Asia has one of the fastest growing startup scenes in the world, with Singapore, Hong Kong, Shenzhen and India all competing to bring the next 'unicorn' to market. Having co-founded a successful startup, I’m often asked for my thoughts on entrepreneurship. Here are my three self-styled ‘startup laws’—a collection of things I’ve learned along the way combined with my own personal beliefs on how a fast-growth business should operate.
Law 1: Advertising is the way to solve the problem of revenue outstripping costs
I say the above with tongue firmly in cheek. All companies seek a way in which to increase awareness of their service—that’s natural. But the easiest path to spend money on acquiring new users to the point of marginal profitability (and beyond) is via over-dependence on advertising. Especially for replacement visitors.
As a startup, your resources may be better spent making your product 10X better. Focus mainly on product improvements, retention and virality—we call this growth hacking. Yes, these steps require greater skill, but surely a better product is worth more to your users than a churning user base?
At Skyscanner we started by sharing two salaries between three co-founders and secured our first external funding six full years after developing our first prototype. We only had resources to build product. Our first marketing was PR and our second was SEO. The interesting thing in retrospect is that they were both fixed costs (based on time and money rather than a per-user cost like an ad).
Nowadays, as a more mature company, advertising brings us great value as part of our acquisition, activation and retention pipeline. But as startup, I’d recommend making your product as good as it can be first.
Law 2: The size of an email footer is inversely proportional to the growth prospects of that company
I once heard a website homepage described as something that represents the scars and battles of the departments in a company. I think the same can be said about the size of your startup’s email footer.
With an email footer you might see a logo, a fax number (still), links to company apps, a legal disclaimer, an event, a new product plug and so much more. And of course there is the counter-productive and passive aggressive ‘think twice before printing this email’.
These can be symptomatic of box ticking and an aspiration to come across as ‘professional’. The vast majority of startups need to change and adapt quickly and to do this, they require great flexibility. They also, by and large, require a singular vision and interest. A long email footer, in contrast, suggests conflicting interests and bloat rather than a simple, widely embraced aim. Sadly for startups, the inverse of this ‘law’ is not guaranteed.
Law 3: Internet-economy success at scale is converging in all sectors on being an AI / machine-learning problem
With so many aspects of internet-economy success focused on shared knowledge sitting atop open source software, the ‘last’ race for online services is trending toward being able to solve complex data and personalisation problems. Doing so will delight users, and will become a prerequisite across every sector.
Take Facebook’s news feed which, very far from being a manual curation problem, is a machine-learning or AI one. 'Mass personalisation' appears to be an oxymoron, but at the very least this requires ever-more complex heuristics. Increasingly, the way to win as an Internet-economy startup with traction is to look to AI/machine learning to achieve that magical experience for the user. Think of Google Now cards, Netflix channel curation or online travel solving the ultimate challenge: Where should I go on holiday?
Gareth Williams is CEO and co-founder of Skyscanner, which was acquired by Ctrip in November 2016 for US$1.75 billion.