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What do an irrational fear of rejection, the inability to talk to girls at a bar, and a startup in “stealth mode” all have in common? 

I was riding the Orange Line en route to our Central Square offices last week, and I saw a sign advertising a study on Social Anxiety Disorder.  They asked if you worry too much about what other people think, worry that people might secretly think you’re stupid, and get more nervous than seems appropriate before meeting people for the first time. 

To be honest, my first thought was that if I didn’t have a company to start, I should go try their study.  But on my second thought, I realized that the same symptoms seem to apply to a lot of startup companies, ours included.

We were very shy at first about sharing our idea – maybe a competitor would get there first, or maybe we wouldn’t be able to deliver.  We got over that one, but it is still terrifying to think that we might do all the marketing right, get press and customers excited about our product, then end up disappointing and/or angering them.  It’s also in the back of our minds that we might “peak too early” and get all of our buzz before the product is ready to impress anyone. 

But the more I think about it, the more I’m starting to think that we shouldn’t worry.  There is so much noise and so much going on that nobody cares what some dinky startup does.  If we put out a product that doesn’t work very well, we won’t get bad press – we just won’t get any press. 

We’re not Microsoft; nobody has the energy or the time to skewer us.  And if they do, nobody has the energy or the time to remember it after they read it.  If we make something subpar, we won’t be noticed.  And if we make something great, then we’ll get customers today.

Some of the evidence from other startups backs this up.  If you tried the first version of Loopt on the iPhone 3G, it was incredibly easy to inadvertently text message every single one of the people in your phone’s contact list with a your location and an invitation for Loopt.  Several of the early versions of Plaxo made it incredibly easy to accidentally email everyone in your address book and ask them to give all their contact info to Plaxo.

Loopt apologized.  So did Plaxo.  Neither of these companies is in the deadpool.  They still have funding, and they still have users.  Aside from a handful of people who make knowing these things their business, my guess is that nobody even remembers. 

An even better example is Hyundai. In 1986 when they released the Excel in the US, it was nothing to write home about. 

Yeah, it looked like that.  I wouldn’t have bought one either.  But by iterating and improving, they’ve turned into an elite car company.  One of our mentors mentioned hearing about how cool the Genesis is on a golf course.  Hyundai really is now a company people associate with luxury cars.  And they had a sense of humor about the whole thing too.

So why are we so worried that our product will fail to impress?  If we make a bad first product, but get better, people will give us another chance.  If our third or fourth version is incredibly useful, they just don’t have time to hold a grudge that our first version wasn’t.  Our biggest problem is going to be apathy, not grudges.  It’s just not personal.  And if we never make the great product that will earn us a second chance, then we shouldn’t succeed.  I believe we’ll get there.

Of course, I have an ulterior motive for bringing this up now.  We’re sending our Baydin ForONE Technology Preview to friends and family on Thursday.  I’ll be honest – it’s not ready.  We have tested it on a whopping two configurations, the results need some work, and the UI isn’t as polished as we’d like.  It also comes with the caveats that it might insult your mother in law, or start crashing some untested, semi-patched versions of Outlook.  Before we’re ready to call it a 1.0 release, we’ll make sure it doesn’t do any of these things.

My arguments about SSAD were only so persuasive, though.  Despite my best efforts to make us a wild man company that releases it to whoever wants it and lets God sort ‘em out, we’re doing a limited release Alpha launch.   If you want to give it a spin, shoot us an email, and I’ll see that you get a download link.

Small Talk experience, philosophy, startup life

As Baydin has started, I’ve heard a number of different voices on how cheap a startup should be.  Those voices have almost universally concentrated toward the extremes – they advise either being incredibly, incredibly cheap (buy nothing, get furniture from the sidewalk when people throw it out, trade time for money always) or spending money like a sailor in port (buy everything, buy luxury, hire expensive service providers, trade money for time at every opportunity).  Some folks have told me that it’s OK to pick an extreme, but not to be anywhere in the middle.  

I think that sounds like a lousy idea. 

We have some money, but we don’t have a lot.  So spending money like a sailor in port is necessarily out.  We can’t afford Aeron chairs, whether we think they’re a great idea or not.  But at the same time, an hour spent hunting furniture on Craigslist is an hour spent NOT building our product, pushing the date when we start getting revenue an hour further into the future. 

I also have a personal distaste for spending my time on things that don’t yield much value.  If I wanted to do something I hate for minimum wage, I would be a janitor, not founding a startup. 

In my personal life, I found an answer that made “buy it or make it” decisions easy – I just set an hourly rate for my own free time.  If I don’t enjoy doing something for its own sake, I should only do that thing if doing it myself saves me more than my hourly rate. 

Setting that hourly rate was easy.  I looked at my paycheck and read the rate off of there.  If I would rather work an hour than do a task that yielded less than that rate, it wasn’t worth the time. 

That made things that look extraordinarily wasteful actually make a lot of sense.  I bought a $500 portable dishwasher that I wheel up to my sink when I want to wash dishes.  Expensive?  Sure.  But in the year and a month since I bought it, I’ve washed about 75 loads of dishes.  Every single one of those loads would have taken me at least an hour.  At $20 an hour, I’d be up to $1500 in “wages” for doing something I despise. 

I would love to use the same technique for Baydin’s expenses, but I no longer have a paycheck from which to read my hourly rate.  My paycheck is now $0, but my time still has value.  How do I figure out what that value should be?

The web tells me that I need to figure out my burn rate, figure out how long I have until I’m out of cash, figure out how much revenue I can expect to gain versus time, then figure out how much faster an extra hour of coding gets us toward the goal.  Put that into a spreadsheet, regress it to the mean, take 2 standard deviations, and voila! 

But it seems like getting to a reasonable answer is a lot easier.  I quit my job, where I had that steady paycheck, to start this company.  If I didn’t believe every hour I spent working on the company was more valuable than every hour I spent at my old company, I wouldn’t have done that.  So my answer is easy.  My “hourly rate” is exactly what it used to be.  If spending less than that saves me an hour, I should spend the money.  Trading an hour of time to get a computer for $369 instead of $389 just isn’t worth it, even though the overoptimizing engineer part of my brain is screaming at me about every “wasted” penny. 

Of course, to be able to have that flexibility, I needed to build savings before quitting my job.  If I hadn’t spent a few extra months at the job, earning the savings, go cheap would be our only option.  Luckily, we’re at a place where we can afford to make the money-time tradeoff for obvious big wins.  We’ll let you know how it works out for us. 

Small Talk economics, startup life