9th Lecture: Building a great company culture

I think that the company culture is more important than its business model. Indeed, all the Unicorns we know, all the most well known companies from the Stock Exchange have a very strong company culture. For example, Amazon has its 14 leadership principles, Google its “10 things they know to be true”.

Today, our guest lecturer was Gunnar Holmsteinn, COO of QuizUp. He pitched his company, then talked about the company culture and Teamwork (which is deeply related).

I really enjoyed the way he pitched his company. It was really structured and factual with figures but still personal. It was for me a great lesson of pitching, I learnt that to keep everyone interested in your pitch you have to divide it into three parts:
1) The features of your product (for your users/customers)
2) The figures (for your investors)
3) The touchy-feely way (for everyone)
To illustrate these words, Gunnar told us that his company was owning and running the biggest trivia game in the world (feature of the product), with more than 75 millions of users playing on about 30 000 topics (the figures) and thanks to the game some users met and got married, showing us thank you letters (the touchy-feely way).

Gunnar was easy to understand, funny and structured. It was only after his talk about QuizUp culture that I understood that he embodies it. When he arrived at QuizUp 2 years ago the company had the strengths and the weaknesses of all average successful start up: high talented people, high growth and a lot of fun but a lack of objectives, information flow and not defined areas of responsibilities. His main job was to solve these issues. For that, he established the company values:
-Help others learn: they are young so they don’t know everything, they shout for help.
-Fun in every action: it is a gaming company, they want to remain playful. For example, to have rates on the App Store, a message appeared when the user opened the app: “hey I just met you and this is crazy, but I am an App so rate me maybe”
-Drive the vision: every action they take is completely in harmony with their vision. They speak their mind; taking risk is their DNA
-Wait for nothing

To improve their teamwork, they have an external consultant who comes once a month during one week, he taught them the 5 points of a dysfunctional team (see below), to avoid them they have a real transparent communication: all the KPIs, results, meetings notes are public, they can also ask anything they want on a poster at the hall and once a week the CEO answers to the questions. They also have created the Quiz Up camp when during 2 days they stay outside of Reykjavik. The first day is focused on the past (accomplishments, failures, mistakes through a timeline with all the projects), the second one is focused on the future (how will be the company in the future, what’s next…)

As I told you as an introduction, I really think that the company culture is more important than the business model because when you have highly motivated talented people you can always find great ideas to merchandise but when you have a great idea without a healthy culture, you will never execute it in a good way.

Francois Freixanet

 

Lecture 7 : The best we had so far

Today we had the best guest lecturer so far : Haukur Gudjonsson – Founder and CEO of Bungalo.com, the largest Icelandic cottage rental website. To me, it was the best lecture because it was a really personal record. He explained us his fears, his failures and above all gave us very useful tips. It was not tips like “create a good atmosphere” or “try to be focus on your business model”, but very concrete tips and because at the beginning every single dollar is important, the tips were especially focused on how to save money :

• The logo, you don’t need a designer just make something simple on your own
• The website, programmers are expensive, try to find someone for free or learn how to code with a book
• The office, don’t make the mistake of having a wonderful office when you cannot afford it. Don’t forget that customers usually don’t come into start up offices. For example, Haukur office was Café or at home
• Marketing, Facebook is free, build you fan base on it. You can target people (for example, girls are usually the one who decide the vacation, target them) for cheaper than any else where
• CEO daily life, it is not very easy during 2 years, no salary, slept in small room or at the office. The food was only composed by noodle soup
• He worked on side project, computing for other companies in order to live

Finally, we had a Q/A session, and it was at least as interesting as the first part of the lecture.

Why Canada? To him it was obvious, usually Icelandic entrepreneurs go first to Nordic countries after being established in Iceland. However this is not a good idea at lot ! For example you have at least 4 different languages in these countries (Finish, Swedish, Norwegian, Danish) in Canada you can only talk English (btw I didn’t really appreciate that he forgot French 🙂 )! Also, the market is bigger in Canada with 35 million of inhabitant than in these countries. Finally, Canada is close to the US, if you can make it in Canada, why not in the US ?

Why did you launch your company with a competitor as big as Airbnb, also there are so many law constraints in this sector ?
He started his company in 2010, at this moment Airbnb was not famous. But the real answer is that you need to avoid being too focus on obstacles. All unicorns had obstacles and if they would have stayed focus on them they would have make nothing. Uber had to deal with taxi driver riots, Airbnb with houses wasted by customers.

After this so interesting talk, we kept on our class with two topics : how to create product that customers love and why you can do something that doesn’t scale. You can still read Bala thoughts on his blog.

Doing product that customers love may appear theoretical easy: show your personality, emphasize with your customers. And details matter, be simple, use the good typography, spacing, colours… To illustrate it, we used the example of the new Surface Book by Microsoft. I was very happy because I was actually thinking about it while he talked of design. If you have not seen it yet, here it is :

Finally, in the same perspective as we saw that a start up is something counter intuitive, today Bala showed us brightly that you can build something that don’t scale. He took many examples (Start up in Iceland, CLARA, GreenQloud…) but what I enjoyed the most was Iceland. Apparently start a start up is Iceland doesn’t scale : it is a way too small country (hardly as big as a mid city in France). Nonetheless, it is the only country where the entire population is on Facebook, also, you can meet very easily any CEO of any company with your relations. Finally I also add that there is less competition as any else where because nobody wants to come here, but the class didn’t really appreciate my words…

6th Lecture: Start up growth with Guide to Iceland example

At the middle of this class, let’s make a briefly sum up, we have for the moment :

• Learnt what a start-up was and understood the entrepreneurship spirit
• How to create his team, find his investor and the role of the CEO
• What a start-up was not and all the counter-intuitive ideas about it.
• How to get great ideas to build great products
• What were the best conditions to start a start up.

So, now that we hardly have all the prerequisite to start a successful start-up, let’s see how we can deal with growth. To illustrate these words, there is no better example as Guide to Iceland, that’s a piece of luck because we actually had a talk with Xiao Chen, co-founder and CMO of Guide to Iceland.

Guide to Iceland is an Icelandic travel marketplace that wants to gather a community of travellers (and not tourist!) and locals. Their go to business was pretty usual with a strong preparation (value proposition, testing, research…), a launch (even if everything was not perfect) and now, growth ! It is a good example of growth because after one year, it is already the largest business network in the Icelandic travel industry, the most popular travel website about Iceland and above all, profitable after only 4 months ! To Xiao Chen, they managed to do that thanks to strong values: think big, customer centric and hire the best.

I really liked this session because I was very interested by the subject. Indeed, Bala keeps repeating that the purpose of a start-up is to make money. But how to make money ? By growing and growing ! So here we were : finally discovering how to rule a start-up once it has been launched and above all, how to continually increase our market share and/or gain more customers. According to this session, and also to an article Bala wrote, growth was about traction. Traction trumps everything, I have read some chapters in a book that I would recommend you, Traction : A Startup Guide to Getting Customers. It, for example, explains that there are at least 19 channels to build your customers base. I won’t tell you all of them here, you can find them on the book and the post I mentioned previously.

I think that there is also a benefit that we didn’t mention in the growth. Of course, the more you have customers, the more you earn money. But there is also the fact that the more you grow, the less you spend. Indeed, on the first hand, you can make economy of scale : when you spend 1000USD for a new computer, if you have 100 customers it is as if your computer costs 10$/ per customer but if you have 1000 customers your computer is now only 1$/per customer ! On the other hand, the more you have customer and the less you have to spend on paid channels (such as offline ads, affiliate programs), you can now rely on free channels (such as email marketing, viral marketing, word of mouth…).

Grow, now!

5th Lecture: The competition benefit and QuizUp visit

This 5th class is a red-letter class : it was the first time I disagreed deeply with Bala. To him, the classical theories (and neoclassical theories) are all wrong regarding competition : there is no benefit in competition for the companies, excepting avoiding them to be lazy. To him, the only winners in the competition game are the customers. I disagree, I think that the competition is something good even for companies.

First, there is of course the competitors pressure that obliges companies to improve themselves, they always have to innovate to satisfy the customers need, or create new customers need to increase their sales. It is for example the case of the mobile phone battle between Apple and Samsung. As Apple  knows that its main competitor is trying to gain marketshare, it must find new features and design of product, releasing a new iPhone each year. To afford the R&D costs, they also have to reduce some spendings by innovating and simplifying some processes.

Second, the competition has now changed. Companies have now a larger field of action, and their competitors in a specific sector can also be their ally in an other one. For example Henkel (Persil) and Procter & Gamble (Tide) are the two major actors in the laundry industry. However, P&G is also the leader in the diaper (Pampers) industry and Henkel in the glue market. As a consequence, P&G is using Henkel’s adhesives to produce their Pampers diapers. Thus, they are competitors in a market but work together in an other one, so to a certain extent it is in their interest to have strong competitors.

After this short class, we went to QuizUp HQ in Laugavegur, Reykjavik. They were organizing the very first Android Keynote in Iceland, pretty exciting to be part of it. The conference was very technical, the schedule was :

18:00 – QuizUp for Android Saga : their early beginning with the Android platform
18:15 – Cleaner Code : how to write an easy-to-read code
18:30 – RxJava in Android land : the use of the new Java App
18:45 – Couch to 65k : how to create a big app (higher than the 65k limit)
19:00 – Q&A

For more precise information and real useful insights to build an Android App, you can watch it fully here.

For me, this conference was above all a mean to understand a lot about start-up:

-When you are working in a start-up environment, you are often a pioneer in what you are trying to create. The answer of your issues are not written in books. When QuizUp was faced to the 65k limit (their app was to big to work), it was probably one of the first time a company was faced to this issue. To solve it they had to find on their own helped by a very large community of computer scientist all around the world.

-Innovation and creativity is everywhere, I was amazed to see all the stuff in the office to promote creativity : a wall of idea where everybody can write, a timetable in the living room where everybody can register to pitch a new idea during lunch time or even a sheet of paper in the toilet to review computer code !

 

3rd Lecture: Money (That’s What I Want)

Today, for our third lecture we watched the movie Something Ventured which tells the story of the creation of an industry that went on to become the single greatest engine of innovation and economic growth in the 20th century. It is told by the visionary risk-takers who dared to make it happen…Tom Perkins, Don Valentine, Arthur Rock, Dick Kramlich and others. The film also includes some of our finest entrepreneurs sharing how they worked with these venture capitalists to grow world-class companies like Intel, Apple, Cisco, Atari, Genentech, Tandem and others.

Beginning in the late 1950′s, this small group of high rollers fostered a one-of-a-kind business culture that encouraged extraordinary risk and made possible unprecedented rewards. They laid the groundwork for America’s start-up economy, providing not just the working capital but the guidance to allow seedling companies to reach their full potential. Our lives would be dramatically different without the contributions that these venture capitalists made to the creation of PCs, the Internet and life-saving drugs.

I have read some interesting stuff after watching the movie and especially an interview with Paul Holland, the producer. You can read it fully here on Forbes but I selected for you some excerpt :

“It’s almost nostalgic to watch Intel, Tandem, Apple, Atari and—maybe especially, Genentech– get their start. You wonder whether we’ll ever be able to recapture that same sort of entrepreneurial spirit in the U.S.

The level of activity around entrepreneurship in this country has never been higher than it is today. Hundreds upon hundreds of startups are coming out of universities, incubators, national labs and corporations. The culture that was created 50 years ago set the stage for this.
But Don Valentine recently answered your question this way…He said: “The film tells you to go West, young man. I’m going to tell you to go East, young man.” Today India and China are more conducive to starting new companies because their governments want companies to get started and be successful. Still, I don’t think there’s any better time than today to be an entrepreneur. It’s a full-fledged industry today and back then it was pretty random.

What do you hope people will take away from this film?
My high hope for this film is that every student that wants to be an entrepreneur—at every level, high school, business school, on corporate campuses—sees it. I want to see more young people fall in love with entrepreneurship… And if I have a quieter, more serious goal, it’s that I want policymakers to look at this and say ‘What can we do to make it easier, not harder, for people in this country to start those kinds of businesses?”

1st Lecture: First steps into the start-up world

This week I had my first “How to start a start-up” lesson by Bala Kamallakharan.

The teacher is what we can call an inexhaustible guy. After studying in India, he moved to the US where he studied Economics, International Trade and Finance at LSU. He worked for some MNC (Capgemini and Glitnir, an Icelandic bank) before being very attracted by the start up world. Now, he is fully working in the start up sphere : business angel, founder of Start up Iceland and, sometimes teacher. If you want to know a bit more about him and Start Up Iceland, you should read his blog and especially this article where he shares his vision of entrepreneurship : http://startupiceland.com/2015/04/01/you-are-not-a-lottery-ticket

The first learnings that I will remember after this lesson are very easy to understand, but maybe a bit more complicated to turn into.
What : “A start-up is the largest group of people you can convince of a plan to build a different future” Peter Thiel in Zero to one
Why : To become a unicorn (a start-up evaluated at more than $1 billion dollars.)
How : Mixing the 4 things to succeed : the idea, the product, the team and the execution.

When : “Now because yesterday has already passed and tomorrow it is too late”

After that, we had a call with Dr. Sean Wise, a Canadian entrepreneur, quite famous across the Atlantic and especially for having write a couple of books related to the entrepreneurship and having taken part into the TV Show Dragon’s Den (the Canadian version of Shark tank, I guess). He answered some questions about entrepreneurship:

“What is the best way to create an idea ?”
There is no miracle solution, but there are at least 3 different known ways. The “bottom-up” is when you have a problem and you try to solve it, the “top-down” is when you have a technology, a passion and you want to use it to start a start up.

Hello everyone !

For my very first article, I won’t introduce myself (you can check on the “Who am I” tab). I’d rather explain you this blog purpose and content.

So, as you may have noticed, I am a student in Iceland for the next 5 months. In this blog I would like to share with you the content of my classes, what I have learned and give you my feelings.
The topics will mainly be related to Start-up, International Management and Leadership.

Don’t hesitate to ask me questions about the courses or the Icelandic way of teaching and living !

Francois