Adii Pienaar

In my inbox this morning was the latest newsletter from Hiten Shah, which is part of a series of newsletters (if it can be called that) in which Hiten is sharing his experiences as an entrepreneur. This morning's topic was how brands need a greater purpose to really be successful and as his thoughts got stuck in my head, I've been trying to figure out what I'd say WooThemes' greater purpose is.

When we started WooThemes, we were designers / developers and totally inexperienced in all of the other things that come along once you create a new business (admin, marketing, branding etc.). Suffice to say, something like a "greater purpose" is not something that ever came up in our discussions and we were more than happy to simply tackle the challenges that we could actually see ahead of us in growing the company as organically & quickly as possible.

So when I now try - in hindsight - to attach a greater purpose to our business, I can see it taking on a variety of shapes & directions, which has changed over time and also differs if I compare my personal aims versus the company's aims in terms of the purpose.

In the beginning, I think our purpose was quite simple: personally, we wanted to create a company that could be an extension of our web development skills and at the same time would result in a passive income. From a business perspective, I guess our purpose was to innovate and create beautiful WordPress themes, unlike those that were available at the time. And I think that this purpose has probably stuck ever since, even though our marketplace today is filled with many more competitors (compared to 3.5 years ago when we started out) and innovation itself has become a lot more complicated in general.

This does however leave me questioning the validity of this purpose given the maturity and size of our business at present. Should we not be aiming a little higher? We could possibly make it our purpose to "beautify the web" or "democratize great design", but whilst those definitely resonates with our core values & passions, they almost seem fluffy and a bit like a "double rainbow". I don't know.

I'm sure that Woo has a greater purpose at the core, but I'm just not sure that we've ever verbalized that in its entirety. We obviously have something incredible at the core which is driving our company forward at full steam, but pinpointing those exact details is a tad harder.

Does your company have a greater purpose? What are your thoughts on having a greater purpose?

I was reading Fred Wilson's post on 50/50 Cofounders just now and caught myself feeling justified in the way that we structured our partnership at WooThemes 3.5 years ago (something which I blogged about here too).

So over at WooThemes, we cofounded a company and decided that the three of us would have equal equity share in the company. We made this decision based on the mantra of "equal share, equal contribution", which at the time probably made more sense compared to today (but only because at that time we were very much DIY and all of us were designing / developing in measurable terms). But to this day, we've managed to apply that mantra in some way and on top of that, we've never had to force a 2 vs 1 decision.

In my time as an entrepreneur, I probably rate this as one of the finest decisions I was ever part of and if I had to go back, I'd want to do the same thing. This decision has allowed us to build a trusting & loyal relationship, which has only really featured a couple of minor niggles in 3.5 years, which is something I think we can be incredibly proud of.

Yes, it has been frustrating at times where opinions have differed and sometimes it does seem that it would've been so much simpler if I could simply make the decision I want to make in my own way. But having to convince my cofounders of the merits thereof, has almost always resulted in a slightly tweaked and better decision.

Most people believe a "partnership to be a sinking ship" and in many cases I'd probably agree. Heck, if I had to do a new startup today, I wouldn't necessarily go for an equal partnership just because it worked before (I believe in using the horses-for-courses mentality). I do however have a massive predisposition to equal partnerships and I truly believe that if you have the right business partners, the pro's far outweigh any possible con's.

A couple of weeks ago I joined AngelList hoping to get into the angel investment scene and diversify my own business interests (as well as meeting new people and having stimulating / challenging business conversations about their work). I've had a couple of introductions to startups which I thought had some traction, but to date I've resisted pulling the trigger on any of the deals, as I've decided to err on the cautious side.

Bubble or no bubble, I'm not convinced of either of those ends on the spectrum. This article published by the Economist last week introduces a new "bubble theory", one which resonates more with my own thoughts than the alarmist articles that have been published recently.

Here are my concerns:

1. Funding supply is exceeding the demand, which is driving higher valuations. Angel investment has indeed become sexy and - dare I say it - moved into the mainstream. Heck, I'm quite connected and I read a lot, but it's only in the last couple of months that I've taken notice of angel investments to the extend that I'm intrigued enough to get involved. More angels obviously means that valuations are being driven up and I'm not sure that all of these valuations could ever be sustainable.

2. Valuation techniques / models are shocking. Talking about valuations, I recently quizzed a startup founder on how they decided the valuation of their business (for the purpose of raising some funding). He said: "We want to raise $200k and for that we're willing to part with 10% equity. So this values our company at $2m". A little crude IMO (especially since this was prior to $1 of revenue)... I'm no investment expert, but I did my fair share of business valuation models during my Honours Degree and this kind of valuation is risky at best.

3. The Exit Culture. At this kind of pre-revenue valuation, how can I ever earn a proper ROI on my angel investment? I need to hope that the company is valued at a higher level in a subsequent funding round or I need to hope that they get acquired somewhere in the future, in which case I'll probably be rich. Alternatively I need to hope that revenues eventually justify that valuation, which is a gamble at best since your guess is as good as mine when - and if - that will happen (as there's no supporting evidence pre-revenue).

4. Closed Focus. It just seems that so many startups are targeting the same kind of tech-savvy demographic, which suggests that we'll eventually reach a saturation point in the appetite of this demographic to try something new (which in actual fact is only a slightly different spin on something else they've been using until now). This approach is very gimmicky and I highly doubt that we'll continue to see $1m-in-sales, overnight iOS app successes as much as we've seen them until now.

None of these concerns, invalidates either angel investment or the tech / startup community at the moment, but they most definitely make me think twice about make any investment at present. I know that there are a lot of angel investors - especially those that have access to the best deals in the Valley - that will make an absolute killing for pulling the trigger now, but that is most definitely easier, when you can make 10-odd sizeable investments & in the process you're hedging your own risk (based on the assumption that you're actually making good investments).

Unfortunately I'm not in that position to take a 10-deal kinda risk on our personal finances at present and I thus need need to be much more selective about the investments that I do make.

The WordPress ecosystem is rife with copycats and we're severely lacking a couple of unique ideas. Due to the popularity of WordPress and the obvious success that designers / developers and businesses have experienced in recent years, many more are flocking to the platform to make a quick buck. Which would've been absolutely fantastic for all those involved, except that these newcomers are not bringing much newness to the table.

In every industry where businesses have experienced significant success, you'll find a lot of "late-adopters" trying to get in on the gold rush. I believe that WordPress is still in its infancy as a ecosystem and as a result I think its a very viable decision for a newcomer to try enter the industry.

The supposed gold rush is most definitely not over and whilst the established players will continue to reap the rewards of being first movers, there is still space for newcomers to make a name for themselves. Yes, it is becoming harder and harder for a newcomer to gain traction when starting out, but it is most definitely still possible.

My problem is that none of these newcomers are bringing any new ideas to the table; instead they have preferred a strategy of emulating the success of the bigger players in the industry. At WooThemes we've often been amused at the varying attempts of newcomers to copy our brand / model / product strategy and yet we're still to be knocked of our perch. I don't say that in an arrogant way, but there's no way that Theme Company A can be as good a WooThemes as WooThemes itself will be. Uniqueness would've however served them much, much better.

To explain this in a non-WordPress context, I love the strategy that the so-hot-right-now flight search engine, Hipmunk, have taken since launch. When they launched, there were many similar services out there, yet they pulled the proverbial rabbit from a hat in tackling a known problem in a very unique way. They Hipmunk'd a whole industry as a result.

I think the whole WordPress community can do with more Hipmunking and less copying.

At WooThemes we've certainly tried to be first movers in a few spaces. Two of these that stand out (to me) are our contribution to the WordPress core with Menu's and all the work we've done to create Tumblr-like functionality in WordPress (which has been a bit of a passion project for me personally).

Another WordPress business that I think has achieved a similar level of first-moving uniqueness is Gravity Forms, which has truly revolutionized any kind of form in WordPress and become a must-have plugin for 99% of new WordPress installations. In a similar way, the "plugin + hosted service" model implemented by VaultPress or ScribeSEO is to be lauded for doing things differently (and being great at what they do of course).

These are the kinda ideas that I believe will add value to the ecosystem and continue to be a driver of innovation in the community. Copycats on the other hand simply dilute the offerings available, which in turn just makes the initial (purchasing) decision that much harder for inexperienced users.

For every e-mail that gets sent, there's an inbox that probably can't handle yet another mail.

Cue the hipster trying to explain this "phenomenon": "I just get so much mail; I really can't answer all of them.", "So sorry if I missed your mail, but I get hundreds each day and yours probably fell through the cracks." or "E-mail overload is a real problem."

Duh.

See, I get it: we're all struggling to answer all of our e-mails since every Tom, Dick & Harry started sending an e-mail about everything a couple of years back. And now most Tom's, Dick's and Harry's have smartphones too (just so they look cool, not because they necessarily fully grasp the device), so they're sending you mail while on the pooper. I get it.

I also know that answering e-mail - especially lengthy one's - isn't the most pleasurable experience, nor do you feel like you've accomplished anything after you're done. I also absolutely hate waking up to an inbox with 30 unread mails, which means I've developed a bad habit of answering a couple of them on my iPhone, in the bed before I doze off to sleep. Bad habit. Yuck. But we do what we have to do.

The best part is that the more e-mails you manage to respond to, the more you are likely to receive back. Exponentially. Talk about a catch-22.

Here's the MASSIVE BUT though: None of these makes it okay for us to start ignore e-mails.

If I sent you an e-mail, I most probably did so because I would really appreciate a response (of any kind). Or maybe I really look up to you, admire your work and wanted to connect about something that might just be important to me. I also sent you the mail knowing that you are busy (just as I am), that it might take a couple of days for you to respond (which I'm okay about) and I tried to keep the e-mail as short as possible in respecting your time. If you don't respond, I don't know whether you got my mail, whether it perhaps went to spam or whether you didn't regard me important enough to warrant a response.

I'm nowhere near perfect when it comes to answering my own mail, but I try really, really hard to answer every single e-mail that pops up in my inbox. I'm slightly obsessive compulsive when it comes to keeping my inbox clean, I don't use any computer process that will "prioritize" my mail for me (just another lame excuse not to answer e-mails from senders outside of my network) and I realize that this isn't the most productive decision I've ever mind. But common courtesy is still a value that I regard highly.

So to everyone moaning about not having enough time, you can join the rest of us in that boat. We can also seriously stop playing the "my inbox is bigger than yours"-game, since that doesn't get the e-mail answered either. We all agree that the massive amounts of e-mail that gets sent is a real problem, but we're not solving it by selectively ignoring some of those e-mails.

You're not doing anything wrong when you're not answering the mail you receive. Compare it having your own home; if there's a knock at the door, it's your choice to open it or pretend like you're not there.

I for one - and I'm sure I'm not alone - have much more respect for those people that takes the 2 minutes to reply to my mail.