San Altman’s amazing Startup course at Stanford is chock-full of amazing speakers and startup essentials. But it all starts with the basic four building blocks of a startup which Altman lays out in the beginning: Ideas, Products, Teams and Execution. Altman says there’s actually a fifth element, luck, but since we can’t plan for that or control it, let’s focus on the big four with an overview of some key points from his talks.
The idea should come first and the startup should come second. Wait to start a startup until you come up with an idea you feel compelled to explore. It’s best if you’re building something that you yourself need. Then, you will be passionate about it and will know fairly well if you are fulfilling the need.
Although the idea is critical, it is just the first step, In order to build a really great company, you first have to transform your great idea into a great product. A great product is something that people love. “Like” is not enough. You need the passion that draws markets. It’s actually better to build something that a small number of users love, then something that a large number of users like. This is critical. If you get it right, you can get a whole bunch of other things wrong and still succeed but if you get this wrong, you can do everything else perfectly, and you’ll probably still fail.
When you develop a product that people love, they become your evangelists. People who love a product, tell their peers about it and that is how markets start to explode.
Early stage startups need extremely resourceful co-founders. Altman says that you need a James Bond, someone who is good at everything, acts fast, decisively and is almost never wrong. If you find one, hold on to him/her. If you find someone that isn’t right, fire fast. It’s painful but might very well save your business. Many startups think that it sounds better when they have a lot of employees. This isn’t true. You should be proud of a small team that is nimble and adaptive.
Execution is probably the least fun of the four elements. And it is constant and drawn out. Execution has two components, focus and intensity. Focus is critical because a founder has a million and one things to do and a million and two things vying for his/her attention. You need to learn to focus on two or three things and do them right and learn how to say no much more often than you say yes.
When it comes to intensity, the best founders work on things that seem small but they move really quickly. But they get things done really quickly. Every time you talk to the best founders they’ve gotten new things done. This keeps the company doing the two most important things for success, maintaining momentum and fostering growth.
We will take a deeper dive into each of these elements over the next few weeks.