Featured Book: Lost and Founder
First, a disclaimer - We at Relevance are BIG fans of Mr. Fishkin and Moz (in that order) and frankly to us, the book felt like a very natural extension of his rather legendary presentations on and off stage!
Our Verdict: It’s a MUST own!!.
Disguised as a breezy weekend read, the book’s biggest success lies in its ability to make us confront our ongoing obsession with billions of dollars, public validation, and, of course, happiness.
And, of course, coming from the God of marketing, each word felt layered with nuances and a deeper purpose that we have come to expect from Mr. Fishkin.
While marketed as a practical, no holds barred, guide to navigating the ‘startup world,’ I think the book contains valuable lessons for all of us as regards our deeply held notions on what construes success and failure.
We contacted The Wizard of MOZ to answer some of our questions about Lost and Founder and have tried to include some of our favorite excerpts without giving too much away!
Excerpt: In essence, founding a startup or being an early employee means taking a risk. You are sacrificing the certainty of a potentially higher paying job with greater benefits at a more established company for what is typically a less than market rate salary, bare-bones benefits, and the hope that if things go very well and if your company is one of the few that survive and thrive, your compensation will rise, the benefits will get better, and, someday, if you’re extremely lucky, your stock’s value will exceed the delta between what you could have made at another job.
Does this mean you shouldn’t found a startup? Or join an early stage company?
No.
But it means you almost certainly shouldn’t do it exclusively for the promise of short term wealth. The idea that you can compress an entire career into a few years of work and be directly or consistently rewarded with cash for that compression is insanity borne out over and over by the stats.
The myth that “founders get rich” has brought thousands of people into the world of startups potentially for the wrong reasons and almost certainly with the wrong expectations.
Right now, my metrics for success have changed substantially from my days at Moz. When I was there, the only barometer for success was a successful sale or IPO of the company at a price that would return a lot of money to our investors (3-5X+ their total investment, meaning a sale somewhere north of $200mm, and hopefully more like $500mm+).
Now, with SparkToro, I don't need to reach anything like those lofty numbers to have a successful business. If this new company can make even a couple million dollars a year, it can still return money to its investors and founders. Of course, I'd love to see it grow into something more, but any outcome that's profitable, sustainable growth in those sizes is a win.
My biggest hope is that SparkToro can inspire others to follow a non-traditional venture path for their tech startups. I think that when we change the criteria for success, we change and broaden who gets to be "successful," and we create a lot more opportunity, too.
Excerpt: When you’re an early-stage startup founder, your job is clear - find product-market fit, and then scale. Beyond that things get murkier. Once you have “fit’ and are scaling, your job is to find growth through any means possible. Greater growth means higher evaluations, the ability to attract better talent, the envy of your peers, the coveted press and prestige, the possibility to sell your company or your stock, and become wealthy; all of it is dependent on growth as measured by the percentage of year-over-year revenue addition.
Silicon Valley startup culture embeds founders with the false belief that because growth is what matters most, we should pursue any and all strategies that could lead us there. Far wiser, and much more difficult because of the patient and discipline required, is ignoring those potential off-course avenues in favor of applying the experimentation, learning, and iteration process to the one thing in which you can be the best in the world, and letting those other strategies for growth wait until you’ve got truly massive scale.
I don't necessarily agree with that. I think that watching what people are searching for and serving them with content that answers their questions and uses the same language they use is a positive thing. Like anything else, there's overkill and people going too far, but in general, serving users well will serve search engines well, too.
Excerpt: The thing is - it is absolutely true that a balanced team, in which one person’s weaknesses are covered by another’s strengths, can be tremendously successful. What’s not well understood, and usually only gets uncovered after years of operations, is how founder attributes instill themselves with near permanence in an organization, while the attributes of the supporting team fluctuate over time. Partially, this is because founders tend to be around much longer, exerting more influence over more time. The average tenure of an employee in the startup world is only about two years. But even if you retain that supporting team, there’s an undeniable, indelible imprint sourced from the founder’s biases, the structure of the business they created, their recruiting, their delegation, their assignment of resources, their passions, and their blind spots.
It's certainly possible! I can imagine that my biases to kindness and inclusivity and other things held Moz back from maximizing the amount of revenue they could extract. As I noted in the book, the company could make it impossible to cancel via the site, which would almost certainly drive up revenue (at least in the short term). Whether that's a company anyone would want to buy from, work for, or run is another matter.
Excerpt: Self-examination is rife with opportunities and incentives for bias. We want to believe the best about ourselves, and we know that many times, attacking pillars of our self-worth or our core beliefs sets off a vast minefield of psychological defenses. These are the impediments we have to overcome. Easier said than done.
The same applies when understanding the strengths and weaknesses of your entrepreneurial venture. You have hypotheses about why one tactic worked and another didn’t. You blame some combination of market forces or poor strategy or too-slow execution. But 9 times out of 10, you do it based on instinct and supposition, using those same biases that drive your blindness to self-knowledge.
I certainly hoped to make Lost and Founder applicable to more than just CEOs/founders, but to people in all sorts of working situations. And yes, I definitely hope to write more in the long term about what I learn about business (and life).
Excerpt: “Reward the behavior. Not the outcome. When we make it about the work, rather than the goal, the outcomes improve. The field of behavioral science has all sorts of data on what happens when rewards are connected to outcomes rather than behaviors (namely, people cheat, break rules, game systems, and ignore the safety of themselves and those around them). There is beauty and clarity in this truth. When we are freed from the mythology that we control outcomes, and asked instead to concentrate on behaviors, we have a powerful tool to fight against negativity and anxiety. It’s a gift.”
I think the relevance of SEO is better now than it has ever been. More companies are investing. The field has more respect. There are more good operators and fewer spammers and sketchy providers. But ROI is probably going down, both because of Google's actions that take away clicks from SEO and because so many more businesses are investing more seriously (which drives up competition). I wrote about this recently on the SparkToro blog.
If you want to know more about Rand Fishkin even after reading Lost and Founder please also check out one of top recommendations.
