by Adrian Lloyd

The book is written by the guys who founded 37 Signals who make successful SaaS products Basecamp and Highrise. They believe the way companies work traditionally is ridden with flaws. Below is a selection of insights I particularly liked from the book, including some lengthy quotes where they write it better than I can summarise.

Something we look for at Episode 1 are entrepreneurs who have been consistently successful in life. Not necessarily as entrepreneurs (though that is ideal), but in whatever they have done. We have always believed that successful people are generally more effective so will continue to be successful. Makes sense, right? This is what Rework says:

“Failure is not a prerequisite for success. A Harvard Business School study found already-successful entrepreneurs are far more likely to succeed again (…34% success rate). But entrepreneurs whose companies failed the first time had almost the same follow-on success rate as people starting a company for the first time: just 23%…Success is the experience that actually counts” (page 17)

Business plans are guesses written at the worst possible time, before you’ve actually started the work – call them that and worry about them less. Just get on with it and plan for the week or the month, not beyond (page 19)

We agree in part with this – when we invest in an early stage startup we know that the company will have 12-18 months of burn before they have to raise again, and we also have a pretty good idea of what the company has to look like at the end of that time period in order to raise a larger round from a larger VC, so we like to set a small number of crucial high level KPI targets from which the entrepreneur can extrapolate backwards into quarterly targets. However, these should be a very small number of targets and we agree that decision making should be focused on the short term and that the focus should be on learning from the customer every day and adjusting accordingly rather than sticking blindly to targets that may end up being wrong for the market.


Draw a line in the sand:

…keep in mind why you’re doing what you’re doing. Great businesses have a point of view, not just a product or a service. you have to believe in something. You need to have a backbone. You need to know what you’re willing to fight for. And then you need to show the world… A strong stand is how you attract superfans….You’ll turn some people off. They’ll accuse you of being arrogant and aloof. That’s life. For everyone who loves you, there will be others who have you. If no one’s upset by what you’re doing, you’re not pushing hard enough. (And you’re probably boring, too) (page 43)


Start a business not a startup…

A business without a path to profit isn’t a business, it’s a hobby. (Page 56)


Less mass

Right now, you’re the smallest leanest, and the fastest you’ll ever be. From here on out, you’ll start accumulating mass. And the more massive an object, the more energy required to change its direction. It’s as true in the business world as in the physical world….If you keep your mass low, you can quickly change anything…. Mass is increased by:

  • Long-term contracts
  • Excess Staff
  • Permanent decisions
  • Meetings
  • Think process
  • Inventory (physical or mental)
  • Hardware, software and technology lock-ins
  • Long-term road maps
  • Office politics

All from Page 62


Build half a product, not a half-assed product

So sacrifice some of your darlings for the greater good. Cut your ambition in half. You’re better off with a kick-ass half than a half-assed whole…Start chopping. Getting to great starts by cutting out stuff that’s merely good…Ignore the details – for a while. Nail the basics first and worry about the specifics later…When we start designing something, we sketch out ideas with a big, thick Sharpie marker, instead of a ballpoint pen. Why? Pen points are too fine…They encourage you to worry about things that you shouldn’t worry about yet… (Page 70, 74)


Throw less at the problem

So do less. Your project won’t suffer nearly as much as you fear. In fact, there’s a good chance it’ll end up even better. You’ll be forced to make tough calls and sort out what really matters. (Page 83)

The core of your business should be to build around things that won’t change. Things that people are going to want today and ten years from now. Those are the things you should invest in. (Page 85)


Launch now

If you had to launch your business in two weeks, what would you cut out? Funny how a question like that forces you to focus. You suddenly realise there’s a lot of stuff you don’t need. And what you do need seems obvious.

Are you working on something that matters? Make sure the answers to these questions stack up (Page100-102):

  • Why are you doing this?
  • What problem are you solving?
  • Is this actually useful?
  • Are you adding value?
  • Will this change behaviour (of your users)?
  • Is there an easier way?
  • What could you be doing instead?
  • Is it really worth it?


Interruption is the enemy of productivity

Your alone zone doesn’t have to be in the wee hours…You can set up a rule at work that half the day is set aside for alone time. Decree that from 10am to 2pm, people can’t talk to each other (except during lunch). Or more the first half or last half of the day your alone-time period. Or instead of casual Fridays, try no-talk Thursdays. Just make sure this period is unbroken in order to avoid productivity zapping interruptions. (Page 105)


Meetings are toxic

Make sure they are absolutely necessary, they last no longer than required and that there is a clear agenda and that there are clear accountable actions coming out of them


Decommoditize your product

If you’re successful, people will try to copy what you do. It’s just a fact of life. But there’s a great way to protect yourself from copycats: Make you part of your product or service. Inject what’s unique about the way you think into what you sell. Decommmoditize your product. Make it something no one else can offer. (Page 139)

e.g. Zappos and customer service & Polyface Farm and its highest organic standards and sales only from the farm


Pick a fight

If you think a competitor sucks, say so. When you do that, you’ll find others who agree with you will rally to your side. Being the anti-______ is a great way to differentiate yourself and attract followers. (Page 141)


Underdo your competition – something Mark Suster calls deflationary economics

Do less than your competitors to beat them. Solve the simple problems and leave the hairy, difficult, nasty problems to the competition. Instead of one-upping, try one-downing. Instead of out-doing, try under-doing. (Page 144)

E.g. Single gear bikes

E.g. Flip video camera

E.g. Highrise CRM by 37 Signals

Who cares what [the competition are] doing

What’s the point of worrying about things you can’t control? Page 148


Let your customers outgrow you

We had customers who said they were starting to grow out of [our] application….they wanted us to change our product to mirror their newfound complexity and requirements…We said no. Here’s why: we’d rather our customers grow out of our products eventually than never be able to grow into them in the first place. Adding power-user features to satisfy some can intimidate those who aren’t on board yet. Scaring away new customers is worse than losing old customers. (Page 157)


Don’t write it down

How should you keep track of what customers want? Don’t. Listen, but then forget what people said. Seriously…. The requests that really matter are the ones you’ll hear over and over. After a while you won’t be able to forget them. Your customers will be your memory. They’ll keep reminding you. They’ll show you which things you truly need to worry about…The really important stuff doesn’t go away


Build an audience

Speak, write, blog, tweet, make videos – whatever. Share information that’s valuable and you’ll slowly but surely build a loyal audience. Then when you need to get the word out, the right people will already be listening. (Page 171)


Out-teach your competition, something that Gary Vaynerchuk does brilliantly at

Instead of trying to outspend, outsell, or out-sponsor competitors, try to out-teach them. Teaching probably isn’t something your competitors are even thinking about. Most businesses focus on selling, or servicing, but teaching never occurs to them. (Page 173)


Do it yourself first

Never hire anyone to do a job until you’ve tried to do it yourself first. That way, you’ll understand the nature of the work. You’ll know what a job well done looks like. You’ll know how to write a realistic job description and which questions to ask in an interview… (Page 201)


Hire when it hurts

Don’t hire for pleasure; hire to kill a pain. Always ask yourself: What if we don’t hire anyone? Is that extra work that’s burdening us really necessary? Can we solve the problem with a slice of software or a change of practice instead? What if we just don’t do it?


Own your bad news

When something goes wrong, someone is going to tell the story. You’ll be better off if it’s you. Otherwise you create an opportunity for rumours, heresay, and false information to spread. When something goes wrong, tell your customers (even if they never noticed in the first place)…You can’t hide anymore…someone else will call you on it if you don’t do it yourself. (Page 231)

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