My Start-Up Life (Book Review) by jgn on Wednesday, March 19, 2008 in Reading, Reviews, and Startup CTO Bookshelf

Ben Casnocha, My Start-Up Life: What a (Very) Young CEO Learned on his Journey Through Silicon Valley (2007). [Amazon ]

This short book is packed with sensible observations from the real experiences of a CEO who started a company (Comcate) with a raw idea, raised money, and built the company up enough to have real customers, real employees, revenues, and, I hope, profits (though this last detail is either not confessed or buried in the story and I missed it). The product was a hosted app allowing small towns to manage their "customer" feedback on-line; each town was billed $10K to $30K / year (p. 151). The product eventually morphed into a "code enforcement" package (p. 154) which became their real money-maker. The story is supposed to be more provocative than the usual CEO/start-up story because the protagonist in this one is . . . 15 years old. I actually didn't find the youth of the CEO to be as amazing as other readers have. The culture of business now permeates teenage life in a way it didn't when I was Casnocha's age: Parents are more open about their own businesses, and are more eager to mentor their kids in entrepreneurship. So let me say a few things about how the book might serve a wannabe-CEO or business-founder as a vade mecum.

Because the author is young, he has to get a lot right to be credible. So Casnocha trained himself at finding the right resources, the right examples, and the right books to serve as guides. He knows some things that a lot of business owners don't learn right away: He knows that his business is all about customers with real problems (p. 21); he rightly disdains utter slavishness to the customer (citing Henry Ford, p. 22), in favor of judicious listening; he determines the price of his product from its cost (p. 24). I could go on and on. Some of his formulations were fresh for me:

"How critical are these problems?" I asked. Some problems only require "vitamins"--that is, a product that's "nice to have." Some issues require "antibiotics," which means they're mission-critical problems. Most profitable businesses solve mission-critical problems, or the "must-haves." I learned customer service is not mission-critical for organizations (whereas financial, payroll, and purchasing systems, for example, all are). My product, then, would be a vitamin. At the time I did not fully understand the challenge of trying to sell a vitamin, instead of an antibiotic. This is probably because I personally had no real "needs." Like most other kids, I had wants, but I didn't think about needs. Food, shelter, clothes were all taken care of by my parents. I didn't view the world through a lens of improvement, a perspective all great entrepreneurs carry. (pp. 23-24)

There are a lot of people who want to found businesses who also have never experienced true need.

As I mentioned at the start of the review, eventually Comcate latched on to providing software for "code enforcement," and he makes a number of astute comments about the difference between "good revenue" and "bad revenue." Basically, if it scales and can be automated, it's good. If not, it's bad. This is hard-won advice, and Casnocha presents the contrast in a couple of pages. (pp. 154-155). A lot of start-ups never figure this out.

On the technology side of the story, Casnocha had a pretty tough time. He always went for the cheap solution, hiring a weak engineer for the first version, and had security and uptime issues (pp. 102-103). Here we have exactly the experience of the non-techie CEO of a web-based business: A missing player in the early game for Casnocha was a good CTO; when he got one, the CTO almost quit: "The technology folks . . . believed the business folks . . . didn't grasp the nature of the technology. They believed we made too many unrealistic demands regarding what product functionality could be developed and at what cost. The business folks thought the engineers were unnecessarily vague in their time line and cost estimates ('It's done when it's done' always justifiably infuriates managers who need to stick to a budget)" (p. 138). (Clearly both sides here are screwed up when the CTO says "it's done when it's done"; perhaps true, but the opposite of diplomatic in a startup.) Reading between the lines, I would have to say, as well, that seeing the CTO as a non-manager is highly problematic in a web-based product. I.e., the CTO should be more of a peer and less of an underling. Casnocha knows some of this, and says: "Technology start-ups take note: when a programmer isn't on the founding team, it is difficult to find engineers who are both high-quality and affordable" (p. 139). But I think the problem is much deeper, and implicitly you have to read Casnocha as acknowledging that is was a mistake not to have such a founding CTO, because it affects all aspects of the business, not just hiring. In any case, Casnocha must be a good listener, because rather than accept the resignation of his CTO, he got everyone talking again, and made concesssions (p. 140), i.e., reorganized work to fit the engineering mindset.

There are many other good bits; as a teaser I'll mention the thoughts of a 15-yr. old who wonders why his new COO would haggle over a few extra days of vacation . . . It will be interesting to hear how Casnocha will read his own book in twenty-five years.

Start-Up CTO Bookshelf

Each grade is on a 100-scale; 75 is a C, 85 a B, 95 an A, 100 and A+.

My Start-Up Life:

Book category: Start-up stories

Impact: 80 Utility: 80 Authority: 85 Good story: 87 Reference: 75 Writing: 87 Humor: 85 (intentional, nut unintentional . . .) Nudge: 75

Start-Up CTO Score: 82