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My Billion Dollar Mistake
- kreetx 8y agoAn interesting read! Who is the author?
- tqkxzugoaupvwqr 8y agoAs implied in the article, Hiten Shah from KISSmetrics. https://hitenism.com/ https://hitenism.com/
- bmmayer1 8y agoIt's implied, but this site doesn't have a byline on posts, or a publication date. It's very annoying.
- testmasterflex 8y agoTbh it sounds like he never understood his customers. He should work on a product he is the customer of instead of looking at competition and worry about their features.
- JamesBarney 8y agoOr just spent more time taking to customers and less time innovating.
- inetknght 8y agoSpending more time talking to customers is usually good. But at the end of the day, talking to customers isn't a sure way to understand their needs.
- omarchowdhury 8y agoGiving a customer a base product and understanding their needs in practice is the way to go.
- StavrosK 8y agoI remember when KISSmetrics was much better than MixPanel, they really were fantastic. It's too bad that they squandered the opportunity, they were the best by some margin. Great article, thanks for posting it!
- Aeolun 8y agoThey were also _way_ more expensive. We used Kiss for a while, but Mixpanel was free for the same volume and just as good if not better.
- no1youknowz 8y agoWhat happened to kissmetrics.com? On their twitter they claim to have sold it to neilpatel.com. Instead it's now kissmetricshq.com. Also there doesn't seem to be a way to get new customers. Looks like they only service old ones? Did they secede from the market entirely? And this guy is offering coaching the kissmetrics way? Amazing... Their twitter is also all over the place, lots of retweets and content from other SaaS providers, looks like they are shilling based on whatever reputation is left on the brand. Starting to get the idea why they went under as that's what it looks like from an observer.
- jumpbug 8y agohttps://neilpatel.com/blog/buying-websites/ https://neilpatel.com/blog/buying-websites/ Looks like this link explains it a bit. Neil Patel bought the blog for 500k
- mathgenius 8y agoUgh. I've worked for, and with, people like this. Never again. It's clear from this article that he still has no idea why he "failed". Apparently his failure was too many ideas, and yet later on in the article he says they failed because execution slowed. Finally he admits it was magic lost, ie. he has no idea. The best solution he comes up with amounts to better planning and "Decide where to focus limited resources." Duh. This guy is ernest, but clueless. If you meet someone like this, run for the hills. They should not be in charge of anything apart from the excel spreadsheet in front of them.
- rabidrat 8y agoWhat kind of person is this? In your estimation, what is his tragic flaw, apart from existing and being involved?
- alttab 8y agoProbably the arrogance to write about his "mistake" without actually learning the core reason for the failure. The author starts out owning it, but then shifts the focus to "we" and other things like execution. In the end I think once KISSmetrics became a hit, it was hubris that took over and the mistakes followed. That's likely hard to own and admit in a blog post, because you'd basically have to be a different person to write it. So to me, the "ugh" response makes a lot of sense.
- pm90 8y agoAgreed with this. There also seem to be a few comments in this thread which makes me wonder how truthful the author really is (https://news.ycombinator.com/item?id=19767442 https://news.ycombinator.com/item?id=19767442)
- Redoubts 8y ago“”” I divide my officers into four groups. There are clever, diligent, stupid, and lazy officers. Usually two characteristics are combined. Some are clever and diligent -- their place is the General Staff. The next lot are stupid and lazy -- they make up 90 percent of every army and are suited to routine duties. Anyone who is both clever and lazy is qualified for the highest leadership duties, because he possesses the intellectual clarity and the composure necessary for difficult decisions. One must beware of anyone who is stupid and diligent -- he must not be entrusted with any responsibility because he will always cause only mischief. “””
- AznHisoka 8y agoIt sounds like they stumbled upon a great idea, built it quickly and then slowed down. But that is natural when your team and product grows. There is nothing to blame. Also claiming you believe you lost out on a billion dollar opportunity is a bit egotistical to say. Its the same attitude that makes one say you know better than your customers/competitors and dont need no validation for your ideas.
- adventured 8y ago> Also claiming you believe you lost out on a billion dollar opportunity is a bit egotistical to say. It's the failure brag. Pretty common ego saving device in the start-up world. The first rule of a failure brag, is to make it really over the top. Something like: It was a trillion dollar opportunity. We were the first to invent [thing that wasn't very important]. We could have easily smited every one of our competitors, all we had to do is this one thing and poof, weaklings destroyed. I merely needed to wave my hand at them, and I forgot to wave. That's how powerful my wave is. Did I mention we invented [thing that wasn't very important]? It changed the world, a world that was ours to own.
- deleted 8y ago[deleted]
- puranjay 8y agoKISSMetrics was the poster child for a lot of people on the SaaS marketing front. Their content marketing game was the best in the business and they tested landing pages aggressively. But I guess there was a mismatch between the product and the marketing
- jgalt212 8y agoYes, very slick. We almost went with them, but this was around the time their evercookie was exposed. After that, we went with GA and Mixpanel. https://www.wired.com/2012/10/kissmetrics-tracking/ https://www.wired.com/2012/10/kissmetrics-tracking/ https://news.ycombinator.com/item?id=2824318 https://news.ycombinator.com/item?id=2824318 https://news.ycombinator.com/item?id=4696441 https://news.ycombinator.com/item?id=4696441
- m0zg 8y agoYep. I'm consulting for a company that has this ailment. Everyone is trying to do 10 things at the same time, none of them matter worth a damn, and they're failing at it. Everyone is overworked and demoralized, revenues slipping, the company is not building product equity, just trying to churn butter out of bullshit by thrashing wildly. Worse yet, I'm not in a position to tell them they need to change, so I take their money and do what they ask me to do, even though I know full well it's basically a waste of time and resources for them.
- gesman 8y agoI can see that most of the examples presented here is a various flavor of a typical mistake: Building "solution that is looking for a problem".
- cialowicz 8y agoIt took me a while to figure it out, but a "Hiten Bomb" is a reference to the name of the founder of KISSMetrics, Hiten Shah. Oddly enough this website doesn't have a by-line to indicate who the author is.
- yesimahuman 8y agoI found this post really curious because he points to some competitors that have also been out-competed, but neglects to mention that and seems to act like they just beat KM and it was game over. Also uses funding raised as a proxy for success which I know he knows does not tell the full story. However, there was something in here that I think a lot of companies struggle with: how do you keep evolving when you start to calcify around a product and use case, without throwing the company into disarray? Tech markets are brutal and the competing need to stay the course but also continuously evolve and even reinvent yourself is really hard to navigate for all but the most obvious of rocket ship companies.
- KaoruAoiShiho 8y agoWho has outcompeted mixpanel and heap?
- eruci 8y agoA solution seeking a problem has little chance of becoming a billion dollar solution.
- m1sta_ 8y agoThis might look true in retrospect because you'll always be able to point to the problem that a successful solution solved. Lots of solutions have been successful after being created with an ambiguous or only just emerging problem.
- earenndil 8y agoI thought based on the title that this was about null—https://www.infoq.com/presentations/Null-References-The-Billion-Dollar-Mistake-Tony-Hoare https://www.infoq.com/presentations/Null-References-The-Bill...
- skmurphy 8y agoThere are several good lessons learned presented that are generally applicable: "We should have spent more time figuring out what the problems were with existing solutions and who specifically had those problems." "The customers we targeted needed to be willing to pay for our solution." "We hadn’t been committed to learning as much as possible about the market and the customer. We were making educated guesses instead of coming to well researched conclusions. This led us down the wrong path twice." In his fourth point he correctly decides to benchmark against the status quo but does not talk to people who are paying for an analytics solution but are using Google Analytics, which was free at the time they were conducting interviews. "We needed to stop building what we thought the market wanted and get back to basics. Instead of writing code, we went out and talked to customers. We spoke with people who used our largest competitor, Google Analytics. We asked them questions to better understand their needs and the current problems they were having with analytics software. They had a lot to say, so we listened." But they do find a pain point people are willing to pay to solve: funnel design and management. So far so good. But the next mistake is instead of focusing team execution purely on requests from customers and prospects who match their target, Hiten Shah tries to move faster by coming up with a stream of ideas (called "Hiten bombs" in the text). He was slow to switch focus from exploration / discovery to execution / delivery. Which is understandable because it was exploration that uncovered the "billion dollar opportunity." His summary is good and also points out a painful reality about "product-market fit." It's not a one time winner take all event. Your early traction invites competition that copies your success, building on it to raise the bar against you. "You can’t just capture the market once and expect to keep it. You have to do it over and over again and faster than everyone else if you want to keep distance from competitors coming up behind you and disrupting you. That’s how you get ahead of the market. We forgot the process that helped us deliver that initial amazing product [listening to prospects and customers]."
- duxup 8y agoI've been working on a project recently. Review after review with the president of the company. He's a good dude but new ideas are frequent, and he is almost too focused on what the thing should be / look like / etc. Same with our customer paying for it (but who doesn't use it) who has strong feelings about "if it does X, Y will happen". They're all more experienced with the industry than I, but their explanations didn't quite jive. I'm no user expert but I'm fairly sure some of their ideas won't make the user make Y happen.... Finally last week I got to talk to someone who will USE THE THING on a daily basis. In a 15 minute conversation with that dude I cleared up months of confusion / questions and I feel like that would have saved us a lot of time. Thankfully it happened and everyone was on the call and now is on board (and I have direct contact with the dude), but man, I wanted to talk to that dude a month ago....
- qwerty456127 8y agoWhy has this been posted 8 times?
- gorkemcetin 8y agoNow I understand the reason behind why Kissmetrics died: egoism and not listening to customers. It is the same way this article is written with such a headline.
- zarriak 8y agoIf your head of product would rather write an internal memo addressed to the entire company instead of coming to you and telling you to shut up you have to wonder how you assume you could ever get to a billion dollars. "I myself didn’t know what to do and which inputs to pay attention to. After months of this and because of the memo, I found out that this was exactly how the team felt too." Can someone explain this to me? I genuinely don't understand this attitude. I mean maybe a week of introspection and pondering is acceptable, but months? At no point does it seem he truly understands that his leadership failed completely. The only thing he tells you is "I’ve learned that the key to driving growth on product is to create product processes that produce repeatable wins." This dude literally was so bad at management he tanked what he considered to be a billion dollar company and doesn't even admit to it after the fact?
- duxup 8y agoI think he does say his lack of leadership failed, but like his description of the company it is a bit unfocused and all over the map.
- zarriak 8y agoIt just seems odd when he is one of the people who founded this blog it is posted on. I'm sure he has great stories to tell and things in hindsight do seem more clear even if I find it odd in the first place. Like you said it is unfocused and that disappoints me when this is his own blog. I'd really like to hear the story of what running a startup is like when your main competitor is Google.
- pm90 8y agoIts seems bad writing. Good writing is quite hard actually, and he may not have even realized that what he wrote is unfocused or may not really convey what he wants to convey. That's the charitable interpretation. The not so charitable interpretation, which to me seems likely, is that he's using this "blog" as part of a campaign to create a new identity for himself, the "almost-billionare startup founder", who has great stories to tell and advice to give so can you please hire him on your company board because he's so well known in the community right? He also seems to suffer from a profound lack of the ability to listen. Literally all the issues seem to be one of him being unable to comprehend reality because he's not listening to the customers,or to the industry trends; he's focused only on creating some mythical product which will be so amazing. Every little success he has buttresses his idea of himself as a visionary, but after that instead of continuing with the good ideas, he goes off on a tangent trying to fulfill this myth.
- thisisit 8y agoSometimes I wonder about what exactly is the line when it comes to listening to customers or looking at your competitors, for ideas? As the Hiten Shah puts it he got ideas or Hiten Bombs by watching competitors, investors, advisers and some which he thought of himself. And he also notes later in the article, they saw Mixpanel doing mobile apps, they saw the freemium option etc. So, the feature generation process was correct. What went wrong was Kissmetric's estimation of the success of different ideas. They decided to pass on building mobile apps or giving freemium because they thought it would cost them too much. The question is - What kind of intuition was at play to make those decisions? IMO there aren't many ways to intuitively know when something will work or not.