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I need some time to ease my mind February 6, 2010

Posted by David Gillespie in Uncategorized.
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When I was writing Digital Strangelove, it was born largely out of work being so busy that I didn’t have time to write semi-daily about the things I was thinking, and I’m starting to feel like I’m all clogged up again in my head – a week where one of your days runs over the course of 18 hours will do that to you.

Anyway, enough of my complaining, I’ve wanted to write this for a couple weeks, and I’m excited to now as I feel really strongly about it. Your friend and mine Fred Wilson was interviewed in January and one of the questions asked was “What common mistakes do start-ups make?” He responds with this:

One mistake  see people make is that they hire out the development of the technology…I think that’s a huge mistake. I think the companies need to have the engineers as part of the core founding team…and a company needs to own its engineering and product in a way that you could never own it if you hire somebody else to build it.

Back in March 2008,  wrote the following:

I’m a big believer in a business being free to focus on its core product(s). If it ain’t what you do, then it ain’t what you do! Far too many times I’ve seen companies get distracted by an interesting piece of technology or an idea outside their scope or ability to act on. When that happens, your core product suffers, and your competitors who may have been running a distant second seem to close the gap over night.

At the time I was thinking about the future of a start-up I was working in at the time, Hippo Jobs. Hippo had made a range of decisions ranging from ones I agreed with to ones I didn’t agree with at all, but that is going to be the case in any workplace where you are an employee and not an owner, and I don’t pretend for a moment to fully comprehend the situations that lead to some of those decisions.

What I believed then and believe now however is exactly what Fred said; a company needs to be in control of its lifeblood and make everything else someone else’s problem. When Yahoo! finally outsourced its search to Microsoft, it acknowledged what everyone else had long known – they were not a search company. Mind you, neither is Microsoft, which is why I can’t see them taking that battle to Google in a meaningful way.

Hippo had chosen to work with Areeba, an innovative and talented dev shop in Melbourne, Australia. The issue was never the quality of the work, it was a team that cared about the product in a way that was more than a job. Where Fred says “a company needs to own its engineering and product in a way that you could never own it if you hire somebody else to build it“, listen to it. He also says the key engineer(s) need to be founding members of the company, which again I agree with.

At the end of the day, ideas are a dime a dozen, and you need the people who can execute to have as much skin in the game as you have; anything less is a recipe for disaster.

See video below, quote begins at 4:48.

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