Ray Ozzie appeared out of the Seattle mist today to share a very important lesson of startups and of business in general. He shared the story of how Lotus Notes started – and it sounded a lot like other stories I’ve heard about successful startups – at one moment they were hanging by a thread, and depended upon an idea and some money to bring their visions to life. They succeeded because of a relentless focus on customers, usability, and revenue.
All of the 10 companies introduced by the Techstars program have the chance to be as big (or bigger than) Lotus Notes. And only some of them will succeed. But the opportunity to build a big company is intoxicating – that was the promise today at TechStars Demo Day. Here’s one of the companies I particularly liked, Apptentive – they focus on a key problem to help in-app mobile customers build a relationship with the app provider. (I also really like Tred, Glider, and Linksy.)
And the first step (getting investors to believe in you) is going to be closely followed by the “trough of misplaced expectations”, where the shiny presentations of TechStars are going to be met by actual customers. Just like companies are looking for investors to believe in the team, these nascent companies are looking for customers that believe in them … And to use them.
Why is that, really? Many customers just don’t like change, and ask for (and sometimes require) an order of magnitude of improvement in their everyday tasks. Startups that create disruptive improvement without asking their customers to change their existing tools and processes will win. Techstars is an amazing way to find, recruit, and build high-performance teams that can build a product idea in just a few months. And the teams that move beyond that to build tools that customers will actually use have the chance to become the next enterprise winners.
Which companies will actually have the capacity and execution to tap the billion-dollar markets that show up on shiny presentation slides? Some of the ones you see at a Techstars demo day who can move from great idea through customer development and discovery, and deliver more than the expected value for their customers that would love to solve a pressing pain point. It’s easy to come up with an idea, and hard to succeed enough to reach Tech Stars. Some of these companies could be the Ray Ozzies of tomorrow, and it’s fun to watch them start.