Tom Hogan - The Ultimate Start-Up Guide: Marketing Lessons, War Stories, and Hard-Won Advice from Leading Venture Capitalists and Angel Investors

Praise for The Ultimate Start-Up Guide

Any first-time entrepreneur who wants to get the fundamentals of team, diversity, and leadership right from the very beginning of their startup should read this book.

Fran Hauser, angel investor

For the many thinking of starting their own companies and others already on the journey, Tom and Carols book is a great read filled with pragmatic, customer-centric advice and a wealth of tips and techniques. Heartily recommend!

Siva Kumar, serial entrepreneur, founder and CEO, The Find

MARKETING LESSONS, WAR STORIES, AND HARD-WON ADVICE FROM LEADING VENTURE CAPITALISTS AND ANGEL INVESTORS

TOM HOGAN AND CAROL BROADBENT

Copyright 2017 by Tom Hogan and Carol Broadbent All rights reserved under the Pan-American and International Copyright Conventions. This book may not be reproduced, in whole or in part, in any form or by any means electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system now known or hereafter invented, without written permission from the publisher, The Career Press.

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Edited by Roger Sheety
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Cover design and images by Ty Nowicki
Cover illustration by filo/istock
Printed in the U.S.A.

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ONE OF THE NICE THINGS about writing a book is the opportunity it provides you to acknowledge and thank the people who helped make it possible.

Silicon Valley and the tech world in general have often been accused of being extremely self-centered. But when we set out to write this bookand knew it needed to include the thoughts and stories of our clients and VC partnerswe were surprised to find that virtually everyone we approached to participate said, Sure, how can we help? And then they made time in their schedules and came back to us later with thoughts that had occurred to them post-interview. Were very grateful for their participation and insights.

Special thanks to some of the pals of Crowded Ocean who lent us their critical eye and extra input. Thats Anne Janzer, Vito Palermo, Steve Baloff, Jennifer Melwani, Ryan Vong, and Ram Gupta.

One company and one individual that we need to call out in particular are Sumo Logic and one of its founders, Christian Beedgen. When we envisioned this book as a collective of sequential chapters around common steps in the start-up process, we thought it would be of benefit to our readers to take one company and follow it through this entire process. Sumo was our first choice, and we were delighted when Christian agreed to participate in the project. He met with us, shared the Sumo story (its ups and downs), reviewed the copy, and hopefully put flesh and bones on our different topics with his real-world examples. Thanks, Christian.

Finally, we would like to acknowledge and thank the people who make our worlds go round. Carol would like to thank her daughter Hannah Fields and best pals Donna Schlimm and Jean Dana. And Tom would like to thank the four women in his life: his mom, Peggy Hogan; his wife, Pamela Pearson; and his two daughters, Rachel and Maya Hogan.

Thanks to you all.

PEGGY HOGAN (TOMS MOM)

WHY THE HELL WOULD ANYONE WANT TO READ A BOOK BY YOU TWO?

CROWDED OCEAN (AFTER SOME THOUGHT)

LET US GET BACK TO YOU ON THAT ONE.

NINE OUT OF 10 START-UPS FAIL within their first 24 months of operation. We should know: we were one of them.

Crowded Ocean, like many start-ups, failed in its first incarnation. We had an interesting idea (detailed in a later chapter), but opened our doors the same week that Lehman Bros. collapsed in 2008, bringing the market crashing down with it. We soldiered on for almost a year with our original idea, but never had a chance. In fact, we didnt make a single dollar that first year. Let us repeat that: not one dollar.

Rather than fold our tents, we regrouped and took a hard lookfirst at the market, then at ourselves. We filled our whiteboard with different concepts targeted at different markets. Then, one evening over beers from our office mini-fridge, taking a break from the whiteboard exercise, we were reminiscing about our days as VPs of marketing (Carol at Aspect and Bay Networks, Tom at VitalSigns and Lucent) and how hard it was to find good agencies. Remembering conversations with our former peers who were now CMOs, it was clear that not much had changed during the intervening 10 years. And at that moment Crowded Ocean 2.0 was born. The concept was simple: we would build the kind of agency we and our peers had always wished we could have found when we were heads of marketing.

That idea by itself wasnt either unique or that compellingwe needed to do something that ensured that we werent pigeon-holed as just another agency. We decided to distinguish ourselves in two ways: structure and target. For the first one, instead of being another large brick-and-mortar agency filled with headcount and overhead (for which we would have to bill our clients), we would be a virtual or just-in-time agency, with no employees. For our target audience, we would focus exclusively on the most underserved audience in the market: start-ups. Our business objective (we hate the term mission) was clear: to build the ultimate marketing agency for start-ups.

Six years and 42 start-ups later, weve been asked by some of our VC (venture capital) partners to put down the lessons weve learned into something that can be shared with first-time founders. Youre holding the results in your handsor on your screen.

A word about the title: when you title anything beginning with The Ultimate, either youre delusional or you better be able to back that claim up with hard evidence. We hope its the latter, but you be the judge.

We want The Ultimate Start-Up Guide to be a go-to resource for startup founders, would-be entrepreneurs, and anyone interested in the start-up world in generala resource they can go to for insights, examples, and advice about starting and growing their own company.

So lets consider those three termsinsights, examples, and advicein order, along with some of that hard evidence we referenced earlier.

In our six years of operation, Crowded Ocean has worked with more than 50 companies, 42 of them start-ups (the rest of them were established companies looking to pivot into new markets).

But so what? Maybe all that number (42) means is that we found an average of seven CEOs a year dumb enough to hire us. So here are some other numbers:

Ninety percent of all start-ups fail within their first two years. More than 90 percent of our clients are still in business after that same period.

Ten percent of all VC-backed companies go public or are acquired at a profit; 30 percent of ours have had the same success. And more are in the pipeline for either acquisition or IPO (initial public offering).