design should never compromise functionality, nor should functionality ever compromise design

Design is something that start ups tend to miss, forget about, or pay little attention to, and this is especially true for those with an engineering background.

Engineers tend to think that as long as it’s functional, and works right, it will appeal to the masses, but these engineers forget that the majority of the population are not engineers and in fact just general folk, and if your product targets the masses, one of the best pieces of advice we can offer is DON’T SKIMP ON THE DESIGN.

Remember the Volvo’s from the 80’s and 90’s? Great cars on the inside, but ugly, real ugly. Then comes Ford, buys the car division, redesigns the body and sales go through the roof, the cars, are now not only safe but cool.

Old example? Look at Android and iPhone OS. Android is open, there are no limits on what you can, can’t do, there is no parent company that strictly dictates what you can put on an Android phone, it’s open. Yet the sales are meager in comparison to the iPhone. Why? Well, it’s cool, the design is sleek and well thought out. Apple more so than any other company is known for the quality of its industrial design, and it shows, just look at the bottom line even during this recession. Now look at Compaq. Who?

Are you starting to see the point?

But thing is as a start up you don’t have the resources to splurge on IDEO, or hire some of the best industrial designers in the industry. Problem? Not really.

If you’re by a major metropolitan area chances are there’s a school which exclusively teaches design, or at least has faculty or a programme that deal with it. Your best bet is to contact them, explain what you’re looking for and see if you can’t involve students in a project, or even hire one as an intern. When it comes to design most of these students will be light years ahead of you and your engineers, they’ll be overjoyed at the possibility of getting some real world experience, and best of all, they’ll make your product attractive to the wider community.

A few things to note.

1. Some designers may go overboard and make it the best looking whatever it is, but completely non functional. Stay away from these and ask to see previous projects.

2. As an engineer, you’ll most likely describe what it is the product does in a way that the designer won’t understand. For this we recommend looking over our older post on value propositions and elevator pitches. Good communication is key.

3. Let the designer do what they’re good at, design. You’re there to get the business going, not micro manage.

4. And remember, design should never compromise functionality, nor should functionality ever compromise design.

And if you’re looking for a design school near you – just click here.

Here are just a few ways to completely and utterly dig your startup into the ground, as such read them, and do what you can to avoid them.

1. Have a poorly defined value proposition. Having a poorly defined value proposition will cause you headache after headache when looking at and presenting your business model. You have to know who you are targeting, what you’re offering and why they would want to use your product or service. Who is your customer?

2. Setting unrealistic objectives in your development and deployment pipeline. No matter what you think you will not underpin the world in a year, you will not have income of €20.000.000 in year one, and you will be greatly disappointed.

3. Focusing on the bottom line instead of on the service / product you offer your customers. Your customers are your lifeblood, if they are unhappy your bottom line will suffer, if they are happy, they’ll be repeat buyers, and even help market your product. Simple as that.

4. Involving yourself and your business in ethically questionable practices. Unsavory marketing practices, overly creative accounting are just some of the things that will in the end ruin your business, don’t do them.

5. Developing a product without adequately deploying resources to market it effectively. Sure, you may have a product that could cure cancer, end world hunger, and fly humans to the moon, but if no one knows about it, no one will use it. Market it, and market it effectively.

6. Going on a spending spree. Meaning, poor cash management. You may have €250.000 that you received in the form of F3 (Friends Family Fools) Capital and you think it’s great so you pay a premium for services that could otherwise be outsourced, delivered in a more cost effective way, and get everyone a brand new Mac Pro to write e-mails on. Not a good idea.

7. Launching too early or too late. Timing is everything, think about the market, the economy, the sector you’re in, where is it now, where will it be in 3 months, 6, a ear or two. You don’t have to change the world today, and launching today may lead to failure.

8. Flying solo. Think you can do everything yourself? You can’t. Involve others. Even if you’ve decided to start alone, bring in friends, talk to your network, and see if people will help you out. You don’t have to give them an equity stake in the beginning see how you work together. If you work well, ask them if they’d like to come on board.

9. Forgetting about scalability. Good ideas scale well, milti million ideas scale at their core. How big can your product realistically get? Who is your customer, and how can fast can you grow without compromising service.

10. Secrets are no fun. Talk, and share your idea with people you trust, friends, family, colleagues, these people are inevitable to the success of your business, you don’t know everything, and collaboration can more often than not fix problems before they arise.

11. Doubting your idea early on. Doubt is natural, you will have ups and downs, this is completely natural, but if you doubt your idea within the first month, or three of your start up career. Chances are you’ll become disheartened quite early on and quit. Save yourself the trouble and thoroughly analyze your concept before taking the plunge.

Good Luck!.

Cut and dry, if you can’t tell me what your entrepreneurial project does in a sentence, you’ve got a problem.

I can’t begin to tell you how common a mistake it is among budding entrepreneurs to delve into the mundane details of their projects. It usually starts off like this.

“We at New Mobile Platforms Ltd. have developed a revolutionary platform that will change the way in which people communicate. By utilizing free wifi access across major urban areas we were able to relay signals and triangulate the locations of other individuals using the same application on their mobile devices, thus pinpointing the users location to 2.3m. Other users and subscribers to friend’s devices, can see other users via real time database query’s that are updated on their mobile devices from street to our data centre and their handset every 15 seconds via, GPRS, EDGE and G3 network connections, as well as free Wifi hotspots. If you look at our programming schematic, you will see that etc… etc… etc…”

Long story short, to most investors, individuals, and to the general public you might as well be speaking Ancient Greek. The majority of the population are not engineers, do not know industry jargon, and most importantly are not interested in detailed programming schematics. What it is that they are interested in is how the product will help them in the course of their day to day lives and what need it satisfies, and when dealing with investors, they’d also like to know how it makes money.

So let’s take the above example, and rephrase it into something that can be pitched in an elevator setting.

“We’ve developed a mobile app that lets you know where your friends are on a map. It’s great for trying to meet up with people and can help you navigate unknown areas, find meetings, and the like. We monetize via Mobile Advertising.”

And that’s it. No long elaborate explanations, no technical details, just what we do, what it offers, and how we plan to make money off of it. Now whether or not this idea is a good one, is a different story all together, but being able to summarize what it does in a sentence is the most important part of any elevator pitch. You get your message across clearly, effectively and quickly.

To summarize.

• Stay away from lengthy explanations that can be confusing.
• Cut away all industry jargon.
• Get to the point and keep it simple.
• Say what you do, how it fulfills a need, and how you monetize it.

There’s a reason why firms pay top money for MBA interns from some of the top schools across Europe and the U.S. They’re worth it. So the question is… how can you capitalize on what large established companies such as Goldman and McK have known and used for years?

Well, here’s the good news. On average entrepreneurial interest in MBA programmes is high, and annually approximately 10% of MBA’s go off to start companies on their own or join start-ups. Figures differ from school to school and when approaching a MBA programme it’s advisable to see what the school specializes in. NYU Stern for example is known for Finance, whereas IE in Madrid is known for Entrepreneurship.

GETTING TO KNOW YOU

That said, get involved with the school, call up the school’s entrepreneurship club, see what activities they have planned and see if you can participate. MBA’s are hungry to know what the life of an Entrepreneur is like, some of the trials and tribulations you’ve gone though, issues that you’ve had with acquiring funding and so on and so forth.

If you’re and earlier stage entrepreneur MBA’s are a fantastic source of critique when it comes to your business model.You can often have them analyze it, dissect it, and present their findings for next to nothing.

When it actually comes to getting an intern. The best thing to do is present your company at the school. Many professors will happily invite you to speak, and if for whatever reason you’re not able to book a class, then the school’s entrepreneurial club will be thrilled to have you. Also, be sure to advertise your position with the school’s career services. They’ll add you to the database, and will in all likelihood include your offer in their weekly newsletter as well as their online application system.

GETTING TO KNOW ALL ABOUT YOU

When it comes to the interview there are a few major things to remember, and while they may seem obvious we’re still going to mention them.

• Treat current students as equals. Nothing is wore than heading in for an interview and having the interviewer ask you to sing your favorite song (true story from a Forture 500 company interview, in fact why don’t we call them on it as this type of practice should stop, it was TechData), and after all you’ll be working with them for a few months.
• Ask questions to see the way the person thinks. Being a start up, you’ll be working closely together, and culture, fit, mix, whatever you call is about the most important thing in building your team.
• Pick someone that compliments you. It’s easy to hire someone just like you and with a similar background. See where your lacking, what can you improve on, and what area of your business needs the most attention, and get the person who can do that job right.

GETTING TO HOPE YOU LIKE ME

Once you’ve chosen your candidate and shortlisted two more be sure to give them an offer that’s fair. If you’ve been funded, offer them a salary. It doesn’t have to be a Morgan Stanley salary, but try and offer something. MBA’s know that you’re short on cash, and they’ll be appreciative of the fact that you can pay them.

If you haven’t been funded and can’t offer cash incentives, be frank and say so upfront. But do express what you can offer, knowledge, insight, networking, day to day entrepreneurial experience.

Did we miss anything?

This should be a no brainer but you’d be surprised juts how often people think that “I’ve got a website, I’ve added some tags, worked on some SEO, and that should be enough to get traffic to my site.” The sad truth is that this method will get you traffic, but organic growth is so slow that by the time you’re noticed the competition will have left you in the dust. You could of course spend hard money on AdWords and other ad solutions, but why not give these methods a go before you dive into those pockets for that oh so needed cash.

1. Submit your start up to relevant sources, the list below comes from – marketingstartups.com and we thank them dearly, you can find the link to the whole article here.

• KillerStartups.com- Use their online form (http://www.killerstartups.com/submitted)
• Launchfeed.com- Use this site to announce the launch of your service. Not as important on the site itself, but other sites subscribe to launchfeed and use the info on their blogs.
• Simplespark- Another source of what’s new online
• MOMB- (Museum of Modern Betas)- A site listing new apps
• Go2Web20.net- A flash directory of startups that actually delivers some fairly decent traffic.
• TechCrunch- The grandaddy of internet startup blogs. You can enter your information here: http://www.crunchbase.com/companies/new
• CenterNetworks- Another great web 2.0 blog
• mashable!- Awesome blog covering all that’s new on the web. Read this post before submitting your site: http://mashable.com/2008/04/10/get-your-startup-on-mashable/
• ReadWriteWeb- http://www.readwriteweb.com/contact.php
• Blogstring.com and MarketingStartups.com- Hey, it’s easy. Just contact me (nathan.burke@gmail.com), let me know what you do, and if your site or service is relevant, I’ll review it here.

2. E-mail everyone you know and their mother, tell them about your product and how good it is and how it will change the face of mankind forever, and elaborate on how much wonderful karma they’ll get if they basically start a chain letter from it. Is it spam? Well loosely yes, but the trickle effect should get you a decent initial user base, and your friends won’t really hate you for it in the long run.

3. Socialize the heck out of it. Facebook, Twitter, LinkedIn, post on forums, write a brief about it on EZineArticles, HubPages, and make a Blogger Site or two that links back to your site, and while you’re at it, add a Wikipedia entry. Not only will this increase your exposure, but it will also help in building back-links to your site, which will in the end help you generate traffic to your site, and spread the word on your product. Oh, and get Wibiya on your site, they recently opened it up to everyone.

4. Network as if your job depended on it, because it does. Most cities have entrepreneurial events that are held quite frequently, look on sites such as Meetup.com, Facebook, LinkedIn, and others to find out where they’re being held, if people like your stuff, they’ll spread the word, never, ever, underestimate the power of networking, and you may even get to know people who in one way or other could help you.

5. Send out press releases to everyone and anyone who may be interested. Write one and then email your local newspaper(s), magazines that cover your industry, websites, and bloggers.

6. Targeted SPAM. We hate it as much as the next guy, but targeted e-mail ad campaigns are one of the most effective ways to communicate what it is you’re selling / doing / building etc….

With that, good luck, and let us know if you have any other ideas on getting your site noticed. We’d love to hear them.

When we started planning for Next Top Startup, we had in mind that the first installment of the event would span maybe two to three European countries, and that if we’d get any traction whatsoever from across a major body of water, it would be excellent and a successful achievement on it’s own.

We had no idea however, that the scale of this competition of ours would reach as far and as wide as it did – in the end, people from 14 countries are coming together to participate in this competition in both a mentor-ship scope and contestant capacity, and as of now we still haven’t reached out to the investment community.

By trying to challenge convention, and doing what we can not to become just another Y Combinator copy, we opened the contest up to all industries – and as such saw projects come in from across the board, some of the more interesting sectors applications that we received came from the following industries: Sports, Clean Tech, Aerospace, Cloud Computing, Social Enterprise, Fast Moving Consumer Goods, amongst many others.

There was one concurrent theme in all this  – technology – in one way shape or form it’s the decisive communal factor which is driving today’s entrepreneurs forward, and while we would have liked to invite all our applicants to participate, ten does seem to be about the right number, and with that we would like to announce the ten finalists to compete for the title of – wait for it – Next Top Startup.

In alphabetical order they are…

. FastTaxi – will be an interactive platform for taxi drivers and customers to get real time information through their smart-phones in order to find and order cabs within easy reach in urban centres.
. Foundation for Global Collaboration & Peace – A serious non-profit concern that aims to build a virtual peace network that benefits the global community through the dissemination of universal human commonalities.
. Getagreatboss.com – The concept is built around a crowd-sourced Interactive Manager Review.
. INBLOON / Zero2Infinity – is a start-up whose mission is to raise our planetary consciousness by offering near-space experiences.
. Lexpertia – aims to commoditise the legal services profession by creating a database and online directory for lawyers based on specialty, operating as a legal advisory search platform for lawyer services.
. Teambox.com – Is an online resource collaboration tool for enterprise and project management.
. Touchland – provides environmentally friendly disinfectant hand wash to the consumer via direct sales and 3^rd party resellers that install their dispensers.
. WeCard – is not a typical static loyalty card but an innovative smart channel of information, and user-business relations.
. Wellknown.as – A mobile platform for delegates, exhibitors, conference organizers and sponsors.
. Xtremgo.com – enables people to easily access action sports through Internet by creating a one off marketplace to book activities online.

Good luck to all of them, and we’ll keep you posted as to the winner, and we ought to have some other treats in store for all our readers after the competition closes. Stay tuned!

VIDEOS

And to get you as excited as we are about our contestants, we’re including those videos that we received from them. Enjoy f3fundit TV

Getagreatboss.com

INBLOON

Toucland

Wellknown.as

The general thought is that if you’ve got a good idea – and no one has done it just yet, or not in the way you’ve conceived it, being first to market means live or die. Here at F3FundIt we think this approach is pretty much wrong.

There are clear benefits to first mover advantage, but there are also a number of other factors that have to be taken into consideration. The first and foremost of these is strategy.

And by strategy we mean launch strategy, short, medium, and long term. One of the biggest problems that we find wrong with start ups, is that they plan ahead for 6 months to one year, and then wing it. However, after those initial six months when the business is already operational, will the management of the company really have the time to create a thorough scenario analysis for the next six months, year, three? The short answer is no, however, they will waste valuable time doing just that when they could instead be spending that time readjusting the business model to best fit the pre-launch misjudgements.

Take for example the case of Lycos, Infoseek, and WebCrawler that all launched in 1995. Then Google comes in three years later, and the rest is history.

Those first search engines had a three year start on Google, but why did they get relegated into the annals of net history while Google took the undisputed heavyweight search crown. It all comes down to strategy.

The code behind Google has already existed prior to its launch, but they decided to hold off a bit. Why? Well in 1998 the internet was just starting to reach its critical mass, the 56k modem came standard with home PC’s and overall connectivity was cheap, $19.95 per month.

In 1995, the facts were a bit different, the equipment was too expensive and and connection speeds too slow for anyone to really use the net outside of institutions.

So the question you should ask yourselves is, is it the right time, are we ready, do we need to be the first, and prepare, prepare, prepare.

And to close, I will quote David Masó who recently told me during a chat “The good entrepreneur is he that resists and pursues their dreams in a smart way”.

Once we had the pleasure of listening to a successful entrepreneur give a talk about how he made it, and how some of his friends who also started companies were faring. Long story short we got to talking about two good friends of his who had started companies years ago. One was now a very successful energy mogul, whereas the other one was still trying to get the idea he had all those years back off the ground, kept on funneling resources into it, he was undeniably unforgiving to his idea. How could his idea not work, after all he had thrown so much time money heart passion and soul into it? Simple answer, it just didn’t.

And when your entrepreneurial idea doesn’t work, the only thing to do is kill it, bury it and move onto the next one. If it doesn’t work, no big deal, the next one will, and if not that one, the one after that, and if not that one…. well… eventually something should hit. But people – they get overly attached to their ideas, they think that the one idea they have and devote resources to will change the world or something here, something there.

Most wont, and the best thing to do is to test it, launch it, if it doesn’t take off. Kill it. Your time is more valuable than the resources you’ll invest into bringing something inherently broken to market.

But how can you identify if your idea is a good idea other than that your friends, and family tell you it is? Follow these simple rules.

1. Does it satisfy a market need?
2. Is it scalable?
3. Who is my market?
4. What are my competitive competencies? Where do I excel?
6. Is my idea really that amazing? If not, it’s no big – more money gets thrown at mediocre ideas with great people than vice versa.

So before jumping into the fire, ask yourselves those few simple questions.

More often than not you will see features and ideas developed and implemented int0 products that serve no purpose whatsoever, they may be nifty little things such as a fingerprint scan to bypass the password on your mobile app, of they may be a peripheral port on an some electronics that serves absolutely no purpose other than being there. Why do we put them in? To make the product cooler? To make it future ready? For 5 years down the line? Most of the time, all these extra features are useless, and here’s why.

Let’s look at it this way.

1. What real purpose do these extra features serve? And

1. How do your customers, or how will your customers engage your product and/or service.

Often times when designing your product or service you’ll want to add in additional “doo-babs” because they’re cool, or will make your product stand out from the competition, or will allow for the eventual possibility of expansion five years down the line. But in reality, will any of this provide an added benefit or is it just some kitsch that cost you time and money to develop? And how do you know if a feature is necessary, well this second part comes down to knowing your customer.

Who is your customer, how does your customer engage the product or service – what is the value that your product or service offers your customer.

Let’s look at the mobile fingerprint concept which recently came up in conversation at an entrepreneurship meeting that I attended here in Barcelona. Sure, it’s a nifty little feature that substitutes the login/password combo of a mobile application, but what does it add in terms of functionality. Not much. But what does it take away in terms of time & resources?

Implementing a traditional login/password combo takes about 5 minutes worth of work, fingerprint recognition, in all likelihood a bit more – in fact probably a lot more.

The time that it took the programmer to develop the fingerprint recognition would have been better spent working on a core function of the software or making sure that the software is bug free, and if that had already been completed then time to market would have been decreased. Lower time to market, the quicker your company starts earning ducats.

Just because a feature may seem “cool”, it’s not necessarily a key component. Will something like a fingerprint password scan make the customer use your product over your competitions? Personal privacy issues aside, probably not.

What will make them use it over the other is the value it offers. Software developers often go beyond themselves and develop really cool but really useless technologies – i.e. aforementioned fingerprint login. But logins and fingerprints aside, they’ll often develop feature heavy applications where the end user will simply want a stripper down version. Meaning, the end user will typically not engage a phone for more than 15 seconds – aside from a flight, a bus ride, or a few hops on the metro. They want their info, they get their info, and they exit the application.Wham, bam, thank you ma’am. A good example of a stripped down version of a software is 37 signals – all they provide are the basics, and leave the hoopla out of it.

By developing 50,000 features into that application that are for the most part an unnecessary expenditure, you’re wasting money, resources, and time, but more importantly you’re not thinking how the customer will use your product.

At the end of the day successful design is not about “cool” but about “functionality” and that applies to anything from mobile applications, to chairs, and cars – and once that functionality is in there, well then you can add in the cool.

Y Combinator’s new 8.25 million USD fund shows that it’s funding model is definitely successful, but the question is can it transfer to other industries?

While Y Combinator may be focused on the web (and by we include mobile as the lines are ever more blurry), this new 8.25M fund shows that Y Combinator’s new approach to investment shows merit. The question however is, can those similar practices be transferable to other industries?

Typically an investment of up to $20k ($5,000 + $5,000 per founder) isn’t exactly big bucks and typically won’t provide sufficient capital to hire a team, program whatever, and devise a strong media campaign. What it does is give the founders of said startup enough cash to live for three months and develop the idea while having their hands held by the incubator.

Specialized business training on the go, or more likely during the building stages? Absolutely, look at the successful entrants, all programmers with little to no business experience, but now with successful companies, Reddit, ClickPass, Zenter.

However, this is the web, where businesses are easily and quickly scalable, but how about if we were to apply the same model to clean tech, could a micro investment also work?

Aside from what is undoubtedly the higher cost of a prototype, the model should be transferrable. Why? Because the recipe is the same.

Inexperienced Engineer in Business + Good Scalable Idea + Capable Mentoring = Higher probability of success

The only difference then is, how much money will a non-web company need, and what is the exit?

First off, we are definitely looking at larger figures of 50-100k+ per clean tech project total seed investment – longer lead times, longer, development times, and longer to market times. Not to mention of course that sales and profit generating activities typically will require more effort but should those same hand holding techniques be applied to a different tech sector we could very well see a paradigm shift in the way we go from prototype to market, and more so how early stage non web companies get financed.

Would be interesting to see if anyone will pick up on such a model in the coming 3 years.