Start Up Blog

Falling in love with infrastructure

Posted in entrepreneurship by Steve Sammartino on July 4, 2011

Here’s a list of companies who should’ve done something, yet instead, let someone else do it for them. And in being asleep at the wheel, they will never be as powerful (read relevant) again.

Yellow Pages should have become… Google
Encyclopaedia Britannica should have become… Wikipedia
RCA / Sony / BMG / EMI / Warner should have become… iTunes
Newspaper classifieds should have become… Craigs List
Trading Post should have become… eBay
Barns & Noble should have become… Amazon
Industry X could well become… Your startup

The key point is this. The future doesn’t care about your legacy, or how things were done in the past, it only cares about what people actually want. And people don’t care about your existing infrastructure, they only care about themselves.

There’s a million more of these examples out there, and many more to come. The question is which industry will you disrupt because they are too in love with their existing infrastructure?

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Theatre at Transaction – Der Raum

Posted in entrepreneurship by Steve Sammartino on June 29, 2011

Recently I ended up at a bar late at night. It’s a revered place called De Raum. It’s been well covered on the web so I’m not going to give a review of it here. What I will do instead is tell you the story of the ‘Teachers Reserve’. And how this business justifies an ultra price premium.

I asked the bar tender for something sweet, to help take the edge off after a heavy day – something night cap-ish. He said;

“I know just the thing. The Teachers Reserve. For those moments when you’ve done all you can, when the days been hard, and it’s time to reflect, quietly and possibly have a conversation in your own head. It’s not exactly social, but poignant.”

He then made up the drink and presented it in a manner which will make sense when you see the photo essay below. He furtively passed me the book, while he looked in the other direction – as if to say: ‘let this be our little secret’.

Classic theatre at transaction. I was delighted, and I didn’t mind paying the $25 for it.

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What comes first

Posted in entrepreneurship by Steve Sammartino on April 14, 2011

Making stuff is what we must do. But it isn’t as important as the thoughts that lead to the making process. Thoughts themselves are things.

What we must do is ensure we allocate enough time to the thinking, so that we end up making.

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Good service? Prove it

Posted in entrepreneurship by Steve Sammartino on April 3, 2011

Yesterday I went to a well known cafe in Melbourne for breakfast. Yes, it had a amazing the decor of a restored warehouse and exotic free range egg combinations, but that wasn’t what impressed me. It was the way they served their ‘non-customers’.

By the time we where half way through our second java a line had started to build for people waiting for a table, which is pretty rare in a cafe centric city like Melbourne. Up until that time the thriving restaurant still had amazingly quick service. But the service I was most impressed with was the service they gave those who weren’t even customers. People waiting patiently outside were treated to complimentary cafe lattes and flat whites. I’m sure they were surprised and delighted at the good will gesture. The tone of the staff there also told me that they gave them coffee because they were genuinely sorry they couldn’t seat them immediately. They meant it, and it wasn’t a promotional ploy. Something we’d never see from a chains store or large corporate. They’d be more concerned with wooing ‘non-customers’ that rewarding their ‘sure bets’. I say they’ve got it back to front.

The reality of the complimentary coffee is that it sent out a good vibe, and cost very little to do. And the benefits? Well I’m already blogging about it and put it on my twitter stream which goes to many thousands. I’d also say that rewarding those you’ve already got, is a far better investment than investing in those who’ve never helped your business. Something all startups should take note of.

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Car smash marketing – Rebecca Black

Posted in entrepreneurship by Steve Sammartino on March 20, 2011

I’m not about to make any comment on the song Friday, or about Rebecca Black. She seems like a nice enough kid having a crack at the music industry.

It is interesting how anything has a chance in a zero cost media world. Sure, not everything will cut through, but in 1991 Rebecca didn’t stand a chance. She had no where to put her song (Youtube), nowhere to sell it (iTunes) and no one to spread it (Twitter / Facebook ). The invention of all this infrastructure made it possible. The thing that is different about the infrastructure versus 20 years ago is that cost of entry has been removed. Extremely good and bad start in the same place. And occasionally something unusual makes it through – so long as it is extreme in nature. No-one has placed multi-million dollar media bets on selling Rebecca’s song, so the cost of promotion has been reduced to taking 3.48 minutes from our day, or typing 140 characters. It’s like a car smash, we can’t help but slow down and take a look.

The question it makes me wonder, is if there is a valid strategy in being the ‘worst’? And if there is, how do we make sure we qualify? And if we qualify, how do we then transform?

Love or or hate her, right now Rebecca has 100% share of voice.What that turns into is entirely up to her.

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Invest 5 minutes in glass

Posted in entrepreneurship by Steve Sammartino on March 7, 2011

This is an amazing piece from Dow Corning on the future of glass in our lives. It really sets the tone on how they will through their products make our lives better. It makes me wonder why more startups and large brands are not creating films about the future, and how they will shape it in a positive sense.

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The worlds first disloyalty card

Posted in entrepreneurship by Steve Sammartino on March 3, 2011

Prufrock coffee who created the worlds first disloyalty card.

The card to encourages their clients to sample the wares of quality coffee shops around their local region in London. Which is completely counter intuitive to sound business practice.

How does it work?

If a disloyalty member tries all 8 coffees on the above card , it will earn you a free coffee at your next visit to Prufrock Coffee. The interesting part is that it was conceived to keep ‘coffee customers’ out of the four walls of the ever encroaching Starbucks behemoth. The disloyalty card created a community of coffee lovers that could compete the ‘way of an artisan’. Something Starbucks could never do. It might just help keep them out.  In this instance the community matters more than the trader. This is the new collaborative world we are in transition towards. A community who vest their interests in each other.

What can your startup do to flip the rules and do what a bigger competitor never could?

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Good stuff is not enough

Posted in entrepreneurship by Steve Sammartino on March 1, 2011

Making really good stuff is not enough. We’ve got to be good as well. Good people. We’ve got to have a DNA encoded into our business which shows we stand for something that is wider than what we sell. I’m not talking about any of that Corporate Social Responsibility crap, or even triple bottom line reporting. I’m talking about caring enough to leave good things behind us in our trail. For the things we touch to be the same or better after we’ve been there.  And most of all, we need to make sure our trail is going to be good, before we carve the path that takes us forward.

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The formula is love – Moby

Posted in entrepreneurship by Steve Sammartino on February 6, 2011

I happened upon an interview with the musician Moby at SXSW in 2008 and he had something valuable to say about love:

The question was: “How do you recommend balancing yourself?”

His Answer:

“My advice first and foremost would be to do what you love. Um… because that way, if you do what you love, it increases the chance that you’re gonna have success with it. And even if you don’t have success, at least you spent your time doing something you love.”

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4 factors for webpreneurs – Guest Post

Posted in entrepreneurship by Steve Sammartino on December 30, 2010

1. Technology is easy – getting customers to pay you is outrageously difficult.

When was the last time you heard about a web startup failing because the product didn’t work?  Almost never.  With the greatest respect to all the hackers and engineers out there coding away, making a product do what you want is simply a function of time.  Spend enough development time on it, and you can write code to do almost anything you want. Getting a customer to pay you some money for that feature you just added? That’s an entirely different proposition. The vast majority of web startups fail because they don’t find enough customers, at the right price and in enough time before they run out of cash.  If we spend as much time on marketing your startup as you do on writing and shipping your code, and we just might beat the odds.

2. Customers can always choose to do nothing

When pitching a prospect we are generally trying to convince them to do one of two things:
(i) Leave a competitor and join you
(ii) Stop doing nothing about their pain problem and join you

Who knew that getting them to leave a competitor was often easier than getting them to stop doing nothing? At least if they are using a competitor they recognise that they have a problem that needs solving! The truth is, many prospects are indecisive, stagnant, glacial, apathetic, unwilling, and unmotivated.  Demonstrating your product and then asking for the sale is just as likely to be met with a yawn and a scratch of the arse as it is with a chequebook. If you understand how difficult the process is, then there is a good chance you will approach it with the right amount of preparation and effort.

3. Financial models are fantasy
Their is one good reason to construct a financial model prior to having any real customer data.  Do it to prove to yourself that the fundamentals of your model will produce a profitable business over time.  Think of it as a sanity check. Once you are happy that the model works in theory, throw the spreadsheet away.  Never look at it again, and for christ sake don’t go out and try and raise investment funds off the back of it (guilty as charged!). Just launch your product and get as much real live data as you can.  Months later you can giggle about how wrong your projections were, but at least you won’t be making life altering decisions based on nonsense.

4. There is no replacement for quality user testing

User testing pays for itself many times over.  This doesn’t mean getting your mates over to play with your creation in return for a 6 pack.  It means getting real life customers/strangers to use your product while you watch. True story.  Our startup is an online event registration solution that allows customers to sell tickets and accept registrations for any sized event. Three months after launch, we sat and watched via web cam while a Canadian tester spent 15 MINUTES just trying to create an account. In one of our releases, we had cannily decided not to display a “register button” to anyone using Internet Explorer.  No-one using this browser  could get in and use our product, and it had been that way for over a week.  He eventually managed to get in, but man was he pissed!

What else do you wish you had known before you did your own web startup?

Post by Scott Handsaker founder of Eventarc

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