Category Archives: Business

How to Pitch Anything in Two Minutes

From BusinessWeek:

  • Demonstrate enthusiasm – “Now here’s something I’m really excited about.”
  • Find a personal connection – He spent a few seconds talking about how he grew up with this company’s products in his home and just how ingrained the products were in his country’s culture. By doing so, he showed he cared about the product and wasn’t just paid to pitch something with which he had no personal connection. Remember, people want to like the person behind the product.
  • Sell the benefit – Instead of simply demonstrating the features behind the product, the chef sold the benefit behind the features. This is a critical persuasion technique. Identify the potential problem before offering a solution.
  • Tell stories – “Let me tell you about an experience I had with a world-renowned chef in London…” With that, the chef regaled us with memories of his travels. Stories create connections between individuals. They can tell your listeners more about your product than just the facts. For example, in the area of enterprise security technology, I recently met a smart IT manager who successfully sells ideas by telling stories. He doesn’t start a pitch by saying: “This enterprise level security solution represents best-in-class technology for our scalable architecture.” Instead, he tells stories that begin like this: “Imagine walking into work Monday morning to find that your computers had been stolen…” Simple stories can take under 30 seconds to tell but can offer more information than mountains of data.

The Economics of Attention: Why There Are No Second Chances on the Internet

From Gigaom:



5 Lessons From OMGPOP’s Huge ‘Draw Something’ Sale To Zynga

The obvious lesson from Zynga’s purchase of OMGPOP yesterday is that the games industry is still very much a hits-driven business. And when you’re the giant in the business and a small startup like OMGPOP has a smash hit, it’s easier to buy the hit than try to replicate it. That’s why Zynga was happy to part with up to $210 million, reportedly, for the New York-based studio.

But there’s more than meets the eye here. OMGPOP is a fascinating story in the life of a startup, with many lessons to learn here for entrepreneurs, developers, financiers, and dreamers.

1. App Store Overnight Success Is Real (And Unpredictable)

Draw Something’s meteoric rise to the top of the App Store charts is the sort you’d dream of. From its launch on Feb. 1, it started shooting up the charts, reaching no. 1 in about a month.

As OMGPOP CEO Dan Porter tweeted yesterday, “It took AOL 9 years to hit 1 million users. It took Facebook 9 months. It took Draw Something ~9 days.”

How did they do it? It wasn’t an original idea – drawing games have been around forever. Heck, the web version of “Draw Something” launched as “Draw My Thing” more than a year ago.

It just hit. “No one had any idea that this would take off, and no one knows why it did,” an OMGPOP investor told All Things D’s Peter Kafka.

And, by the way: When overnight success hits, brace for impact. Porter tells a good story of OMGPOP’s scaling challenge: “We had to move completely off of Amazon and host everything ourselves. As soon as we did that, our growth exploded again. Going from the 25th to the 1st most popular app was as much about performance as anything.”

2. You Can Fail 30 Times And Still Succeed

“Draw Something” wasn’t OMGPOP’s first game. Its website actually lists more than 30 game titles, from the 2007-vintage Tetris clone “Blockles” to 2008’s “Hamster Battle” (that one was pretty fun) to the “Jigsawce” puzzle game.

Similarly, “Angry Birds” was Rovio’s 52nd game. Today, four of the top 25 most popular paid iPhone apps are “Angry Birds” varieties.

In a hits-driven business like gaming, stamina is as important an asset as creativity. (And luck!) Be patient.

3. “Sell High”

It’s only been a day, and “Draw Something” has already been knocked off the no. 1 App Store spot by the new “Angry Birds Space” game. Who knows, the “Draw Something” craze could fade as quickly as it started.

So, sure, it’s possible that OMGPOP could have kept growing like “Angry Birds” parent Rovio and become a billion-dollar company someday. More likely, arguably, it could have raised a new round at a high valuation, lost momentum, and gone back to the drawing board.

After all these years of hustling and struggling, it’s no surprise that Porter and OMGPOP’s investors would have been thrilled to see a $200+ million exit. That is a lot of money with the power to change many peoples’ lives. Especially when the lights could have easily gone out by now. (Fortune’s Dan Primack has an interesting story of the company’s funding challenges: “The deal that saved OMGPOP.”)

Anyway, if you’re going to sell the company based on a hit, sell on the way up. Great timing for Dan Porter.

4. Startups Can Thrive Without Their Iconic Founders

In the New York tech community, OMGPOP was synonymous for years with its scenester founder, Charles Forman. (It was once a small scandal that Charles received so many demo slots at the monthly New York Tech Meetup.)

But Forman hasn’t been day-to-day at OMGPOP for a while: He’s been working on Picturelife, a photo sharing startup. Forman may have given OMGPOP its start, but Porter is the man now.

In most cases, it’s probably better for recruiting, public perception, and morale if the company’s founder is still an important employee. Digg remains a tough sell without Kevin Rose. (Rose, coincidentally, was one of the first OMGPOP investors.)

But it’s certainly possible to thrive without them.

5. Your First Idea Doesn’t Matter That Much

This is something you hear a lot, and it’s true: It’s not uncommon that the first idea you have for a company isn’t the one you see through. In the case of OMGPOP, gaming was actually the third idea.

“The beginning of the company itself was, in some sense, an accident,” Forman told Gawker in 2007. “I went alongside Dan Albritton to help him pitch his mobile business idea to Y Combinator as a favor to Dan. Within minutes of presenting, Paul Graham at Y Combinator told us that Dan’s idea wouldn’t work and that they weren’t interested. They were, however, interested in us, as people. Paul asked if we had any other ideas.”

That led to I’minlikewithyou, a sort-of auction-based dating site. And that eventually led to a pivot into social gaming, hiring Porter as CEO, and changing the company’s name to OMGPOP. And that was 3 years ago. It’s been a mostly tough slog since then.

Similarly, OMGPOP was all but married to Adobe’s Flash technology when it started to lose favor as Apple’s iOS platform took off. But even OMGPOP was able to shift off that platform and make its biggest hit – which ultimately sold the company – using a different technology platform. It’s important to be flexible.

Extreme Management: What They Teach at Harvard Business School’s Advanced Management Program

In poorly managed companies, people are problems. In well-managed companies, people are problem-solvers.

The wrong person in the wrong place = Regression
The wrong person in the right place = Frustration
The right person in the wrong place = Confusion
The right person in the right place = Progression
The right people in the right places = Multiplication

Little Bets

Barnholt calls it the tyranny of large numbers, explaining that “there’s a natural tendency to think in terms of bigger bets as you get to be bigger.” … Barnholt recalls, “Around that time, people said, ‘We [HP] don’t even want to look at opportunities unless it was going to be a billion dollar business.’ A billion dollars kind of became a mantra.” They then researched and analyzed the markets, segmented them, and developed products. … “We had all these ideas. And they were all big,” Barnholt recalls, “but they all failed!”

The reason they all failed and the reason they were big is that someone was already there.” To borrow a phrase from Silicon Valley consultant and author Eric Ries, they “achieved a failure.” Their ideas made sense. The technology was great. They executed on their plans well. But they still failed.

HP’s assumptions turned out to be wrong because of what Barnholt calls intangible factors, the realities beneath the surface: the underlying customer problems, needs, preferences, and supporting market dynamics. They were not discovering new opportunities or developing new products, they were relying on the success of competitors to identify the areas they targeted. They weren’t being creative. … “That’s how I learned the importance of making a lot of little bets.”

Cars vs. Beans

The former General Motors vice chairman dished out some great commentary. Lutz was promoting his new book Car Guys vs. Bean Counters: The Battle for the Soul of American Business, and talk quickly turned to his role as it related to product development and high-level decision making at GM. While on the topic of brand management, Lutz revealed a few rather interesting tidbits about his former employer:

  • All Chevrolet vehicles were required to have five-spoke aluminum wheels and a chrome band up front, as part of the Bowtie brand’s overall image.
  • Pontiac was required to utilize “see-through” headrests, despite the fact that they cost more to produce while offering no consumer value.
  • All Buicks required a sweep spear in the exterior design language.
  • Cadillac considered building a 550-horsepower supercharged Escalade.
  • Saturn was working on a seven-passenger Vue.
  • Many of the non-car person GM board members preferred to drive imports.
  • Proportion and shape didn’t matter as long as all the brand-image boxes were checked.

Lutz provides an interesting look at the type of decision making that forced GM into a position of bankruptcy. The automaker was being run solely by folks focused on techniques and ideals that don’t work in the industry. He takes a few shots about MBA culture:

  • More beancounters in product planning than in GM finance – and they unintentionally subverted the car process because of too much abstract analysis – instead of common sense analysis
  • Stupid corp metrics – 40% of products had to be ‘innovative’ — which led to stupid, ridiculous design
  • Financial reporting metrics (esp regional) led to sub-optimal behavior – that were just wooden nickels
  • Lack of thought about real customer value — too busy being driven by things like per unit car cost vs incentive cost – instead of what the real cost was for the customer and for GM

Standing Out. “Safe is risky” – Seth Godin

Standing Out. “Safe is risky”

All marketers are liars

On the tribes we lead

On social networking