The Hard Truths of Entrepreneurship

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The Hard Truths of Entrepreneurship Rand Fishkin, Individual Contributor, Moz @ randfish | [email protected]

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Rand Fishkin's presentation on lessons learned over a decade of entrepreneurship around culture, team building, values, and more.

Transcript of The Hard Truths of Entrepreneurship

  • The Hard Truths of Entrepreneurship Rand Fishkin, Individual Contributor, Moz @randfish | [email protected]
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  • With a Story Lets Start
  • 2001: Rand Drops Out of UW, Two Classes Away from Graduating. Rand in 2001... Thank god for beards.
  • 2005: After 4 Years of Hard Work, Rand & His Mom Have Built $450,000 in personal debt
  • 2007: The Blog Rand Started to Learn More About SEO Helps Moz Pay Off Its Debt! The SEOmoz blog, coded by Rand in PHP (meaning it barely worked).
  • Nov. 2007: Moz Raises $1.1mm from Ignition & Curious Office to Make Software 7 employees and $80K in the bank!
  • 2009, 2010, & 2011: We Try to Raise Money Three More Times All End in Failure An email from an investor telling me not to lose sleep, just days before they pulled out of our signed term sheet and venture-capital-process
  • 2012: Thankfully, Wed Stayed Profitable! Our pitch deck to VCs in 2011:
  • April 2012: We Meet Brad Feld; Hes Dreamy Brad wrote about TAGFEE:
  • We Raise $18mm w/ Foundry & Ignition
  • We Raise $18mm w/ Foundry & Ignition My favorite coverage was from TNW: internet-memes-to-announce-18m-funding-round/
  • 2012-2013: Moz Grows a Lot Details from our CEOs blog post on 2013 in review:
  • Past 12 Months: We Hit Some Rough Patches More about this:
  • Jan. 2014: Rand Steps Down as CEO
  • of Entrepreneurship 10 Years 6 Lessons to Share Today.
  • People & Hiring Matter (but not in the ways you might expect) 1
  • Most companies incorrectly reverse these two.
  • Via: What Does Culture Fit Mean? What Culture Is Not Whether you rock climb/surf/ hike/watch NFL/etc What kind of movies you like Bean bag chairs Nerf gun fights Catered lunches Mashed potato sculpting contests judged by your auditors at Deloitte (yes, we really did this at Moz, and it was totally fun) What Culture Is Shared Values Shared Priorities Stylistic Cohesion ValuesMission & Vision Hiring, Firing, & Promotion Criteria Cultural Fit =
  • Via: Common Advice: Hire slow. Fire fast. - Every management book & guru
  • Less Catchy, Better Advice: Hire slow. Fire with a consistent, empathetic process. - Moz Why? Because consistency in evaluating people and giving them time to improve is essential to maintaining your reputation internally & externally. When firing happens fast, you create an environment of fear, uncertainty, & mistrust.
  • Humility is the Most Underrated Attribute 2
  • In my experience, those who think highly of themselves are very hard to work with, and those who dont think about themselves lack self-awareness. In my experience, both confidence & arrogance are correlated w/ poor results, while self-deprecation is often correlated w/ the right kinds of humility.
  • Core Values Are Hard (not having them is way, way harder) 3
  • Mozs Core Values: TAGFEE Transparent Authentic Generous Fun Empathetic The Exception We share what we do, what we learn, and where we struggle openly and honestly. We will be our true selves, never masking our beliefs for commercial gain. We seek to give without thought of return. Work is only work if you make it so. Our most important value we strive to share the emotions & experiences of others. We strive to be the exception to the rule, and to take the path less traveled.
  • Mozs Core Values: TAGFEE Transparent Authentic Generous Fun Empathetic The Exception Real values come from a deep, personal place in the founders past/beliefs. Real values are disconnected from opinions about what will make the business succeed.
  • When things go well, values are easy. When things get rough, values are important. The core values embodied in our credo might be a competitive advantage, but that is not why we have them. We have them because they define for us what we stand for, and we would hold them even if they became a competitive disadvantage. - Ralph S. Larsen, CEO of Johnson & Johnson
  • Core Values Are the Glue that Holds Vision, Strategy, Team, & Everything Else Together.
  • Your Team Is Absorbing Far Less Information than You Think 4
  • Like most CEOs, I sent emails, presented at team meetings, and expected people to internalize that information. This is not the face of a smart man.
  • Note: the percentages on this visual dont have credible research behind them (though the broader concept does):
  • Assuming knowledge thats been shared once (or even a few times) has been internalized by everyone can create fatal pitfalls. The same type of distribution happens internally at organizations, too.
  • If Management is the Only Way Up, Were All F***d 5
  • In Many Organizations, the Only Path for Career Growth is to Become a People Manager Career path illustrations from a variety of companies & fields
  • See Daniel Pinks Illustrated Video: What Makes Us Happy at Work? Many people are not motivated or made happy by managing others
  • And, People Managing is NOT the Only Skill of Value to a Growing Company
  • At Moz, Weve Built Two Tracks with Equivalent Compensation & Recognition Pay ranges at each level are the same across both tracks.
  • At Moz, Weve Built Two Tracks with Equivalent Compensation & Recognition I recently made the move from people wrangling to individual contributor myself!
  • Building a company is really just a cycle of failure & learning that, from a distance, resembles overnight success. 6
  • A lot of days feel like this:
  • We compare ourselves and our success to outliers rather than norms, and this brings great unhappiness. We Imagine Entrepreneurship Looks Like This:
  • In Reality, It Looks More Like This: Geraldines Travel Blog:
  • Geraldine started her blog in 2009 In Reality, It Looks More Like This:
  • For 2 years, she never broke 100 visits/day. In Reality, It Looks More Like This:
  • This is where most people give up. In Reality, It Looks More Like This:
  • These days, she gets 100,000+ visits each month In Reality, It Looks More Like This:
  • Every first-time founder Ive ever talked to shares a story that looks a lot like this one. You are not alone. In Reality, It Looks More Like This:
  • The Price of Success is Failure after Failure after Failure* * Hopefully, each of those failures provides an opportunity to learn.
  • 1) Moz is by no means perfect. Critical Caveats: 2) Getting this stuff right does not guarantee success. 3) These lessons were hard learned by me & Moz. I share them in the hopes of saving you that same pain.
  • Rand Fishkin, Individual Contributor, Moz @randfish | [email protected] The Hard Truths of Entrepreneurship Online: