Life as a tech founder is, to put it mildly, rich. And two things are certain: 1. There will be a lot of work. 2. You're going to make mistakes. Lots of mistakes. - "We have a black belt in 'startup fails'," laughs Sveinung Totland, CEO of the successful company Apps, behind his Haugesund accent.
– "Yes, we've experienced everything," adds Co-Founder and partner Espen Hareide.
– "From customers trying to pay with liquor, to developers on the other side of the globe delivering a month late." We met the boys at Vulkan in Oslo, by the banks of the Akerselva. And is it really so that you have to fail big time first, to succeed later? No, it's not, according to the two colleagues. The founders behind the successful company Apps, however, know well that you can get some scrapes along the way. But, after helping hundreds of startups and scaleups with technological development and pioneering work, strong value propositions and good user experiences, they also know everything about what it takes to succeed.
Read on for their top eight tips for surviving the tech jungle. If you look at Silicon Valley, it's easy to think that crashing into the famous wall is a job requirement in every startup. For Sveinung and Espen, who founded Apps in 2008, the road through the great mobile revolution has been a big upswing.That's not to say there haven't been any setbacks along the way. Hareide and Totland have a couple of robber stories up their sleeves from both the dotcom wave and the app revolution. But the biggest lesson they have learned is that startup life is often about connecting with good people in certain key areas for the business.- Good things can come out of making mistakes, but if some greedy person has made a mistake before, and you can avoid it, that is preferable. Or what? asks Totland rhetorically.
1. You lack the competence to make the right choices
It starts with an idea and butterflies in the stomach. However, enthusiasm and passion alone are not enough to get your startup to take a gazelle leap. There are not a few napkins with brilliant tech ideas that end up in the wastebasket. If you want to play in the elite series, pure talent is not enough. You have to train correctly and a lot to end up on the top shelf.
- Everything is about competence. There are millions of ideas. Your own and your partners' expertise is what really determines the degree of success, says Totland.
- All entrepreneurs start with an idea. Often you know someone who knows something in one field, and get help from these developer friends to create some things based on the knowledge that is available, adds Hareide.
- Yes, and of course it's cool if it works! But it often turns out that the winnings go up in the spinning at the next crossroads. The best thing is to choose the skills that help you reach the potential of your idea. Not the fastest and cheapest solution right then and there.
As experienced advisers, Espen and Sveinung have seen many of these mistakes repeat themselves, year after year. In their eyes, the most common mistakes that cause a startup to fail technically can be avoided by choosing partners from the start. The technology you choose, the architecture you choose, the choice of cloud service: everything requires expertise and experience. Choose someone who has been out on a winter night before, and who can stand with you in the war. Someone who made similar solutions before.
- It's better not to make a couple of the mistakes you're bound to make, even if you might get one less nachspiel story about the hard startup life, Hareide winks slyly.
2. You choose technology before you know what you are going to make
Another common and basic mistake. Perhaps you know someone, or that one of the founders has one type of technological expertise.
- Many entrepreneurs see the whole world as nails, because they have a hammer in their hand. Instead of genuinely trying to solve the company's problem, you throw yourself into a development course that has not been thought through. And there are things that will bite you in the tail a little further down the street, warns Hareide.
In Apps, they have met entrepreneurs who have realized that the only way forward was to take two steps back. Start over, quite simply – something that both costs a lot of money and valuable time in a vulnerable phase.
- It is important to make the right choices early on, which do not limit you in the future. All choices are important, but some choices can be made without being dangerous. Others need to be thought through more. Our experience helps us make good choices for the entrepreneurs who come to us, which in turn benefits their investors.
The two tech advisors are left to discuss the dangers of, for example, locking into a cross-platform framework, which could set limitations in the future.
- If you are going to create a mobile app and you absolutely have to do it as a web hybrid solution, only because you have that expertise you can burn yourself. If instead it is more beneficial in the long run to develop natively for iOS and Android, shouldn't one take advantage of the opportunities that lie there? asks Hareide.
3. You're falling into the Sport Utility Syndrome trap
- Tech is not just about technology. It's just as much about people. Because it is in the face of both UX and UI that the strong feelings arise, says Totland.
And if you don't pass the big market test, costs and new rounds of development await. Self-confidence and belief in the basic idea are superpowers for an entrepreneur. But uncertainty can often be camouflaged behind an exaggerated belief that "everything around" will save a weak basic idea.
- This is often rooted in the fact that you do not trust your concept, and create a lot of small features that are not needed to embellish the value proposition, says Espen Hareide. "A goal without a plan is just a wish", and it is not enough to wish for a good basic idea, he adds.
In the discussion that follows, it is clear that the problem is something that Espen and Sveinung are engaged by. It is often the case that one has little focus on the core business, and wants to do as much as possible "to expand". Once you've passed the point where it's too late to turn around, it can be difficult to be honest with yourself. Instead, you take far too great a risk when you subconsciously try to compensate for your weaknesses.
- It has not so much to do with technology, but human factors and emotions. In the end, it ends up costing a lot of money, and it takes the focus away from the most important thing. This can easily be avoided and has mostly to do with understanding the problems to be solved in the startup. It's all about preparatory work and research, which reduces the risk. If you jump into it unprepared, the risk increases. It's that simple and that difficult, says Totland and claps his hands.
4. You underestimate piloting, MVP and agile development
- The consequences of working flexibly, and the whole lean way of thinking, is that things are constantly changing, Hareide points out.
- This can be an advantage if, for example, you work with MVP (Minimum Viable Product editor's note). But economically, there will always be an inherent conflict between flexibility and a fixed price for projects, adds Totland.
In addition to the fact that the flexible working methodology can lead to changes and choices almost all the time, as a fresh start-up you can make choices or make mistakes that others have made before you without you knowing about it. It can be expensive, but can be avoided if you work with people who have made these mistakes before so you avoid the extra rounds and the costs involved.
- A common mistake is to think that an MVP is the first solution on the market and that it doesn't cost that much. "It should go quickly," many think. But our starting point is that there is a clear consequence between MVP and agility. You must create small solutions and check them off before moving on. Does this work or does it not work. Deny and confirm. The typical mistake is to underestimate the early stages and rush to market. Patience is important, so you don't have too bad a basis for making forward-looking choices, explains Hareide.
The challenge is that you often do not know enough about your problem to make good choices. This is what you must ensure against with a flexible process, and make good decisions on a good data basis. It's more cost effective to get it right the first time, rather than incurring multiple rounds because you steered with your gut instead of your head.
– Cut the crap and kill your darlings! Hareide slaps his hand on the table. - Base your choices on data and insight. Then you get to make the right choices and don't use up all your funds on the way to a crash landing.
5. You validate with a too simple solution
In the continuation of this comes validation.
Espen Hareide has more on his mind:
- Customers who come to us have often piloted something, been out and tested a prototype of their solution. And often this can be a bit too simple, so the customer may not have a full overview of the real issues they have to deal with. That's why we like to be involved right from the piloting phase and be with them all the way, not just when creating the solution.
Sveinung Totland explains:
- Then we have to help with the experience we have to find a clear proof of concept or a pilot that is usable
- in other words, that we are at the heart of the issues the customer is facing. In that case, wireframes on an overall level will not do. It has to be something that they have actually had people out in the real world to use, and that they relate to as if it were a finished product. You can create a mock-up, hack into proxy solutions and build simple versions of an app. Then you get a proof of concept that looks like it was finished. Then you get proper data that makes it easier to make good choices. That's the whole point. It's that simple and that hard.
6. You take on too many tasks as an entrepreneur
A gründer is a potato that eventually doesn't have much left. Due to all work tasks and ongoing processes, you are spread far too thinly by everything that happens. It is important to find both early and clear answers to what you should spend your time on.
Espen Hareide is crystal clear on what he believes is important.
- It's about the fact that you should do other things than think about your technology stack.
It turns out that the Apps founders speak from experience. After they got the idea for Apps at the Underwater Pub in Oslo almost 15 years ago, they gained some valuable experience.
- We thought we were world champions, laughs Sveinung and shakes his head. I don't know if it was the pork and the dip at the legendary Restaurant Schrøder's on the other side of the street that went to our heads, or if we were starstruck after sitting on the next table to Dan Børge Akerø. But little did we know when later that evening we got the idea to start Apps at the Underwater Pub, about all the mistakes we were going to make. We thought we could do everything ourselves. Being tired was the normal state. It was supposed to be like that, we thought. But old entrepreneurial ideals quickly died. It is a myth, or perhaps a trend, that you have to walk into the wall. That's just stupid, we found out.
7. You offshore where you should nearshore
It is always tempting to save money on development. To set this to a team with someone you are contacted by on LinkedIn. But it is a long way to both Eastern Europe and South-East Asia.
- We've done it ourselves, and been sold things by someone who didn't know what they were doing. We have learned that what works best for us is to work with people you can have a coffee with. We also see that more and more people are moving things home. Those who come home with cheap projects from, for example, India or Ukraine in their digital suitcase, often have to make expensive restarts, says Totland.
You can therefore save money if you offshore tech expertise. Trust is important when creating the company's most important assets. Having someone to fight the war with, who has worked with you for many years, is an invaluable asset.
- For startups, nearshoring is clearly recommended. At the same time, Apps as a nearshore partner can give our customers the offshore effect, through our subsidiary Apps Lab in Hungary. Then you get offshore margins with nearshore advice, says Hareide. When we established Apps Lab, it was important for us to work with a dedicated team of seniors to ensure good deliveries. Apps Lab must deliver the same quality as any Norwegian development environment.
8. You misjudge time-to-market
If you haven't done things before, it takes twice as long. At the same time, this lack of knowledge can paradoxically lead to people rushing and becoming impatient. An entrepreneur's most important characteristic is also paradoxical, because it is about recognizing different scenarios. But how do you recognize these if they are completely new to you? The paradoxes are thus in line. As an entrepreneur, you are both a marathon runner and a sprinter. Miner and mountaineer.
- If you want to climb to the top of your industry mountain, you must first know where to dig for gold. At Apps, we've helped hundreds of startups and scaleups find it. We see ourselves as a guide. We know the map. And if you have been in the terrain a few times, you learn to recognize both pitfalls and gold mines, philosophizes Sveinung Totland.
- After a few decades in the industry, we luckily end up in Klondyke more often now than when we started. We have made most of the mistakes in the book, and have certainly not made our last. Fortunately, that's just how you learn and develop, concludes Hareide.