overshadowed by the excitement of positively impacting the world and achieving your dreams.

How much money do you need to raise now to get you to the next stage?

In order to scale up and accelerate growth, we will be looking to raise at least $800,000 by the summer of 2011.

If your friend was about to start a business, what advice would you give them?

First, I’d subject the person to a psychological examination to ensure that they are just crazy enough to start a business. Assuming they aren’t either too sane or too crazy, I’d advise them to become consumer-facing as quickly as possible. Regardless of the idea on paper, the ultimate success lies in the hands of the buyer. The most important feedback, especially at the outset, is also likely to come from consumers, so it makes sense to prototype and test before investing unnecessary resources in a dud. Lastly, I’d remind my friend that passion should be at the center of the business. It’s the driver that will get the person through setbacks and make the victories more meaningful.

 

 

Do you see yourself as a serial entrepreneur or is this your one big idea?

I see the entrepreneurial lifestyle as a chronic disease, and I consider myself hopelessly afflicted.

Someone said that “any idiot can learn from his/her own mistakes, it takes a genius to learn from the mistakes of others” — what lessons do you wish you’d learned from others?

I think you can avoid a lot of unnecessary mistakes by establishing an advisory board from the outset. It’s easy to neglect this task in favor of immediate concerns, but once we recruited seasoned and candid advisors, Bennu became much more efficient and productive.

The State of Guerrilla Marketing

Posted on by Drew Neisser

The following is a Q&A with yours truly on the current state of affairs in guerrilla marketing.

Q: How has guerrilla marketing evolved?

Guerrilla thinking has evolved tremendously in the last 24 months. Press seeking guerrillas have shifted away from street theater to something with online legs. Part of this is fishing where the fish are. Part of this is that if you can gain Likes or YouTube channel subscriptions, your initial contact can turn into a more lasting relationship. Part of this is the press itself—the press is more likely to wax on about a social program than a purely street program at this moment in time.

Q: What’s up with street stunts?

Frankly, I’ve never been a fan or promoter of the street stunt approach. They are typically a brief encounter with little residual value. The challenge with guerrilla has always been to provide a reasonable exchange of value between brand and consumer. In exchange for a consumer’s time, the brand must provide some value, either genuine utility or at least a good laugh. The reason the HSBC BankCab is still on the road after seven years is that the value exchange is extraordinary. First, people love to see an old Checker driving around the streets. Second, when they get in the BankCab, it is a refreshing experience complete with a truly knowledgeable cabbie. Third, HSBC customers get a free ride when engenders brand love. We recently renovated the HSBC BankCab, enabling it to run on compressed natural gas, thus making it a more “green” experience. As street programs go, this is about as good as it gets.

Q: What’s cool right now?

The most exciting area of guerrilla right now, is the social to offline movement. Skittles “Mob the Rainbow” program is one great example of this. Skittles solicits ideas from its 10 million strong Facebook fan base, which sometimes lead to hilarious offline executions. For example, fans suggested sending Valentines to a particular postal worker. Skittles did just that and produced a funny viral video which brought the program full circle. JetBlue is using its strong Twitter following in a similar fashion. Earlier this year, @JetBlue tweeted they were on a particular street corner in Manhattan giving away tickets. In a matter of minutes, 300 eager travelers showed up and of course, JetBlue got some nice ink for this as well. In this way, social media has replaced email as the ignition switch for flash mobs.

Q: How does social fit into a guerrillas plans?

Any marketer considering a physical guerrilla interaction would be crazy not to also bake in a social component. The social component should give the program legs, extending the offline interaction online. It also provides a home for videos and or photos taken of the physical interaction thus sharing these experiences with a larger audience. The social component also helps amortize the cost of the potentially expensive offline component. Finally, the social component provides an opportunity for feedback something that is not always easy to get in the physical arena.

Q: Is the physical street experience dead?

Since marketing success has often been about zigging when others zag, a few enlightened marketers will renew their emphasis on the physical experience and the true engagement opportunity it represents. Touching someone deeply often requires a physical touch. Online dating sites do the matchmaking but typically the fire doesn’t flame until the couple actually meets.

Q: What roles are left for guerrilla marketing?

Guerrilla thinking has never been dependent on one particular type of interaction. It has always been about making more out of less, breaking the ice in order to build meaningful and hopefully lasting relationships. Social marketing has proven its ability to maintain and nurture relationships but the jury is still out on its ability to generate trial from new customers.

Q: How has Renegade evolved from a guerrilla standpoint?

I see social marketing as an evolution of our long-time guerrilla practice. The goals haven’t changed but the tactics  we use continue to grow and evolve. Five years ago, three out of four incoming calls would be from clients seeking guerrilla ideas. Now those same clients are requesting social marketing ideas. The impetuous for the calls is the same—help us engage customers cost-effectively.

[“Delivery.com Street Stunt in October”][]

A Wine Lovers Guide to Entrepreneurial Success

Posted on by Drew Neisser

Plato’s words, “No thing more excellent nor more valuable than wine was ever granted mankind by God,” would find no argument from Snooth co-founder Philip James, who turned a 30-page business plan into a profitable media business in under four years. Just before handing the reigns over to a new CEO, James spent an hour with me, reflecting on his company’s growth to-date and providing, with a little help from other illustrious oenophiles, a wine lovers guide to entrepreneurial success.

Life is too short to drink bad wine–Anonymous

As is often the case with successful start-ups, the original idea may not be the big idea, so entrepreneurs must be prepared to pivot. Explained James, “Snooth was originally going to be an installed kiosk company,” that provided detailed information on wine in understaffed grocery stores. Having built the database and a demo site to support the kiosks, James and his partner, “fumbled around as every-start up does looking for a revenue model.” Fortunately they quickly eschewed the hardware business for a software-driven alternative made possible by the well-timed rise of smart phones. Noted James, “we realized people are just going to use it on the phone, they don’t need it in the store.” Thus Snooth.com, the ultimate wine lovers resource, became their focus and mobile iterations became essential.

Wine gladdens a man’s heart–Psalms

Once you build your product or service, it is essential that you really understand what business you are in. Having grown Snooth.com into the world’s largest wine database with over 5 million unique searches per month, the Snooth team does not see themselves as educators. Explained James, “it is not our job to make you an expert in Burgundy, it is actually our job to entertain you and give you what you want, otherwise you just don’t come back.” Recognizing the importance of entertainment to the Snooth.com experience, the editorial team covers a wide range of products and topics from expensive Bordeaux’s to cheap chardonnays, from baby backs to box wines. If consumers respond well to a particular topic, more posts along a similar vine follow thus enhancing engagement.

I like best the wine drunk at the cost of others–Diogenes the Cynic

An essential ingredient to rapid growth is the ability to find new customers on someone else’s dime. With site traffic up 60%, page views up 100% and time spent on the site up 15%, Snooth is expecting triple-digit revenue growth in 2010. A large part of this growth can be attributed to numerous partnership deals on sites like Epicurious, Yahoo! And MyRecipes.com on which Snooth powers wine pairings with recipes. Explained James, “we reach about 10 million people per month through these partnerships which are branded and link back to Snooth.com.” Because these are revenue sharing deals, “there are benefits for both parties, they get unique content and it helps recipe sites tap new ad verticals,” enthused James. It also means that Snooth can avoid investing in what James calls, “paid marketing.”

Wine is the most healthful and most hygienic of beverages—Louis Pasteur

When it comes to the health of a start-up, it is important to have multiple means of customer engagement, staying top-of-mind and encouraging word-of-mouth. Adding over 1000 registered users a day, Snooth.com has done an especially good job with its newsletter, which “goes to a quarter of a million people and is Tweeted, ‘Liked’ on Facebook and shared really extensively,” offered James. In addition to pushing out content, consumers are encouraged to participate on the site itself. Explained James, “users used to come just to read about wine and look up prices and over time that has expanded into an active forum.” This rapidly expanding community has multiple tiers, with the most engaged considering Snooth’s headquarters a home away from home. Noted James, “the top 1% have my cellphone number, email me and come by the office unannounced, so we know what they are thinking!”

Wine is a puzzle yearning to be solved–Aaron B. Sherman

Web-based businesses like Snooth.com capture a tremendous amount of data, data that can be used to increase customer satisfaction AND to create new revenue streams. Currently, Snooth “serves over 41 million food and wine matches per month and we expose some of the data to wineries, and that is really helpful to them,” explained James. Snooth also encourages wineries to certify their content which 2,700 wineries have done thus far increasing the accuracy of the data and improving the ranking of those wineries. Each winery can also access their own data through a merchant interface, so they can see in real time, “which area in the country or the world have the most interest in their products right now,” reported James. Though this information is very helpful to the wineries, James admits that when it comes to data mining, “we could do a much better job.”

“Wine is inspiring and adds greatly to the joy of living” Napoleon

While most entrepreneurs can inspire the launch team, there comes a point when they need to ask themselves if they are the person to bring long-term joy to investors. When I asked James if he was the guy that could get Snooth to $20 million in sales and beyond, his response made the announcement of his successor as CEO one week later only a modest surprise. James spoke to the need of any entrepreneur, “to hire really smart people, way smarter than [he is] and to give them responsibility.” “I think people like me are really good at vision, creativity, hiring and inspiring the team,” explained James. James went on to tout his soon to be successor, Rich Tomko, as “an operations guy who knows how to make it from $5 million to $20 million.”

Final note: As a long-time member of the Snooth community and a wine lover from way back, I must ultimately side with Alexander Fleming who said,”Penicillin cures, but wine makes people happy.” And it would really make me happy if Verizon had the iPhone so I could use Snooth’s mobile app in NYC liquor stores to find my faves at even better prices!  This article first appeared on FastCompany.com.

13 Things Every Entrepreneur Can Learn

Posted on by Drew Neisser

Here are the highlights from my interview with Joe Meyer, CEO of HopStop, one of my favorite online utilities.  I got in touch with Joe after he sent an email to me and thousands of NYC-based users apologizing for a recent change to the site that ended up needing to be adjusted after user feedback.  (A shorter post will appear on FastCompany.com at some point soon).

1. Sometimes the founder needs help

“I’m actually not the founder; I’m the CEO who took over for the founder [18 months ago]. Often times in successful startups, the founder steps aside after a certain point and the company matures and grows to a certain level where you need a different type of leader or CEO to take the company to the next level and beyond. I came from Silicon Valley where I spent around a decade working for highly successful companies such as eBay, ,  and as a result I’ve seen this play out many times before. HopStop is no different.  I’m personally responsible for taking a very good service, a very strong brand, a good vision and putting a business around it and making the company more successful and the user experience even better.“

2. Having a large competitor is a good thing

“One of the things among many that intrigued me about HopStop when I was first approached with the opportunity was the fact that we compete directly with Google, and as a result Google is our only true competitor in terms of offering  an analogous service and that’s a nice place to be in. For some companies, it’s intimidating and scary. But I’ve seen this play out before; Google not only validates markets but it leaves a lot of crumbs on the table. If you can focus in on those vertical areas that Google pays attention to and spends resources on (but doesn’t focus all its business on) and if you focus on it much more than they do and you create a better user experience, then that leads to opportunities.”

3. Stay focused

“We were the original pedestrian navigation service and we still consider ourselves to be the best.  Navigation is all we do. We come to work every day with one ambition and that’s to provide the best user experience possible. We’ve identified many ways to  further impress our users, but we’ve resisted the temptation to build them because we’re still trying to accomplish the core objective of having the best routing experience possible.  Without that, none of those other opportunities will matter.  Our primary job is to get someone from point A to point B in the most efficient way possible. Once we’re able to do this better than anyone else, then we’ll look at additional bells-and-whistles but  you need people using your core service en-masse to do those other things.”

4. Be a “must-have” service versus a “nice-to-have” service

“People need to know how to get to-and-from where they need to go. It’s part of your everyday life when you’re going to interviews and meetings and social gatherings and visiting relatives and friends. If you screw that experience up, then people get mad. But if you get it right, then you have a loyal user. Often times we get compared to companies like Foursquare because they are another location-based service and as great of a service as they offer, I don’t consider that a must-have. It’s kind of nice to have. You know, do I check in when I get to the bank or not – maybe, but first tell me how to get to-and-from the bank. That’s useful.”

 

5. It’s not just about the size of your budget

“Probably the most impressive thing is that HopStop had built a strong brand, a strong following, a great user experience, competing against  great companies all on a shoestring budget. We’ve raised very little outside capital to date and I was very impressed with how much the company could accomplish so much with so little in terms of outside funding. We’re very judicious with our time and money, and we spend both very wisely.?

6. Revel in direct user feedback and admit your mistakes

“Sometimes we don’t get it right, but I think that’s another thing that differentiates HopStop versus the Goliaths that are out there. We highly value user feedback. Speaking of, you saw my note to HopStop users. That was a note that I sent to hundreds of thousands of users and needless to say, you aren’t the only person that replied. I’m replying to every single one of those emails and we invite and encourage this sort of feedback. The users tell us what they like, what they dislike, what’s working, what’s not. They find bugs for us that we fix and prioritize and, you know, we use that feedback (of the people using our service everyday) to improve our service, because  there’s not enough of us here at HopStop to identify these issues. Millions of users have to bang away at it 24/7 and tell us if we’re doing a good job or not.”

7. Think about providing a genuine service, not marketing hype

“We’re kind of anti-marketing, anti-PR. Some of it is intentional; some of it is unintentional. Unintentional because whatever resources we have we devote to the core business and to engineering, and intentionally because, again, I came from Silicon Valley where every start up is trying to differentiate themselves and trying to get buzz and send out press releases every week and most of the time I think it’s just noise. I mean if people find you interesting enough to write about, they’ll write about you, and they’ll come find you. You’re a user right? And you find it interesting what we do, and therefore that will make for a much better story than it would if it were being written off of a press release. I realized this dynamic when I was a GM at eBay. Many of the best stories that were ever written about eBay were those written by avid eBay users who just so happened to be professional writers as well. HopStop is no different.”

8. Leverage partnerships to create a win, win, win

“We forged a very strategic, integrated partnership with Connect by Hertz, which is the largest competitor to Zipcar, almost a year ago. It’s a multi-prong partnership where if HopStop users realize they don’t want to take a trip via mass transit, they can rent a car for an hour or two or three. We brought-in the reservation functionality from Hertz directly into our user experience and then HopStop brought its direction/routing functionality directly into Connect by Hertz’s site so that we can route you to any one of their parking lots (based on where you’re coming from). It’s a very interesting, value-added partnership for both companies, but most importantly,  it directly benefits the users of each service.”

9. Being mobile means more than just having an iPhone App

“We have a top ten iPhone app within the navigation category of iTunes, which is the most popular app category on iTunes so we’re right there against AT&T Navigator, MapQuest, among others. That’s very impressive for a small company like ours. As a result, we’ve seen tremendous growth in our iPhone app usage and downloads. We also have a very popular and widely utilized mobile site, which is m.HopStop.com (or HopStop.mobi). We’ll also have an Android app launched by the end of the year, and again our users are telling us what they want. We also have very advanced text messaging capabilities  and can power direction via SMS. So if you’re a MyHopStop user and you text us a message in which you list a starting address and a destination address, we’re fire-off a route to your cell phone within seconds. So mobile is a very large opportunity for us. Our growth on the mobile side is several hundred percent year-over-year. “

10. You know you’re in a good spot, when you’re brand becomes a verb

“Our founder was recently speaking with a news editor from The Wall Street Journal and she was talking about her first time using HopStop and someone in her social circle said, ‘You should HopStop it.’  While HopStop is not quite like Kleenex, our users do use the word HopStop as a verb – ‘You should HopStop it.’  Considering that HopStop is still a start-up, the use of HopStop as a verb is quite amazing and very complimentary, and it goes to show how we were the first-mover in this market and how people equate pedestrian navigation with us. You can’t buy that endorsement. No marketing in the world can replicate that power of word-of-mouth and a positive personal referral. At the end of the day, it’s still a job for us, but it’s certainly nice to know the service you’re providing and improving is helping millions upon millions of people.

11. Look for the hidden goldmines

“I think where an opportunity lies for us is we’re sitting on a ton of data. We’re sitting on a ton of transit data, which makes our routing possible, but also we know where millions upon millions of people are traveling to and from everyday.  We currently utilize that information from a geo-targeting ad-serving perspective (to help us monetize our traffic and bring-in dollars to pay for employees and pay for engineers), but I think there’s a realistic opportunity for us to highlight and promote the trends that are bubbling up from those millions upon millions of searches.”

12. Find your unique SEO opportunities

“We get a good amount of our traffic from SEO. We do SEO a little bit differently than other digital media companies. We don’t have traditional content? We’re not putting out articles. The directions are our articles, are our content. We SEO those to the hilt.”

13. You can be a social brand without expending resources on social media

“We’re not a social media platform. We don’t have the big “wow” that social media sites like Facebook and Twitter have. That said, we have incredibly passionate users and they’re users that voice their opinions and use our service as if we were a social media platform. Very passionate, very vocal, very engaged, very willing to share their opinions about good and bad. People are using HopStop to do inherently social things. People are using HopStop to go meet other people. They’re using HopStop to go figure out how to get to that restaurant, to go to that business meeting, to go out to the Hamptons or come back from the shore, or to meet their friends in the park, or to go to the summer concert series, or go to that rooftop bar. They’re doing it to be social in the real world, not behind a computer.  As a result, HopStop is a means to an end in that we help enable people to get to those popular locations at which they plan to interact and be social with one another.”

“That said, there are definitely distinct opportunities for us to become more social within our core user experience, to engage with our community more on the site itself and to infuse social media elements into our experience, whether it be Facebook Connect or the Facebook Like button or Twitter Places or potentially Foursquare check-ins. So we will likely do that, but we need to be very smart about it because, again, people come to our site to get directions and we have to nail that user experience and we’re still   in the process of perfecting that.”

Top Tips From One of the Fastest Growing Small Businesses in the US

Posted on by Drew Neisser

Here are some of the highlights of my interview with Brian Halligan, CEO and co-founder of HubSpot, one of fastest growing small businesses in the US.

Identify an unmet need

“I was a venture capitalist before I was doing HubSpot, and I was trying to get the portfolio companies to use modern marketing to create blogs to pull people in through the search engines, social media sites, and the blogosphere, and I had a hell of a time making that shift. I had to hire a ton of consultants and a ton of IT people and buy 6 different software packages, and it was very hard to pull off. So that was the gap I basically saw in the market and thought, ‘How do we pull all this stuff together into one simple package and then transfer as much knowledge we can from our heads to their heads and get them to shift the way they market?””

Eat your own dog food

“We are the number one user of our own product. I personally use it every day. A key part of our growth is that we are able to use the product. We feel the bugs at just the same time as our customers feel the bugs, so we fix them as quickly as we can. We know what we want in a software. We’re on the cutting edge of all this stuff. Like Dan Zarrella, for example, is one of our employees. He’s a real cutting edge kind of guy. He’s more leading edge than most, so we try to learn as much as we can from him and build it into the software so that mere mortals can use it, not just Dan Zarrella.”

Replace messaging with valuable content

“The basic idea behind inbound marketing, this marketing transformation I’m talking about, is you want to create remarkable content that becomes a magnet to pull people in. So we create tons and tons of blog articles and the blog articles I wrote 4 years ago still are like magnets, pulling people in through Google. We write eBooks. We create a weekly TV show, HubSpot TV. And we build these Graders, which are basically little tiny pieces of our product that we break off and we offer for free for people to run their site through, and they get a diagnostic on it and they get a score, and based on that score – it’s 1 to 100 – if they get a crappy score, they say, “Well who are these HubSpot guys?” and they end up in our funnel and we show them a demo, take them through a trial and they end up buying the software. So it’s very much part of our philosophy of ‘How do you free up as much knowledge and content as you possibly can and use that knowledge to pull people into your business and try to convert them into customers?’”

Build a community

“There is definitely a big community forming and we do a couple of things to foster it. We have Inbound Marketing University where you can come and there are 15 online lectures you attend – and there’s a test at the end. If you pass the test, you get a badge and you get Inbound Marketing Certified, and those have been showing up on a lot of people’s LinkedIn profiles and resonate these days– our customers are dying to hire them. The second thing is there is an Inbound Marketing LinkedIn group that is very, very active. I don’t know how many people are in there. I haven’t looked recently, but it’s quite an active group in there that’s cranking away. There is a HubSpot partner group. There are a bunch of splinter inbound marketing communities that keep popping up, and we’re just trying to do our best to keep up with them and help them and foster them, and it’s been a big part of our success.”

Inspire a compelling culture

“Culture turns out to play a huge role. When my co-founder and I started the company…in the first two years of the company we didn’t mention the word culture. It wasn’t something on top of our minds. And then about two years in, we did a survey of our employees – the Net Promoters survey. We asked them two questions. Question number 1 was “How likely are you to refer HubSpot to another friend of yours to join us?” on a scale of 0 to 10. Then the second question was “why?” When we got responses from the ‘why,’ we probably had 60 or 70 employees at this point. The two big reasons people like or loved working at HubSpot was 1 – the culture. The culture? We didn’t know we had a culture. And number 2 was that they loved their fellow employees. So at that point we were like ‘OK, it seems like we got something here.’ Why don’t we try to institutionalize the culture and make sure that that doesn’t break. So we hired one of our old professors from MIT to do a project with us to clarify the culture and clarify the mission. Then we tried to institutionalize it in the company. When we do the annual reviews of our employees, the culture is part of that review. There are 7 points in our culture and we grade them. It has become a great part of who we are. I wrote an article about our culture that has been very popular on the Internet. It is called Start up Culture Lessons from Mad Men.”

Don’t try to do it all yourself

“[If you’re starting a business, the] first thing I would find is a great co-founder. It is lonely at the top. Don’t find just any co-founder. A mistake that so many entrepreneurs make is that they find co-founders just like themselves. When you look at the special stars of the early successful teams, like Jobs and Wozniak, there are usually two people with someone who can actually build something and someone who can actually sell something. So my advice would be to find a great co-founder who would compliment you and, very early on, figure out the equity split and figure out the roles, because so many companies die because of a founder conflict.”

Be open-minded about your idea

“Another piece of advice I would give to a founder is to be very open-minded about your idea.  There is a great book called Founders at Work, written by a journalist on the west coast [Jessica Livingston]. She interviewed about 100 entrepreneurs that were successful and I would say that 90% of the entrepreneurs started out with plan A and ended up making money on plan B or C. It took them a while to meander to the idea, so don’t get too stuck on your original idea. Be very flexible and take a while to meander your way to the right idea. The third piece of advice is not to raise venture capital too early. Make sure, if you are going to do venture capital, that your incentives are in line with the VC and that you really want to swing for the fences. Once you are backed by venture capital you are committed down this path. One you become venture backed, you are committed to trying to hit a home run, and you can’t go back to being conservative.”