If I were starting now I would do things very differently. I didn't know anything. In Silicon Valley, you get this feeling that you have to be out here. But it's not the only place to be. If I were starting now, I would have stayed in Boston. [Silicon Valley] is a little short-term focused and that bothers me.
Remember the flak that Mark Zukerberg took after he said that back in October at Y Combinator's Startup School? Was Zuck far from the truth, however?
Zuck's statement reminds us of PlayCafe, an interactive TV gameshow start-up that crashed and burned in 2008 nearly a year and a half after it was founded. Mark Goldenson, one of the co-founders, says they made several mistakes. Short-term thinking was a common thread in those mistakes.
PlayCafe was quick to get funding, but they were clueless when it came to producing a live TV show, Goldenson says. They didn't properly plan ahead of time for the rigors of doing live TV, learning what they needed to know before actually doing it. They figured all they need was a single camera and a pretty host. That shortsightedness meant they had to split their time developing both content and technology side-by-side.
Another mistake — underestimating cost for future expansion despite having a detailed financial plan. In the end, they didn't build for the long haul.
Building for the Long Haul
You probably get the idea from these examples above, short-term thinking can backfire on a startup. The real question of course is: How do you build for the long haul?
Instead of explaining the ins and outs of how to do this, lets take a real life example. Remember Box.net? If you live in Bay Area, you've surely seen their ads on route 101. Over the 6 years since the idea was conceived, the company has captured the hearts of more than 4 million users and recently closed $81 million in funding.
The founders of Box.net based their company around the strategy of "building for the long haul." Aaron Levie, CEO of Box.net recently outlined the steps they followed as they focused on building for the long haul:
- Establish a long-term vision Levie says companies should have a mission that tackles a long-term, complex problem that won't go away too soon. This is the approach taken by Amazon.com, which plans 5 to 7 years ahead.
- Build a team that can see you through Levie says it's crucial to establish a strong culture early on and enforce it by hiring people that fit. We've talked before on the importance of team and culture to the success of any business.
- Reinvention. Levie suggests constantly reinventing everything — yourself, your product, your ideas, and your vision. Companies with longevity, he says, always challenge the status-quo. Think about the iPhone, which reinvented the smartphone and was itself later reinvented.
Thinking 5 to 7 years ahead instead of a few months at a time can help prevent startups from fizzling too quickly. Short-term thinking doesn't lead to longevity.