Deep, deep thought

I was intrigued to find out that what sets us Humans apart from Beasts and mere animals is our inability to want what we need.

  • Florin Muresan

What a Startup Really Is

I’m getting sick of hearing people saying that a startup needs to be a young company (<2 years) that’s growing “hockey-stick”-style.

I’ll give you the real definition of what a start-up company is:

Startup = an organization which is still searching for its business model.

It gets money to continue experiments and testing for the business model. When the biz model is clear and has all of the processes 100% established, then it is no longer a startup.

Paul Graham’s ideas about high growth and bla bla are besides the point. I believe Steve Blank has a better view on this.

[Product Design] The Hierarchy of Engagement

[Article from:: https://www.linkedin.com/pulse/hierarchy-engagement-sarah-tavel]

Building an enduring, multi-billion dollar consumer technology company is hard. As an investor, knowing which startups have the potential to be massive and long-lasting is also hard. From both perspectives, identifying companies with this potential is a combination of “art” and “science” — the art is understanding how products work, and the science is knowing how to measure it. At the earliest stages of a company, it comes down to understanding how a product is built to maximize and leverage user engagement.

I think of user engagement as the fuel powering products. The best products take that fuel and propel the product (and with it, the company) forward. Just how products do that is something I’ve been thinking about for most of my career.

At the Habit Summit this week, I presented a framework for how I evaluate non-transactional consumer companies I’m looking to invest in that synthesizes some of this thinking — I call it the Hierarchy of Engagement. The hierarchy has three levels: 1) Growing engaged users, 2) Retaining users, and 3) Self-perpetuating.

As companies move up the hierarchy, their products become better, harder to leave, and ultimately create virtuous loops that make the product self-perpetuating. Companies that scale the hierarchy are incredibly well positioned to demonstrate growth and retention that investors are looking to see.

I encourage you to use the Hierarchy of Engagement framework when thinking about your own product, and building out your product roadmap. But, like most frameworks, I am continuously improving the hierarchy and would love to hear your thoughts.

Let me know what you think.

And here’s the presentation on SlideShare: