In Startupland (2015), Mikkel Svane tells you the true story of his company, Zendesk. He explains the path that led him from working for a small website in Denmark to becoming the CEP of a million dollar company in the US, and shares the insights he gained along the way.
Who should read this book?
- Entrepreneurs and Entrepreneurs
- Anyone who wants to see their business ideas come to fruition
- People who are not afraid to take risks
Mikkel Svane is the founder and CEO of Zendesk, a software company for customer support based in San Francisco.
What's in the book?
Increase your chances of standing in the world of entrepreneurship.
You just have a bright business idea, or maybe you have had it for a long time but can't pursue it. Either way, you hope to be able to build a successful business on that new idea.
However, it seems that in today's open universe of creativity, the competition is extremely fierce. Around you, everyone is frantically fighting to realize their ideas. So, how to keep your plan from being devoured by the belligerent startup animals out there?
The author's suggestions, an experienced player in the field can be a good start for you. In this book, the author shares his personal story of how he successfully built Zendesk. From rekindling the idea to being based in the US, the author invites you to share his experiences of getting on and off dogs, and also suggests a lot of tips and experiences that he has learned.
Through the book, you will discover:
– Who is a good investor and who is not;
– Why teamwork skills are important;
– Why did the author move from Copenhagen to America.
If the first start-up fails, that's okay too
When Columbus returned from his discovery of the Americas, some jealous co-workers quipped that anyone could discover a new continent "as long as they sailed west". To prove the lunatics wrong, Columbus challenged them to stand a hard-boiled egg on a table without any additional tools. After they gave up, Columbus smashed one end of the egg and easily placed them on the table.
The core of Columbus' story is that it's nothing if you already know how to do it, and if you don't, then you have to take the risk. So does starting a business.
Starting a startup is all about using the entrepreneurial spirit to try new things. The author of this book worked on several projects before developing Zendesk, a software tool that allows companies to provide better customer support.
The author's first project was to create 3-D models based on 2-D faces, using software. At that time Mikkel Svane was in business on his own: customers sent orders to him and then he returned the products himself via CDs sent to the customer.
Mikkel Svane's next product was a tool for creating Websites, and the project gave him a first-hand experience of the failure of his company after the dot-com crash of 2001.
When you start a business, you will eventually realize that sometimes the best ideas don't sound very appealing.
At first, few people put their faith in Zendesk, as they were not very inspired by the idea of a technology company to improve customer care and support. Alex Aghassipour, who later became one of the company's core employees, said that at first Zendesk's idea sounded terribly boring.
Like Zendesk, dozens of other startup ideas all seem very unattractive at first, but once they've run well, they're attractive. Like Dropbox for example. File sharing might not have been a hot-sounding service at the time, but Dropbox turned it into something simple, engaging, and even social. in again.
Choose investors wisely
If you're a kid with a lack of money, the neighborhood bullies aren't your good options. They may lend you money, but you will inevitably incur exorbitant interest and big trouble if you don't pay on time. So is the world of your startup.
Not all investors are kind people. Sadly, our startups often don't have many options when it comes to raising funds internally; When you are just starting out, you will have to deal with a lot of selfish investors who only think for themselves. The best thing you can do for your startup is to hold off and hold out for a while.
Mikkel Svane had a similar problem when he founded Zendesk. The first angel investor interested in his project kept asking unreasonably large amounts of information and documents from the company. The author even realized that this was just a tactic to put pressure on the group. Investors know they desperately need money and try to gain a negotiating edge by delaying investment decisions and demanding formalities.
So where should you make your investments? Many times friends and relatives are the best investors. When Zendesk started running out of money, the founders called for investment from people around, and word of the project spread between their old friends and even their bosses. There was one person who invested up to 30 000 USD!
Of course, opening your mouth to "seduce" friends and relatives is not easy. The author's advice is that you should expect a little low, refrain from giving in to allowing investors too much influence, and you should be prepared to disappoint a few people – maybe even lose yourself.
The last thing is that even if you already have enough money, don't turn away good investors.
After the founders of Zendesk raised enough capital, they received an offer from another angel investor. Instead of refusing, Zendesk eventually accepted the investment, which allowed them to set more ambitious growth goals. Not only that, but they also have an experienced financial partner.
Choose a great team, and fight to keep it together
Did you ever play soccer or basketball when you were in school? What type of teammate do you like better: the sociable type and always wants everyone to join in the fun or the star type who always scores most of the goals but likes to keep the ball alone? Obviously the first.
So does starting a business. People with teamwork are always better entrepreneurs. Of course, it is not easy to keep the team in shape.
In the early days of Zendesk, the three founding members worked extremely hard but were not paid, so it was difficult for them to focus on the project. Too little money makes it impossible for them to support their family, which makes them really committed to not giving up the company and moving to a more stable job.
Mikkel Svane decided to keep the group by offering to pay a founder a small amount, even if the company had no money at all. He realized that keeping the group together was more important than splitting up to save money.
However, achieving unity in the team is not always easy, especially in difficult times. Zendesk fell into crisis as soon as the new company received a large investment, corresponding to the sale of a large amount of the company's shares. This means that some of the founding members will become a minority voice, and even new board members can kick them out of the company if they so desire, a painful fact.
The founding members lost their cool during this stressful time, in one meeting, Mikkel Svane yelled at two of his colleagues before walking out because he couldn't convince them of the change. this. The working atmosphere in the days that followed was extremely embarrassing. Things then calmed down, everyone finally accepted that the company was short of money and that getting an investment was the best way to get all the money moving forward.
America is the best place to live in the startup world
Outsiders are often allergic to American aphorisms like “Fake it till you make it” or “Winner never quit.” . At first glance, American-style optimism may seem a bit far-fetched and unrealistic, but actually a good startup environment needs such incentives. You won't be able to start a successful business if you don't confidently commit to a risky choice.
The truth is that the leading companies selling applications on the Internet are all from the US (and indeed the Internet also originates in the US). Denmark, for example, had only a single dial-up Internet provider with exorbitant prices in the 90s, in the US at that time people began to frantically cover the internet in the big cities.
San Francisco residents started using the internet to communicate, advertise and even order food before Europeans even used email.
Why? Because a lot of inventors as well as big investors settled in America. For such reasons, the US became the best place for Zendesk's team to find their first investors.
After launching Zendesk, the author of the book attended a TechCrunch party over the summer in San Francisco, and almost all of the attendees there have heard or even used his product, and they haven't. are also startups. The author feels closer to the community there than at home when the startup space in Copenhagen is really conservative.
So Zendesk's founders weren't too surprised when their first big deal required the company to move to the US. When the team accepted its first venture capital investment, the team was faced with a difficult decision: Zendesk had to move to Boston, where the fund's headquarters were located. Although Boston was not an ideal location, the author convinced the team to move.
Start-ups and your family
In general, once you start a business, your life will be full of work. You can work 12 hours a day, and when you're not working, your head will be full of work. Naturally, these will have a big impact on your family.
First, once you have a family, financial risks will become more sensitive and unacceptable. The book's author had to go through hard times and torment as he owed a ton of credit, spending all his savings on building Zendesk. He also borrowed $50,000 on a personal basis. At one point, he was only 2 weeks away from bankruptcy (if he couldn't find more investment).
This book author and founder didn't want his partner to be under pressure, so he didn't fully explain the situation to her.
Later, his job also caused stress for the whole family when the company moved from Denmark to Boston. This became even worse when they went to Boston in the summer, the heat was terrible and the air conditioning was broken. The young family had to wear underwear around the house for 2 months.
Stress doesn't end there either. In fact, soon the whole family moved from Boston to San Francisco again! The family moved in when Zendesk received a new $6 million investment from a company called Benchmark, based in San Francisco. It was a busy time when the family was constantly on the move.
On their first night in their new place, the children accidentally locked the bathroom door while leaving the key inside. Mikkel Svane's wife was sick at the time, and it took him 2 hours to open the door before rushing to work. When you start a business, these legendary moments can become everyday stories.
Adaptability and flexibility in recruitment will help you find the right people
If you've ever had to flip through a stack of 80 CVs, all written in equally confusing languages, then you'll understand how hard it is to hire a good candidate. Sometimes interviews make matters worse: candidates get nervous, so they become too talkative or too quiet.
And imagine going through all of this in a foreign country! That's what Zendesk's founders went through after they moved to Boston. Here they learned important lessons here.
The Zendesk team realized that Americans and Danes have very different ways of expressing themselves in an interview. The team initially used a Nordic approach: humility is paramount and you don't need to prove you're better than others.
As a result, the recruitment team selected a large number of resumes because these people exuded confidence and grandeur on their resumes. They were too naive to assume that the candidates would always be humble and sincere.
Then, the author and colleagues changed the way of recruiting with interesting tactics.
For example, the head of recruitment, a former soldier, will take potential candidates to a cafe near the company. Along the way, he would try to hurry to see if the candidates could keep up, watching closely how they handled their bills. He also used vulgar slang during the conversation to see how they responded to it.
Zendesk recruiters don't ask candidates about their education, instead, they learn about their personal interests, travel experiences, or how they cope with life's challenges. .
Be prepared for mistakes
Launching a new product is like taking a penalty. You can have a great goal, maybe also a bird shot. In general, it may take a few shots to find a way.
For example, when Zendesk was just starting out, the founders made a lot of mistakes during the fundraising process. In 2008, while the company was still in Denmark, the author flew to the US to convince a venture capitalist. But it was not a good time when the financial crisis hit, the companies went bankrupt, the mortgage real estate was no longer worth, the Lehmon Brother collapsed...
The fund and its partners argued vehemently about investing in Zendesk, and in the end they decided not to invest.
One of the other fundamental mistakes is underestimating the small details. Zendesk's team learned this lesson when they recruited Amanda Kleha, a former marketing executive at Google.
Kleha arrives at her first day of work without a computer, which she implicitly believes the company will prepare. When she got home to pick up her computer, Kleha left a note saying she guessed she was joining a startup. This made the leadership team realize that they needed a more comprehensive growth strategy.
However, the worst mistake is the one that affects the customer directly. Zendesk realized this after a crisis because of a product price increase, customers turned away. Many customers' frustrations went viral everywhere, seriously damaging the company's reputation.
Mikkel Svane realized that they were implicitly misinterpreting the emotions of their customers. Although they informed customers of the price increase, they did not clearly explain why. As a result, customers feel they have to pay for something they didn't agree to. The company eventually apologized publicly and set the price back the same.
The main message of this book is:
Starting a business is simply developing new solution ideas and taking risks, so there is no single formula for success. Have a strong team, find decent investors, prepare for mistakes and change tactics when results are not as expected. You're bound to run into roadblocks that you didn't anticipate, just like the author of this book. But you can also learn from the author, and your company will still move forward if you know how to be flexible and consistent with your vision.