A catch phrase will go here soon.

Startup Handbook: How to identify and deal with the slow masses, knowledgeable skeptics, and savvy dreamers.

1/25/2008

When you start a new company your job as founder is, in large part, to help people understand the vision. To help them explain why the idea you have, which on the face might seem somewhere between impossible and crazy, is–in fact–completely logical and obtainable. If you’re like me you’ve found that different folks respond differently to your idea at different points in the life cycle of your company.

I’d like to look just year one of your company and how to deal with the three major buckets of people in the business world: the slow masses, the knowledgeable skeptics, and the savvy dreamers.

Of course, everyone does not fit into each of these buckets. Additionally, these scenarios revolve around you taking the assumption that your idea is going to succeed and perhaps even be game changing or revolutionary. Since all entrepreneurs should think this when they start a new company I think it’s an OK assumption to take.

I base these thoughts and theories on my experience starting a magazine about the internet in 1996, a blog network in 2003, and a social search engine in 2007. The first year of each of those business followed this exact pattern.

YEAR ONE: Why doesn’t anyone understand my idea?

The Slow Masses (70% of people you meet)
A negative correlation exists between how good your idea is and how much the slow masses will understand it–at least in year one. Don’t worry about this, they will get it in year two or three. If it’s a good idea they will actually love it in year two or three and not even remember the fact that they ever doubted you.

Basic logic states that since you’re doing something very innovative the masses *won’t* understand it in large part. It they did there would be fifty people doing it already and the market would be flooded (or at least very established).

You can identify these folks because they:

  1. Typically work three levels below someone who is innovative. Their boss might be innovative, but most likely it’s their bosses boss who is the real visionary.
  2. They have probably never created a company, and if they have it was probably years ago and it failed. They have no interest in starting another one.
  3. They say things like “I don’t understand” and “why don’t you do INSERT LAST YEARS TREND HERE instead?”

How to handle the slow masses in year one: Don’t worry about these folks in year one, they are not that important. Steve Jobs doesn’t worry about these folks when he launches a new product like the iPod, iPhone, or Macbook Air. He knows they won’t get it year one.

The Knowledgeable skeptics (about 20%)
These folks are smart and they get it your idea–they just don’t think it will work. They will, in fact, probably identify all the weaknesses in your business plan within 10 minutes of hearing it. They will interrupt you and shoot you down as quick as they can. The skeptics might, if not for their pessimistic attitudes, actually be your competition! However, they are skeptics and their role in the world is to knock folks who are dreamers. They get a rush from shooting people down and showing how clever they are because they can think of reasons of why something won’t work.

The hard part? They can right often.

You can identify the knowledgeable skeptics because they:

  1. Typically have run something successful, but it was probably not that successful. Perhaps an also-ran type business (i.e. someone who came in second or third place in their market).
  2. They might have lower self-esteem. They might feel like they haven’t been given enough credit in life (either financial or attention-based).
  3. They say things like “that’s interesting, but it will fail because…” or “someone tried that it doesn’t work.”

How to handle the knowledgeable skeptics in year one: Spend a lot of time with these folks and take a lot of notes. They are free “Eeyore” consultants with the ability to tell you all the things that could go wrong with your plan. Knowing these potential problems is very valuable except when, as is the case in many Eeyores, it keeps you from executing. It’s important to *disregard* the general negativity of such people while you suck their brains dry. It’s important that when you leave these folks you shake off their negativity because it is contagious. These folks overestimate the downside risks and play down the upside potential. They are folks who told Google and YouTube that the world didn’t need them.

The savvy dreamers (the final 10%)

These folks are typically very successful. They have seen wild ideas by wild entrepreneurs succeed in the wild. They play down downside risk and they sometimes overestimate the upside potential.

You can tell these folks because:

  1. They are successful and many of the skeptics and masses in the other 90% say it’s because they got lucky.
  2. They say things like “that makes total sense,” “I get it.. brilliant!,” and “can I invest?”
  3. When faced with challenges they are dismissive and say things like “X, Y, or Z could be problem but I’m sure you’ll figure that our as you go.”

How to handle the savvy dreamers in year one: In year one you want to spend time with these folks and you want them involved in your business. The involvement of the dreamers will create excitement around what you’re doing and they will pull the masses and skeptics even deeper into your world. They will help stay positive, they will give you ideas for free, and they will brainstorm will you for hours on end. These are the winners who understand that nothing great is ever achieved without sacrifice and perseverance. These are the folks that the knowledgeable skeptics hate and the slow masses adore. They are the Steve Jobs, Richard Branson, Bill Gates, Larry Page, and Sergey Brins of the world.

That being said, you need to know that whatever results you bring to these folks they will see them through rose-colored glasses. If you only hang out with them you might get, as Scarface would say, “high on your own supply.” You need to balance these folks out with the negativity of the skeptics and the lack of vision of the masses.

The masses need to be bought along over the long haul, and the skeptics need to be leveraged for their risk management skills but ignored for everything else.

Many times you’ll find that you have these different type of people on your own team, or that one of your investors have an array of these folks on their team. Then things get really complicated. Of course, in year two a lot of things change as well, but that’s a whole other blog post. :-)

  • http://www.keenerliving.com/some-food-for-thought/ Some Food for Thought

    [...] entry dealing with startup organizations is Jason Calacanis’ The Year-One Startup Handbook on “how to identify and deal with the slow masses, knowledgeable skeptics, and savvy [...]

loading
English Bulldog

Hello, my name is Jason. Welcome to my blog on the interwebs. You can reach me on twitter @jason and by email at jason@inside.com. My Skype is jasoncalacanis, and my mobile phone is 310-456-4900.

I only pick up numbers I recognize, and in terms of emailing me, the best strategy is to write short, blunt and to the point requests. I can quickly respond to short messages, and many times I simply don't have the time to read five page pitches. In terms of taking meetings, I only do that after reviewing an actual product (not a business plan). So, the best time to ping me is when you have mockups or an alpha site. I don't read business plans, and I've never written one.

Other twitter accounts you can follow: Inside.com, Ticker, This Week in Startups and LAUNCH Festival

Archives