Stability or startup: Keys to making the choice

Effective planning can help overcome the fears about taking the leap into launching a new venture


Ro Choy is a veteran Silicon Valley tech entrepreneur and CEO of PeerPong. This column first appeared in VentureBeat.

Nearly four years ago, I decided to leave a director role at eBay to join a small four-person team called RockYou. At the time, a lot of folks told me I was making the wrong decision. Several questioned whether social media was a fad, if we would ever make money at it, and the value of a service that existed as a ‘feature’ for another site. Four years later, conventional wisdom would argue the opposite.

Six months ago, when I left RockYou to join PeerPong, a startup in the knowledge management/ social Q&A space, I faced the same questions. Looking at my rationale then and now, there were some basic patterns that helped me make the call. If you’re considering making a leap of faith yourself, here are a couple of basic thresholds I used when jumping into a new opportunity.

It Begins with Team: In the case of both RockYou and PeerPong, making an informed call on the people who would work at the company was absolutely critical.  In my opinion, there are a couple of values to look for in the initial team.

Answering Hard Questions
Every member of the team needs to have answers for a lot of hard questions.  In the consumer space, for example, experience in scaling users and the technology to support it is absolute. Ultimately, whether it’s experience or outright smarts, having a constant stream of answers to tough questions across the team makes things much easier for everyone. Having a CEO or CTO source all the product or business ideas slows a startup down considerably and often avoids the needed conversation and consensus within the team to come up with the best answers.

Each member of the team needs to be fully responsible and accountable for his or her work.  This is closely linked to generating answers.  In general, a startup team needs to run across as flat an organization as possible, where even interns have an immense amount of responsibility and in turn, accountability for what they do.  With so little time to prove a business model, having anyone on a team that isn’t pushing their objectives aggressively severely limits the potential for the entire startup’s success.  It’s truly a situation where the weakest link can kill an entire team’s efforts.

For me, understanding the strength and character of the team I was joining made the risk/reward decision a lot easier.

Vetting the Technology: One of my biggest frustrations working at a large public company was the lack of product knowledge at the executive level.  How do you succeed if you don’t know what the most current technology can even do?  A great product, at whatever stage of development, radically reduces the risk of people jumping to a new opportunity.  When deciding to join the “new new” thing, I made sure to vet the heck out of the technology the company had built.

In the case of RockYou, this meant going through thousands of profiles on MySpace, Hi5 and other social networks, mapping out how RockYou’s widgets compared to all its competitors. In this case, making a bet on a product leader was an easy decision, even if the product category was still undefined.

In the case of PeerPong, measuring the effectiveness of indexing and routing of expertise was the focus.  There are established leaders in the Q&A space given the years players like Yahoo Answers and have had to build up a base of users.

What I found with PeerPong was a unique, cutting edge and hard to replicate technology.  I compared that to the competitive set in the space and found few players using a similar product or with a team capable of building the same platform.

In both cases, the technology was a true, measurable asset to the startup, whether through proven user adoption or complexity and value.  Having a strong sense of the value of the technology let me worry less about the means to success (the product) and focus on the end potential (the opportunity).

Ultimately, if you’re looking at making the jump to a new, unproven startup and market, ask yourself a few questions: What’s your appetite for ambiguity? Does the unknown gear you up or stress you out? Are you comfortable depending and trusting others for your success? Would you use this product/technology yourself and sell all your friends on using it as well? Can you work effectively with very limited guidance or direction?

The answer can help ground your decision. Or if you’re more a fly-by-the-seat-of-your-pants person, just say the heck with it and do it.


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