A really great book. I found most of the advice in it to be highly practical. If I had had this book a few years ago, I probably would have made a few less mistakes in my selection of startups to work for and on my own startups. A couple of years ago, I read “The lean startup” from Eric Ries. I find that this book is a “practical” companion to Ries’ book. Where, the Lean startup is more on the theoretical side, this book is quite practical.
The book is divided in 5 parts (the million dollar app, the 10 million dollar app, the 100 million dollar app, the 500 million dollar app and the billion dollar app). Each section covers the problems and solutions associated with that particular size. I have to admit to having being riveted for the first few parts but lost interest a little bit towards the end. The initial parts cover more of the mechanics of creating the app while the followup parts cover more the mechanics of running a large company. At the present time, I’m pretty far from having a billion dollar app but could see myself having a 1 million dollar app (rightly or wrongly) so it’s understandable that section 1 and 2 hold more interest to me.
The most enlightening part of the book is the importance of analytics. Obviously, it’s important but I never realized how important it is. Get Google analytics, get Mixpanel, and possibly others. You can have more than one analytics solutions. Mixpanel and Google analytics appear to be quite complimentary so start with those. Make sure you have a plan as to how you want to use analytics.
That being said, awesome book. Highly recommend it (4.5/5)
Here are some of my notes:
Part 1: The million dollar app
- You need to define which business model applies to your business. The author defines 5 of them:
- Software as a service
- I am unsure as to the way the business models are broken up. It seems a little bit contrived but there’s no doubt that as a entrepreneur you should know where your revenues will come from.
- It is possible to start a company by yourself but having a co-founder is a good idea to deal with complementary skill sets. The author recommends a number of ways to meet somebody (e.g. Developer meetups, startup weekends) and a number of online resources (meetup.com and angellist.com).
- Online resources to find domain/company names:
- You should build an iOS version and an Android version but do one at a time. Though the author does not state which one you should start with, all of the examples seem to point to iOS.
- Author recommends doing MVP (minimum viable product) from Lean startup approach.
- Metrics are immensly important. Make sure you have some.
- Author divides metrics in 5 categories:
- You should understand these categories and understand how they map to actions and goals.
- It’s pretty simple, you need to build something that people like, or rather love. It’s easy to say, quite hard to do.
- Analytics should help. Make sure they are present from the start. (Look into using more than one of them e.g. Google analytics and Mixpanel)
- Having analytics is key to finding Best PMF but also to get proper funding. If have good analytics number concerning acquisition and retention, getting money is a lot easier.
- Agile and continuous development recommended
- Crunchbase is a free site that allows you to find valuation of companies that may be comparable to yours.
- It takes time to get money. On average, in 2013, it took close to 600 days. This is awfully long when you have a team living on the initial seed money.
- VCs will normally look for three things, ability to maintain their ratio in the company, ability to sell before anybody, sit on the board.
- Find head of marketing, get a marketing team in place
- Look at Fiksu for marketing, seems interesting
- Analytics still play a huge role here
- On page 282, there’s an interesting equation to measure virality
- User retention is important. Fred Wilson has this ratio (30:10:10). I am intrigued by these numbers. Need to find out more. Here’s the breakdown:
- 30% use the app each month
- 10% use the app daily
- 10% of daily users represent maximum number of users present at any time.
- OKR (Object Key Results) method is a good way to focus a company. Every quarter goals are set, measure metrics are defined and results are obtained at the end of the quarter. Used by Google. Created at Intel.
- Hire well, might be time to find somebody who is used to managing/guiding a business of this size. Might want to take a backseat. (Paraphrasing here).
- It’s all about people. Hire well.