Summary of Key Lessons

This is a concluding summary from Kommon: A Startup Story, a set of key lessons for first-time founders told through the story of the successes and failures of my business.  

I have been told that putting these lessons within the full narrative of an early-stage startup, including real customer data and product feedback, has meant they really resonate for first-time-founders navigating their own startup journeys. ‍The introduction to the series with further details on why I wrote it can be found here.

Introduction

Each chapter of the Kommon story ends with key lessons that I learned from that phase of work.  In the introduction to this story I said the whole point of it was to make those lessons feel real by setting them inside the full narrative of a real early-stage company.  It’s what makes this startup story different.  

But everyone loves a summary.

So while I would recommend reading each chapter to get the full weight of experience that sits behind those lessons, they’re all consolidated here - split into Product, Sales & Marketing and Operations. 

This summary also quantifies that stock phrase ‘I learned so many lessons from founding a company’. In my case, apparently it’s 45.  I should say at least 45, there will be many others which haven’t made it in.  

But before we get to the 45, if I had to pick three which still stand out as core to my experience, it would be these. I’m aware that these aren’t original, but sometimes the classics are classic for a reason: 

• Know your customer: there’s a story from Steve Blank about how you should know so much about your customer that you could essentially do their jobs.  You should know what it’s like to walk in their shoes, to do their work, feel their pressures, and understand how they think about solving their problems. I think this is true.  I knew 90% of this for people managers, and the missing 10% on product adoption cost us our SaaS business.  Deep customer knowledge remains the foundation of everything. 

• Find mentors: when we started Kommon, I didn’t feel I had any mentors in my network whose experience was applicable. I also felt I had a good grasp on the fundamentals of how to proceed in the early stage.  Given time was my most precious resource, I didn’t think it was worth spending it speculatively reaching out to folks who may or may not have been a good fit and trying to build those relationships. This was wrong. In hindsight, there were several moments where the right outside perspective would have been invaluable in building Kommon, even if it took significant time to get it. In any future ventures, I am determined to find these people at the earliest possible stage. 

• Stay focussed: when time and money are tight, it’s imperative to spend them on whatever is going to move the needle for your business. This means having strategic priorities, a plan of action for achieving them, and measurable experiments to know whether your efforts are being rewarded.  Wasted effort is deadly. Develop a way of working which enables you to focus on what matters and know whether you’re winning.  You’ll run more efficiently, learn faster, and gather the data you need to make the right decisions when you need to. 

Product

• Reach beyond your experience: in hindsight, I over-indexed on thinking about ‘what am I good at’ and underestimated the desire of customers for good products, regardless of who builds them. One of the most exciting parts of being an entrepreneur is making your earliest sales and realizing that if customers like your product enough, they’ll take a chance on you. I could have reached beyond my existing experience into bolder areas, backing my underlying capabilities to figure out solutions for customers.

• Think about operational ideas: even though I was thinking pretty narrowly about ideas (see above), my key breakthrough was when I stopped thinking about the thematic expertise I’d gained, and started thinking about operational insights from the businesses I’d been a part of.  

• Test your ideas by working backwards from a mock pitch: it sharpened my thinking to consider not just whether I thought a startup idea was promising but whether I would be confident pitching it to a sophisticated investor, and how I would do that. I weeded out many poor startup ideas this way. 

• Be aware of your biases:  I filtered the insights I received from my customers through the lens of what I wanted to build.  This fundamentally undermined our product strategy from the start.  Going back and looking at the data I collected in 2020, I had everything I needed to build the right product - but I didn’t perceive it at the time because I saw what I wanted to see.

• Get others’ opinions: following my customer conversations, I would have been less likely to draw erroneous conclusions if I’d discussed them with the right advisor or mentor.  I didn’t feel I had this type of person in my network at the time, and thought it would have been too time-consuming to find them.  In hindsight, I should have spent the time looking.  There are lots of people (myself now included) who are happy to give their time to advising aspiring founders.  I think I would have been able to find various voices who could have given me good advice at this crucial time.

• Talk about product adoption: although I discussed with my customers how they would pay for my product (and received positive responses) we didn’t discuss how they would go about adopting it from scratch in their team and organisation.  I think if I had asked more detailed questions about this, it would have highlighted some issues with enterprise adoption which later stymied the growth of the product.

• Prototyping is awesome: the sophistication of contemporary prototyping tools means you don’t need to spend any money on development to present potential customers with a compelling vision of your future product.  

• Be wary of ‘gaps in the market’: I used to think that gaps in the market were to be charged into, but now I approach them warily.  Some entrepreneurs do have unique market insights which enable them to create a whole new product category, but they tend to be the exception.  In most cases, some other bright founder will have spotted the same opportunity you did, you will have competition, and you will just have to outdo them.  That’s fine.  If you spot a ‘gap in the market’, it might just be that there is no market.  In hindsight, I believe this to be true for self-serve SaaS for people managers.

• Ask for referrals: I had some of my best customer interviews by being referred on from initial interviews.  If you have a conversation which goes well, always ask if they know anyone else you should speak to.

• Love your customer as well as the problem: a lot of startup literature says you need to fall in love with the problem you’re working on, because you could be looking at it for years.  But you don’t have to spend hours in meetings with problems, or answer their queries, or think about how their lives work. You do have to do that with your customers.  One of the main reasons I enjoyed building Kommon was because I got this right.  I loved speaking to managers and working out how best to help them run their teams, and this sustained me for years.

• Think just enough about names and logos: coming up with an initial name and logo shouldn’t take more than half a day.  Unless you really mess up the process, you will grow into it. 

• Engage with waitlists: other than gathering typeform survey responses from our waitlist, we let it sit there and just took it for granted that a proportion of them would be interested in our product.  They were just email addresses, they didn’t feel like customers, and we had a product to build and content to write.  This was the wrong way to look at it. We should have got to know every single person on that list. If we had, we might have avoided some of our mistakes and learned what we needed to build a better product. 

• Don’t solve for multiple low-value pain points: building a consolidated solution where the value is aggregating features for multiple smaller pain points is risky.  Unless you’re absolutely sure it’s what customers want, and have the capital to build it, it may indicate that you’re not working on something customers care that much about.

• Talk to customers about how they will adopt your product: we asked managers how they could pay for our product (they could), but we didn’t ask about precisely how they would adopt it in their teams. This mistake was critical.  If we had, we would have learned before we built anything that a high percentage of managers felt they had to notify HR about product adoption, and we could have focussed on HR/People teams from the start.

• You can have the right problem but the wrong type of solution: you can be working on a valuable problem but still fail if your solution doesn’t deliver value how your customers want or expect.  Software is eating the world, but it’s not the answer to everything.  Some problems are best solved through services or content, rather than SaaS.  If you want to build software first and foremost, make sure you choose the type of problem that software excels at solving. 

• Learn when customers are lying to you: we received so many positive comments from people who said they would ‘definitely’ trial Kommon with their teams and then did nothing.  This isn’t to blame those individuals - people saying nice things to your face is human nature and a product/sales issue as old as time.  However, it was formative to see it in action. It pushed us harder to think about what signals represented true commitment/engagement from customers, and how to measure them, rather than just wrapping ourselves in the comfort of warm words. 

• Beware of basing strategy on fading trends: Building a startup is already playing life in hard mode. One of the ways founders make it easier for themselves is to choose a sector with strong market demand. While we knew HR wasn’t necessarily a sector filled with hype, B2B SaaS valuations had been strong, the market was large, and various companies offering similar SaaS manager tools had recently raised. We felt we were at least swimming with the tide.  In hindsight, some of the companies that received funding in this space in 2019-2020 were probably experiencing the tail end of low interest rates and frothy SaaS valuations. As we learned, software for managers isn’t a great category, and I expect most of those that raised will eventually close, pivot, or be acquired at a discount. I expect if we had found the right advisor, they would have been able to give us this guidance rather than us learning it the hard way.

• Improve adoption by serving customers where they already are: Kommon should have been a Slack app, at least at first. Workplace adoption is such a significant hurdle to get over.  If you’re selling B2B, think hard about how you can make it as simple as possible for users.

• You’ll know if you have PMF.  You’ll also know if you haven’t: if you haven’t had PMF before, and are unsure if you have it for your product, assume you don’t.  You’ll know if you do.

• Conviction is everything: as soon as you start doubting your product and its value, you need to course correct to find your conviction again.  It’s one of the main things that will keep you going.

• Persistence pays off: it’s a truism in startup literature that those who succeed are the ones who manage to stick at it.  They’re the ones who keep recycling their learnings into new ideas until they find the one that sticks.  This was also true of Kommon.  We could have given up after our software failed but we used the knowledge and contacts from that experience to find a new customer and build a successful product. 

• Deliver a genuine MVP: you hear various startup cliches about basic MVPs, and how if you understand your market, you can deliver value to sophisticated customers with something as simple as a pdf.  I’ll be honest, I never really believed this. Then we did it. We created more value for a paying customer in 6 pages than we did in months of software development. Your MVP can be as ‘minimum’ as that, if you understand your customer.

• Focus on products which delight customers: speaking with customers about our software felt fine, it felt positive. Until we knew different, it felt like something worth building on.  But the feedback for the playbook and the training was glowing and immediate.  The difference was night and day.  It’s only worth spending time on products where you get the latter.

• Good data is fundamental for fundamental decisions: the decision to close down Kommon was made simpler because we’d run rigorous commercial experiments in the previous year and knew exactly where our business stood.  If we hadn’t been tracking the data, making such a significant decision would have been much harder. 

Sales and Marketing

• Content engagement might just mean great content: we got a great response to our content and that made us hope that our audience wanted our underlying product.  But one doesn’t equal the other.  We were actually just making great content. We only really had success in the context of our business when we moved to judging how our content served Kommon’s objectives.

• Interrogate missed targets: startups are wildly uncertain but setting targets is still helpful because they codify a state of mind and a hypothesis at a given point in time.  Missing a target forces you to interrogate the attached hypothesis. This is the hard part because it can involve challenging foundational ideas about your business.  We badly undershot our waitlist target but chose not to interrogate why that was and instead focussed on the customers we did have. We should have done both.     

• Quality always resonates: there’s always value in hitting or exceeding your customers expectations of quality.  We deliberately created content and a website which we knew was the equal of better-funded competitors and it paid off in the spaces we were able to compete. 

• Assess content effort vs impact: content analytics make it easy to find something to get excited about.  Everyone loves a graph that goes up and to the right.  However, that graph might not track the key output that’s material to the business, or the resources that are being consumed to make it happen.  Particularly if you like content creation, it can be easy to keep producing for a receptive audience without facing up to whether it’s having the necessary impact. All content should have a defined impact for the effort that is being expended on it, and if that target isn’t hit, then question whether you should be doing it at all.

• Meet readers where they are: if you’re starting content from scratch, don’t just throw it out into the ether.  Find where your readers already are and make sure your work is in front of them.  That may mean joining Slack groups, Discords, LinkedIn groups, or it may mean approaching readers directly.  

• Look at the steepness of funnels: if you’re struggling to convert viewers of your content into product signups, consider how big a leap you’re asking your viewers to make.  Your funnel might just be too steep and if you include some interim steps - additional content/interactions - it may improve conversions.

• Align content with customer problems and your solutions: we had most success when our content was tightly aligned with the problems we were solving for.  This may mean writing more niche content which doesn’t get as many views, but those who do engage with it are more likely to be the right audience for your underlying product.

• Pick a customer who knows they have a problem: educating a market about why they need your product is time and resource-intensive.  If you take this path, you’re playing on hard mode and will need the necessary runway to sustain you. Choose customers who already know they have a problem and are looking for a solution.  Through Kommon’s lens, new managers weren’t experienced enough to know they needed manager training but their bosses and their People teams were (mostly). 

• Don’t sell until you know what a customer wants (especially when you really want to sell): every conversation with a customer is an opportunity to learn something about their problems and how you can help. You should only jump into selling your solution when you’re sure it meets their needs.  If you sell too early, and get it wrong, all you’ll get is a ‘no’ and you’ll lose the opportunity to learn about how you could have got it right.

• Recognise good customers: even in a tightly defined customer segment (People teams in companies of 30 to 300 people) there are still ‘good customers’ and ‘bad customers’.  I don’t mean in terms of their ethics (although that can also be an issue), but in terms of how good they are for your business. Good customers are looking for a solution like yours and have an available budget to pay for it.  Bad customers are the opposite.  However, bad customers can initially look a lot like good customers and you can spend a lot of sales resources on them with little prospect of a purchase. Key to running an effective sales process is finding which questions to ask which help you identify good and bad customers early in the sales cycle.  This is a long-winded way of saying what sales people will already know as ‘qualify your leads’.

• Speak your customers’ language: the title of the New Manager Playbook wasn’t an accident.  It was what repeat customers said they were looking for (even if they didn’t know precisely what it would look like). Talking our customers’ language enabled us to create a compelling landing page that converted well.  

• Test your messaging whenever you can: talking to prospective customers, whether that be in formal meetings/calls or in passing at conferences and events is a vital way to test the positioning of your product.  As you meet with different prospects, you’ll notice which phrases resonate and which don’t, enabling you to refine your pitch.  Over 48 hours at the Running Remote conference, I spoke to at least 30 potential buyers and my pitch was completely different by the time I left.

• Know your cost of sales: as soon as your sales process begins to involve multiple calls with a customer, you will need to have a product which has an Annual Contract Value (ACV) of $20k+ (with the potential for revenue expansion) to make it worthwhile. If you find yourself spending hours with customers to close sales which are worth less than this, your business is unlikely to be sustainable.

• Invest in customers until the very end: when we were closing down the company we made every effort to communicate clearly with customers and ensure they were supported.  It’s too early to point to concrete outcomes from investing in these relationships but I’ve no doubt there will be some unexpected positive consequences in the future. 

Operations

• Consider your financial options: there are a whole range of options about how founders choose to fund their lives in the early stages of a startup. I’m not going to go through them all but just to say that I continued to do five days a month paid consulting for the whole time I built Kommon (often on weekends). There are various opinions available on this topic as to whether this is an unhelpful distraction from your business or whether it can provide increased focus due to diminishing financial worries.  My view still is that I made the right decision. Although it meant time away from the business, I think it gave us greater runway and enabled better decision-making. I wouldn’t have done it differently. 

• You make your own luck finding co-founders: chancing upon a stranger you’re happy to work with for years is lucky.  However, if you’re looking for a co-founder, you can maximize the chance of working together if you’re ready to seize the moment when you come across that person.  Be ready to give them the best pitch they’ve ever heard.  If you’re a non-technical co-founder, having existing customers lined up to try your product is a powerful statement that will distinguish you as a potential partner in a competitive market when you’re searching for collaborators. 

• Celebrate the milestones: the goal of any founder is to create a successful company.  It was my goal too.  But that can take years.  In the meantime, make sure to set milestones for your success along the way and genuinely celebrate them. It feels good to reflect on your progress.  As I found, if you don’t, when the hard times come it can make it difficult to feel like you’ve achieved anything which can have adverse effects on your mental health.  

• Know your story: every time you talk to someone about your company, whether potential customers, investors or employees, you’re selling yourself.  When you sell, people don’t remember products, they remember stories.  At all times in your company’s development, try to have a compelling story about why you’re doing what you’re doing and why you believe you’ll succeed.  People will remember you. 

• Set targets and conduct reviews: as time went on, my co-founder and I became stricter about setting targets for any experiments we ran or work we did, and interrogating any success or failure before committing to further work.  This made us far more effective and improved our focus on ideas that genuinely moved the needle. This level of focus and rigour should have been how we were operating all along. 

• Say yes to meeting new people: the opportunity to sell Kommon only came about because I said yes to going to a routine, unremarkable coffee event.  I only met Gareth because I forced myself online to an unpromising tech speed-dating event.  It’s impossible to know which networking will pay off, but as a general approach, saying yes to meeting new people has underpinned much of Kommon’s development.  Particularly when I really didn’t feel like it. 

• Openness can help get a deal done: different deals require different approaches, but it can be easy to default to caution when trying to establish working relationships.  The deal between Kommon and Unicorn Labs happened in no small part because both parties were willing to be open about their respective businesses and positions, which quickly built the trust on which to progress negotiations.