How to De-Risk a Startup

In a previous post, I wrote that startups are collections of risks, and that the best way to make progress on a company (and to get higher valuations from investors) is to address the biggest risks as quickly and thoroughly as possible. But how do you actually mitigate different types of risk? How do you convince yourself that you have product/market fit? How do you persuade investors and employees that you can build a lasting company? How do you demonstrate to early adopters that you're good at building products?

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Startup Cargo Cults: What They Are and How to Avoid Them

"In the South Seas there is a Cargo Cult of people. During the war they saw airplanes land with lots of good materials, and they want the same thing to happen now. So they’ve arranged to make things like runways, to put fires along the sides of the runways, to make a wooden hut for a man to sit in, with two wooden pieces on his head like headphones and bars of bamboo sticking out like antennas—he’s the controller—and they wait for the airplanes to land. They’re doing everything right. The form is perfect. It looks exactly the way it looked before. But it doesn’t work. No airplanes land. So I call these things Cargo Cult Science, because they follow all the apparent precepts and forms of scientific investigation, but they’re missing something essential, because the planes don’t land."

- Richard Feynman, 1974 Caltech Commencement Address

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Common Startup Timing Mistakes and How to Avoid Them

"The right thing at the wrong time is the wrong thing."

- Josh Harris

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How to Make Better Decisions with Data

Companies often use A/B testing to optimize their websites, but they rarely use it for anything else. This is a wasted opportunity. It turns out that if you capture enough data, any repeated, measurable activity can be framed as an A/B test. For example, how does breakfast affect your morning work productivity? If you spend a month or two tracking your productivity along with the breakfast meals that you eat, you'll quickly learn if skipping breakfast turns you into a zombie or if having eggs instead of pancakes will help you get a promotion.

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Why Startup Technical Diligence is a Waste of Time

In late 2012, I made the transition from software engineering to seed stage investing. I started Susa Ventures with several friends, and I was going to be the person in charge of all technical diligence. Since practicing software engineers are relatively rare in the VC industry, I (naively) assumed that my background would give Susa a big competitive advantage when making investing decisions. For the most part, I was wrong.

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