This is Stripe for Email
Why listening is more important than creativity; the human side of marquee startup acquisitions; the harsh reality of being a founder; and introducing Jack Butcher.
🧠Top of mind: Creativity matters less than you think
Many prospective founders put a huge emphasis on “the idea.”
But they shouldn’t.
It’s incredibly counterintuitive, but true, that startup ideas are basically worthless. I moved to Silicon Valley with dreams of being the next Steve Jobs — I considered myself to be full of startup ideas, and therefore destined to be a founder.
Once I landed in San Francisco, however, I quickly realized the reality of the startup world: that ideas will barely get you off of the starting blocks, and merely having a good idea won’t get you very far at all.
Basically every good idea has already been tried. As Marc Andreessen, our “person to know” last week, said:
We launched Loudcloud in 1999, and basically Amazon Web Services is what Loudcloud would have been if it had launched in 2006 instead of 1999. The technology wasn’t ready. Reid Hoffman started a social networking company in 1997 called SocialNet.com, long before Facebook or LinkedIn existed. For 20 years people laughed at the Apple Newton and said it proved that nobody had any interest in a tablet. And then along came the iPad. A lot of ideas that failed in the dot-com era were actually winners. They were just too early.
Startup ideas in Silicon Valley follow the Law of Witty Comments on Reddit:
There are usually multiple teams pursuing any given startup opportunity. Examples abound: Uber and Lyft (on-demand taxis); DoorDash and Postmates (food delivery); Bird and Lime (scooters); etc. Often, venture capitalists come up with the idea first and find the startup to fund second; they send an Associate out to find every company in a particular space, then invest in the team they like most. Another Silicon Valley surprise: VCs will never sign an NDA. It’s just not done. Ideas are a dime a dozen and basically impossible to truly protect; it’s often a fool’s errand to try to stay truly “stealth.”
Perhaps the best example of the value of ideas is the Y Combinator “Request for Startups” list. YC is the best early-stage investor in the world, and they’ve openly published a list of ideas they think are worth pursuing for anyone in the world to see.
Creativity in coming up with startup ideas just isn’t all that important to being a founder. But if ideas don’t matter, what does?
In short: listening.
Brilliant startup ideas help you get started, but don’t last. No battle plan survives first contact with the enemy, and no business plan survives first contact with the customer. Once you start your company for real, listening instantly becomes the most important skill you can have.
No matter how smart you are, there are more great ideas outside of your head than within it. Great listeners benefit from the great ideas and observations, and just the inimitable lived experience, of others. Great listeners see trends emerging before others do; they can cut through the groupthink to hear the truth behind the opinions others share; and they develop strong internal representations of [customers, investors, employees] to predict how people will react to their words and decisions.
It was a bummer to hear that my startups ideas weren’t worth the billions I had hoped, but in the end, it was freeing: I didn’t have to be uniquely original, creative, and brilliant to be successful. I just had to listen.
📢 What do you think?
Is creativity overrated? Would you replace “listening” with “hustle,” or something else? Let me know on Twitter. I’d love to hear from you.
✨What’s (not-so) new in the Valley
[Startup] for [Location]: Paystack, a.k.a. Stripe for Africa, was just acquired by Stripe itself for $200 million. (Stripe makes it super easy to accept payments on your website.) Shola Akindele, Paystack co-founder, released a video that captures him feeling how I think most CEOs must feel in his situation: bewildered, happy, and inspired. Money quote: “What would you do if you had all the resources to do it? This is my opportunity to answer that question.”
Garage to Glory: In another startup-to-startup sale this week, Twilio bought Segment for $3.2 billion. (Twilio makes a communications API; Segment helps companies collect and use customer data.) Segment founder Ilya Volodarsky told their nine-year, completely non-linear story in a tweetstorm, given a hilarious grace note by Paul Graham, the founder of YC who funded Segment:
Evacuating the Premises: Startups and investors in Silicon Valley these days are… no longer in Silicon Valley. Venture capital investors were among the first to buckle down when COVID-19 hit (and were ridiculed for doing so), and I imagine they’ll be among the last folks back. Tech companies are following suit: Twitter, Facebook, Shopify, Dropbox, Microsoft, Adobe, and Stripe, among many others, have allowed their people to work remotely until at least Summer 2021.
🔎 Highlight: Startups are really, really hard
The life of a startup CEO looks glorious from the outside. You get to build a company exactly how you have always wanted. Nobody can tell you what to do. And then you become a millionaire. Right?
The reality isn’t all sunshine and daisies: the bigger the reward, the tougher the battle to get there, and startup founders are gunning for a very big reward. As a founder, your organization still isn’t completely yours: it is subject to the forces of the market, and the board can still tell you what to do. You have no true peers at the company, because the buck stops with you, and all of the company’s hardest problems, highest drama, and most intractable problems end up on your to-do list. And, as we covered last week, you’re probably not going to end up a millionaire when all is said and done.
Being a startup CEO can be a very lonely, very tough job, and it’s hard to express why without witnessing it firsthand. But that didn’t stop Ryan Caldbeck from giving it a try.
This week, Ryan published a remarkably candid and emotional blog post about his experience as the CEO of CircleUp. At one point, he was pivoting his company (drastically shifting its strategy mid-flight), making layoffs, raising money, dealing with a malicious board member, braving fertility issues with his wife, and fighting cancer. Give it a read; a short summary like this can’t do justice to something so heartfelt.
👨🎨 Someone to know: Jack Butcher
Jack Butcher is a master of modern content creation. After reading Naval Ravikant’s famous “How to Get Rich (without getting lucky)” Twitter thread in early 2019, Jack created a Twitter brand with a very simple concept: black backgrounds and white illustrations, captioned with words of wisdom.
He made a few of these illustrations every day, went viral, and followed Naval’s advice to productize himself. He released digital product after digital product — eCourses, an online community, iPhone icons, and more. And as of six months ago, he was making about $5,000 per day.
What I like most about Jack, however, is his strategy towards brand expansion. After Visualize Value, he started @Value. After Value, he started Advice, inverted.
Once he struck gold with his original concept, he’s been searching intently for offshoots and side projects that can build his brand. And so far, it’s working — a great case study for folks who want to learn how to build a hype machine on social media.
Catch you on the out side,
Christian