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This guy wants his windows fixed

by • December 27, 2011 • Best of, Founders, ListeningComments (10)331

Abstraction makes us stupid at business

You want to start a company restoring ancient stained glass windows to their former glory.

You live in a country rife with cathedrals and have spent a lifetime appreciating these translucent masterpieces, but you don’t have any deep technical knowledge of their restoration.

How do you get started?

Why is it that most people can intuitively approach this situation correctly while simultaneously doing the exact opposite for their tech startup?

How any normal human would begin

Well, first you need an amazing technical partner to explore the possibilities with you. It’s not like you could run the company without one, so it doesn’t make sense burning money until you’ve found him. But this is a field you care deeply for, so it’s easy to strike up conversations.

Then you’d want to walk into a few cathedrals and ask around until you find the person responsible for maintaining the property.

You’d ask where their restoration budget comes from, what it looks like, and how the glasswork fits into all that.

A few conversations in, you might find someone who is desperate to get those windows fixed up. Bingo. With your passion for the art and your partner’s technical excellence (and your presence in the room), you’re the perfect candidates. You’ve got your first customer and begin hiring a couple more people to see it through.

How a tech entrepreneur would begin

You’re eager to start, so instead of staying at your job while you find a great partner, you hire some cheap labour in another country to make an example of your craftsmanship.

You take the demo to your friends & family, who give you a bit of much-needed cash. You spend it on the rest of the people and tools you’ll need to do a good-enough job at window work.

Now you take a guess at the budgeting and pricing processes, pick a number from a hat, and begin sending promotional flyers to chapels.

Abstraction makes us stupid

In this scenario, it’s obvious that we wouldn’t hire a team before getting a customer. It’s painful to think of outsourcing the core value proposition or hiring day labourers to do a good-enough job.

Code is to tech startups what staff is to real-world service businesses. A big fixed cost that you want to delay until you’re pretty dern sure someone will pay you for your investment. It’s obvious we shouldn’t hire pre-maturely, but far less obvious that we shouldn’t write code before making some progress with customers.

For physical businesses, it would be literally unthinkable to set up shop without talking to loads of relevant people and figuring out how the industry works.

Would you open a high street shop before popping into chat with every other nearby store owner and spending a week parked across the street watching how foot traffic behaves? I sure wouldn’t.

And yet we do that every single day online. Crazier still, it’s the default online.

Brick & mortar

Think about your new business as if it were of brick & mortar.

We have a great deal of intuition about real-world businesses.

Make use of that, and you’ll find that your perspective on crucial first steps and must-have investments shifts considerably closer to reality.

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10 Responses to Abstraction makes us stupid at business

  1. Marco says:

    I think your article is right. But for me the bottom line is talk to the right people and not: Abstraction makes us stupid

    I don’t get it why abstraction should make people stupid. It’s the opposite, it let’s you see patterns and that makes you smart.

    • robfitz says:

      I agree with that bottom line ;). Still, when dealing with a real-world business, people intuitively know they *should* be talking to other people and they actually go and do it.

      We can walk into a cafe or a hardware store or an insurance agency and see a lot of the moving pieces right in front of us. We’ve all seen stores on our own high street closing down and have tut-tutted and said “What a shame… if only they had better service and advertised themselves a little more!”

      When dealing with virtual businesses, all that learning and common sense goes out the window. We don’t have an intuition for these types of businesses, even though we should, and so you run into too-common situations like somebody building a whole product before talking to anyone.

  2. This is the fundamental premise of Steve Blank’s “Four Steps to the Epiphany”. Blank draws on some infamous examples where abstraction led the process, rather than getting early feedback from customers. WebVan is one such case.

  3. Rob,

    Kudos seeing you on the front page of HN. I agree with your sentiment but disagree with your analogy. In your first example the real world business restoring windows the process of this business is already known and likely also the tools exist (unless you are doing an initial batch of R&D to forge a new process).

    Both businesses should be broken down into “What tools do I need?”, “How do I get those tools?”. It just so happens that for your “Restore Windows” business it’s likely the tools already exist so you don’t have to build a proof of concept. Hence you can skip straight to “Find tech partner” then “Find customers”. You have skipped the “invent new process” and “design new tools” stages.

    In technology startups it’s common (although not a requirement) that some of the tools (e.g. software) do not exist hence you have to meet any prospective customers in the middle and sometimes show them (or investors) what you are trying to do.

    I do agree though that more people should apply more common sense to tech startups. Keep it lean. Keep it simple and all that…

  4. Eric Normand says:

    I agree that we often do things in the wrong order when thinking about software products. Part of the difference I see is that it is easy to sell a service (such as repair) before it exists. “Give me money and I’ll start tomorrow.”

    Selling software (a product) is more difficult. You are only selling an idea and if they do buy, you can’t deliver right away. “Give me money and, in several months, I may be done with the product you want, and I might not because product development is hard.”

    The trick is to minimize that risk for yourself and the customer.

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