entrepreneur

Why the ‘Best User Experience’ MITX award means so much

Last night at the 2015 MITX awards, Punchbowl won the award for ‘Best User Experience.’ This award meant a lot to me — let me tell you why.Screen Shot 2015-05-15 at 7.19.11 AM

On February 25, 2014 (15 months ago, and just days before my second child was born), I held an offsite meeting with key members of the Punchbowl team. At this “eTeam meeting” I brought up a radical idea: what would happen if we removed 50% of the features in our product, drastically simplified the user interface, and focused the product on our core offering of digital invitations? After several hours of discussion, “Project Megadeth” was born.

For the next several months, I worked on strategy with close advisors and mentors. We worked through some of the tough business issues, thought hard about tactics, and plotted a plan of attack. A few months later, our product team had cleared their plate and was ready to go. In June 2014 at our Q3 kickoff meeting, I unveiled the bold plan to the whole Punchbowl team, and we set out on the most ambitious project in the history of the company.

Every day, for weeks and weeks on end, our design and product team met. Lead by our Director of User Experience, we explored, iterated, designed, thrashed, re-designed, and iterated some more. We built from the ground up with tablet and mobile phones in mind. Seven years of experience paid off, and eventually we had a design that we believed met all of our objectives. Our development team dove headfirst into implementing the design, and within a few months we began to see the new user interface come to life.

However, with any radical new design, there were several challenges. Our CTO is fond of saying “a spec is just a suggestion” and in this case it was definitely true. There were several issues that we had to solve during the implementation phase, as we balanced simplicity with powerful features. One example: we wanted to preserve our ‘Potluck’ feature, but we didn’t want it to be a required step for every user. We solved it by branching the feature from the ‘Invitation Options’ page and creating a mini user workflow for creation and editing. Sounds simple, but the devil is always in the details.

On October 20, 2014 we launched the new site. The response was overwhelmingly positive, and we were really excited about early usage. Over the next few months, we measured conversion and improved some of the user interface based on the metrics. We saw incredible growth, especially in our kids birthday segment. We knew we had a winner on our hands.

Fast forward to May 14, 2015: it’s now been well over a year since that fateful meeting with my eTeam. And yesterday afternoon, I had the opportunity to demo our fantastic product to a group of MITX judges. Several hours later, I sat with over 1200 people at the MITX awards ceremony. The event was elaborate and very fancy — and for the companies nominated, it felt like the technology Academy Awards.

When they announced the winner in our category, I pumped my fist and thought about the hundreds of hours that we spent designing and implementing the new user interface for Punchbowl. And I thought about the awesome people on the Punchbowl team, and just how very far we’ve come. I jumped up on stage, took the microphone as the lights shined brightly in my face and said  “Here’s the thing about great UI:  we spent literally hundreds of hours making a website that works on mobile, works on tablet, works on desktop and when you use it, it just feels like it works. I’d like to dedicate this award to every single entrepreneur who is not getting the notice that they deserve, who are taking one little step at a time, which is what we’ve done for the last seven years. So to the Punchbowl team, to Devin, to Blake, to Ryan, to Stephanie, we did it baby – let’s go!” (video of my acceptance speech below)

SWAMI SAYS: Some awards are just marketing gimmicks — and some awards mean a lot. The MITX award for ‘Best User Experience’ means a lot to me and the Punchbowl team. I’m very thankful and proud of the award.

First time entrepreneurs should avoid two-sided marketplaces

marketing-challengesIf you are thinking of starting a company, there is one decision that you need to make right up front. Are you trying to create a product or service for one market or are you going to attempt to create a two-sided marketplace? Most of the products and services that we use are one-sided. A company builds a product that certain users demand. A two-sided market (e.g. marketplace)  is one that requires demand from TWO different types of users. That’s really tough to build.

I didn’t know it at the time, but I made a smart decision when I started Punchbowl. Although I had ideas about how to create a two-sided marketplace, we’ve created a product that is fairly simple to market and grow. To be successful, all we need to do is to get more people to plan an event. We’ve tested some ideas around creating a two-sided marketplace, but our bread-and-butter is a simple one-sided market.

Two sided marketplaces are very difficult – they suffer from the “cold-start” problem because you need demand from two sides. Most of us know the “original” two-sided online marketplace: CraigsList. When CraigsList started, the site needed both people wanting to sell things and people wanting to buy things. In the early days of the Internet, this wasn’t a sure bet. But CraigsList was able to create demand on both sides of the market with a simple user interface and by being one of the first to market. And it didn’t hurt that it was free!

Here are a few other two-sided marketplace examples:

  • eBay (EBAY): Needs both people who want to sell things, and people who want to buy things in an auction style.
  • Homeaway/VRBO (AWAY): Needs both people who have vacation homes that they are willing to rent and consumers who are looking to rent vacation homes.
  • Care.com (CRCM): Needs both families in search of child care providers, and people who are seeking child care jobs.
  • The Knot (XOXO): Needs both brides seeking DJs, caterers, and bakeries and local vendors who offer their services for the wedding market

Several times a month, an entrepreneur reaches out to me to get my take on their startup. And more often than not, I’m being pitched a two-sided marketplace. Here’s the problem: to create a two-sided marketplace, that means you need to do TWICE the amount of marketing to be successful. And while two-sided marketplaces can be very lucrative, more of them fail given this intrinsic challenge. If you’re a first time entrepreneur, I would strongly recommend that you build a company for only one market, and leave the more difficult two-sided marketplace for your next rodeo.

SWAMI SAYS: Starting your first company? Don’t try to build a two-sided marketplace. It’s difficult enough to build a great team, get your product to market, and find users. If you’re successful building your first startup, you’ll have the experience to try and build a two-sided marketplace. One last thought: successful two-sided marketplaces can be very lucrative. All of the companies I listed above are publicly-traded companies. Take a look at their financials and quarterly reports to learn more about what it takes to build a successful two-sided marketplace.

Roy Hobbs, Single Malts, and Destiny’s Child

Over the years, I’ve been interviewed many times for various publications. The most recent time was this week when I was interviewed for an article that appeared on BostInno. It’s sometimes hard to convey who you really are when you are asked a series of seemingly random questions — but I thought the questions and my answers in this interview provides nice insight into how I think and what matters to me. Special thanks to Connor Barnes and Linda McDonough of Cassidy Turley Boston for the opportunity. You can read the entire interview on BostInno, and I’ve chosen my favorite questions to re-blog here. Enjoy, and let me know what you think.

If you could have had the starring role in any movie, already made, what movie would it be?

MjD: Well, the obvious answer would be Groundhog Day and I would love to play Phil Connors. The scene where he drives down the railroad tracks, gets stopped by the police, and proceeds to order fast food when he rolls down the window still gets me every time. But I think the movie “The Natural” would fit me better: a total unknown comes out of nowhere and possesses unbelievable talent. I’d like to think of myself as a modern day Roy Hobbs in the tech startup world: no one believed I could build a company from nothing, but here I am. Above all, I’ll have a huge love of the game of baseball, and in my opinion “The Natural” is the greatest baseball movie ever made.

What do you do for fun?

MjD: I have two kids now, and I spend most of my time with them. Those who don’t have kids will never understand the unbelievable joy you can feel showing them something new for the first time. Last weekend, I took my 4-year-old daughter to a local pond and we set sail using my inflatable raft. Splashing each other with water as we paddled around was more fun than I could possibly describe. I’ve also developed a habit for great beers and whiskey. It’s lots of fun to taste new craft brews and single malts. And the more you taste, well… it gets more fun.

What is one thing the startup scene is missing in this area?

MjD: The startup scene is missing enough early-stage investors who can suspend their disbelief of new entrepreneurs. We almost didn’t get funded simply because I didn’t have a track record of startup success. Meanwhile, second-time entrepreneurs are getting silly, ridiculous money for bad ideas simply because they had some success in the past. We need more investors taking risks on first-time entrepreneurs with good ideas.

If you had a theme song that played every time you walked into a room, what would it be?

MjD: Probably the chorus of the song “I’m a Survivor” by Destiny’s Child. The lyrics “I’m a survivor, I’m not gonna to give up, I’m gonna to work harder, I’m gonna make it” are all you need to know about me. I may lose a given battle, but I’m not going to lose the war. And I have a very long memory for people who stand in the path of my success.

Who is the most fascinating person you know?

MjD: On the street where I live, there is a man who walks to the train at exactly the same time every morning like clockwork. He wears a fedora and carries a briefcase, looking straight ahead with no expression on his face. In the evening, he comes home at exactly the same time every day, briefcase in hand, with barely a nod to people he passes. One day, I stopped him to say hello and asked him what he does for a living. He told me he’s an engineer for Verizon and his primary job is maintaining code for landlines using an outdated language called Cobalt. He’s worked at the same job for 30+ years. Here’s why I’m so fascinated: this man is the polar opposite of me. I can’t imagine doing the same job for 30 years, working on outdated technology in a declining market. This guy clocks in and clocks out, happy to collect a paycheck and inch his way towards retirement. The mindset of someone like that is fascinating to me.

Any advice for the young entrepreneurs out there?

MjD: Here’s what I wish someone had told me: as a young entrepreneur, your instinct is to solicit advice from those who have been successful and those who might know something about your market. This is a great way to meet a lot of people and grow your network. But don’t mistake their quick take for anything more than a 15-minute look into your world. They don’t understand the nuances as well as you do and they don’t understand the context as well as you do. So while it’s important to surround yourself with people who can help, it’s more important to listen to your inner voice. Look deep inside and ask the question “what do I really think?” You see, it doesn’t really matter if you’re right or not. What matters is that you have the conviction to keep going, to not give up, and to learn along the way. Successful entrepreneurs listen to their inner voice more than they listen to the opinions of all of the people around them. The first step to success is to truly believe in yourself.

NDAs are Stupid (mostly)

A few weeks ago, I asked our System Operation Manager to get a quote from a new service provider. To get a quote, we would need to provide some basic information about our server configuration, and the service provider would give us pricing. But rather than a simple conversation, the vendor decided that we had to sign an NDA (non-disclosure agreement) before they shared any information. You know, for our mutual protection. What a joke.

NDAs are stupid (mostly). The basic idea behind one is that it’s a formal legal agreement that states I won’t share your secrets and you won’t share mine. But how many secrets does a company really need to protect? And what’s the consequence if those secrets are shared? Most importantly, how do we enforce the NDA if the secrets are shared? An NDA is only really useful as a legal document in the case that the parties end up in court. And if you end up in court, it’s going to be expensive – VERY, expensive.

NDANDAs are only useful if the secrets disclosed would have a DETRIMENTAL impact one of the parties involved. If we are sharing proprietary data or we’re divulging top to bottom financial information that would harm us if leaked, then we can do the NDA dance. If we’re simply providing basic information to each other, then there is no use for a piece of paper that is only useful in a court of law. I have a stack of signed agreements from companies that insisted on an NDA before we can have a meaningful conversation. By requiring an NDA, these companies put up an unnecessary roadblock that slowed innovation. They are mired in paperwork for a false sense of security.

One of the more bonehead uses of an NDA is by entrepreneurs who try to get an investor to sign an NDA before sharing their idea. It’s a sure sign of a newbie if you ask an investor to sign an NDA. When an entrepreneur approaches an investor for money, it is unlikely that the ideas and technologies discussed are absolutely novel. Most likely the investor has already seen something similar, and if they haven’t they soon will. If an entrepreneur is really concerned about someone “stealing” the idea, then the idea probably isn’t that good. A successful startup is all about execution, not novelty. Case in point: how many social networks existed before Facebook came along? Mark Zuckerberg and friends simply out-executed everyone else.

So in what scenarios does it make sense to sign an NDA?

  1. If we are sharing specific financial data with each other that would harm the company if shared. For example, if I’m going to disclose revenue, expenses, profits, margins and I don’t want my competitors to have this information, then I probably will want you to sign an NDA.
  2. If we are going to show each other proprietary technology that is not yet commercially available, then we should probably sign an NDA.
  3. If we are engaged in partnership discussions that will have a material impact to either of our businesses, then we should probably sign an NDA.
  4. If we are deeply engaged in merger and acquisition discussions, then we should probably sign an NDA. Neither party would want that information leaked, and the addition of an NDA demonstrates the seriousness of the parties.

SWAMI SAYS:  If you sent me an NDA to sign, there better be a very compelling reason that we need to sign it. Are we sharing proprietary information that could harm both of our businesses? Would we actually sue each other if the information gets leaked? If not, let’s skip the NDA and focus on building a mutually beneficial relationship. We don’t need a piece of paper to prove that we’ll respect and trust each other.

Eight years ago today, we incorporated Punchbowl, Inc.

It’s April 11, 2014 — which means that eight years ago we incorporated Punchbowl, Inc. as a Delaware company. I’m always nostalgic on April 11th, thinking about how far we’ve come as company and how far I’ve come as a entrepreneur. On a day like today, I wish I could reach back into the past and talk to Matt Douglas of 2006.

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Matt signing the original Punchbowl incorporation papers

If I could talk to Matt in 2006, here are eight things I would tell him:

1) Your team is everything: You won’t get very far with this company without a fantastic group of people with you along the journey. Hire slowly, and fire fast. Pay close attention to what makes each person tick. Some of the people around you will become life-long friends.

2) It’s going to take longer than you think: Everything is going to take a lot longer including developing the product, raising money, hiring a team, and growing the business. Starting a company isn’t a short-term affair. Be prepared for a very long ride.

3) Starting a company is full of heartache: The road you’re about to embark on will be a very tough journey, and you’re going to feel deep sadness and heartache along the way. You’ll be betrayed, tricked, and ridiculed. But just know that around the bend is another day, and it does get better.

4) Don’t compare yourself to others: Oh, this is so hard. But it’s critical to your sanity. You’re going to see other companies get more funding, and other entrepreneurs start numerous companies while you’re still working on this one. You’ll see CEOs with more Twitter followers and startups with more users. Remember, you can only control your small sphere and you’ll drive yourself crazy trying to keep up with others.

5) Don’t worry about the competition: You can spend lots of time worried about what your competition is doing, or you can focus on what you can control. Hire a great team, build a great product, and focus on revenue and costs of your own business. The competition will come and go, but you control your own destiny.

6) Raising money is very, very hard: It’s difficult to put into words just how hard it is to convince people to part with their money and invest it in your company. Until you get the check in the bank, anything can happen. The key to success is presenting the company as an investment opportunity. Remember, people have lots of places they can invest their money. Find ways to get people truly excited to invest in your company.

7) Survive and advance: Like the NCAA basketball tournament (“March Madness”) it doesn’t matter how you win — just find a way to survive and advance. When you look back, the details will be fuzzy, but what you will always remember is that you found a way to survive. And that’s more than most entrepreneurs can say.

8) Form your own opinion: You’re going to be surrounded by lots of so-called experts along the way. Listen to what they have to say, but make sure you form your own opinion. It’s their 15 minutes of advice, but it’s your company. And you have to live with the decisions.

SWAMI SAYS: They say Rome wasn’t built in a day, and neither are successful startups. In fact 99% of successful startups grind it out every day and wake up many years later just hoping to have seen some success. Today, I’m going to pause for a moment to celebrate just how far we’ve come. What a ride it’s been!

The ‘flyover’ states

Like most startup CEO’s, I spend most of my time dealing with companies on either the East Coast or the West Coast. Between Boston and New York on the East Coast, and San Francisco, Silicon Valley, LA and Seattle on the West Coast there are a lot of potential partners for a business like Punchbowl.

Flyover

However, over the last year, I’ve noticed an increasing number of potential partners and big customers  that are between the coasts. I’m talking places like Idaho, Missouri, Indiana, and Minnesota. In fact, I spent several hours last week talking with a couple of companies in the Midwest that are several billion dollar companies (yes, that’s billion). And guess what? Many of them talk about their strong customer base in the middle of the country.

Those of us on the coasts tend to forget that there are a lot of people who live between the coasts. The wonderful thing about the Internet as a marketing channel is that you can reach them just as easily as the people on the coasts. You don’t need to get on a plane or spend thousands of dollars on billboard ads up and down the interstate. Punchbowl.com doesn’t care where you live (and we love our international customers too!). (more…)

Chicken Soup for the Entrepreneur’s Soul

A few weeks ago, I had a meeting that was supposed to be uneventful, but it left a lasting impression. The meeting was with the CEO of a small company in downtown Boston. On my drive into Boston (about 25 minutes) I reflected on how much I value these kinds of meetings. In this case, it had taken a few months for us to find a date that would work for both of our schedules. I looked forward to meeting this fellow CEO.

When I walked into the company’s offices, I was immediately impressed. It was the kind of office that says a lot about the company: modern conference rooms, open-style workstations, colorful walls, and a whole lot of smart-looking people that looked genuinely happy to be at work. The CEO took me for a tour of the facilities — which included a design firm that worked within the company (not affiliated, they just shared space), and an artist-in-residence (you know, the kind that actually paints art). Very cool. (more…)

7 Pithy Insights about Dharmesh Shah

Note: This is a refresh of a post that I originally wrote in 2007, but it was removed from the web when I created my new blog. Much of the content below is new.

Before I begin, a disclosure: Dharmesh is an investor in Punchbowl, an advisor, and a business friend. However, even though I know him fairly well, he remains an enigma for many people in the Boston startup community (and beyond). What makes this man tick? How does he churn out such great content, attract fantastic people to join HubSpot, and invest in so many companies as an angel investor? (more…)

Twitter syntax is important

tweet-meThis week, I started more actively building my brand online. As part of my strategy, I announced on my blog and on Twitter that I will donate $0.25 for every new Twitter follower that I get this year. And in the first day, a few prominent people helped by re-tweeting. I grew my Twitter following 10% in one day. I’m starting with a fairly small base, but that’s progress.

In the process of tweeting, I’ve already learned a few syntax things about Twitter that are useful as I spend more time on Twitter (hat tip to @adamrubin for his clear explanations): (more…)

$0.25 for every new Twitter follower


As I embark on a new journey to build “brand me”, it’s clear to be that I have a cold-start problem. I’ve spent too many years not sharing my story and being involved enough in the conversation. And as a result, I had 520 Twitter followers as of yesterday.

I came up with an idea that I think might help me with my cold-start plan. I’m going to donate $0.25 to Water.org for every new Twitter follower I get this year. If I hit 10,000 new followers, that will be a $2500 donation to a charity that I believe does a lot of good around the world. And if this blows up well beyond 10,000 followers… well, I’ll cap my donation at something reasonable.

I tweeted this today and a few times “I’m donating $0.25 to Water.org for each new follower this year. Tech/biz folks love my content. Will u RT?” A few prominent people re-tweeted it and I’m up to 565 followers. So that’s $11.25. A good start.

Will you help me grow my followers on Twitter? Please RT this post.