Startup Lessons Learned

startup lessons

The most important lesson I ever learned

By Ryan Allis

Here are thirty of the most important startup lessons I learned from 2002-2012 while building iContact.

1. Don’t get stuck in analysis paralysis. Take action now.

Sometimes you’re not going to see all the way to your end destination when you start, but just take the very first steps and the world will open up with new people, new resources, and new opportunities that enable you to achieve more than you can even fathom today.

2. It’s up to you to get out there and do it, to take the initiative.

No one else is going to do it if you don’t. It’s your job to take chances and make things happen.

3. Investors don’t invest in systems that go home at night.

They invest in businesses that have systems and processes that can run even without the main entrepreneur having to be there.

4. Don’t be afraid of failure.

Most people are afraid to fail. They worry constantly about not living up to expectations, about making mistakes, and about trying something new. Because of this, most people never get started on the path toward reaching their goals and their full human potential. In order to become a successful entrepreneur, you’ll have to pay your dues and fail a few times. You’ll learn lessons, and only then will you be able to come through a winner. While you don’t have to take wild chances, you do have to take some risks. And most importantly, you have to get started quickly.

5. Recognition and praise are often bigger motivators than monetary compensation.

Never forget this as you work with your team.

6. Always communicate frequently and openly with everyone, including customers and stakeholders, during negative events.

The worst thing you can do during a negative press event or downtime is be silent.

7. Once you have 80% of the information necessary to make a decision, make the call.

You will be right more often by acting quickly and learning and incrementally improving than by waiting to make the decision until all the information is available. By increasing the frequency of decision-making, you will be able to achieve much more than by simply waiting longer.

8. When things are going well, it’s the right time to prepare for when things won’t be going well.

When you don’t need money, get a credit line. When things are growing at 100% a year, think about what your strategy would be if a competitor were to come into your industry and make your product for free.

9. Building a business is sort of like moving something heavy. It takes time to get the momentum going, but once you do, that momentum can begin to take over and things can start moving even more quickly.

Jim Collins, in Good to Great, calls this “the flywheel effect.” He compares a company to a heavy wheel, and explains, “Your job is to get that flywheel to move as fast as possible, because momentum—mass times velocity—is what will generate superior economic results over time.”

10. Part of the CEO’s job is to find and hire people who can do their roles much better than the CEO could.

When you hire someone, make sure they can do their job at least twice as well as you could.

11. Build consensus about strategy and direction with a small core of your team, and then share widely.

It’s important to choose the right small team to create strategy, at the same time taking in feedback from a large group of people by having automated systems and processes that get input from customers and the frontline all the way up to the senior management team. Once you get consensus, share the strategy with your whole company.

12. When you see someone doing a good job, tell them right then and there.

If you can get into the practice of writing just one handwritten note a day that you can give to one of your team members, people will treasure those notes and you’ll be able to achieve much more and people will love working with you.

13. There is great power in deadlines. Create some.

A deadline is simply a time at some point in the future at which you want something to happen and then there will be some positive consequences if it does happen and some negative consequences if it doesn’t. Deadlines, in reality, are almost always artificial, but a good leader knows how to use deadlines to drive focus on a team. Also, after a key deadline is passed and a key milestone is achieved, giving the team a little bit of time to refresh and rejuvenate is a key part of optimal productivity.

14. To create a great organization, you must build a system to cultivate greatness in leadership potential in others.

You should be investing in your brightest employees, and in their potential to someday take leadership roles within your organization and to innovate and create for the future.

15. Give immediate and specific feedback more often.

This applies particularly to things that you want to be improved. You want to give someone the ability to become great at whatever they do and mentor them along the way.

16. Make sure your incentive structure incentivizes the right goals and the right behavior.

This goes for both your monetary and compensation incentive structure, as well as your intrinsic feedback mechanisms. Take the recent example of the 2012 Olympic badminton teams from China and Korea who purposefully tried to lose because there was an incentive structure from the people who created that game that if they lost, they would actually be advantaged in the next round. Good leaders ensure that incentive systems incent the right behavior—the behavior that leads to customer value creation.

17. Once you get past about 20 employees, conduct annual online 360-degree reviews.

You want to start conducting performance reviews that are written and documented, ideally on an online automated system that includes 360 feedback. 360 feedback simply means that every person within an organization—your supervisor and peers as well as people who directly work for you (your direct reports)—can give feedback on your leadership style, your managerial style, your performance, and your productivity. Often the best feedback you can get is feedback from those who work for you. Yet, for some reason, most performance reviews come from a superior to a subordinate. Often subordinates can give the most valuable feedback to their superior.

18. Have all team members share their personal goals and dreams with their teammates.

It’s important that team members share their goals and dreams not only with the leader but with all of their fellow team members. Once there is a holistic understanding of someone’s true motivations and what drives them, they can often work much better in a team and you can create a managerial structure that aligns what they want to do with their life with the goals that you have for the company.

19. When you get to about 50 employees, hire a chief operating officer.

If you’re going to do a good job as a leader with this many employees, you will need a good COO who can be your operational execution partner.

20. Entrepreneurship is doing something others won’t for about ten years so that you can do what others can’t for the rest of your life.

Entrepreneurship is an investment in your future, in your family’s future, and in your ability to leverage your time and assets to create organizational structures that make a difference in the world. It is something that’s not right for many people. But if entrepreneurship is for you, it can be extremely rewarding and enable you to do things that many people are unable to do. Entrepreneurship is a special field, but if you can be part of it, it can be very exciting.

21. Entrepreneurship is about passion, following a dream, and changing the world, with plenty of craziness along the way.

Dare to think big, and take risks. “Dream no small dreams” as Goethe said, “for they have no power to move the hearts of men.”

22. Becoming a successful entrepreneur is not easy. It’s not for everybody, but if it’s for you, it can be rewarding.

To succeed as an entrepreneur, you must have persistence, dedication, tenacity, and the ability to deal with adversity. If you can have the ability to get through this adversity by being deeply passionate about your mission, great things can be achieved.

23. You may not be able to do everything at once and you need to take a long-run approach.

While companies like Instagram might have sold at 13 employees for $700M to Facebook, it often takes decades to build a company to have created enough value in the world to be worth a billion dollars. But that’s okay, because even if it took 20 years or 30 years to build a company to a billion dollars, you’ve still accomplished something that very, very few people ever accomplish.

24. Play life and play business like a long-term game.

Be good to everyone, respect everyone, treat everyone with kindness and fairness and karma will come back around to benefit you for the better.

25. If you presently today don’t have the financial resources, the experience, or even a good business idea, intern or get a job at a company you are passionate about and start learning.

Particularly if you are a younger or a first-time aspiring entrepreneur, don’t wait for inspiration or for an unexpected windfall. The most important thing you can do is to start getting experience and building your network.

26. Always focus on building quality, giving, and caring authentic relationships with good, caring, quality, authentic people.

At the end of the day, the people in your life end up enabling you to do things (or to not do things) that can allow you to make a difference.

27. Take a proactive role in your personal planning and your business planning with goal setting.

And be sure to regularly evaluate your results personally and professionally.

28. Many people are afraid to ask for help from others, but if you ask for help, people are often willing to help.

Just ask genuinely and find a way in which you can give back to them as well as them giving to you. Build relationships for the long-term, not for the individual transaction.

29. Get experience however you can. 

Build your network, have confidence, and be in it to help others to win and to make a difference. Regardless of what you’re doing, make sure you’re constantly learning and working with people from whom you can learn.

30. If and when you do succeed, give back.

There are many brothers and sisters in our world who have not been as fortunate as we’ve been.


Life Lessons Learned

By Ryan Allis

Since 2005, I’ve gotten into the habit of writing down the things that I have learned in my personal journal. I’m going to share a few dozen of the key life lessons that I’ve recorded over the past few years.

1. Listen to that little voice in the back of your head.

It’s often alerting you to something very important.

2. You can achieve anything you set your mind to.

Back in 2001, when I was 16, I wrote down the very ambitious goal of building a company to $1 million in sales by the time I turned 21. As I’ve shared, I missed that goal, but only by 18 days. There’s no way that we would have been able to achieve what I did at iContact had I not written down that goal and brought into my life the people, the knowledge, and the resources necessary to figure out how to actually make that a reality. In 2005, when we got to $1 million in sales, I really started believing that I could achieve anything I set my mind to, as long as I was acting within the Golden Rule.

3. Never let non-communication or lack of communication lead to the degeneration of a relationship.

Often, when I was growing up, I had the Internet as a shield between me and real people. I wasn’t as good at interacting with others, and as a result, many times I didn’t proactively communicate. What I’ve learned is that it is rare to over-communicate. Spend time investing and communicating with your partners, with your friends, and particularly with your teammates.

4. Don’t avoid doing things because they may cause conflict.

One of the hardest things to learn as a manager is sometimes you just have to get in there and deal with the situation, even if it’s going to cause a little bit of difficulty along the way.

5. At the end of the day, integrity is what matters.

One of the most important lessons I’ve ever learned is that at the end of the day, integrity is what matters. Integrity means telling the truth and doing what you say you are going to do.

6. Never or rarely say “but” and instead say “yes, and.”

I learned this lesson in 2006 during improv classes in Carrboro, North Carolina at the Dirty South Improv Theater. There we learned to “yes, and” to life and to “yes, and” to everything our partners in that act were saying. One of the most important parts of improvisation is to flow with it and just go with whatever is happening and to “yes, and” what your partner is bringing to the table and accentuate and elevate it even further. I brought that principle back to my business and I was able to have better debates and better discussions with people by being able to reinforce what they were saying by saying “yes, and” instead of saying “but.”

7. There are two ways to determine the rules of life. You can either do it by talking to smart people, or through trial and error. Either way you do it, start learning early.

I’ve learned my most important lessons both ways. And I’m grateful to have learned so much before the age of thirty.

8. If somebody sues you, go talk to them in person, immediately.

I learned this lesson the hard way in 2006. Virante, my web design and search engine optimization company, was in a legal struggle with another company down in Texas. We had a client who wasn’t happy with some of the work we had done. Instead of flying out there and talking to the client, or even picking up the phone, we talked to our lawyer and the lawyer said, “Whatever you do, do not talk to your client. It will cause a legal issue if you have any communications.”

At that time, I was only 21 or 22, and I listened to our attorney and decided to avoid the client and the client decided not to pay us for a long time. Eventually, we ended up in arbitration and we actually won the case. But it really wasn’t worth it. After all that time, when you look at how much money we made for the hours we put into it, we lost out.

So what I’ve learned is that if someone sues you or threatens to take you to arbitration, talk to them in person and figure out how to have a win-win. Figure out what the communication gap is.

9. Networking is not about business cards.

It’s about building meaningful relationships that can last for life with quality people and seeing how you can help them. It’s not about transactional relationships that are one-off where you can get something in the short-term from someone. It’s about building something that can last for a long time, in which you can both help each other out.

10. 2.6 billion people live on less than $2 per day.

In 2006, I started learning a lot about economic development, international development, and global poverty. I had one of my most inspirational professors as a senior in high school back in 2001 by the name of Mr. Fletcher, who taught economics from a sociological or human perspective, instead of the supply-and-demand curve mathematical perspective from which economics is generally taught. At the time, he taught us that 2.6 billion people live on less than $2.00 per day. That really hit home.

You might argue that $2 in another country goes a lot further than $2 in the United States. While that’s true, this figure is actually “purchase power parity” (PPP) adjusted. What that means is that this figure is adjusted based on what actually costs to buy bread, fuel, and other basics in other countries.

Imagine having to get through an entire day on less than $2. It would be very difficult. The reality is that 39% of the world (2.5 billion people) do that every single day. In fact, one billion people live under $1.25 per day, which is the World Bank’s measure for “extreme poverty.”

11. 22,000 children under 5 die every day.

Most of them die in the developing world from preventable diseases and low nutrition. This simply doesn’t have to happen in a world where we have the amount of resources that we have.

Think about how much you make per day if you’re in the working world (if you’re not, think about your parents). In America, the average wage annually is around $40,000 or $45,000. If you work, say, every day of the year, that would be about $120-$130 per day, per year.

The reality is that the average (or mean) wage in the world, per year, is right around $5,000. But if you were to adjust that for all the high income earners at the top and you were to look at not the mean, but instead the median (the most frequent) wage that’s around the world, it’s actually right around $4 per day. That’s about $1,200 per year, again purchase power parity adjusted, so it’s comparing apples to apples.

12. 80% of humanity lives on less than $10 per day.

$10 per day adds up to about $3,500 or $3,600 per year. The reality is that 80% of humanity lives on less than this. If you’re living on more than $10 per day, count your blessings.

13. Life is precious and it can be very, very short.

You should always value it and every day, express gratitude and tell those you love that you love them as often as you can. I had a friend who experienced a tragic loss in her life back in 2007, and I learned that lesson very quickly.

14. One can see further by standing on the shoulders of giants.

In other words, by having great mentors, you can do so much more and see so much further. Find mentors who are giants—high-integrity, amazing people.

15. The world has so many more opportunities than you might even imagine.

Growing up where I grew up, I didn’t really realize how many opportunities there are in the world for great people to do good things—how many scholarship programs, fellowship programs, and work programs. If you simply define your purpose and know what to want to achieve, you will start surrounding yourself with people who are passionate about the same thing as you. When that happens, you will start to find out about amazing opportunities. Once you define your purpose, you can more easily seek out these opportunities.

16. Positive developments occur when you associate with extraordinary people.

Once you find extraordinary people by aligning with your purpose, great things can happen—access to networks, new opportunities, chances to up your game and do better, do bigger, think bigger, and execute at a higher level.

17. Gratitude is an extremely powerful character attribute.

Just take time during a daily meditation in the morning or at night and say what you’re grateful for that happened in your life that day. A friend of mine told me recently that one of the things she likes to do with her boyfriend after spending the day apart is to come home and each say three things that they’re grateful for about their partner and about what they did that day. Gratitude can be extremely powerful in building a relationship and achieving internal mastery.

18. Humans – all of us – often have a deep desire in life for love and affection.

That may seem like an obvious lesson, but that year I separated from a girlfriend of three years and learned about how much we crave love and affection.

19. If there’s one thing in life that you overdo, make it communicating with others.

This lesson applies particularly in a work environment or in a loving relationship.

20. Let your inner child come out daily and silly dance!

Throughout my teenage years and early 20s, I was very serious all the time. In 2007, I went to a course in Chapel Hill, North Carolina, called the Grinnell Leadership Program. The Grinnell program gave me a “360 review,” which meant I asked all the people who reported to me at work to write up an assessment of myself as a leader and manager.

One of the things that came out of that review is that for a 21- or 22-year-old, I was too serious. I found out that I had something people called a “stone face,” where I would curl my eyebrows, show very little emotion, and look very serious. That was my way of trying to act like an adult—to come to the table every day and be seen as an older, mature person. But the effect was that it made it very difficult for others to connect to me on an emotional or human level.

I still have a lot to learn about relaxing, letting my inner child out, and silly dancing. One of the things we’ve implemented at my new company, Connect, is that after every daily meeting, we take about 30 seconds to silly dance. Today we have a team of eight. Someday hopefully we will have a team of 800. I can’t wait until we have our monthly meeting with all 800 and we can end it with a massive silly dance.

21. Wait until you’re fully able to stand on your own two feet from a financial standpoint before you choose to get into a partnership with somebody else.

I learned this lessons after seeing a lot of my friends from childhood and college get married at the age of 21, 22, or 23. It’s not only important from a financial acumen or financial safety standpoint; it’s important for a sense of self-worth. When two equal partners come together, both of whom can live apart if need be, and choose to create a partnership—to have two whole selves form a union that is stronger than either individual—it’s a much stronger bond than when two people have to be codependent on one another to even cover basic financial needs.

22. If possible, wait to have children until you can really financially afford to have children.

Oftentimes, someone who is in their early 20s might make plenty of money, but it’s not until your later 20s or even your early 30s that you really have enough savings in the bank to be able to afford to raise children and raise great children. I’ve always wanted to delay having children until later in life, in order to really do it well.

23. Good health is everything.

I learned this in 2007, when a good friend of mine became very sick. Investing in healthy eating and exercise, regardless of your age, is critical to your daily performance and your long-term existence.

24. Don’t ever let your mind limit yourself.

Many people have a sense in their mind that not much is possible. What I’ve found is that a lot of limitations are self-imposed or come from friends who are saying, “Oh, don’t be silly. Don’t even try to be ambitious.” Earlier, I talked about aligning yourself with people who tell you that you can do anything you set your mind to. Whether it’s your friends or your own self that’s limiting you, don’t let them.

25. One way to avoid criticism is to do nothing—the world will then leave you alone.

Oftentimes, people fear criticism. If you do nothing worthwhile, you’ll avoid it. The world will leave you alone. If you do something, if you put yourself out there, if you try to do something that’s a little bit abnormal, most likely you will be criticized. That just comes with the territory of trying to be a leader, trying to be someone who might be in the public eye.

If you really want to make a huge impact on the world or live a public life, you have to learn to deal with other people criticizing you. It’s one of the hardest things to learn. When that happens for the first time professionally, it can be very challenging to deal with. But getting through that and getting to the other side will enable you to become a much more effective leader and manager.

26. Arrogance is not over-confidence. It’s being dismissive of others.

Growing up, I always thought arrogance was just over-confidence. But I learned that in fact, it’s being dismissive of others. I’m a pretty confident person, but I hope I don’t come across as arrogant. I hope I come across as valuing everyone, regardless of where they’re from, their background, and their perspectives. I hope I come across as recognizing that we all have amazing gifts to give the world. You can be extremely confident, as long as you’re not dismissive of others.

27. Never cheat on your spouse, period. And especially not if you’re planning to run for national political office.

I’ll leave the people who taught me this lesson nameless, but suffice to say that there have been some very high-profile cases where people ended up ruining their political careers by not being faithful to their partner, their lover, or the person that they have committed to.

28. It takes 10 years to become great at something. Choose carefully.

In a 60-70 year productive life, you can only really be great at six or seven things. It takes about 10,000 hours to become an expert at something, according to Malcolm Gladwell. Putting in that amount of time usually takes around ten years. And for every kid you have, that six or seven things goes down by one, maybe you can do four or five things in life really do well, so that they last beyond your own lifetime and leave a legacy. Choose those four or five things carefully.

29. Every day, do something wonderful with infectious enthusiasm.

Going into 2009, I had a wonderful friend who taught me this life lesson. I’ve tried to follow that every single day. Ever since, life has been even better.

30. Just say “Okay, good” to life.

In 2009, I was traveling with my friends Bob and Jess in Uganda. We woke up a little late and we had missed our bus from Gulu down to Kampala. I was fumbling for my alarm clock and I spilled milk all over the place. And the words came out of my mouth: “Okay, good.” That became a saying between that small group of friends. Whenever something was difficult, whenever something was not going our way in life, we would just say, “Okay, good.” It means: That happened and that’s all right. I’m going to deal with it and move on and be able to do something better in the next iteration of time.

31. Cancer really is a horrible thing.

In 2009, my business partner, Aaron, was diagnosed with thyroid cancer and I saw the horror of cancer firsthand. Regardless of the cause, cancer is a horrible thing. I’m really hoping that in the years ahead, as scientific research advances and we learn about the wonders of what’s possible with new materials like carbon nanotubes, new drugs, and new vial treatments, we really can, once and for all, end many, if not all, of the forms of cancer.

32. We all have challenges in life. It’s how you interpret them and respond to them that counts.

I am always humbled and inspired by the examples of people who went through unimaginable trials, yet emerged better people, with a greater desire to do good in the world. It all comes down to how we interpret our challenges—do we simply feel sorry for ourselves and angry at life for having dealt us a bad hand, or do we see opportunities for growth and wisdom even in the hardest of times?

33. People act consistently with what is expected of them. So expect great things!

I’ve been pleasantly surprised to discover that if you expect great things from people, they will often act consistently with that expectation. Unfortunately this lesson works both ways—if you have low expectations of people, they will likely fulfill those too. That’s one of the reasons that prisoner recidivism is so high. If you label someone a prisoner, a miscreant, or a criminal, and punish rather than rehabilitate them, they are more likely to go back into society with the sense that they are still a prisoner, a miscreant, or a criminal.

34. Most people in the U.S. do not consider themselves to be authentically happy.

I found this to be a very interesting statistic. If you can find internal alignment, live a life of integrity, pursue your vision, find your passion, figure out very specifically what the purpose of life is for you, and truly surround yourself with great people who you love and care about, you can reach that level of authentic happiness. But you are probably in a rare grouping of people.

35. There’s beauty in seeking to understand nuance.

The world is not simply black and white. It’s not one or the other. It’s not binary. There is a lot of grey; there’s a lot of detail and nuance that has to be understood, particularly when you start to understand some of the complex forms of “systems thinking” in relation to policy and how to make a difference in the world.

36. Be careful who you trust when you’re in a new environment.

One of the great travel lessons I learned in the past few years was in February 2009 in Beijing, China where I fell for what’s called the tea ceremony scam. Two young girls in their early 20s came up to me and asked if they could practice their English with me. I was pretty skeptical, but it seemed harmless enough.

After about 10 or 15 minutes of chatting, I learned that they were from the western provinces and they had come to Beijing to learn English before going back, and they were really excited to have someone who spoke English as a first language to converse with. They asked me if I wanted to grab tea with them at a local tea house and I said, “Sure,” thinking that was a pretty safe thing to do.

We walked for five minutes, went into the tea shop, sat down, and had a wonderful time. We had about 13 different types of tea. At the end, I got the bill, I used my Blackberry to do the currency conversion into dollars. It turned out it was $380. We had had never even seen a menu with the price on it. That was a very clear lesson that you need to be careful who you trust when you’re in a new environment. Take time and be very aware.

37. Rarely do anything that you wouldn’t want on the front page of the New York Times.

In today’s age of social media, pretty much anything and everything eventually gets into the public eye. Live a high-integrity life, be honest, and don’t do too many things you wouldn’t want other people to read about.

38. I’ve felt most connected to the human spirit dancing in villages.

Sometimes the simplest moments can awaken us to the beauty of our shared humanity. This lesson really came home for me during a visit to Africa in 2009.

39. Ask for advice more often.

I have a tendency to try to do everything myself. What I realized is that in a company where you’ve surrounded yourself with great people, not utilizing the strengths and knowledge of those people is really a waste.

39. Focus is necessary for success.

I often say that in life, anything is possible, but not everything is possible. If you want to be successful, you will need to make the hard choices about what your priorities are, and focus your energy and your attention on what matters most to you.

40. There is great power in a handwritten note.

Taking that few minutes to personally write a note to express your appreciation can make a lasting impression that an email can never match.

41. Fight hard for what you believe in.

There are few worse feelings than the regret that you didn’t really do everything you could have done.

42. Find a way to make all negotiations benefit both sides.

Creating a win-win is always better in the long term, even if it might temporarily feel good to get the upper hand.

43. The best medicine for stress is laughter.

When you’re trying to achieve great things, it can be easy to be very serious. Make sure that you make space in your life for laughter and silliness. There’s no better remedy for stress.

44. Travel the world for at least three weeks every year.

I find that some of my greatest moments of inspiration—my biggest “eureka” moments—happen when I’m in a new environment. Whether it’s going to Kenya, Uganda, Rwanda, or Central or South America, I try to do my best to at least take a few weeks of every year to travel.

45. Spend more time reading than watching TV.

There’s nothing inherently wrong with TV, but I find that I learn more from reading great books, and this lesson helps me to keep the balance right.

46. Investing in Africa today is like investing in India 25 years ago.

They are tremendous economic and business opportunities on that continent, whether in Kenya, Uganda, Tanzania, West Africa, Ghana, Nigeria, parts of South Africa, or places like Botswana. It’s no longer a place where you can’t make a return through investing. A lot of capital is flowing there.

If you want to invest for the long-term, I encourage you to take a look at companies that are growing in Africa. Today the continent has over a billion people. By 2050, it is on track to have about 2.5 billion people—a huge market opportunity in which you can do well and do good at the same time.

47. Nearly super human feats are possible when you’re deeply passionate about your mission.

When you align what you love with what you do, you will be amazed at the results. In 2010, my business partner Aaron and I rearranged some of our company’s philanthropic giving. We created a Corporate Social Responsibility Program that realigned how iContact gave back to the community. When we did that, I became deeply passionate about iContact to an even greater degree because I knew that every time we grew the company, we had a philanthropic program in place that would scale with that growth.