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Monday, 15 July 2013 06:09
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The following is a guest post by Nathan Beckord.  Nathan is founder/CEO of Foundersuite which provides software and templates for founders.

We launched my startup Foundersuite in June of 2013 with nearly 800 startups on our platform, several strategic partnerships, and press coverage by VentureBeat.

Nearly all this traction came from hustling, pitching, and “launching” at 5 different startup events, at a total out-of-pocket cost of $883.

Here’s how we did it. You can do some of this too.nathan small

Event #1: Startup Exits Conference, January 17

What it is: Startup Exits is an event I produce two or three times a year focused on “hacking the exit process.” We run it at Rocketspace, and it draws a crowd of about 150 entrepreneurs and VCs looking to connect with corporate acquirers.

What I did: Since this event is my baby, I had the liberty of inserting a 2-minute preview of Foundersuite into the mix. To ensure the maximum number of eyeballs, I staged my demo right before the segment with John O’Farrell of Andreessen Horowitz, who I knew would be a big draw.

To avoid the risk of an embarrassing crash or bug, I mainly showed screen shots of the product instead of an actual demo. I also framed it as something coming down the pipe, vs. any kind of actual “launch”-- a very, very soft sell.

Result: By giving a “sneak peek” we were able to get initial feedback on our product (this was the first time anyone outside the company had seen Foundersuite.) The overall reaction was good, which provided a boost to morale. This event also served as a “deadline” to hit, which rallied the dev team and got us focused.

What I could've done better: We had a registration page to collect beta users, but it wasn’t fully baked-- 10% of those who tried to register got spit out of the system. Also, we had no structured way to collect feedback, which is so critical to do early and often.

Cost: Nothing. In fact I made a small profit on the event, which went straight back into development. :)

Takeaway: Of course, I had the inside advantage here. It takes some effort, but putting on events is surprisingly easy-- and it gives you a captive audience to pitch whatever you’re hustling. And no, I'm not suggesting you host events just to peddle your stuff.  The event should need to exist and focus on delivering value to the audience.

Event #2: SFBeta “DeveloperWeek Edition,” February 4

What it is: SF Beta is a bi-monthly mixer held at 111 Minna, a bar-cum-art gallery in the SOMA area of SF. Roughly a dozen startups set up demo tables, and it draws about 150 attendees. This event was held to coincide with Developer Week, and it focused on platforms and APIs.

What I did: I printed up two Foundersuite t-shirts from Zazzle-- one for me, and one for my product guy, Victor. Huzzah! We were official! I also printed up stickers and business cards, and I brought along a 27” Apple monitor. At the event, we put out a cardboard box and offered free beer for developers in exchange for their business card, and we ran demos of the product all night.

Result: This event served as a good catalyst to finally get our “game face” on and produce some marketing collateral. It also forced us to polish and tighten our pitch. In the end, we got about 40 new beta users to sign up. In addition, we made friends with a few external developers, and got their perspective on the product vision-- useful, since we eventually plan on opening up an API.

What I could've done better: Realistically, it was too early for us to start courting developers; although there was interest in building on Foundersuite, there’s nothing for them to do (yet). It might be tough to re-engage later.

Cost: $250 for the demo table, $88 for shirts, and $100 for stickers and cards. Also about $60 for follow-up beers with a couple engineers.

Takeaway: Find a small or low-key event for your first “coming out” party; use it as a shakedown cruise to tighten the screws and hone your messaging.

Event #3: VatorSplash, February 13

What it is: VatorSplash is an evening event of about 400 attendees that includes an on-stage startup pitch competition, a keynote, and VC panel discussions. There is also a demo pit for 30 companies. It’s held about 3 or 4 times a year in SF, LA and New York.

What I did: Because Vator was held only a week after SFBeta, I basically recycled the demo table setup. For extra visibility, I printed a large foam board placard at Kinkos and duct-taped it to the wall behind the table.

Result: The demo pit was somewhat empty, except during intermissions. Nonetheless, we had a strong run of investors stop by and check out our software. These visits led to a couple great follow-up meetings with guys like Mike Walsh and George Babu, both of whom provided some awesome feedback. We also signed on about 40 new beta users.

What I could’ve done better: I should have hired someone to run the booth, as the action was really in the main ballroom. Also, the event had an after party featuring the BSD-heavy band, Coverflow-- think VCs and ex-Facebook execs. If I’d been really ambitious, I would’ve rallied for some additional networking fun.

Cost: Zero. My friend Russ Bertuccelli was one of the sponsors and hooked me up with a free table, and we used the collateral left over from SF Beta.

Takeaway: Don’t be discouraged if a demo event is slow or mellow; it's the quality of the interactions that matters, not the quantity.

Event #4: Launch.co Festival, March 4, 5, 6

What it is: Along with TechCrunch Disrupt and DEMO, the Launch Festival is one of the largest startup events of the year. It’s put on by consummate hustler and promoter Jason Calcanis, and is held at the cavernous Design Center.

This thing was massive-- 50 companies demo’d their wares on stage over the course of three long, grueling days. The organizers claim 6,000 people registered, and I’d estimate that at peak times, close to 4,000 were actually there. The list of VC judges and sponsors reads like a startup founder’s dream. In short, this was showtime.

What I did: First let me start off with what I didn’t do-- I didn’t land a spot on stage, though not for lack of trying. I used LinkedIn to see how I was connected to Jason, and then worked every connection, avenue and back-channel to get intros and endorsements. He was responsive, but no stage time for me; however, I did get a free demo table out of these efforts.

Since this was such a large show, we pulled out all the guns. I brought along Victor and also hired my charismatic friend Rebecca Harris to run the booth with me, and that was money well spent. Not only did she master our pitch in about 15 minutes, but it allowed me to get out and wander the halls, which led to some great strategic partner discussions.

We also ran a “mildly guerrilla” marketing campaign at the show; for example, we changed our tagline from the plain “Startup Management Software” to the more provocative “Tools To Get Startup Sh*t Done” and plastered this slogan on our t-shirts, materials, and signage. Right before each lunch break, I would fan a dozen Foundersuite stickers on the lunch tables, which surprisingly, drove a number of people to our booth, while Rebecca did the same at the coffee stations.

Result: This show set in motion several things that, four months later, are still paying dividends. For example, we did a deal with Hack Reactor to use their students for a few projects. We also landed a free Ruby engineer for the summer via a deal with Innovation Norway. I met the folks from Draper University, which led to a speaking gig to their entire student class, and we struck marketing partnerships with two incubators. In addition, we gained about 150 new users and collected an absurd amount of feedback and new product ideas from the hundreds of folks who stopped by our booth.

What I could’ve done better: I still ruminate on how we could have better hacked the application process to land a spot on stage; we were probably dinged a few points when we temporarily took down the beta wall, as Jason saw it and called us on it (this conference is aimed at startups in stealth, who are making their first real debut).

Having a dubstep-blasting rainbow bubble machine (or at least a full-size banner display tower) might have helped, as the level of professionalism WRT booth accessories was a notch higher here-- our neighbor had a futuristic police car with a siren and flashing lights, while we were still using our cardboard box with the “Drop Your Card, Win Free Beer” call to action written on the side in red marker.

Cost: Parking was $15 per day x 3 days = $45. Rebecca cut me a deal and charged $240 for two days of demo help. New T-shirts and other collateral was about $100.

Takeaway: If you pay for-- or get selected into-- one of the large demo events, don’t hold back; such events can “make” your fledgling company.

Event #5: SFNewTech, April 24

What it is: SFNewTech is one of the longest running demo events around. Once a month, six new startups take the stage for an efficient format: 5 minutes of live product demos, followed by 5 minutes of audience Q&A. It’s a fun and casual vibe, held at a nightclub.

What I did: I got a slot as the third speaker to take the stage. Since Foundersuite has a lot of moving parts-- e.g., we have 4 separate software modules as well as template collections-- it was a challenge to demo it all in under 5 minutes. Thus, I gave a super-quick, high-level summary of everything, then drilled into one module, Investor CRM, to show the user flow.

During the demo, I focused mainly on the value proposition for the founder-rich audience. I also spent roughly 20 seconds of the opening explaining why we’re doing what we’re doing-- our mission-- and about 20 seconds at the end showing where we’re going next, which was a nice way to “bracket” the core content of the demo.

Result: This event generated about 55 new users, some great social media activity, and we got a cool video out of it. Also, a writer for Venture Beat was in the audience; he followed up afterwards, and we gave him the exclusive on our launch coverage.

What I could’ve done better: I wish I’d lost about ten pounds and got a decent night’s sleep before going on stage. :)

Cost: Free; the ringleader, Myles Weissleider, is a friend.

Takeaway: Getting stage time in front of a large audience of target customers is extremely efficient marketing.

...and that’s how we successfully hacked our launch. Net-net, our results by the numbers:

5 pitch events

~5000 relevant people exposed to our product

~300 new users of our product + an additional ~500 new users via viral loops

2 partner deals

1 speaking gig

3 interns, all technical

1 major media placement (and several smaller ones)

Lots of fun and new friends

---------------------

Total cost: $883

...a pretty decent ROI, IMO.  But remember, your mileage will vary (I had some inside connections which kept costs relatively low)

Nathan  @foundersuite @startupventures

Want more? For the extended mix, I now present “Key Tips & Lessons Learned”:

Use the novelty of being the “new new thing.” The period between your private beta and your public launch is a special time, when interest levels and curiosity about your startup run unusually high; you basically have a brief window where you can leverage the lure of the “sneak peek” to effectively generate buzz, get feedback, and make friends. Use it to your advantage.

Be an all-consuming, feedback-eating machine. Events are Customer Development on steroids-- so figure out a structured, efficient way to collect and process the avalanche of feedback and ideas you will get. To be honest, we didn’t do a great job of this-- I’m still finding business cards and scraps of paper with user comments scribbled on the back. But the feedback we were able to process has been priceless.

 

Play to the motivations of the event producers. Almost all of the event organizers I worked with were cool people, genuinely motivated to see startups succeed. But they are also building their brands, and / or trying to turn a profit on their productions. They are looking for interesting companies that people will talk about, and in doing so, create a halo effect around their event. Be that interesting company. Make it memorable for their audience.

Pay it forward. You may have noticed that I was “hooked up” for free at nearly every event; this wasn’t by accident. In most cases, when someone set me up with a demo table or pass, it was 10% because I’m a nice guy, and 90% because I’d helped him or her out on some previous initiative. No one’s keeping score; but when you’ve been paying it forward long enough, it’s amazing how receptive your network is to helping out when it’s your turn to ride the startup roller coaster.

 

Being cheap increases your ROI. Demo events are fun a great way to engage potential users and investors in a casual, low-risk way. But they take a lot of time and energy; in the case of the bigger ones like Launch Festival, they suck up the better part of a week. They can also be expensive-- TechCrunch Disrupt Startup Alley will set you back $1995. Work your network for the free booth hookup, or ask the producers for the “pre-funded startup” rate. Volunteer to work the door in the morning, or offer to promote the event to your network for a free pass. (Related note: It helps to have built a network that folks are interested in leveraging).

Start the SEO clock ticking. Many startup founders repeatedly delay their launch because they’re not “ready,” and I definitely get the desire to avoid putting out a bunch of crap too soon, as public scrutiny can be brutal. But as Paul Graham eloquently writes, startups need to release early and often; in addition to getting user feedback, there’s a ton of value in making some noise and laying down an online presence early in the game. For example, it helps you to establish your social media voice (something we did way too late). Also, getting your logo on a few high-traffic sites will help boost your SEO; both the Launch Festival and SFNewTech events are still driving a steady flow of organic traffic.

 

Still here? Color me impressed. I’ll leave you with a few tips for hacking your onstage pitch and demo booth:

Make your demo short and sweet. Get your product demo to < 3 minutes (5 minutes max). Keep it high level-- skip all the tiny product features and nuances that are important to you, but often turn into a confusing rat hole for people seeing your product for the first-time. With a shorter demo, not only will you be able to talk to more people over the course of the show, but you’ll have better attention and retention of what you’re offering.

End with a call to action. What do you want people to do after they’ve listened to your demo? Do you want them to register on your site? Introduce you to users? Give you feedback? Invest in you? The CTA may differ depending on who’s listening; for example, at the SFBeta event, we printed two giveaway cards, one for developers and one for users. Each had a specific call to action of what we wanted to happen next. Bottom line: if you don’t have an “ask” connected to your demo, then you’re just expelling warm air and sound.

WIIFT? For on-stage demos, build your pitch story line using the “what’s in it for them” framework (them being the audience). In other words, don’t show what your product does; rather, explain how it benefits your users, who ideally-- if you’ve picked your event right-- are also the folks listening to you onstage. If you can’t use the WIIFT approach, at least explain why you’ve built what you built. People love origin stories and mission-driven companies.

Staff appropriately. Always have at least two people giving demos-- crowds come in waves, and a solo founder won’t be able to efficiently process the queue. But never have more than three booth staffers out front-- that just makes for a crowded booth and will scare people off.

Usher along the salesmen. One of the annoying parts about having a table or booth is that you’re “captive prey”, and inevitably, you’ll get booth visitors who feign interest in what you’re doing, but who are really trying to sell you something-- banking, insurance, HR services, etc. Without being an ass, quickly end the conversation by asking for their card, saying, “awesome-- thanks for stopping by” and shaking their hand. Remember why you’re there: to talk to as many interested, relevant parties as possible. Keep the pipeline flowing.

Be polite (ish) to competitors. Another annoying element of the demo table is when competitors come sniffing around. A key identifier is when a person has obviously intentionally turned their name badge around, or tucked it under their sport jacket. I don’t suggest you worry too much about this-- most attractive markets are plenty big enough for multiple firms. But one way of heading this off is by asking them where they work before launching into your demo-- then if it’s clearly a competitor (or an investor in a competitor), give the abridged demo version without the secret sauce.

Have fun with it. You’re living the dream, pitching and hustling your startup baby. ‘Nuff said.

<END. Really.>


Looking for other startup fanatics?  Request access to the OnStartups LinkedIn Group.  130,000+ members and growing daily.

Oh, and by the way, you should follow me on twitter: @dharmesh.


Wednesday, 03 July 2013 03:43
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Do you sometimes lack confidence?  Good.  Because truly confident people sometimes feel insecure.  They sometimes feel uncertain.  Show me someone who claims they are confident all the time and I'll show you someone who's not truly confident.

First things first: Confidence is not bravado, or swagger, or an overt pretense of bravery. Confidence is not some bold or brash air of self-belief directed at others.

Confidence is quiet: It’s a natural expression of ability, expertise, and self-regard.

I’m fortunate to know a number of truly confident people. Many work with me at HubSpot, others are fellow founders of their own startups some of whom I've met through my angel investment activity. But the majority are people I’ve met through my career and who work in a variety of industries and professions.describe the image

It comes as no surprise they all share a number of qualities:

1. They take a stand not because they think they are always right… but because they are not afraid to be wrong.

Cocky and conceited people tend to take a position and then proclaim, bluster, and totally disregard differing opinions or points of view. They know they’re right – and they want (actually they need) you to know it too.

Their behavior isn’t a sign of confidence, though; it’s the hallmark of an intellectual bully.

Truly confident people don’t mind being proven wrong. They feel finding out what is right is a lot more important than being right. And when they’re wrong, they’re secure enough to back down graciously.

Truly confident people often admit they’re wrong or don’t have all the answers; intellectual bullies never do.

2. They listen ten times more than they speak.

Bragging is a mask for insecurity. Truly confident people are quiet and unassuming. They already know what they think; they want to know what you think.

So they ask open-ended questions that give other people the freedom to be thoughtful and introspective: They ask what you do, how you do it, what you like about it, what you learned from it… and what they should do if they find themselves in a similar situation.

Truly confident people realize they know a lot, but they wish they knew more… and they know the only way to learn more is to listen more.

3. They duck the spotlight so it shines on others.

Perhaps it’s true they did the bulk of the work. Perhaps they really did overcome the major obstacles. Perhaps it’s true they turned a collection of disparate individuals into an incredibly high performance team.

Truly confident people don’t care – at least they don’t show it. (Inside they’re proud, as well they should be.) Truly confident people don’t need the glory; they know what they’ve achieved.

They don’t need the validation of others, because true validation comes from within.

So they stand back and celebrate their accomplishments through others. They stand back and let others shine – a confidence boost that helps those people become truly confident, too.

4. They freely ask for help.

Many people feel asking for help is a sign of weakness; implicit in the request is a lack of knowledge, skill, or experience.

Confident people are secure enough to admit a weakness. So they often ask others for help, not only because they are secure enough to admit they need help but also because they know that when they seek help they pay the person they ask a huge compliment.

Saying, “Can you help me?” shows tremendous respect for that individual’s expertise and judgment. Otherwise you wouldn't ask.

5. They think, “Why not me?”

Many people feel they have to wait: To be promoted, to be hired, to be selected, to be chosen... like the old Hollywood cliché, to somehow be discovered.

Truly confident people know that access is almost universal. They can connect with almost anyone through social media. (Everyone you know knows someone you should know.) They know they can attract their own funding, create their own products, build their own relationships and networks, choose their own path – they can choose to follow whatever course they wish.

And very quietly, without calling attention to themselves, they go out and do it.

6. They don't put down other people.

Generally speaking, the people who like to gossip, who like to speak badly of others, do so because they hope by comparison to make themselves look better.

The only comparison a truly confident person makes is to the person she was yesterday – and to the person she hopes to someday become.

7. They aren’t afraid to look silly…

Running around in your underwear is certainly taking it to extremes… but when you’re truly confident, you don’t mind occasionally being in a situation where you aren't at your best.

(And oddly enough, people tend to respect you more when you do – not less.)

8. … And they own their mistakes.

Insecurity tends to breed artificiality; confidence breeds sincerity and honesty.

That’s why truly confident people admit their mistakes. They dine out on their screw-ups. They don’t mind serving as a cautionary tale. They don’t mind being a source of laughter – for others and for themselves.

When you’re truly confident, you don’t mind occasionally “looking bad.” You realize that that when you’re genuine and unpretentious, people don’t laugh at you.

They laugh with you.

9. They only seek approval from the people who really matter.

You say you have 10k Twitter followers? Swell. 20k Facebook friends? Cool. A professional and social network of hundreds or even thousands? That’s great.

But that also pales in comparison to earning the trust and respect of the few people in your life that truly matter.

When we earn their trust and respect, no matter where we go or what we try, we do it with true confidence – because we know the people who truly matter the most are truly behind us.

So, what do you think?  Are there qualities of truly confident people that I've missed?  Would love to read your thoughts in the comments.

Note: The original version of this article was published as part of my participation in theLinkedIn Influencers program.  The article was very well received. It got 1.1 million views and has generated 4,000 comments.  This is v2 of the article with some minor edits. -Dharmesh


Looking for other startup fanatics?  Request access to the OnStartups LinkedIn Group.  130,000+ members and growing daily.

Oh, and by the way, you should follow me on twitter: @dharmesh.



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Tuesday, 02 July 2013 00:55
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Think you're ready to start up? Put yourself to the test. Check out the five crucial keys to knowing it's time.

Andy Palmer has started at least five companies by my count--and I’d guess he has invested in dozens of others. Based on that experience, I’d consider him an expert when it comes to deciding whether you have what it takes to be an entrepreneur.

After graduating from Bowdoin with a major in English, History, and Computer Science, the passionate Rugby player was injured and decided to become serious about a career. So he got an MBA from Dartmouth’s Tuck School.

From there, Palmer went on to be part of the founding team of five start-ups: Austin’s Trilogy; pcOrder.com, a Trilogy spinoff for buying PCs and software online, that was spun back in; Bowstreet, a “portal-based tool provider,” that IBM acquired in 2006, Infinity Pharmaceuticals, a cancer drug developer that went public 2000; and Vertica Systems, a database company that Hewlett Packard bought in 2011.

Now Palmer spends half his time on life sciences and half on tech start-ups. He has invested an average of $75,000 in some 30 ventures; is a founding board member for six companies; and works on more altruistic projects--such as collaborating with MIT’s Broad Institute to help develop a genomics information system.

Here are five thoughts Palmer offered on what he would tell a young person considering whether to become an entrepreneur.

1. Know how good you really are.

Palmer pointed out that potential entrepreneurs must know where they are on the “bell curve.” As he said, “Some people like Steve Jobs or Bill Gates are destined to be entrepreneurs and nothing will stop them. Others are one standard deviation out of the bell curve. They could be entrepreneurs under the right circumstances. But most people are just average when it comes to their entrepreneurial potential.”

This self-assessment has important implications. If you are destined to be an entrepreneur, there is no need to ask anyone else’s opinion. You will start companies. If you are one standard deviation out, then you need to find the right circumstances--meaning you must pick the right opportunity to target and figure out which key entrepreneurial talent you bring to the party and partner to find your missing piece.

2. Be willing to team up.

This brings us to Palmer’s idea that the idea of the hero entrepreneur--Larry Ellison against the world--is outmoded. He looks at Google as a model which is run by a troika of Larry Page, Sergey Brin, and Eric Schmidt. Each of them have different strengths and they are willing to work together to apply those strengths to helping the company grow and adapt to change.

For most technology start-ups, there are two skills needed at the beginning, business (which includes sales, marketing, and handling capital raising and accounting) and technology development. If you are excellent at one or the other of these skills, you should find a partner who excels at the other skill.

For example, when Palmer started Vertica, he was in charge of the business side and he partnered with a database expert, Michael Stonebraker.

3. Share the right values.

How the business person know which technology person to partner with and vice versa? Palmer believes that values make all the difference. He argued, “It is a big responsibility to be developing a new product for a customer. As a business person, I want to make sure that potential customers do not get an overly optimistic view of where we are in our development process.”

Palmer wants a partner who shares his belief in the importance of setting realistic expectations. “Simply put, I want to partner with a technologist who shares the value I place on giving potential customers an intellectually honest set of expectations. It is too easy in high tech to exaggerate your accomplishments.”

4. Have unquenchable passion.

Palmer argues that an entrepreneur must know why he is starting a venture. “When it comes to figuring out where you are on the bell curve, it is essential that you ask yourself honestly why you want to start a company. If you are doing it to get rich, you should not proceed. The best reason to start a company is because you are passionate about it,” said Palmer.

This passion was something that drove him to join the start-up team at Infinity. As Palmer explained, “By the time I joined Infinity, I was feeling that the software companies I had started were not going to make the world a better place. But when I went to work for Infinity, I believed that I was helping to solve a big societal problem-curing cancer.”

5. Fit your operating style to the opportunity.

Palmer has seen two kinds of start-ups: blessed and bootstrapped. And they demand different operating styles.

A blessed start-up has access to the most capital, the best investors, the best executives, and top talent at all levels. “Before I started Vertica, I was an executive-in-residence at Kleiner Perkins. Ray Lane told me that he was expecting me to build it into a billion dollar company. If you’re in a blessed start-up like that, you have to get used to the enormous pressure to achieve excellence and react accordingly,” said Palmer.

But a bootstrapped start-up is very different. It makes “every dollar an investment that yields a five-fold return” quipped Palmer. “In one start-up we had a conference room that contained all our servers, and it was hot in there. And our other conference room had a big glass window so it was always cold. We channeled the heat from the server conference room to warm up the cold one.”

If you can pass these five test, you may be ready to start-up. Otherwise, think again.


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Monday, 01 July 2013 10:50
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It's official: Mark Pincus is stepping aside as CEO of Zynga. It's hardly surprising: Founders rarely make good public-company CEOs.

Mark Pincus has left the building.

Well, sort of. In a statement issued earlier today, Pincus, the founder and CEO of Zynga, the troubled gaming start-up that's been struggling to maintain its relevance ever since its IPO in December 2011, announced he's fired himself, and hired another industry veteran--Don Mattrick, a former head of Microsoft's Xbox division--as his replacement.

"As I reflect on the past six years, I realize that I’ve had the greatest impact working as an entrepreneur with product teams, developing games that could entertain and connect millions," Pincus wrote.

"I've always said to Bing and our Board that if I could find someone who could do a better job as our CEO I'd do all I could to recruit and bring that person in. I'm confident that Don is that leader."

He adds, "Going forward I'll continue in my role as Chairman and Chief Product Officer."

It's a rosy spin on a likely turbulent departure. Zynga has taken a beating in the press over the last couple of years, mostly over rampant employee turnover and complaints about the company's culture. Suffice it to say the company has a bad rap in the Valley.

But despite what the critics will say about Pincus himself amidst his departure, I empathize with the guy: Founders don't always make the best corporate CEOs of publicly-held companies. In fact, they very rarely do.

Consider the research from Noam Wasserman, a Harvard Business School professor, who has been studying founder-CEO succession for over a decade. Back in 2003, Wasserman published a fascinating report that detailed the succession histories of founders of 202 Internet companies. The paper, titled "Founder-CEO Succession and the Paradox of Entrepreneurial Success," brilliantly details how and why start-up founders tend to find it so difficult to stay CEO as the company grows and becomes more successful.

Of course, not all founders get fired by their board (or decide to fire themselves)--but it's more common than you might think.

He writes:

Early on, Founder-CEOs who are adept at solving such challenges are often able to attract high-quality technical people, to manage the product development process well, and to help their organizations succeed at developing the product efciently. However, once the initial product has been developed, the CEO's job broadens and gets much more complex, for he or she has to begin selling the product to customers, building an organization to support the product, and creating a marketing team.

This dramatic change in the contingencies faced by the rm often results in a mismatch between the skills of the technically adept Founder-CEE--whose skills were the key to success until now--and the new needs of the organization. The fact that the rate of succession increases immediately after the completion of product development suggests that company owners proactively assess the quality of this skills-contingencies t and make CEO changes before a mismatch would cause problems.

Of the last 100 consumer Internet IPOs since 1996, only about 20 percent of the company founders remain as the company's sole CEO. Clearly, leaders like Jeff Bezos, Mark Zuckerberg, and Jeremy Stoppelman are the outliers--which is probably why they get so much media attention. But that media attention can create a false echo chamber that might lead you to believe that "most" founders are able to lead a publicly-held company. That's just not the case. Mark Pincus, quite frankly, is the more common example.

The lesson here for founders is important. As Wasserman puts it:

A founder's early passion, confidence, and attachment to a vision are often the magical ingredients that fuel the launch of a startup rocket ship. Visionary founders are usually the most central, irreplaceable players in a startup. Seen as the guardians of the corporate culture and the ones with deep ties to early employees and customers, such founders enjoy being the generals leading the troops.

However, these early strengths can become Achilles' heels if a founder is not aware of the downsides of passion and attachment. The downsides include things that the founder can’t do and things that the founder won’t do. On the "can't" side, founders fail to realize that success breeds a new class of challenges; challenges that require skills they do not have, such as scaling a larger organization or managing functions in which they haven’t worked. On the "won't" side, they stick with their initial ideas for too long, ignoring clear signals that it is time to pivot. They stick with their early employees and executives, even when those people are not up to the new challenges and demands.

When news circulated on Monday that Pincus would be leaving the company, Zynga's stock price jumped about 10 percent, which makes you wonder: What if Pincus had removed himself even earlier? Would Zynga be in such doldrums?

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