I was introduced to this book by Mark Tonneson, my first manager at Cisco. Fresh out of college, I was an eager whip-snapper who would soak up any piece of advice on “getting ahead”. I didn’t read the book, although Mark bought it for me. It still is in my ‘library”. But the phrase “Dig your well before you are thirsty” has been with me since that day.

Most of us tend to ask for help when needed. Its the “on Demand” way of doing work. I’ll learn something when I need it, until that point of time, learning it is useless. I agree with that principle for knowledge.

For relationships, though, I have always tried to build them way before I’d ever need them. In fact building relationships without the intent of ever using them is a sport of mine. It comes from being interested in people and wanting to know as many people as possible.

As an entrepreneur that principle has helped me more than anything else I have done.

This however, is a story of how I acquired my first customer at my first company. It began 3 years before the customer signed up though. So effectively my sales cycle was “3 years”.

Circa 1995, Rational was hosting an event on Object oriented modelling. It was a free event, sufficient enough excuse for me to show up. The event was to start at 830 am and was scheduled for 2 hours. The venue was the Double Tree hotel in San Jose. I showed up at 815, and was negotiating with the automatic gate (which I felt was unreasonably placed in a position which required you to get down from the car to reach for the button that would give you a printed ticket), which would trigger the proximity sensor to open the gate.

I had to get down. Damm, I hate these poorly designed machines, which don’t really help serve the purpose that they were intended for.

It took me a few minutes to park and make my way back to the entrance. In the meanwhile a few other cars were backed up at the gate, facing the same problem. I was not “smartly dressed”, and had on a t-shirt and slacks. I noticed a few more folks struggling with the sensor gate, so I made my way across to that gate, and helped push the button and get the ticket for the first car. The gentleman in the car was in a beige suit and seemed preoccupied with something on his dashboard. He did though, look at me and murmured “thanks”. I was just about to make my way to the entrance when I stopped and realized every one of the cars in the queue would have the same problem.

For the next 3 minutes I pushed the button for 5 or 6 cars and diligently gave them the ticket so the drivers did not have to get down from the car. Noticing it was 825, I decided to make my way to the registration.

The “beige suit” was just behind me at the registration desk. He did a quick double take and asked me if this was the Rational rose event.

I replied in the affirmative and said it was and I was registered for the same event. He introduced himself as Steve and said “I really have to say thanks again, since I did not realize you were helping me even though it was not really your job”. I realized then that he thought I was an attendant whose job it was to “push the button and give the ticket”.

I laughed pretty hard for the next few minutes and we both got talking about my job at Cisco and his. We agreed to keep in touch after the event and “catch up over lunch sometime”. Over the next few months, I would email Steve off and on, sharing some articles and such, and we’d have some email “debates”, that but never really met him for lunch.

3 years later, I left Cisco to start my first company. Steve emailed me a few months earlier saying he had joined Netscape (Actra).

I sent an email to my contact list 2 months after my beta product release, letting them know our product was available for companies to install and try.

The first email response I got back was from Steve. He asked me to come by and give his team a demo.

A month later we started working with the Actra team (Netscape) as part of BuyerXpert product.

You can call it luck. I also call it luck.

I am actually known to be the luckiest guy on this planet.

The only thing I do to get lucky is dig my well before I am thirsty.

Other

What the websites of 145 Ycombinator companies told me about their marketing approaches

March 12, 2012 Mukund Mohan 2 Comments

As part of my research on website design and marketing approaches by yCombinator companies to come up with best practices, I looked at over 145 companies that have been funded by them. Of that list, 53 were B2B companies and rest were B2C (consumer Internet).

My goal was to understand the approaches they took, what they highlighted (navigation, call to action) and what their strategy towards building their website was. I fundamentally believe your website is the #1 marketing investment you can make, so I judge most companies by how good / bad their web presence is.

According to Wikipedia (through AMA)

Marketing is used to identify the customer, satisfy the customer, and keep the customer.

Lets drill down on the “identify” part of the definition and understand that after you segment and target your customer, you will have to offer them something they want.

Lets make an assumption for this post that this definition is slightly dated and “satisfied” customers are insufficient, and you need to “delight” them.

Finally if you delight the customer consistently, then “keeping” them is less of a challenge.

The best sales people (in my book) are those that understand the buying process well and do everything to fit into that process.

The best marketing people do the same. They understand what really motivates the “heart, mind and the wallet” – emotion & logic and position their products in that context.

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On the web (with inbound marketing included), marketing emotion and passion is hard. Its not impossible, but hard.

Any number of focus group studies and A/B testing of your website and SaaS offering will only appeal to the customer’s wallet and mind.

Appealing to their heart is an altogether different beast.

Which is why in the list of yCombinator companies, most have 3 top pages – pricing (wallet), features / product tour (mind) and sign up (call to action).

The “heart” part of these websites is filled with

a) customer testimonials (people like you buy from us!),

b) demo videos (its really easy!)

c) funky about us pages (we’re regular guys like you or we are rockstars so please buy!)

d) blog (hear from us!) and

e) contact (since our website can’t sell as well as we can, please call us!).

I am not sure how well these companies are doing, so I cannot comment on their conversion ratios, their incoming traffic etc. but I can gather that they are looking to A/B test that.

Here are the top 3 things I learned.

1. Stick to 1 call to action per page. Except 4 companies, all the others had only one call to action (A bright colored “Sign up”.

2. More than 3-5 navigation links on the top makes people think you are a “corporate” and not a “startup”. Use the fact that you are a “startup” to your advantage.

3. Use your interactions with customers (phone, face-to-face meetings) to really understand how to appeal to your customer’s heart, since I fundamentally believe you cannot A/B test it.

Marketing, Sales

“Professionally friendly” – a trend I am noticing in Indian startup entrepreneurs

March 8, 2012 Mukund Mohan 2 Comments

I used to think this was a great tactic followed only by young women (read: single, good looking, and smart) in India, but Indian entrepreneurs are now catching on to this new form of relationship. So my fellow entrepreneurs, if you want to be successful selling in India, talk to your good looking women classmates from college and learn how to be “professionally friendly”.

“Professionally friendly” to me is a business relationship with a person who you want to do business with, but realize that you might have to build trust with to get it done. If you get too friendly they will take advantage of the relationship (like friends do, but you like your friends not business acquaintances) and if you are too professional, they will negotiate very hard and likely delay your deal.

Let me tell you a story first:

I have a good “friend” who’s an entrepreneur. He sells end-to-end software and solutions (his words) to hotels, restaurants and spas to manage their bookings and inventory. His company has been around for nearly 2 years with some decent traction (over 100+ customers). He’s built his business mostly through word-of-mouth.

Initially he found that most of his customers were taking too long to evaluate his product (30 day trials went to 90 or 120 days) and were negotiating very hard to reduce his already thin margins. He realized that his 2 initial customers were friend who were more than willing to pay fair price.

So he changed his sales process: Step 1) Cold call and get appointment. Step 2) Initial meeting and demo. Step 3) Invite prospect to Bangalore Club for a lunch / tennis, etc. – essentially grease the skids.

He found that it reduced sales cycle’s dramatically but obviously all that eating at Bangalore club did a number on his waistline (actually it made a dent in his wallet, but he raised his prices to cover the cost of the meal obviously). Second, this lunch thing clearly did not scale.

So he tried selling 2.0 – now he’ invite 3-4 people together for a double’s tennis match or a group networking lunch and figured they’d meet each other and talk. Worked better in terms of scaling up.

Meanwhile, his first few customers became good friends. Two of them were late on payments and asked for a 3-4 month extension (we are good friends, so please help) since they were “having to fight fires” or were renovating their spa or had some issues at their Chinese restaurant. The 3 month non-payment turned into 6, 2 free licenses turned into 5 and outstanding receivables were slowly approaching 72 days.

He’s found it very difficult to confront “friends” for overdue payments. They invite his family for lunch during weekend (Had their wives call my friend’s wife and told her about the new “diet” version of American chopsuey, which she had to try at the restaurant).

Bottom line – his “lets be friends first and then business partners” is not exactly going on track.

So how can you maintain a “professionally friendly” relationship? <Please> first stop laughing, since I did that for close to 50 seconds, when he told me this story.

I had 3 suggestions for him and I’d love your feedback:

1. Go prepaid – payments need to be made upfront for usage of software, services.

2. Separate selling function from payment collection so you can always say – “I am the nice guy but my finance person asked me to switch off the service till payments were received”.

3. Ensure business contacts are not involved with family – removes the “emotional atyachar” factor.

Entrepreneurship, Sales, Tips

The 3 biggest causes of stress for entrepreneurs and how to deal with them

March 6, 2012 Mukund Mohan 21 Comments

An entrepreneur’s life is fairly stressful. Most of it (in my perspective) is self induced, so the best advice I have ever received is “take a deep breath”. That said the first step to reduce stress is to pinpoint the sources of stress.

1. The stress of “expectations”. This causes serious heartburn and is the biggest cause of all stress. Most entrepreneurs believe they can be successful in their own right and when their own “expectations” of self defined success dont match with the progress of their startup, they tend to go into a vicious circle of blame, guilt and introspection.

Expectations from family – parents thought you’d be making good money by now, as opposed to eating Ramen noodles (they fed you much better) and guzzling oodles of Red Bull (drink milk instead).

Expectations from friends – many of whom got a good job at a larger company with a steady paycheck, (mostly) defined hours of work, a “life” after work and health insurance, while you sleep on the bean bag under your desk.

The expectations from friends and family can mostly can be ignored.

The expectations that you set for yourself, comparing your progress to Airbnb for e.g., either in terms of your product, traction, funding or hiring will cause you more sleepless nights. I have seen many folks couch this under the category of “benchmark against the best”, but its hugely unproductive.

“There will be people much better than you and those that will be much worse than you. Deal with it”.

2. The stress of “competition”. I worked at Mercury Interactive (bought by HP) for the longest stint of my professional career in one company (side note, my dad worked at two companies for 20+ years and he claims I worked at 20+ companies in two years). At Mercury, I got to work with an immensely talented bunch of engineers based in Israel. After their mandatory 2 years at the armed forces, they were so “battle hardened” that they LOVED competition. They (David Reichman & Boaz Chalamish) taught me how to really compete in hugely competitive markets. Here is the secret of their teachings condensed in 1 line. You ought to pay me for this in gold, BTW (Feel free to send me a beta invite to your product instead).

Rule #1 – Dont care what they do. Rule #2 – There are no other rules. Rule #3 – What? Are you still looking for more rules? Go back and read Rule #1.

My suggestion, the stress from what competitors could do, would do, will do, should be the least of your worries. I am not suggesting you ignore competition – just dont get stressed about them, because you can largely not control what they do. You can only control your own actions, strategy and plan. Focus on that.

3. The stress of “closure”. We have all been in this position. You email that certain angel investor, advisor, customer, potential key hire, then call them, drop them a voice mail, send them a LinkedIn invite, stalk them on twittter, only to get largely ignored. I send so many emails and get so few responses that if I had a penny for every email sent and 2 pennies taken away for every email I received back, I’d still be super rich.

The best way to counter this stress is to keep going. Develop “Temporary Forgetfulness” – which my wife can attest I am awesome at.

Most of all – “take a deep breath”.

User Interface

Google already has brought “voice recognition to Search (Screen shots)

March 5, 2012 Mukund Mohan

Google is debuting “assistant” for Android by Fall 2012 apparently. I noticed today though that they already have “Siri” like capability for google search. See screen shots below.

When you search for something on google, you can see a mic at the end of the search. Click on the mic and you get a pop up saying “Speak now” which you can use your computer’s mic with to speak into.

Entrepreneurship, Marketing, Sales, Tips

What all does a non-technical co founder do in a SaaS / Mobile application startup?

March 3, 2012 Mukund Mohan 9 Comments

If you are non-technical co founder at a startup that’s primarily a consumer web / SaaS or Mobile application company, there’s only ONE thing you should be focused on:

A plan to acquire, nurture and grow users (customers) with as little money as possible.

With a caveat – you should not use any of your technical cofounder’s time (once a week update / meeting to discuss progress is okay) to achieve your goal. If you do that, it takes away from building the product.

Dont waste your time on “legal paperwork”, “office space hunting”, “attending networking events” or “talking to lots of people to get advice”.

User acquisition involves multiple steps that you need to do in a disciplined fashion:

1. Understand, document and verify your user segments / audience / customers (demographics, usage patterns, usage behavior, etc.)

2. Put a plan to create awareness with as little budget as possible. Make the assumption that as a startup you will have some time but no money.

3. Document who are the key influencers (bloggers, reporters, analysts, etc.) you need to get in front of and when / where you plan to meet them to talk about your product.

4. Plan a content marketing strategy (blog posts, infographics, surveys, slide share presentations, videos, etc.) that will consistently help you build lots of content to help grow your organic traffic from search results.

5. Learn how to build, manage and grow a community of users to help build a great fan following for your company.

You can call this anything you please – Marketing, Hustling, Selling, Community building, User acquisition, etc.

Each of these are very measurable.

1. How many visitors came to your site?
2. What were the sources of your visitor traffic – blogs, organic search etc.
3. How many are repeat visitors, versus first time?

Nothing else matters. In fact if you do a great job at this, you will be as valuable as your technical co founder.

Other

What countries can learn from Facebook – dont tax your citizens, only corporations

March 2, 2012 Mukund Mohan 4 Comments

I think facebook is trying to be a country NOT a company. Therein lies its huge valuation.

1. A country with over 800 Million citizens that are all over the world.

2. A country which is rolling out its own passport called verified IDs.

3. A country with its own currency called Facebook credits.

4. A country which has citizens (users) who dont pay any tax to access any of its services or infrastructure.

5. A country where every corporation (Zynga, etc.) that wants to sell to the citizens who buy virtual goods pay a flat 30% tax on every purchase by a user – so yes the user indirectly pays.

6. A country whose benevolent dictator wants its citizens to know its social mission.

7. A country is very business friendly and is increasingly becoming more useful to them.

8. A country with privacy issues with its users to deal with.

Marketing, Mobile

How does mobile marketing change the spend on Paid, Owned and Earned Media?

February 29, 2012 Mukund Mohan 5 Comments

If we were to revisit paid, owned and earned media and the impact on mobile marketing.

Most marketers are now building custom mobile applications (owned) for Android / iOs and will soon start to build them for Win Phone 7. Most are already ignoring the Symbian and Blackberry RIM.

During the days of television, print and radio paid was the choice of campaign spend, whereas earned was relatively small (less than 10%). Meaning, you paid for advertising alone and worked on your PR strategy to get your message out alternatively without paying for placement.

The days of the web changed that mix from only paid and earned to spending on your website (owned) which I think reduced the percentage of paid to 70% (from 90%) with 15% being spent on owned and earned slightly increasing to remaining constant.

With mobile applications being developed by marketers and social media engagement the owned portion of marketing spend is increasing even more to close to 25% of marketing budgets, and PR at a constant 15%, the spend towards paid media has further dropped to 65%.

The challenge with every marketer trying to develop their “owned” media channels is that they need

a) more resources (social media analysts & marketers and app developers) instead of campaign spend and

b) more “viral” techniques are being adopted to promote the owned properties.

Lets assume the viral techniques are getting more ineffective as more people try them.

Marketing budgets are increasing at a pace of about 5-7% annually for large companies and more marketers are being asked to spend more money on “owned media”.

What impact does this have on the future of marketing and more specifically mobile marketing?

1. I see the mobile advertising (both display and search) largely being used for promoting marketers “owned” applications – the main reason for that is the instant gratification that comes with an ad to download an application that possibly helps you more than just an ad for branding purposes. It is a lot more measurable.

2. I see many marketers being asked to “get more technical” and start building more “owned” properties since in the long run they are cost effective, easier to control and provide measurable value to the company.

3. Mobile ad networks such as inMobi, Google Admob, etc. will start to focus on helping marketers build, deliver and then promote these owned “applications and properties” since its in their best interest to get marketers to spend more money and make it a lot more accountable.

Update: Nick Burcher has written a book on this topic, and the except is available to review.

Mobile

What if scenarios for mobile phones, devices and thoughts on MWC 2012

February 29, 2012 Mukund Mohan 4 Comments

The mobile phone is fast becoming to 6 Billion people what the PC was to 2 Billion people – a communications device (voice and text), and entertainment unit (video, music, movies, news & information, gaming), a productivity tool (contacts, email, task manager and calendar), a gadget (camera, mobile wallet) and an Internet access unit (social networking, commerce, etc.).

First the mobile phone replaced the phone booth and the pager. Email has already replaced faxes and postal mail. Given that 27% of emails are read using the mobile phone (up from 20% the previous year). I wanted to speculate all the “devices” that the mobile phone threatens and might replace.

1. Camera – done mostly. The camera market will be largely relegated to SLR, while point and shoot will reduce in # of shipments. With the announcement of the 41MP camera by Nokia, we are now getting high resolution pictures taken by the phone. This will accelerate the downward trend that point and shoot cameras are seeing overall.

2. Television – In the last few months, I have seen more people using their phone to watch movies on planes than ever before. Previously they would either watch it on their laptop or a portable DVD player with an integrated display. I can still see the need for television for the large screen viewing experience with an integrated audio system, but with projectors built into phones, they might soon be used for short movies.

3. Game console – In 3-5 years with motion sensing and gesture recognition coming to mobile devices, and built in projection, I suspect most game consoles (Wii, XBox and Sony Playstation) will go the way of the SLR camera. Hard core gaming will be for the niche market, while casual gamers will use the mobile phone as their primary game entertainment device.

4. Radio – The primary use of radio is during commute. Specialized radio units I believe are already passe, so this unit is also mostly done with. I suspect most kids born today will not even know that stand alone radio units can be bought. They will be a “feature” on the phone as are calculators.

5. Car stereo – With 3G and integrated music output into the speakers of the car, this device will also be relegated to low-end cars alone. Imagine having a “separate” MP3 device just for your songs – bizarre in 3-5 years. Most likely the phone unit will snugly fit into a slot where it will be both charged and can power the music / radio within the car.

6. Projector – this is just starting to happen, and will take longer than 3 years, but with Samsung announcing the new integrated phone / projector unit (its a start), there will be possibly no longer a need to lug large projectors for quick presentations which don’t require high resolution projection.

7. Cash / Payments – This will take longer because of ID requirements than necessarily mobile commerce. The average wallet today contains a government issued ID, a security badge (company / employer issued), a debit card, one or two credit cards and some cash. The cash and credit card can be replaced within the next 5 years, but ID’s will take much longer if at all.

8. Access (Security) device or other forms of ID – I can see the possibility of employers issuing limited ID card applications that function both as an ID and an access unit. They are easier to destroy and manage (if the employee leaves the organization) and cheaper than physical cards. I can also see insurance companies quickly providing their ID for insurance etc. on an app within the device instead of a physical card.

9. Flashlight – useful in countries such as India where you have power outages in the night.

10. Business cards – surprisingly this is taking much longer than most people thought it would. You should be able to bump your business card to another phone regardless of whether they have different platforms. It will happen in 3-5 years, but the business card is going the way of the fax – niche, used sparingly to make a statement, but not pervasive.

11. Keys – This is a lot more tricky. Given typically most people have 3-4 keys – car, home (front / back) and some cases office, replacing these will take a lot longer. I dont see this happening in the next 5-10 years.

If your phone really replaces all these devices, you will need a cloud storage and security because nearly 25% of phone are lost / stolen / dropped in liquid each year. So you should be able to walk into a store, buy a new phone and “log into” your phone, similar to what an IP phone does already.

For women, who have a larger purse or handbag with other items such as a makeup kit or lipstick, I am surprised that phones dont offer that yet (although the Micromax Bling does offer a compact mirror).

Now that all items that you carry daily on your pocket will be mostly replaced by the mobile phone, I think the laptop bag or backpack is next.

The personal blog of Mukund Mohan