Lessons From Our First Hiring Mistake

19 Jun

Now HiringThree weeks after we made our first contract-to-hire job offer at GoodApril, we pulled the plug.

As a two-person startup, we recognize that making our next three hires will set the culture and trajectory of our company for years to come.  Nevertheless, it’s hard to turn down qualified candidates who fill most, but not all, of your expectations – last week we made the hard choice to go back to the drawing board and find the right candidate, even at the cost of short-term productivity.

“Hire Slow, Fire Fast” is harder than it sounds

That old adage sure sounds great when presented in the abstract, but in the midst of the early entrepreneurial sprint, it’s much harder than you would expect.

Here’s our entrepreneurial reality: we are two people in week 6 of the 12 week TechStars startup accelerator.  The pressure for us to execute is intense – we know that potential investors are evaluating us and the progress we make.  Two of our top goals during the program are to launch a beta version of our forthcoming real-time tax planning product (announced at FinovateSpring) and to assemble the core team that will enable us to prove out our business idea to provide online tax planning services to individuals.

So, six weeks ago we met an amazing CTO candidate – a recently departed senior engineer from a major tax filing company.  He had seven years experience building tax software, he had the right entrepreneurial mindset (offering to take no salary until we closed our seed round), and his references were glowing.  We could just imagine how much more progress we could make on our product, and how much more credible our team was going to look to investors at the big “Demo Day” at the end of the accelerator program.

Two weeks ago our candidate hit the ground on a two week contract-to-hire test.  On Friday, we decided to call it quits, despite all of those pluses.  The experience helped us discover what was important in our hiring process.

GoodApril’s Hiring Manifesto

We Will Hire Better Than Ourselves

It’s important that we stretch ourselves and our team’s capabilities by hiring people who are strong in areas where we are not.  The biggest thing that went wrong with our hiring process was that we discovered our CTO candidate couldn’t keep pace with my co-founder, Benny, from a pure technology development perspective. While Benny is a talented engineer, he’s also got an MBA and two years experience as a Product Manager – we need our CTO to be a better developer than he is. The same holds true for making a hire in any other functional area: marketing, business development, etc.

We Will Hire “Swiss Army Knives” (for now)

As a small team can’t afford to hire team-members with narrow functional capabilities – we should be hiring diversely talented generalists who can help provide coverage across multiple elements of our business.  Our candidate had strengths that were extremely relevant to product design, team management, and some specific elements of tax software, but didn’t have as much ability to make hands-on contributions in other areas.

We Will Reward Entrepreneurial Ambition

On the positive end, our candidate truly impressed us with his willingness to take risks in pursuit of our entrepreneurial vision.  In exchange for his willingness to take less salary, we agreed to over-compensate him with equity.  We recognize not everyone can afford to take as much risk as others, but those willing to take more risk should see greater upside.

Now Hiring

As we move forward, I’m sure we’ll continue to develop more of a point of view on how to hire – I’ll be sure to share those here as well.  In the meantime, if you’re a full-stack software engineer looking to take a lead development, or even CTO role, please check out the GoodApril careers page and get in touch.

Photo Credit: Zach Klein

How to Trend on AngelList: GoodApril’s Success

6 May


AngelList is now a critical part of the startup toolkit.  It helps emergent companies attract talent and investors, and apply to incubators.  Learn how GoodApril was able to “trend” on AngelList, and the benefits of doing so.

Trending on AngelList

Why “Trending” on AngelList Matters

Attracting a large following on AngelList is helpful for raising money, hiring employees, and gathering the “social proof” that other startup-insiders think your idea is compelling. There are thousands of startups listed on AngelList, but only a few are highly visible at any moment – these are either “featured” (curated by the AngelList team) or “trending” (adding lots of followers in a short period of time), and are listed on the website and in a weekly email to users.

Partially as a result of being featured as a trending startup, GoodApril was able to attract 175 followers on AngelList, the majority of whom had no prior connection to us, within one week of listing on the platform.  The talent service found a match of mutual interest between us and 21 job candidates, and gave us exposure to at least 100 more over the next month.  While GoodApril has not pursued external funding, when we do, we already have several investors who have pre-emptively expressed interest through the platform.

How to Get Your Startup Into the “Trending” Section

The basic key to trending is to add as many followers in as short a time period as possible.  It’s not formally stated, but we believe that AngelList also considers how “popular” the people are who are following you – so it’s most valuable to add followers who have a large number of followers themselves.

Ironically, the most effective way to gather new followers for your startup is to be listed in the “trending” section of the website in the first place.  What it takes to be successful at growing your follower base, therefore, is to rapidly harvest your own network, and then ride the wave of new “organic” followers as you begin to trend to stay there.

How to Get Prepared:

  1. Find all your allies already on AngelList - If you use other social networking tools like LinkedIn, it is very easy to find your network on AngelList.  Click your profile, then “Find Friends,” and connect your social network profiles.  You are presented with a list of people in your network already on AngelList – comb through this list a bit and begin following people you actually know or whose updates you might find interesting.
  2. Prioritize your allies for outreach - Now go to your own profile, click the number of people you are “Following”, then “All [XXX] following.”  This presents a full list of the people you just added or were already following.  Take this list and move it into a spreadsheet.  Put the number of followers each of these people has into a second column and sort.  This is your prioritized list for outreach.
  3. Ask your most prominent non-investor advocate to be your “referrer” – Using your new “allies on AngelList” spreadsheet, you now have a hit-list of potential “referrers”.  It’s not publicly stated how this person influences your listing, but they are prominently listed on your profile page.  I recommend contacting and getting a commitment from this person in advance.
  4. Get your non-AngelList Allies Listed – Ask any advisors, employees, investors, lawyers, or other advocates who aren’t already on the service to create a profile in advance of publishing.  Ask, in particular, that they include a photo – a profile page full of photo-less profiles is shady.

Begin your Outreach:

  1. Begin building your profile in “draft” mode – You can add your advisors, lawyers, investors, and referrer while your company is still in “draft” mode.  This enables you to get all your loose ends together before publishing.
  2. Go “live” and individually email your allies – While it is tempting to send a blast email to ask folks to follow you, refrain.  Individual emails, with some thoughtful work put into crafting it to your relationship and most recent conversations, are critical to driving up the number of people who actually take the trouble to click “follow.”  So bust out your prioritized list of people in your network, and start emailing.  Pro tip: draft these emails before you go live so you can just click “send” on launch day.
  3. Publish to Social Media - This should be obvious, but it’s also a good idea to send out a call for help to your friends on Facebook, Twitter, and LinkedIn.  Tell your friends that you’ve debuted on AngelList and that their “follow” will help you get noticed by potential investors (this message seems to be easily understood by people even unfamiliar with tech startups).  We found that this was a helpful way to have a second “touch” with our network to remind them about the individual email we had sent earlier in the day.
  4. Do follow-ups 3 days later -  Even writing individual emails, it took us nearly 200 emails and a social media blast to reach ~75 followers.  We pulled in another 10 or so by going back through our list of new followers, cross-referencing that to our Allies list, and sending a follow-up to the folks we thought were likely to support us.

Timing your Listing (and Trending) on AngelList

The only real benchmark for success for a company is ultimately growing a large base of customers who value and pay (directly or indirectly) for your service.  Despite knowing this, it is very seductively ego-boosting to watch your company’s base of followers grow.  Try not to get too distracted by it.

As I mentioned at the start, we saw many quantifiable benefits of trending on AngelList.  Other incredible benefits included getting noticed by some folks in the accounting industry, who provided the first bit of press attention for us.  An investor spotted us and introduced us to the executive team at a major player in our industry, which led to valuable business development meetings.  Finally, we saw significant traffic to our site and dozens of prospect customer signups.

There is a cost to trending, however.  It takes valuable time and attention from the founders – you have to do the cost-benefit analysis yourself on that one.  It’s also hard to sustain, and you more or less have one good shot at it (until your product and/or investment news is powerful enough to bring on a second or third wave).  Others have written that you shouldn’t post until you are already mid-way into your fundraising cycle.  In our case, we listed before we were even seeking funding, and we’re happy we did.

That’s our story, but if you want to hear another entrepreneur’s experience, check out Justin Thiele’s article with his advice and experience with trending on AngelList.

Do you have an AngelList success story of your own to share?  Please leave a comment!

Tractor Trailer vs San Francisco Hills

2 Apr

This tractor trailer “semi” truck is stuck on the hill outside of our home in the Noe Valley neighborhood of San Francisco.  I feel a little bad for the driver, but this is classic San Francisco stuff.  Gotta love living next to one of the steepest streets in the city.

Tractor Trailer Truck vs San Francisco Hills

Tractor Trailer Truck vs San Francisco Hills

Tractor Trailer Truck vs San Francisco Hills

How GoodApril Used Balsamiq to Save Hundreds of Hours in Building its MVP

28 Feb

In a Startup, Speed Matters

When you’re just two guys with a big startup idea, you can’t afford to waste your time on “pretty good” product ideas.  You have to milk every ounce of value from an hour, and that extends all the way from deciding how to strip your product vision to it’s barest essentials (the “minimum viable product” or MVP) down to choosing the right development tools.

While building GoodApril, Benny and I chose to use Balsamiq as our wireframing tool because it’s easy, affordable, and most importantly, fast.  I can turn out high-level pages in minutes, and I can go back to add in greater levels of detail and precision quickly and easily.  Our designer loves its inherent “sketchiness,” which makes it clear that our output is merely a guide, freeing her to generate creative and beautiful pages using our content as a starting point.

Balsamiq Mockup of GoodApril Checkup
What we were Aspiring to

Two years ago, my Co-Founder Benny Joseph had one of those frustrating-to-the-point-of-inspiration moments that spawned the idea for GoodApril.  He realized that he had wasn’t going to be able to deduct from his taxes the thousands of dollars of student loan interest he’d paid off the year before by a tiny margin.  He could have deducted the interest and lowered his tax bill by hundreds of dollars had he just contributed 2% more to his 401K. If he’d just known that a few months earlier, he could have easily made the change – but how are he have possibly know his tax outcome before he filed?

Thus: GoodApril.  We will help people prepare for and pay less in taxes by providing in-year tax planning and advice, through an easy online service.  Our vision is to leverage financial data aggregation and tax savings algorithms to create an online “tax accountant” that follows you through the entire year (automatically, and unobtrusively), giving you a “heads up” when your taxes need your attention.

Building our full vision will take a bigger team, and time, however – we obviously couldn’t build it all at once.  We had to start smaller.

So how to pick the right FIRST product?

Balsamiq to the Rescue

After interviewing and surveying hundreds of taxpayers, we thought we knew what our first product should be: a real-time tax forecast.  We set to work building out wireframes in Balsamiq, and over the course of about two weeks, we had a solid vision for how it would work.

Before we invested hundreds of hours of development time building it, however, we went out to some of our target customers, to company advisors, and to a couple potential investors, to get feedback. Well, we discovered something pretty underwhelming: they thought it was “somewhat interesting.”

“Somewhat”?!  This was supposed to be our big “debut”!  This was the product that would prove that customers needed a solution like GoodApril.  “Somewhat interesting” wasn’t going to cut it.

Iterating, and Discovering the Tax Checkup

We went back to the white board, begin generating alternative wireframes, tested two new concepts, and discovered what we needed: people loved our new “Tax Checkup” concept.

Reactions to our Balsamiq wireframes showed that potential customers, advisors, and investors were much more excited by this new direction.  Knowing we were on the right path, we then sunk our teeth in on design, product planning, and development.

A month and a half later, we’re pleased to be on the verge of launching our Tax Checkup.  It’s powerfully simple: a customer sends us their 2012 tax return after they file, and we analyze it.  We generate a custom report telling them how much more they are going to owe in taxes in 2013 as a result of the 7 major tax changes coming this year, and identify several potential actions that they can take to pay less.  It’s doesn’t update itself automatically, it’s not exhaustive in its evaluation of possible tax savings, but we’re confident it’s going to save taxpayers $100s or $1,000s in taxes this year.  And that’s a pretty great start.

Check out GoodApril and sign up to get your own free Tax Checkup.

GoodApril MVP - Tax Checkup - Cropped

Business Plans are Dead. Their Replacement? Startup Accelerator Applications.

21 Feb

Business planYou don’t hear people talking about business plans very often these days.  In my six months as Co-Founder of GoodApril (an early stage tax planning startup), I have yet to be asked to hand over my business plan to a potential investor, advisor, or employee.

…Which is a good thing, because we don’t have one. Or at least, not one of those 20-page Word documents that I created as an undergrad business student.

Listening to a recent Mixergy interview with Christopher Hurn of Mercantile Capital, he describes how the process of creating his business plan was helpful in forcing him to think through things like competition, how you’ll differentiate, and how you’ll acquire customers.

The very act of writing the business plan itself; it forces entrepreneurs to contemplate those things. Now obviously, today… you don’t see that as much in some of the high tech space because things are moving so quickly. Although I still think that idea, that thought process, is extremely important.

…Which got me thinking: we DID do those things, but not by creating a business plan.

Enter Y Combinator

GoodApril’s application to Y Combinator, the prestigious startup accelerator, was in fact the first time we were forced to put to paper the details of the business we had planned.  The application (which we have since learned is very similar to those of other accelerators, such as TechStars and AngelPad) asked the same critical questions any entrepreneur would include in her business plan, with the useful restriction of needing to keep it jargon-free, concise, and conducive to skimming (YC and other accelerators are known to spend less than 2 minutes reading most applications):

  • What is your company going to make?
  • What’s new about what you’re making?
  • Who are your competitors, and who might become competitors?
  • How do or will you make money?
  • How will you get users?

I’m glad our accelerator applications forced us to stop and consider these fundamental questions in a complete and formal way.

Does your startup have a business plan?

Are Product Managers Future Entrepreneurs?

1 Feb

I posted this answer today on Quora, in response to the question “Are Product Manager Future Entrepreneurs?

As a former Product Manager, recently turned Entrepreneur, I’ll say that several skills necessary to be successful in Product overlap, but certainly not all.

Skills in Common:

  • Cross-company collaboration - PMs must be able to work across business functional areas, including marketing, service, and engineering, in order to get great products built.  This flexibility and breadth of exposure is helpful as an entrepreneur
  • Focus on users - PMs tend to be highly customer-centric – thinking about the best user experience that a product or service can deliver.  This is even more important for an entrepreneur, who must even more actively seek out customer opinions to assess the merits of a specific product idea
  • Effort and priority assessment - PMs are required to constantly manage a backlog of priorities and keep tabs on the productivity of a finite number of resources.  These same skills are necessary to maniacally manage scope for startup projects where resources (namely your own time and that of your co-founders) is extremely limited
  • Market evaluation - PMs often find themselves in the role of assessing the viability of a particular market or product, and developing a business case.  This is obviously similar and even more exaggerated for an entrepreneur.

New Skills I’ve Found Necessary as an Entrepreneur

  • Sales - As a PM, I did not find myself having to sell, and certainly not to external audiences.  As an entrepreneur, I have had to learn how to sell others on my vision, on how our progress actually represents tremendous momentum, and how our barely-existent product is a solution for their needs.
  • Networking - As a PM, only rarely did I have to develop relationships outside of my business – much more important were my internal connections and clout.  As an entrepreneur, I am constantly looking to develop new relationships and connections with potential employees, advisors, and investors.
  • “Growth hacking” - As a PM, I certainly had to worry about user adoption, but mostly only the abstract – there was a marketing team that was responsible for delivering new users to “knock on the front door.”  As an entrepreneur, I have had to get very creative in finding ways to deliver users to my product with little or no budget to spend.

I’m answering this in the context of an online product manager transitioning to the role of the founder of an online-product-centric startup – other scenarios are obviously possible.

Looking forward to hearing the opinions of others.

An Unexpected Wrinkle in Preparing to Launch a Tax Business

25 Jan

Imagine preparing for the SAT, only to find out three days before the test that it had been struck down, and was no longer required for entrance to college.  That’s sorta what today felt like.

As Benny and I prepare to launch our tax preparation and advice startup, GoodApril, we have been prepping to take the Registered Tax Return Preparer exam with the IRS to help bolster our tax credentials.  While the test is really intended to ensure your local preparer knows their stuff, we thought passing it would help with fundraising and gaining customer confidence.

It turns out, however, that the United States District Court for the District of Columbia struck down the IRS’s registered tax return preparer program on Friday and is preventing it from enforcing the regulations.  As a result, the IRS today suspended the entire program, including its qualifying exam.

With the tax-filing season starting Jan. 30, hundreds of thousands of return preparers won’t have to register with the federal government, pass a competency test or meet continuing- education requirements.

So, it’s back to the drawing board on how to demonstrate that our product is being produced by financial technologists with legitimate tax “chops.”

I guess entrepreneurship is all about rolling with the punches.  In the meantime, you’ll just have to trust us: we know tax.

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