Live in the future. Most of us live in the past or the present. It is easier to analyze what already succeeded and think of ways to replicate the success. It’s thinking by analogy. It is a valid way to think, except that this isn’t the way to create a big startup. With UberPool, the idea that at any given point in time there are at least two people going from about the same location to about the same destination is non-obvious. It is hard because you would have to gather and store mountains of data about where people actually go in a city. But Uber thought of it when they offered their first ride back in 2009. They were living in the future.See what is missing in the world. You probably noticed that before Uber, taxi rides weren’t enjoyable. You probably noticed that before SpaceX people were less interested in space. But that is already the past. What is missing now? More importantly what is missing from your life now?
Write it down. When you write down your ideas you automatically focus your full attention on them. Few if any of us can write one thought and think another at the same time. Thus a pencil and paper make excellent concentration tools.
Make a prototype. If a picture says a thousand words, just imagine how a great prototype speaks volumes for your startup. Most of your thoughts, even the best ones, will never see the light of day sadly. You will forget them into oblivion even if you write them down. The only exceptions are those thoughts you prototype. It’s not fully-functioning (that will come later), but by creating a rough prototype of your vision you’ll have a much easier time explaining the concept to potential investors, clients, folks at meetups and anyone you encounter when evangelizing the potential of your startup.
Show the prototype to 100 people. You’ve been working on a cool idea for the past few months. You have made significant progress in building your first prototype. Now you will need to step out of your comfort zone and seek out people who will critique your prototype. Why 100? Because you need a breadth of perspective and hopefully a pattern to recognize from all the feedback. Don’t be afraid that one of them will steal your idea as chances for that are slim and the benefits that you can get from their input are priceless.
Iterate. Do you know that single biggest reason for the failure of a startup is building a product that no one wants? Although a few people will get it right on the first try, the odds are you will not. This is very easy to do if you are a customer of any product. You know that the product is working but needs a lot of improvement. You can take build a better version of the same product.
Find a co-founder. Entrepreneurship is tough – It’s a marathon and not a 100 meters sprint. More often than not you will need partners who will have to help you reach that 26 mile mark. While doing it alone is not easy, incompatible partners can be disastrous for the business. It is critical to choose your co-founders carefully.
Register your business. Split equity. Finally, an easy step. Get a lawyer who will register your company. Give your co-founder as much equity as will make them work their hardest, while you keep as much as will make you give it your all.
Look for funding and build version one. Unless you have enough savings to build version one, go find an investor. While you are doing that build version one. You have to keep building because there is no guarantee about when or whether you find an investor. Don’t assume that you will just because other startups are getting funded. Assume the worst, and build your product.
Launch. By the time there is even an iota of usefulness in your product, launch it. Extra features, better interface, faster load time and other optimizations probably won’t save it, if the core features have no use.
Follow up with users. Are users coming back? Find out why they are not.
Launch again. Launch as many times as it takes. At some point, if at least a few dozen people are coming back on their own, you probably made something valuable.
Get to 1,000 users. This may not seem like a lot, but the first 1,000 users will show the weaknesses of what you have built. You probably will have to recruit them manually. How manually? Take their computer and open your website for them. Whatever it takes.
Grow. Paul Graham encourages startups to grow at least 5% a week. If you grow that much, within 4 years you will get to 25 million users. In other words, you will be one of the largest startups.
Success – whatever that is. You can IPO, sell your company to another or stay private by convincing investors that there is a bigger liquidity event coming. Even now, though, you may or may not have made the world better. WebVan IPO’ed, but quickly disappeared. Think about what kind of a dent in the universe you want to leave with your startup.