It’s been about 6 months since I started Novella — a good opportunity to be introspective and honest about the progress we’ve made. I’m trying to build in public more and long-form mediums are the most natural for me. Think of this as a retrospective on me as a founder and the first 6 months of company building.
The first 6 months of a company are unique in that most of what you’ll accomplish, or not accomplish, is dependent only on your own competence. In the earliest days of a company, you’ll spend time building your founding team, interviewing customers and building an early product. But the reality is, progress at this stage depends almost entirely on the founders ability to move forward. The quality of the decisions you make won’t matter much in these early stages, but your ability to make decisions will.
In our case, we set 4 goals for the first 12 months of Novella.
- Hire a founding team
- Get all the required licenses
- Find an insurance carrier to work with as our capacity partner
- Launch our product and sell something
Hiring a founding team and getting licensed depend entirely on our own ability to execute. Finding an insurance carrier to work with depends primarily on our ability to execute given how many possible partners exist, though there is some market dependency here. A carrier has to want what we’re offering them. But at its core, this goal depends on us more than the market.
The last one however is interesting — Launch and sell something. While this obviously depends on our competence, this is the first time our thesis meets the market. This is where feedback goes from anecdotal to experiential. Before launching, you speak to customers, show them designs and prototypes but they haven’t actually used anything. Once you launch though, they’ll only use your product if it’s useful.
This is where the progress of a company starts depending not only on the founding teams’ ability to make decisions, but on the quality and accuracy of the decisions they make.
Novella is a brokerage business, we sell insurance policies. Selling a single policy is probably more dependent on our competence than on the market — insurance is a big enough category that we’ll find someone willing to buy what we’re selling. But from here, we leave the realm of goals that are solely dependent on our competence and face the market. Us accomplishing our next set of goals is dependent on us being incredible executors but also on us being right. If we’re building something no one wants, our competence won’t save us.
Candidly, this point scares me. I’m willing to bet my career on my own competence. But the more luck associated with building the right thing at the right time means my success will depend on things outside of my control. Early stage investors will tell you to counter this in two ways: (1) it’s never too early to interact with customers and involve them in the build process. Early design partners are crucial to get market feedback as early as possible. (2) Raise enough money in the early days so you can maximize shots on goal. Once you’ve found a problem worth solving, it will take a few tries before you successfully solve it. Early stage companies die because they run out of money before they build something valuable — give yourself enough time to try a few things against the market, one of which hopefully will stick.
The second point is a way to swing the pendulum of success back to competence. You cannot control if the market likes what you build, but you can iterate quickly to give yourself the maximum number of chances. Competence will allow you to quickly get feedback and change course but can’t dictate what customers want.
In our case, we raised a little more money than we needed. We had incredibly strong conviction around the problem, that hasn’t changed. If anything, our conviction around the problem we’re solving has gotten stronger. We just launched our first attempt at solving that problem. The early market feedback has been positive — good user feedback, users coming back for more and engaging with us asking for new features.
But we’re still far from knowing that what we built is the right way to solve the problem. Only our users and customers can decide that — and having that element be out of our controls scares me!
