(Note: This is a great piece for those interested in technology startups.)

Haroon is the CEO of webs.com (formerly Freewebs) which also spun out the Social Gaming Network, SGN.

He apparently has had the entrepreneurial spirit his whole life — lemonade stands and the like, and eventually went to the University of Maryland for his undergrad.

While working with his brother doing web development, they asked the question:

‘How does this scale?’

It doesn’t.

So they decided, back in the end of the web 1.0 days, to create a website that could create websites, to save themselves the hassle of managing loads of web development — and essentially build a model with the potential of scaling.

He gave some good advice, which I’ll try to chronicle here.

1. Launch as fast as possible.

Once you have enough of the concept in place, launch early quickly, to run a ‘minimum valid test,’ that is, proof of concept and proof that users actually want what your making.

While working full time at Harvard, Haroon and his brother were bootstrapping, and the hardest part was getting users. One of their applications on SGN now gets 500 million page views/month, within a year of launching, which is more than the entire freewebs.com span of properties.

Why? They launched a minimum valid test, and iterated rapidly.

Some know this as the “release early, release often” method.

2. After minimum valid test, set up a general analytic framework.

You want to know why you grow, how you grow, and you want to understand how change in the system is impacting this process. Focus on what’s going to move the needle, and than attack it determinedly.

Again, the value is in the data — the more data one collects the better. A basic package like Google Analytics works possibly at launch, but am ore robust analytics engine is necessary — especially real-time traffic analytics.

3. How do you decide?

If you have data, run A/B tests — all decisions should be specific. Google helps with a website optimizer, but again, can build the platform out locally — but the decisions should be based on data … When there is data, you should make decisions based off it.

4. Only hire the best people

Layout vision, and inspire people to vision. Only get people — no matter how talented — who are passionate and believe in the vision, 100%.

One sour apple will spoil all the good apples and bring the whole team down.

5. Decide what type of startup you are.

How you decide what type of startup you want — whether you want to sell for $10 - $20 million or $500 million, will also determine whether or not you need a VC firm or would be better of going after an angel round, or bootstrapping.

(There is the 37signals approach, and there is the Jason Calacanis way, and everything in between)

Max Levchin, who had a number of failed startups prior to Paypal, related to Haroon that he doesn’t want to sell Slide for less than $1 billion. Why? Because the money he’s made was already life changing — now he is going for a much, much bigger goal.

In the end, a founder must ask him or herself, what kind of outcome will make you happy?

6. Silicon Valley vs. the rest

Freewebs is based in Silver Spring, Maryland, so there was a very real decision to NOT go after west coast VC money and to get East Coast money and stay in the region –a personal preference for Haroon, yet he realizes there are many benefits of being Silicon Valley over Washington, DC.

Pros:
More VC money
More talent
More people interested in web/mobile/ technology business and are always talking about it.
Startup atmosphere

Cons:
Competing for talent == will pay $100k + / year for an engineer because of competition with Facebook, Stanford, etc.
Echo chamber effect
Quality of life — if that’s where you want to spend 5-10 years of your life, cool, but some prefer otherwise.

7. Simpler, easier, faster always wins out.

Google might have beat out other search engines not for their page rank algorithims and better results, but for having faster load times. There’s a danger for an application to become too bloated and to do too much — simpler, easier, faster wins.

8. Having a competitor is motivating.

SGN vs. Zynga

There’s much more value (both for acquisition and attracting customers) to be no. 1, even by a sllim margin. an acquirer will pay the extra dough to have the no.1 , while competition also forces employees and the company to stay motivated.

9. Go long on drive and raw intelligence.

Go long on drive and raw intelligence, and no ego, and short on experience. Don’t be afraid to ask for SAT scores, or other metrics of intelligence — the better employees are smarter.

But you have to create some reason for your employees to want to be there. For Facebook, their management believe in Mark Zuckerberg, for better or for worse, and are inspired by him and his vision for the company and he is the reason many of them are there. The employees are then inspired by the company he’s helped to build. (Read Nationalism in the Startup World by a former Facebook employee)

10. Be true to the product

Focus on things that matter.

11. Success is relative

For some, they look at Haroon as successful, but he is looking at the most successful entrepreneurs in the country as his benchmark for success.

12. Viral Cycle

The steps a user goes through between entering the site to inviting the next set of new users. (Andrew Chen goes a bit more in to depth, here)

13. Hire low level people

If you go after managers right away, they are used to managing people and have others do the work for them. Hire the lower people first –the office managers, and developers — who not only cost less but will go out and get the job done themselves.

Don’t settle when you’re hiring!

Tags: freewebs, Haroon Mokhtarzada, start up

Categories: Entrepreneurship