The "Full Build" startup 🏢🏢🏢

Competing with email clients and spreadsheets, field notes on bringing in first operators, and cake ‘even over’ ice cream.

Welcome to the 65th edition of The SaaS Baton. A fortnightly newsletter that brings you three, hand-curated pieces of advice drawn from the thoughtful founder-to-founder exchanges and interviews taking place on Relay (curated with 💛 at Chargebee) and the interwebz. So, stay tuned! 

In this edition, you’ll find the following instructive and inspiring pickings:

#1: Equals’ co-founder and CPO, Ben McRedmond, proposes (and illustrates with lessons from a failed past attempt) a startup type that sits at far-flung contrast to the idea of a minimum viable product. 

#2: Ambrook’s co-founder and CEO, Mackenzie Burnett, sums up distinctive themes that emerged from her conversations with adept operators (such as Claire Hughes Johnson) on the foundational subject of screening first hires. 

#3: Parabol’s founder and CEO, Jordan Husney, highlights a thinking tool that makes “hard choices explicit” and injects practical clarity into strategic decisions.

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🗞 Recently on Relay:

Heuristics and Hunches — “No One is Coming to Save Us,” The “Need to Reestablish PMF,” and Other Earnest Founder Commits for 2023

This is a freeing mindset, especially in an environment full of constraints like most companies have in 2023. It means that we double down on investing in the people we have, seeking out intellectual honesty about every facet of the business, and a bias toward action and velocity.

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#1: The “Full Build” startup

(From: Equals’ Ben McRedmond) (Source: Wrap Text)

Nearly all startup advice is for Minimum Viable Product – or MVP – driven startups. You start small. Get something real in front of customers ASAP. You learn. You iterate. The idea is to reduce risk. To Build Something People Want. But for a certain type of company – what we’ve ended up calling “Full Builds” – you need to start with more.

…

In 2017, I co-founded an email startup called Consider. Consider was a new email client built to compete with Slack. After a few years of building and having gotten little traction we made the decision to shutdown.

Email clients and spreadsheets are difficult in different ways. But there is one important commonality: both of these products require building an awful lot before doing anything new. They’re Full Builds.

Planning was a good chunk of Consider’s failure. We should’ve had a map of all the things we needed to build upfront. We knew Consider was a large undertaking. To write that all out – to put together a 9 month or 12 month plan for building our V1.

It went against everything anyone would tell us about building a company. So we didn’t. I thought building iteratively would let us build less, maybe skip some email features that weren’t too important, get something infront of people sooner.

Yet our even bigger mistake was changing things not core to our thesis. We changed things like how conversations were defined, how the inbox worked, and how emails were presented. You’ve got to spend months building this thing anyway and we’re smart product people? Why wouldn’t we make it better!

…

When starting Equals I started hearing all the same things as before. You’re building too much. Why don’t you start with a plugin instead? You’ve got to get out there and learn!

What we needed for Equals to work was not a recipe for building less. We knew deep down that we had to do the Full Build. What we needed was a way to reduce the risk in building so much. So we came up with three rules to keep us on track.

First, make a detailed plan. We weren’t going to spend months building this only for it to be missing key features.

Second, change nothing. Equals was going to look and feel exactly like the spreadsheets you already know how to use.

Third, win with a single large bet. Our v1 had a single bet – data connections. We were pretty confident in this bet but if we were wrong, the situation would be salvageable.

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#2: Patterns and proxies for hiring strong operators

(From: Ambrook’s Mackenzie Burnett) (Source: Twitter)

After the first few interviews, a clear pattern emerged in both the career paths of these individuals and in the types of operators they liked to hire. I tried to look for these qualities in applicants at the resume screening and phone screening level:

Strong deviation from the path of their peers — Often manifested in a “random walk” of a resume where they showed they were willing to take risks, able to dive into new areas and excel, and/or in founding something even if it was just a club.

Pulled into the important problems — Was routinely moved to work on the most valuable problems within an organization.

Low ego — Willingness & excitement to do the work necessary even if it was a grind.

Autodidactic with surprising speed and resourcefulness — Taught themselves the skills they needed to succeed, often by going out and finding the expertise they needed to learn from via a series of interviews and/or reading voraciously.

Could survive being dropped in a foreign environment — Track record of the equivalent of “could drop them in another country and they’d figure it out.”

…

Maybe equally important, I also developed a series of proxies to screen out applicants:

“Finally want to take the risk” — Applicants who did not have the history of risk-taking or founding anything, but who expressed that they were finally ready to leave their current job to “get their hands dirty” or “take a risk” with Ambrook, seemed risky to hire as one of our first employees.

“Want to have decision making power” — It also seemed risky to hire applicants who expressed frustration with a lack of decision making power in their current roles and who wanted to join Ambrook in order to have a lot more influence over strategic direction. This is a bit nuanced, as we wanted people who wanted and are able to have strategic impact, but it seemed clear from my calibration interviews that great operators found ways to have decision making influence within an org no matter their role.

Too junior — The risk for junior candidates was that it might take a while to enable them to operate autonomously with a high level of quality, especially since we’re remote.

Too senior — The risk for really senior candidates was that they would want to build teams before we were ready to scale that part of the org.

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#3: Strategic prioritization using “even over” statements

(From: Parabol’s Jordan Husney) (Source: Jordan Husney)

“Cake even over ice cream” is a compact way of expressing a strategic preference between two good alternatives. While choice among desserts serves as a reasonable introduction, let’s see how ‘even over’ statements might be used by a real organization.

Our company, Parabol, creates team collaboration software suited for a wide variety of teams and purposes. However, to build our company and edge out the competition we must focus. By authoring a group of ‘even over’ statements we can compactly express a strategy for our entire company. Consider this group of ‘even over’ statements we might use at Parabol as an example:

* Small organizations even over global enterprises

* User growth even over revenue

* Initial signup retention even over existing user retention

* Desktop experience even over mobile experience

These aren’t Parabol’s actual strategies. However, they illustrate how powerful ‘even over’ statements are when a few are written out together. Imagine how much differently the company would act from the company that has reversed each of these statements…

It’s the same company, but a completely different strategy expressed in only 4 sentences.

Using ‘even over’ statements to prioritize a backlog

When we meet to discuss what to execute next we generate a list of potential projects. They’re messy. They’re ill-defined and often written as a single sentence. They’re just ideas.

We take these ideas and we rank them according to 3 factors: Strategic Alignment to our ‘even over’ statements, Time Criticality, and Job Size. Then, we calculate the idea’s priority score like this:

(Strategic Alignment + Time Criticality) ÷ Job Size = Priority Score

This formula is a modification of the Scaled Agile Framework’s Weighted Shortest Job First prioritization model. When we calculate each of the factors we play a sort of Planning Poker. It sounds a lot like this:

“Ok, the next idea we’re ranking is, ‘importing project data from Trello.’ Does this align with, ‘small organizations even over global enterprises?’ Please hold up 1 to 5 fingers, where ‘5’ means, ‘this idea strongly supports this strategy,’ ‘3’ is, ‘it’s hard to tell,’ and ‘1’ means, ‘this idea is strongly the opposite of this strategy.’”

…

Formulating strategy is hard. Applying strategy is harder still. The usage of ‘even over’ statements is just one tool in a strategist’s tool chest for reducing cognitive load when choosing from among a set of possibilities. They are a supplement to research, analysis, and story telling, not a substitute.

However, distilling your strategy down to a list of ‘even over’ statements can be an incredibly powerful thing. They make hard choices explicit. They are information rich and poetic, almost a thumbnail sketch of a full strategy.

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🤝 Founder social:

Ferruccio Balestreri @0xferruccio

One of the biggest challenges now at June is scaling two years of things that don't scale The current approach is just auditing some of the time spent and trying to automate repetitive tasks

Steph Mui @stephmui

next time i'm in a partner meeting and someone asks me why they should invest in me, i'm telling them it's because i have lucky girl syndrome

Josh Ho @jlogic

For anyone that has done outbound... Is there a reason the ask is always "15 minutes of your time"? Does it make sense to have a lower commitment ask, like take a quiz that is both fun and contextual?

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Until next time,

Team Relay