Two Questions Every Entrepreneur Should Answer (#397)

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Mike Maples, Jr. (Photo by Christopher Michel)

“If the customer doesn’t scream, you don’t have product-market fit.” — Andy Rachleff

Welcome to another episode of The Tim Ferriss Show. This time, we have a slightly different episode—a takeover by Mike Maples, Jr.

Mike Maples, Jr. (@m2jr) and his firm, Floodgate, have invested in and supported many of the startups you might recognize — including Twitter, Twitch, Lyft, Chegg, and Okta, among others — long before they were household names. He’s been on the Forbes Midas List eight times in the last decade, but he’s much more than a successful investor. Mike has also succeeded as both a founder and operating executive.

He’s also simply a great guy and the first person who really taught me how to angel invest. For more on that background, listen to my interview with Mike at tim.blog/mikemaples.

In this episode, however, Mike speaks with Andy Rachleff (@arachleff), co-founder of Wealthfront and Benchmark Capital, about two of the biggest questions that should be on every start-up founder’s mind: How do you reach “product-market fit” (a term that Andy coined), and how do they know when you’ve achieved it?

Andy has known many of the start-up world’s giants and synthesized their lessons, so you will also hear what Andy learned from Don Valentine of Sequoia, Scott Cook of Intuit, Reed Hastings of Netflix, Geoffrey Moore, Clay Christensen, Eric Ries, and Steve Blank.

The audio from this conversation is from the premiere episode of Mike’s brand-new podcast, Starting Greatness, which I encourage you check out. There are some incredible guests coming.

So, if you like this conversation between Mike and Andy, be sure to subscribe to Starting Greatness on Apple Podcasts, Spotify, Overcast, or wherever you get your podcasts. You can also check out the website at greatness.floodgate.com, and on Twitter you can follow Mike at @m2jr and Andy at @arachleff.

Please enjoy!

Listen to the episode on Apple Podcasts, Spotify, Overcast, StitcherCastbox, Google Podcasts, or on your favorite podcast platform.

#397: How to Win in the Startup World — Mike Maples and Andy Rachleff
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This podcast is brought to you by Peloton, which has become a staple of my daily routine. I picked up this bike after seeing the success of my friend Kevin Rose, and I’ve been enjoying it more than I ever imagined. Peloton is an indoor cycling bike that brings live studio classes right to your home. No worrying about fitting classes into your busy schedule or making it to a studio with a crazy commute.

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Want to hear an interview with Mike’s business partner? — Check out my conversation with Floodgate co-founding partner Ann Miura-Ko in which we discuss what counts as “world class effort,” how an introvert becomes a debating competitor, and much more. (Stream below or right-click here to download.)

#331: Ann Miura-Ko — The Path from Shyness to World-Class Debater and Investor
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QUESTION(S) OF THE DAY: What was your favorite quote or lesson from this episode? Please let me know in the comments.

SCROLL BELOW FOR LINKS AND SHOW NOTES…

SELECTED LINKS FROM THE EPISODE

  • Connect with Mike Maples, Jr.:

Floodgate | Starting Greatness | Twitter | Medium

  • Connect with Andy Rachleff:

Wealthfront | Twitter

SHOW NOTES

  • Andy explains the meaning and origin story behind the term “product market fit.” [08:48]
  • The four heuristics Andy uses to test if product market fit has been achieved. [10:24]
  • Two counterintuitive lessons. [14:19]
  • Andy outlines the second biggest mistake he sees entrepreneurs making. [15:08]
  • Questions you’ll hear from potential customers, venture capitalists, and others who are in on your “secret” when you’ve got product market fit. [15:56]
  • Why does Andy think more people should be reading Crossing the Chasm by Geoffrey A. Moore, and what makes it as current for today’s world as it was when first published in 1991? [16:41]
  • How Facebook’s growth is a perfect example of Crossing the Chasm philosophy. [19:36]
  • Why successful companies and entrepreneurs — from Facebook to Google to Netflix’s Reed Hastings — tend to revise their own history. [21:04]
  • Andy and Mike share their thoughts on pivots and restarts. [26:57]
  • Andy explains why it’s not imperative for everybody to like your product — in fact, it may even be better if some people don’t. [29:39]
  • What does the term “savored surprises” mean to Scott Cook and the company culture of Intuit? Why should you be concerned if nothing surprises you about a project? [31:54]
  • What does Andy consider his biggest “unforced error” at Wealthfront, and when did he have the epiphany to correct course? [35:04]
  • How did Andy nail his niche early on? What worked — and didn’t work — in the effort to spread the word to potential clients? [39:43]
  • What a recent insight yielded for Andy’s company, and how this appeals to a demographic its competition has been neglecting. [43:48]
  • Mike reiterates Andy’s point about entrepreneurship succeeding by being non-consensus and right — defying common wisdom to create something people don’t even know they need until you’ve arrived to bring it to them. [45:45]
  • The startup law of the jungle, insight development, and what we can expect from Mike and his guests in future episodes of Starting Greatness. [47:12]

PEOPLE MENTIONED

Posted on: November 25, 2019.

Please check out Tribe of Mentors, my newest book, which shares short, tactical life advice from 100+ world-class performers. Many of the world's most famous entrepreneurs, athletes, investors, poker players, and artists are part of the book. The tips and strategies in Tribe of Mentors have already changed my life, and I hope the same for you. Click here for a sample chapter and full details. Roughly 90% of the guests have never appeared on my podcast.

Who was interviewed? Here's a very partial list: tech icons (founders of Facebook, Twitter, LinkedIn, Craigslist, Pinterest, Spotify, Salesforce, Dropbox, and more), Jimmy Fallon, Arianna Huffington, Brandon Stanton (Humans of New York), Lord Rabbi Jonathan Sacks, Ayaan Hirsi Ali, Ben Stiller, Maurice Ashley (first African-American Grandmaster of chess), Brené Brown (researcher and bestselling author), Rick Rubin (legendary music producer), Temple Grandin (animal behavior expert and autism activist), Franklin Leonard (The Black List), Dara Torres (12-time Olympic medalist in swimming), David Lynch (director), Kelly Slater (surfing legend), Bozoma Saint John (Beats/Apple/Uber), Lewis Cantley (famed cancer researcher), Maria Sharapova, Chris Anderson (curator of TED), Terry Crews, Greg Norman (golf icon), Vitalik Buterin (creator of Ethereum), and nearly 100 more. Check it all out by clicking here.

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4 comments on “Two Questions Every Entrepreneur Should Answer (#397)

  1. Hi Tim! Glass of wine or two in Austin this week? My husband and I would love to commiserate on the best food, wine, beer in Austin yadayada!!!

    Like