Ask HN: How transparent should your startup be?
I recently watched a Jason Cohen talk called Naked Business - How Honesty Makes Money[1]. I'm the founder of the Bike Index, and I think we had bought into all the quasi-marketspeak that makes the Bike Index sound like a big company, when being transparent about our size and limitations seems like a better strategy.
I opened a github issue[2] and revised our about page. I asked everyone I could about whether this was a good thing and the general response was yes.
So Hacker News - is this honesty a good thing? Should we be even more transparent, for instance by publicizing our burn rate? If we start to look for investment, is being up-front about being excited to run the Bike Index regardless of whether it makes money a good thing?
[1]: http://vimeo.com/96685927 [2]: https://github.com/bikeindex/bike_index/issues/80
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I wouldn't suggest using transparency as a marketing tool. Most of what I've read seems to have a serious case of survivorship bias (I haven't listened to the Cohen talk).
I'd focus on your business and what's important to you.
I current share - Wages, Intership programmes, Size (I dont pretend to be larger than we are, we used to but its beneficial not too for us.)
I'm concerned about sharing rev as well, but I have shared it with clients who have asked.... Its odd some clients mainly enterprise will ask whats your yearly rev as if its not a personal question.
I'm leaning towards being more transparent, sharing your burn rate in a particular way is OK. However its about messaging. If you write a blog post advertising the rate and its bad, I'd see that as negative. However if it comes up in conversation (article or RL) then I dont see the issue with sharing.
- sharing roadmap, gaining support for it, then changing your mind or failing to meet deadlines ("never promise what you can't deliver")
- sharing roadmap, gaining support, then having better-funded/faster-moving competitors steal it
I see a lot of advantages as well, but those are the two biggest risks in my eyes.
Selling users isn't the only way to make money.
When I talk to prospects, I emphasize that, since we're small, we will be very responsive to their needs, and that they get access to the highest levels of the company in a way they never would with, say, IBM or Oracle.
"With us, you'll have the CEO's personal cellphone number, and you can call and wake me up at 2:00am if you need to. I hope you don't need to, but you'll have that option if need be. And you won't get that from Oracle, IBM, Microsoft, etc."
As far as burn rate and financial data... we don't actively disclose that to the world, because there doesn't appear (at first blush) to be an value in it. But we do disclose a lot of stuff (sales leads, prospects, product roadmap details, etc.) to our advisory board members, and a group of 20-30 or so people (investors, potential partners, etc.) who have expressed at least some interest in knowing what we're up to.
[1]: http://www.amazon.com/The-Discipline-Market-Leaders-Customer...
It may not work out, but I guess only time will tell.