Rabid is now Ackama
In September 2018, on the company’s 8th birthday, Rabid became Ackama - this was to reflect that fact that we work on large digital ecosystems, and given that nature is the largest ecosystem in the world we wanted a name that came from nature. Ackama, or Makamaka, is a small bushy tree with white flowers and red seeds. It’s found on the coast from Whangarei north.
On Taking Startup Lessons from Unicorns
Alan Schaaf Founded Imgur and Came by Wellington
Alan Schaaf, Imgur founder, swung through Wellington a couple of weeks ago. As a highly successful entrepreneur of the classic American ‘overnight success’ ilk, it gave me pause for thought about startup myths and lessons we can take away from the experience.
If you don’t know Imgur (pronounced ‘Imager’ I discovered - don’t follow that link, you won’t make it back to this blog post…), they are closely linked with Reddit as the Reddit website doesn’t provide means for images to be easily uploaded and shared. If you’re familiar with any cat meme online, you’ve likely seen his website. This year, Imgur raised $40m funding from Andreeson Horowitz after 5 years of bootstrapped (self-funded) operations.
###A Living Myth Have you met someone who was building a Facebook about the time that Mark Zuckerberg was? Me too. There’s only one Mark Zuckerberg that gets talked about but many with the coding ability and similar websites that have long since faded. What defines that elusive take-all winning recipe?
Similarly, Alan had an insight and responded, creating Imgur sharing it around the Reddit community he was active in. The cash outlay of launching was $7, and true to the developer image a few pizzas to feed himself. Alan was a developer so this was a project that he could create himself and test with small change.
From there, he very quickly adapted this very simple site, switching hosts and dealing with scaling his service to serve viral traffic as memes became a popular part of the social internet.
I think it’s too simple to derive platitudes to ‘follow your passion’ and achieve success. My read is that Alan did his project with zero commerical thinking and that he did it from the desire to simply create. Having created Imgur, he got lucky. Then he had the capabilities and determination to see the business through. Two separate things - luck and execution.
###Are You Invested in Getting Lucky? I’ve read a lot of business advice, and a lot of the popular self-help literature. Many books promote fantastic messages and reading widely is an important part of personal education and development.
But I also feel there are many messages encouraging us to blindly throw ourselves into situations, deny fundamental realities, and buy into the success fetish of online business marketing. Many early entrepreneurs don’t recognise that they are being marketed to, and their attention, and work is a product in an industry of inspiration and success guidance. The reality of starting is usually exponentially harder work than anticipated, a unique experience in fear management, and the constant humbling process of learning outside the classroom (a virtuous circle of discovering the limits of your competence, feverishly looking to solve this gap and trying to stay solvent all the while)
What it comes down to for me are a couple of fundamental questions to ask the project’s core founders on a bootstrapped project:
are you happy to get the rewards of creating a service, regardless of the financial needs to make money, pay bills etc?
if/when you do get lucky, are you going to be thrilled and motivated to do the hard work to make this a success? Many people might be motivated by other drivers such as money, self-esteem, parental expectations or whatever else. Finding that they actually lack the desire to work on their underlying project or to actually help the users that they want to reach can be a harsh lesson!
are you humble enough to pay attention to what your users want or do you stick to an internal vision or design that hasn’t been road tested in the real-world yet? Will it ship while it’s rough, or sit in your garage until the final wax is applied?
are you ignoring your own personal story and treading in the paths of your heroes?
###What Does This Mean for Me? I found this session fascinating because Alan represents a myth to me. A real-life startup unicorn who followed his passion and built one of the top 50 websites on the internet.
Alan’s history is a contradiction of what we do at Rabid - steadily help businesses plan and implement new services. Our heart is in creating startups and that is what we spend our free time on. But our team are paid and we believe we benefit hugely from a wider knowledge-base than our own as business founders. We have to operate in a commercial reality. One way or another, eventually, you will too.
I believe it is great to experiment, create, and go deep on big problems. Many of these problems don’t fit a compelling, low-investment success outcome. I’ve also learned that startups are volatile things, with individuals working at the limits or beyond their capabilities, managing the fear of impending chaos with the excitement of delivering their business services. This all sounds stupid, until you contrast it with the reality of innovating within larger organisations.
As Rabid, we’ve done deals with other entrepreneurs, providing our technical and strategy experience to online ventures. This is premised on the belief that while we can’t go deep into industries in a startup timeframe, you can repeat and leverage the product development practices when you work with others who understand their industry and know how to innovate and sell new services.
We’ve built a serious services business, and employed staff with great capabilities. Some business guru messages would suggest we aren’t ‘serious’ about growing entrepreneurial businesses and will only ever have a lifestyle vehicle from here. Many of the backstories of people who espouse this view either have many years of working in services businesses or are themselves consultants.
Are you thinking of bootstrapping your idea? Are you lacking that technical co-founder who needs to give up their nights and weekends to test this? I’d encourage you to think carefully about your drive and be patient. Create things, sell small services, study users and consumers. Do things that don’t scale. Discover why your problem actually is worth giving years to- an interesting counter to Paul Graham’s post.
- nothing can replace the role of a founder in conceiving and championing a product and Alan fits the visionary role
- I missed this but others picked up that Alan’s first colleague was someone to dialogue with the ‘community’. As Alan was a technical founder, it would be easier to tap into an ‘entrepreneur, salesperson or more developers’
- we often forget to give advice to entrepreneurs to consistently and regularly use their product. Alan spoke of many, many hours using Imgur and has an advantage of being naturally part of the community he builds for (or maybe that’s just a regular characteristic of success)
- bootstrapping is great. But bootstrap on something that will grow and cover costs. If bootstrapping is the route you are going down, that’s excellent but it may limit the scope of what you can undertake.
- if you are measuring your own success by external benchmarks, you’re always going to find someone more successful. At the time of raising funding, Imgur had a team of 13, and 130 million users. Instagram on acquisition had a similarly small team.
Praise should go to the US Embassy for sponsoring Alan’s trip. Whatever attracts serious and respected entrepreneurs to Wellington, we are lucky to have regular visits from serious players. What’s really exciting to me is an emerging community of capable and ambitious startups in Wellington (and wider New Zealand - but I do feel Wellington has a special touch).