I began this blog with the sincere intention of regularly posting book reviews. I’ve come to realize, though, that my opportunities for leisurely reading are consistently limited, and I frequently lose interest in many books, leading to my lack of success in this area. Oh no!
One book that was released very recently, however, finally broke this pattern. I was thrilled to find the time to complete it in less than a week.
What is this enchanting, extraordinary book I’m talking about? Rand Fishkin wrote the book Lost & Founder. I was filled with anticipation from the very beginning when I learned about its impending release, and my hopes were set high for it to be truly extraordinary.
It was a truly positive experience.
What sets this book apart from other startup books?
In a nutshell, it’s absolutely incredible. I understand that we’ve already discussed this, but I feel compelled to reiterate.
In my opinion, it’s the most exceptional book on startups available. This book is a must-read for anyone involved in or thinking about starting a business. It offers valuable insights and advice that can greatly benefit entrepreneurs. Preparing yourself for your new life and anticipating obstacles well in advance is crucial. It will set you up for success and help you navigate any challenges that may come your way.
This is remarkable because all the other books I’ve read that discuss startup life have, to put it delicately, been disappointing. They were either 1) perpetuating the image of Silicon Valley as an ideal place to launch a business, where success comes easily and everything is flawless, or 2) expressing an overly pessimistic viewpoint that falls into the category of “disgruntled employee revenge,” which is not reliable or worth listening to.
Disrupted: My Misadventure in the Start-Up Bubble by Dan Lyon is a prime illustration of this. It was engaging and well-written, but I didn’t enjoy it. It’s a disappointing critique of a successful company (Hubspot), with arguments that lack credibility and highlight the individual’s limited understanding of the company.
Lost & Founder, on the other hand, provides an honest and insightful portrayal of the realities of startup life from a CEO’s perspective. Throughout my tenure as CEO of AdEspresso, I have found that I can strongly identify with every chapter of this book. I wholeheartedly agree with the majority of Rand’s insights on startups, marketing, funding, and various other topics. They resonate with my personal journey.
Initially, I had planned to write a chapter-by-chapter review of Lost and Founder, as each chapter is truly worth reading. With that in mind, I wanted to avoid giving away too many details from the book. Instead, I’d like to highlight a handful of chapters that resonated with me as the CEO of a startup.
Chapter 2: Embracing Services in the Startup World (and Why You Should)
If you speak with individuals who have experience in the startup industry, they will advise you to avoid services due to their lack of scalability. Graphic designers rely on their creativity and expertise to bring their designs to life, while freelance writers use their writing skills to craft engaging content. It is often believed that startups heavily dependent on service-based revenue may not attract venture capitalists.
This has some validity; scaling services can be a challenging task. Indeed, this is a valid point, and individuals who are shifting from a service-based business to a more traditional SAAS business model may feel compelled to eliminate the service aspects.
Although it is true, services can provide significant advantages when starting a business. Fishkin presents a compelling case for embracing services in this chapter. I’m inclined to agree for my own personal reasons, which include:
- It’s more secure. According to census data, nearly half of service-based businesses manage to survive the challenging first five years. It’s a challenging reality that only a quarter of startups make it past the first five years. To be honest, I believe this is a rather positive set of data.
- Beginning with services can be a fantastic strategy to generate funds for the growth of your business that focuses on products. As you may have gathered from my role, this is how we managed to secure funding for AdEspresso.
- Working closely with customers in the consulting industry can be incredibly valuable for gaining insights and understanding their needs. It allows you to receive valuable feedback and direction on how to improve your product to better meet their requirements and address their pain points.
I can personally vouch for all of these points. I had the privilege of running a successful consulting business for over 12 years before embarking on my journey with AdEspresso. The consulting business played a crucial role in providing the necessary funding for the company during its early stages and helping us gain a clear understanding of the product we needed to develop.
At AdEspresso, we continue to offer consulting services to assist SMBs in reaching their advertising goals with the help of our talented team of marketers. Whenever we need to make a product decision, our product managers make it a point to consult with our trusted advisors. They value the feedback they receive from the field, as it helps validate our roadmap.
Chapter 3: Inspiring Founders Pursue a Greater Vision, Not Just Their Passions
This chapter may be brief, but it contains a valuable nugget of wisdom. The title speaks for itself, and as your startup continues to thrive, you will soon understand the profound truth behind it.
The experience of being the CEO of a startup can be quite different from what you initially envisioned. I thoroughly enjoy brainstorming solutions for the challenges I encounter, transforming these ideas into tangible products, and enthusiastically marketing them.
Most of these things are part of a CEO’s job, but the responsibility for completing the tasks will lie with someone else. Instead of directly executing them, which may not be feasible given your time constraints, your role will be to ensure their successful implementation.
When bootstrapping with your co-founders, you’ll discover that you have to handle a wide range of tasks. This includes setting the vision, coding the product, designing wireframes, writing blog posts, and more. That’s quite a rollercoaster, but I must admit, it’s a thrilling ride (at least from my perspective).
As your startup flourishes and you bring on board a team of highly skilled individuals, your role will naturally evolve from being hands-on to becoming a facilitator. You’ll discover yourself taking charge of the company’s vision and empowering others to bring it to life, handling tasks that may have never crossed your mind when you first began. Here are some examples:
- Raising funds to ensure you have the necessary resources to bring your vision to life.
- Invest valuable time in interviewing candidates who align well with your company
- Empowering individuals, from personal interactions to fostering a positive work environment to optimizing organizational structure and beyond,. Continuously refining processes to enhance overall efficiency.
- Dealing with unexpected challenges (they always seem to come up)
- Ensuring that everyone is inspired and united in their commitment to the company’s vision
- Overcoming numerous challenges that constantly evolve, even when you think you’ve completed them,
For founders who have a passion for marketing and enjoy working closely with clients, their role may evolve over time. Rather than personally running campaigns, they will transition into managing a team of professionals who will handle the increasing number of accounts.
Chapters 6, 7, and 8: Securing Funding
Within this resource, you’ll find three distinct chapters dedicated to the art of securing funds for your startup. Here are:
- 6: Be cautious when seeking funding and ensure that your motives are genuine and aligned with your values. It’s important to carefully consider the sources of your funding to ensure they align with your goals and principles.
- 7: So You’ve Decided to Reach Out to Complete Strangers for Millions of Dollars
- 8: Building a Top 5% Startup May Not Guarantee Wealth
If you’re not familiar with the startup scene, here’s a fun fact: discussing the amount of funding you’ve secured for your startup is a common topic in Silicon Valley, akin to boasting about personal achievements. It’s quite fascinating how many startups prioritize raising money as their ultimate objective rather than concentrating on building a business that truly generates tangible value.
These three chapters… Take the time to read them attentively. There is a wealth of valuable information available on how to successfully secure your next round of funding and effectively manage the funds once acquired. Rand not only provides a thorough explanation of how the process works but also sheds light on all the unspoken commitments you make when entrusting someone else with raising the funds.
In this resource, you’ll discover a comprehensive breakdown of the VCs’ business model, their expectations, and how they will engage with you during both prosperous and stagnant periods of your business.
One crucial aspect, in my opinion, is to truly grasp your desires.
Ready to embark on an ambitious project? Alright, let’s gather a significant amount of funds and create the next extraordinary success story.
Looking to achieve financial success? Considering the potential downsides of raising a significant amount of money, such as dilution and dealing with preferred stocks and liquidation preferences, it may be more advantageous to sell your company at an earlier stage for a lower price but with a higher percentage of the stocks. This could potentially lead to a more favorable outcome compared to going through multiple rounds of funding and ending up with less than 4% ownership when going public.
It is crucial to grasp all of this because each individual has unique aspirations for their startups.
Given Rand’s exceptional intelligence, he went above and beyond in establishing his new company, Sparktoro. They successfully raised funds using a unique and innovative legal structure and generously made all the documents available to the public. (Just to be transparent, I have a small investment in Sparktoro, but rest assured that this review is completely unbiased.)
I highly recommend reading the motivational story that Wistia recently published if you’re interested in the financial side of startups. It delves into their decision to forgo selling the company for a quick profit and instead opt for a different path. They raised an impressive $17 million in debt to buy out their investors, showcasing their determination and resilience. There are plenty of valuable pieces of information in it.
Advantages
If I haven’t made it clear enough, this book is truly outstanding. The content is excellently crafted and provides a wealth of practical and valuable insights.
There are several other significant aspects that truly set this book apart:
- Rand’s transparency in the book is truly remarkable. He fearlessly shares the most challenging aspects of his journey, making the book incredibly authentic and highly valuable.
- There is an abundance of valuable first-hand advice on startups and marketing from someone who has successfully navigated these fields multiple times.
- I found the book to be incredibly captivating and engrossing, which is a rare quality that I don’t often come across in my reading.
Downsides
One potential drawback of this book is that it focuses solely on Rand’s personal experience. It is worth emphasizing that the experiences of each startup and CEO are unique to them, which may seem obvious but is important to acknowledge. Approach things with a sense of perspective, as they’re not always clear-cut, and there are multiple ways to achieve the desired outcomes.
Important Book Details
Written by Rand Fishkin
- Number of pages: 320
- Release Date: April 24, 2018
Reviewing “Lost and Founder: Conclusion”
And that concludes this review. If it wasn’t already evident, I highly recommend purchasing and reading this book right away if you have any interest in the startup world.
Curious about what lies ahead? It will probably be “10x Marketing Formula: Your blueprint for Creating ‘Competition-Free Content‘ That Stands Out and Gets Results” by Garret Moon, the CEO and Co-Founder of CoSchedule. These individuals are revolutionizing the field of inbound marketing, so I have no doubt that this book will be exceptional.
