The desperation of the startup founder is well documented in such great books as The Startup Playbook. They’ll say and do anything, right? But we don’t hear too much about the decision-making challenges that startup CEOs face as they get beyond the startup phase and prepare their company for the next level, whether it is a sale, new investment, an evolution of product sets, new positioning, or a change in leadership.
That’s what Moz co-founder Rand Fishkin sets out to do in his candid and insightful book, “Lost and Founder.” Fishkin, a rock star SEO blogger and conference speaker – the line to shake his hand at last year’s Seattle Interactive event was out the door — pulls few punches as he documents the rise of Moz into a $45 Million a year SEO firm. In “Lost and Founder,” he focuses on Moz’s challenges as it strived to keep up with the shifts in local online marketing, grow, and meet the tough expectations of investors.
Here’s the thing: he got fired. Although Fishkin remain the company’s largest shareholder and its executive chairman, he lost his leadership role in the high emotions around a stall in the company’s growth and a major round of layoffs. To the reader’s benefit, he wants to talk about the whole thing.
As Fishkin recounts, Moz’s initial success was mostly the result of good timing, passion and a successful pivot. The 14-year-old company started as a successful SEO consulting firm for the likes of eBay, Yelp, Open Table and Zillow. But it was never going to be scalable. The key to success was the launch of a self-serve, SEO subscription service for thousands of SMBs that has kept the transparency and honest values of the close-knit consulting firm, but also allowed the company to thrive and attract investors.
Is a pivot from the original business model for everyone? Many startups assume they’ll eventually find their way into their real business model, a la Slack, Flickr, Twitter, Pinterest, PayPal, Groupon and Instagram. I know about this personally: as a consultant, I am always looking past the startup’s stated business model to their eventual pivot.
But Fishkin hopes most companies don’t do it – you lose all your traction in making the switch – customers, connections, reputation and technology don’t always convey. Moz was a special case, says Fishkin, because its business model allowed it to apply the expertise from working closely with key companies into a software product.
Another key issue for startups is launching the “MVP,” or Minimally Viable Product. It is an approach that Fishkin notes is meant to help companies “learn faster, iterate faster and survive longer on less money.”
But Fishkin notes it’s a dangerous game to launch something that isn’t ready for prime time. A lackluster product creates an “MVP hangover,” hurts a company’s brand, and may cause customers to never come back. If you are already in the market with a core product, he suggests extending the enterprise with a soft launch with a focus on proving value to a customer, and eventually launching an “EVP,” or Exceptional Viable Product.”
“Great ideas and products are often born from mediocre ones,” says Fishkin. “The keys are time, humility and survival.”
A lot of Fishkin’s thinking on the subject comes from his launch of an all-in-one product that was the logical evolution from a silo built around SEO to a comprehensive “earned media” platform providing customers with social media marketing, content marketing, public relations and online brand marketing.
The earned media concept bombed at Moz for two key reasons. One, Fishkin says he relied too much on intuition and not enough on what customers wanted – an important lesson that other startups should take note. Two, Moz doesn’t have a core competency in software integration. It just couldn’t pull it off. Three, an all-in-one platform wasn’t consistent with what Moz’s customer base wanted from the company.
All this, of course, is contrary to the current conventional wisdom, which suggests that SMBs want a single vendor and that they receive synergies from integrating different services. But Fishkin’s firm conclusion is that most customers only wanted SEO help from Moz, and were happy to continue working with other groups for advertising, web site help, PR etc. “Online marketing remains as specialization heavy as ever,” says Fishkin.