I've written about this in the past. One of the best ways to get smarter and better at something is to do frequent postmortems after bad decisions. We do it in our firm. When we screw something up, we go back and analyze why it happened, what we did wrong, and what we could have done better. It is incredibly useful.
In the history of our firm, to date we have had only one service fail and shut down. That is Wesabe. And this past week, Wesabe's founder and CEO, Marc Hedlund, did a postmortem on what went wrong. Here are some quotes from Marc's post:
I took over as CEO and led the company without a formal peer for the final two years. All that adds up to me having absolutely no one to blame for Wesabe's failure but myself, and as a result I can't now nor could ever be dispassionate in thinking about what happened.
Between the worse data aggregation method and the much higher amount of work Wesabe made you do, it was far easier to have a good experience on Mint, and that good experience came far more quickly. Everything I've mentioned — not being dependent on a single source provider, preserving users' privacy, helping users actually make positive change in their financial lives — all of those things are great, rational reasons to pursue what we pursued. But none of them matter if the product is harder to use, since most people simply won't care enough or get enough benefit from long-term features if a shorter-term alternative is available.
Can you succeed where we failed? Please do — the problems are absolutely huge and the help consumers have is absolutely abysmal. Learn from the above and go help people (after making them immediately happy, first).
I selected those three quotes for reasons. The first quote is great because Marc is taking full responsibility for the company's failure. In fact, it was not entirely his failure. It was the failure of everyone who was involved including the board and investors. But one secret to good postmortems is not blaming others. When you start by blaming others, you don't get to the truth.
The second quote is the money quote. The first and most important thing about a product is making it easy to use and easy to get value right "out of the box." Wesabe did not do that very well and as a result it could not achieve its loftier goals.
The third quote is my favorite. Marc says "we didn't solve this problem" and suggests that it is still a wide open opportunity and that entrepreneurs should learn from Wesabe's mistakes and go for it. I love that and agree with it.
I do not take much satisfaction from the fact that only one service we have backed in the past seven years has failed. Either we are not taking enough risk or we are destined for more failures. I think it is the latter. And when we fail, I hope that we talk openly and honestly about the failures. It is the right thing to do.
I applaud Marc's courage and honesty in writing this post. I encouraged him to do it a while back and he did it. Bravo Marc.
Well put, Fred! The problem with startup-life, I find, is that everything moves at such a quick pace that it’s quite difficult to have the presence of mind to reflect on a bad decision and think of ways to avoid making the same mistake twice. Simply fixing the problem keeps the ship from sinking today – reflecting on what caused the leak may save the ship from sinking in the future. The presence of mind to stop and honestly reflect on the causes of leaks is challenging, but essential.
Writing a mea culpa is very cathartic. Making it public is brave, worthy of respect and valuable to the community at large. The number of links and amount of discussion his post has garnered attests to this.Why do you attribute this single usv failing to just being the first of more to come and not down to lack of risk. How do you know you are investing with sufficient risk?
i think our returns to date show that we are taking enough risk. i believe that risk and return are highly correlated in the long run.we tend to be more supportive of projects than many in our business. that is probably a weakness in terms of investment discipline. but it is a strength in the minds of the entrepreneurs we back.so I think we keep things alive a bit longer than mostmost often that simply delays the time of failure and that is why i think we have more comingbut sometimes a team can pivot and turn failure into success
By “keep(ing) things alive a bit longer than most” also surely translates into also “learning a lot more about what is possible, about what the market place has evolved into wanting since the effort commenced, about what any competition might be pursuing” thus into gaining significant experience and background that potentially should better enable a viable pivot that can thus benefit from all of the time, effort and creativity already invested.Clearly no value in placing any venture on life support in a denial of reality yet sustaining a venture could also yet clearly be of value if anything can yet be recouped from all of the effort already committed – keeping any sentimentality/emotional attachments out of the picture.
Fred, not sure if you have written any posts about pivoting (or if any of your portfolio companies have been through that) but it would make for a great future blog post that we could all benefit from
I’m sure that writting it down has helped him in the process of offloading before going for the next one (and I hope there will be a next one because I like how he thinks).And I agree, making it public is really brave and has brought a lot of discussion. It’s amazing how obvious some issues seem to be when you look back. And because of that, some people critizice those who fail. They can’t know how difficult is making constant decissions without all the info at hand. They should try themselves to understand!
Wow, Mark’s comments are so refreshing. I’ve seen and been involved in too many “fantasy post mortems” where the main objective is fostering some alternate version of what happen and to assign blame.The stigma of failure has a weird affect on memory. In most corporate settings someone has to take the hit instead of understanding the reasons for lack of success.
This post deals with two different types of situations: a bad decision of the every-day variety, and a bad outcome of the monumental kind. The latter warrants a post-mortem, no doubt, but in the case of the former I can see a scenario where the post-analysis can take over. If I were to do a post-mortem on every bad decision every day, I would have little time left for actual deciding… let alone inclination. I don’t know, maybe that in itself would be a good thing after all. Still, there comes a point of paralysis and that’s no joke.
good pointyou can’t do a postmortem on every bad decisionjust the big ones
I think you can do quick postmortems on smaller bad decisions, and I encourage it. In the lean world, they use the “5 Whys” approach to understanding a problem, and once you get good at it you can do it pretty quickly.
As someone who has been in the trenches, Marc’s post is painfully inspiring.Building something new and from scratch takes superhuman belief. Likewise having it crash and acknowledging responsibility takes painful clarity. Almost a confession.I’ve never seen this happen on such a public stage.Energizing actually.
“painfully inspiring”Poignant phrase, Arnold.
First let me say again that I think it is awesome that Marc wrote this post – I wish more founders would write them and I wish more bloggers would work towards getting the real story versus just some pageview fest when a startup closes shop. These lessons are important for all of us as we move forward with our own startups.I will say the same thing I noted on Twitter – I actually think there were other reasons that Wesabe didn’t gain traction – either on their own or versus Mint. And frankly I think too much of Marc’s post was focused on Mint.If I get some time this week away from CC, I will try to do a post on the topic on CN.
Fred,Why did you shut the company down. How much would it take to buy the code for the site? There are some great ideas which should not be allowed to fade away. Think of a warehouse re-purposed into lofts. I think there is real value, just from a different angle.
we “did not shut the company down”about a year ago Marc and the board decided that our efforts to sell the company had failedMarc wanted to try to keep Wesabe aliveso we “handed the keys” to Marc and he slimmed the team way down and tried to make a go of it with a white label modelit almost worked but they were spending too much time and money keeping the site up and not enough revenue was coming inthis summer Marc decided that it was time to close down the servicewe supported his decision but were saddened by it as was Marc and everyone involvedthere were multiple efforts to find a home for the service and the code base. nobody ever stepped up with an interesting offer
Interesting that they folded after just an A round. Was there no prospect for a B round? It sounds like the team may have been able to come to some good remedies had they taken the time to take an honest and hard look at their issues while in the middle of the tempest. I would’ve thought that especially with Mint’s acquisition, that there was room for another player or two in this market if the opportunity still is ripe and the problem still hasn’t been solved (which I agree with).Fred, beyond Marc’s postmortum, I’m interested to hear if you have any comments that add to this story with the benefit of hindsight. For example, should you have pushed Marc to do a larger A round to carry them further? Counseled them to put more money into customer acquisition?
there were additional cash infusions just not another round
Read Marc’s post before reading this – your point that only one service you’ve backed has failed is pretty astonishing, but to the extent that if and when others do fail, you can encourage this kind of self reflection among your founders, I think you’ll be doing all of us younger founders in the community a huge favor. 2 questions;1. Why do YOU as a backer, or USV as a firm think Wesabe failed? Are you in complete agreement with Marc on all his points?2. What’s Marc doing now? Taking time off or focusing on his next venture? I’d like to get in touch with him both to learn more and because I’m working on a venture which directly overlaps with his efforts at wesabe.
marc is one of the top execs at daylife.comi generally agree with Marc’s post. he lists all the issues. i might debate around the edges a bit but that would not be productive and it was his baby not mine
Like Marc mentioned, there’s no best answer for personal finance yet. I don’t trust Mint for the reasons he mentions and actually looked at inDinero even thought it’s geared towards small businesses.Look forward to what he tackles next.
Did they consider going open source, with a different business model?
We did open source much of the code: http://github.com/wesabe/And we also tried several business models over the course of the business’s life.
When you feel like it, and when your healing process is over, I think a lot of us would like to hear more about the different things you tried.Thank you Marc!
most of the wesabe code base is open sourced on github
Yes actually wondered if an open source business model had been considered.Like Redhat, for example.
For the record Fred is exactly right about this. No one forced us to shut down and our investors supported us both while things were going well and when they weren’t. The final decision to shut down was mine alone and came only after years of trying to make some good outcome happen.
Greetings Marc, thanks for your brave post-mortem.I hope we’ll have you back soon with another great product and a lot more experience under your belt.
I love post-mortems. Most people probably aren’t aware, but (aviation) pilots have an absolute obsession with reading NTSB reports. I went to school to become a pilot several years ago, and its pretty much joy reading for pilots (along with aircraft manuals). It may seem like an odd thing…pilots reading about how other pilots met their demise, and enjoying it. But its really an amazingly detailed, accurate and unbiased post-mortem. And we all know that there’s probably few better ways to learn than from our own (or other people’s) mistakes.Kudos to anyone who is willing to publish a post-mortem that details their own mistakes. It’s a very courageous, humble and unselfish thing to do.
I am a pilot (2k hrs in Bonanzas) and I do, in fact, read the NTSB reports of every airport that I go in to for the first time. It gives me a sense of what can go wrong at that airport and when I see a pattern, I am alerted to that possibility.I often ask myself if I could do the same thing wrong that the unfortunate pilots did wrong. Sometimes, unfortunately, the answer is YES. That also alerts me to the necessity of being careful and safe.I love the former series “I Learned About Flying From That” wherein pilots tell some tale of woe about what might have been — usually nicer outcomes than the NTSB reports.
He seems a very thoughtful guy. It worries me that he can have such clarity, and yet Wasabe crumbled.
It takes time and energy to sort through the emotional complexity of falling well short of the greatness you originally envisioned. Reflecting upon Marc’s postmorten and my only knowing him near the end of this journey, it’s clear Wasabe wasn’t a technological failure, but a strategic one around product decisions that he squarely owned. The wisdom here is that although many entrepreneurs focus on the lifetime value *of* a customer (ie. revenue), they might ignore the lifetime value *to* a customer (ie. benefits). Finding the right mix of customer incentives and behaviors to harness motivations and create a social funnel of value is hard – skipping critical initial steps in terms of messaging, selection of defaults and immediate gratification have killed many otherwise genius ideas. As has been proven countless times (and I’m guilty of it also), customization is not a *benefit* to the user, it is a *burden*. Be very selective of the burdens you levy upon your audience.
“customization is not a *benefit* to the user, it is a *burden*. Be very selective of the burdens you levy upon your audience.”interesting perspective. am on both sides of the fence at the same time.food for thought.
From Marc’s postmortem, “customization” is analogous to vegetables from his perspective: the users might not have liked it so much, but it was good for them. Tough to fight cupcakes with broccoli though.
Tough to fight cupcakes with broccoli -what a great line. Need to write that one down.
Thanks, Liad. A great comment. It is better to be 100% on point with a small feature set than 50% on point with a large one.
The truth is is out there LIAD. Simply measure the percentage of people deviate from the default settings of any given site. I submit, that if you have over 10-20% of people changing the default settings, you have one of the more engaged/aware audiences out there. Sites like Facebook have made a business of shifting the privacy sand beneath users’ feet, all while knowing that users will most likely not change the new defaults.Customization is, more often than not, a barrier to entry.
Some companies whole businesses are built on pre-checked ‘auto rebill me” check boxes.
We need more lessons like Marc’s. Knowing that only 10% of startups succeed, why don’t we hear enough lessons from the 90% that fail?Most tech blogs coverage is totally tilted towards covering successes or glorifying wannabe successes, but when things don’t go well, either no one wants to write about it, or the company slowly evaporates and we quickly forget what we should have learned from them.There used to be a site called f*dcompany.com and TC bought them and turned it into http://techcrunch.com/tag/d… , but coverage is scarce.Hindsight is always 20/20, and as much as post-mortems do surface some of the learnings, startups also need “earlier failure detection”. You might think that the eco-system around them is supposed to provide that early warning, but if that’s the case, are we doing a good job at it?As much as failures are a necessary indicator that we’re taking enough risks, why do we have to wait til we fail to learn from these failures? With more real-time feedback and business models transparency, we should be able to decrease the rate of fatal startup failures, but are we?
Maybe they shouldn’t have been there to begin with?I know for a fact 99% of people don’t put the same amount of thought and analysis into something as I do (okay – maybe it’s 98% of people).So, perhaps the 98% of those people don’t bother to analyze the after-the-fact.
Because nothing, and I mean absolutely nothing, teaches, strengthens and galvanizes like failure. A near death experience will surely bring the greatest love of life and a renewed drive of meaning more than a life time of reading self-help books. And even still, nothing can guarantee immortality.Those that make common mistakes over and over again probably deserve their fate. Its usually getting blindsided from left field that causes the fatal blow.
Thanks Marc – good learning for all of us.It’s pretty interesting how things are much clearer when you are doing a post-mortem. Clear thinking is almost impossible while you are still in it. Fred, any thoughts on this?I remember trying Mint, Wesabe, and couple of other services a few years ago. My purpose was simple – aggregate all transactions somewhere with no effort so I can go back to it when I had a need to. Making decisions on all this data was secondary priority and only if it were a minimal effort. When I logged into Mint once a month, new stuff was there. With Wesabe, I was just seeing what I saw the last time I logged in. Also agree that Mint has not solved the tougher problem of helping people make sense of their money (with minimal effort).I wish Marc the best on his next venture.
Investing, in general, is characterize by pattern recognition. Really successful investing is usually characterized by earlier pattern recognition than the crowd added to tremendous execution and an even larger dollop of luck. While it is important to keep winning patterns in mind – it is perhaps even more important to understand failures and the patterns that lead to them.In reading through Marc’s post you see a numbers of patterns emerging that should be recognizable in the future:Not making the consumer experience simpleNot making the initial utility of the experience high enoughHaving a dynamic where one person controls the UI and no one is able to challenge themNot learning and pivoting when a successful competitor started to really take shareGoo lessons all.
Thanks Fred for pointing this out. I caught it referenced twice from different folks I follow before seeing it here (HackerNews and twitter), that’s usually a signal that a post is something special. I made sure to read it yesterday, fire it off to twitter and brand the ideas into my mind.If we can get past our personal failures, and understand why what we’re doing/did lost, failed, didn’t pan out, not only does our future work benefit, but other folks can learn from our mistakes.10/10 on Marc’s post. 127k+ views say I’m right
I find a lot of value in doing regular retrospectives, not just postmortems after big failures. Sometimes the best lesson to learn isn’t about a mistake. it can be about noticing an improvement and doing more of it, or just appreciating what’s working well so you don’t mess with it.For those interested, I suggest Norm Kerth’s book “Retrospectives”, and “Agile Retrospectives” by Esther Derby and Diana Larsen.
Your second last paragraph is the jewel.
This is a fantastic thing to write about. I have immense respect for Mark even though I do not know him personally. It does take courage to admit that the bucks stop with you — the CEO. And it’s so very true.When you are a CEO you are constantly making decisions. You will make several every day. Many will be passive, meaning, you didn’t have to do anything to make the decision. Most of the time you are deciding to leave things as they are. You are constantly thinking about your product, the road-map, your prioritization, your teams “take” on things. You can decide to change things or leave them alone. As an attentive CEO we all have to be pondering these things on a rolling basis.So my take on leadership is that you have to hire great people and you have to respect them. As CEO you have the burden of providing vision. Your vision doesn’t have to be perfect, but it does have to serve as a blueprint for where the company is going. You cannot “outsource” vision, to anyone.You can get your vision modified, altered, improved, extended, polished, etc. That is the job of your key talent. Still, no matter how this all goes, the buck still stops with the CEO.If a company fails I do believe the CEO should take a disproportionate amount of the blame for the reasons I’ve laid out. If your company succeeds the “team” should get a disproportionate amount of the glory because they clearly made lots of good decisions along the way, ones you allowed to leave in place.
The first thing a CEO should do is hire somebody who fills out his blind spots. Complementary not supplementary.The second is to hire a crackerjack CFO. If you can afford a $100K CFO, hire a $150K CFO.The third thing is to hire someone who could — not will — replace you if you get run over by a car. Mentor him.The fourth thing is to have a no baloney set of analytics which can be easily viewed to ascertain heading, speed and trajectory.The fifth thing is to have a set of financial reports which can easily be used to ascertain the financial health of the enterprise from 360 degrees at an instant.I had a pretty damn good company — 400 plus employees, lots of assets, substantial positive cash flow — and was trying to work myself out of a job as I had spent several years building the business and was getting a bit worn out. I wanted to fatten this steer before taking it to the pay window.I had done all of the above including taking the entire executive team out of the country for a workshop on succession planning.I contracted a life threatening illness and was out of work for 18 months. I was very sick. Low and behold the company ran itself — well, not really, everything worked as planned. And those folks ran the company without me, thank you very much.It was actually quite humbling to see how little impact my absence had on the quality of the operation and how little I was really missed. Oh, when I got back to work, I think I jacked things up 5-10% but that was because everything was still working as I had left it.It also taught me a great lesson — I am a better fire starter than a fire tender.
Mark strikes me as exactly the type of person I would want on my board, as an adviser or independent director.Strange, but think about this: his perspective and experience could ultimately benefit dozens of startups,with much greater scale and leverage (than had Wesabe been successful). The Wesabe team’s wisdom (and USV too) will yield fruit in initiatives, firms, technologies and the entrepreneurs who pursue them. All of this because he chose to share his experiences, and Fred (and others) gave the community a forum to learn.
Great post. And as others have said, I appreciate Marc posting his postmortem. It’s so very helpful to all in the startup community.Paul Biggar provided a similar and very detailed account (from his point of view) of the closing of NewsTilt. http://blog.paulbiggar.com/…The dynamics of each success and failure differ, but there are takeaways in each that one can and should salt away.
It’s great that Marc has the honest intention and greatness to do it (good for him), also the generosity in sharing it with others (good for us), and that can’t be praised enough.That being said, in the list of things which went wrong, he minimises some of the things Wesabe did wrong, and he doesn’t seem able to tell us many things they excelled at.It doesn’t feel like he’s over it yet, he seems to feel very guilty for everything that went wrong.The truth is that the CEO is the captain, but a captain can only do so much when he’s handed a ship that leaks in the middle of a storm. He’s being too tough on himself.I don’t think it’s a healthy thing for him to go public as some sort of self-punishment or offer to the gods.For what I read his process of painful denial/acceptance/recovery is not over yet. Maybe I’m wrong and it’s possible that it’s good catharsis for him, I hope it helps him to go through it.Fred, how about introducing Marc to your friend Jerry Colonna?
I’ve been doing this without realizing what the term was.It’s been integral to framing my mind as to how to attack something, and then how I must prioritize next.It reminds me of Skiing and Startups post … learning how to navigate better, make better decisions throughout …
I understand the importance of having to take full responsibility for failures, in order to really delve into what went wrong, but it seems a tad ironic to say “When you start blaming others, you don’t get to the truth,” when clearly the truth,as you say, is that “it was not entirely his failures”. Perhaps it’s a moot point, but I feel like honesty in all aspects of the postmortem, rather than just all the parts after the “who is to blame,” seems like the best strategy (i.e. if the rest of the post does not play the ‘blame game,’ it’s a much more clear indication of intent than the one sentence indicating that he only blames himself)
I think Fred’s point was that blaming others is often a way of eliding the truth of your own mistakes. You’re right though, that since it wasn’t entirely Marc’s fault, Marc’s postmortem probably isn’t the complete truth. To be tactful and get the full truth would probably require other former Wasabe folks to add their own post mortems.
In much the same way that a bit of craziness is truly required to be an entrepreneur, entrepreneurs are never, ever, ever really satisfied with their performance.Not in the — hey I made a bunch of money and wrote a big check to my university, look at me, Mom — kind of satisfaction but rather in that dark little recess of your mind where that idea germinated and first took root and propelled itself into a reality.Where you are so different from the rest of mankind who actually does not think that life is just a movie and what is going on in your brain is reality.In that dark little corner, you always know “I could have done it better.” Even when you are at the pay window.And, that’s why you will never, ever find the cure. Because you are a diseased person doomed to follow that desire to do it perfect the next time around.And, that’s what makes the American entrepreneur the driving force of our Nation and the economy — the unleashing of all that energy and force not in search of something so mundane as money but looking for a payoff in a different currency — I finally did it as well as I am capable of doing it!Which, unfortunately, diseased entrepreneurial beastie, will NEVER happen. I hope.But, hey, I could be wrong.
The quest for perfection in business decisions you describe makes me think not only of the original post here, but of my marriage.As leaks sprung, I sought to hold them closed. Eventually, with a tremendously leaking vessel in my hands, I realized I did not have enough digits to cover each leak. I put the leaking vessel down and it broke. I was relieved. Each leak was not my failure, it was a leak. It was better for it to be accountable for its own brokenness, and all efforts, however valid and well-intentioned on my part, were useless. It was not to be.We don’t make all situations, things arise, things which we don’t control. We do our best (or hope to). Thinking we can control all and Overcome is the ‘disease’. We are too small for that in this big life. I think it is part of Buddhism for you to realize your smallness, and be good with that, which is courtesy of my business coach. My mother says “you did your best and angels can’t do better” and I tend to agree. If you didn’t do you best is your cross to bear, and not everyone else’s.
On a personal note, I’m really struck by Marc’s example.I have this maxim that the best way to ensure repeating history is to ignore it. I am also thinking that a good failure is just too precious to waste.Thankfully, not only has Marc not wasted this failure for the sake of his own growth, but he has generously shared with the rest of us so that we can learn from it too. He has given a tremendous gift.On a professional level (in recruiting and hiring – and I imagine this translates into VC investment decisions), I’m thinking about how the knowledge of the way in which an executive (or startup founder?) has dealt with past failures is critical in understanding how they operate in general and predicting what they will do in the future.I think that this is too important a piece of knowledge to bypass.
“The third quote is my favorite. Marc says “we didn’t solve this problem” and suggests that it is still a wide open opportunity and that entrepreneurs should learn from Wesabe’s mistakes and go for it. I love that and agree with it.”I read this postmortem elsewhere a few days ago and agree with that quote too. In fact, I think the whole field of personal finance has been plagued for years by a parochial focus on personal spending (emphasized by the ubiquitous and flawed cliche about the financial rewards to be gained by eschewing lattes). The gap between what the average American earns and the middle class lifestyle he has been raised to expect is too big to be addressed in this way alone. How much help a web app can add here I’m not sure, but some thinking should go into the income side of personal finance, and a broader range of lifestyle choices ought to be considered as well.
would you fund him again?
we are always open to funding people againit would depend on the plan and the people around him, of course
The humility required to write such an honest (and probably at times painful) postmortem is a testament to Marc’s dedication. Though Wesabe failed, I think I’d bet on Marc in the future.
When I think of Wesabe, I always recall the contact page that had Marc’s phone number for customers to call at any time. Coupled with this postmortem, I can certainly say the failure can’t be attributed to lack of caring for the product or customers. Great post Marc.
Thanks much, Daniel.
Typical thought provoking subject and discussion.Everybody — who is trying, who is testing themselves and who is taking a bit of risk or who is swimming beyond the sight of land — is sooner of later going to fail. I have numerous times. Once or twice spectacularly.If you haven’t failed at something, then your are either a chicken shit (oops, sorry) or you have not yet really tested yourself. Nobody bats 1.000. Nobody. So slink out of your comfort zone and see what you are really made of. You will surprise yourself.I like to think of every “failure” I have endured as being an “experiment” from which hopefully I will learn something. Sometimes something very, very critical to some future success.My personal theory is called — Failing Forward.Fail in such a manner that you really learn something from the experience. Like a football halfback — Earl Campbell being the best example — who when being tackled ALWAYS hits the ground in a north-south posture extracting from the run the length of his body.When I fail in business or personally, I want to Fail Forward in the same manner, extracting the value of the experience in some positive way.I think about this consciously and I consistently apply it and I think therefore I might fail as much. But again, I have had some real winners.
I like ‘failing forward’ as an image, which is almost like ‘falling forward’ in sound, but also in image. I relate it to a favorite book of a few years back:The Innovation Paradox : The Success of Failure, the Failure of Success. A favorite of mine, wherein the the authors try to redefine failure as part of success. A mindset shift – it’s not failure, it’s working things out. The main trouble is in calling it ‘failure’ to begin with. Want to learn fast? Double your failure rate.I find the there is a great difference in those discussing what went wrong, problems, issues etc, without emotion or blame – just ‘it is what it is’ – versus the emotional “I suck, I failed” exposé.I am glad people like Wesabe’s Marc come to the table. I am sad we consider it this large brave act. It is an act. He describes an event. It’s too bad it didn’t work. By now he knows why. Don’t repeat. Learn from mistake. I dislike how couched this event is in emotionalism, like it’s Oprah. Of course Wesabe not working out is a big problem, but it was composed of a run up little problems. For some reason the little problems were not dealt with, snowballed, and became a big one. Their choice.In the practical sense, having no experience with Wesabe, but being a new client to Mint, and coming from Quickbooks, of which I despised every minute for over a decade, I can tell you Mint is not perfect either and should look at their complaints seriously. I am finding them a pain to deal with and should they continue in this vein 1) I will decamp, and 2) they will follow Wesabe, and 3) someone will fill the void thereafter having learned from both companies mistakes. Record keeping and bookkeeping are arduous enough already, let’s not make it worse. For goodness sake, please some one get it right.
Really like “Fail Forward” – your sports analogy is spot on, when playing rugby you never want to be hit back in a tackle, it hurts way more!
Reminds me that Edison is supposed to have said something along the lines that he did not have a thousand failures before succeeding with the light bulb ~ he just found 1000 ways in which it did not work!
“Failing Forward”That’s a great phrase.I’m always a bit afraid of someone who hasn’t failed, unless they are very young. Either they aren’t human, haven’t risked enough or cared enough, or are in denial.I do realize that there are some who don’t always perceive failure as such. They think of it as something like “just not having gotten it right yet.”Although when someone has a big failure, there is no other way you can describe it.
I’ve failed and nearly lost everything. Stared the devil in the face as it were. Looking back, its always worse when you’re in the middle of the storm. I can’t say that that experience has left me completely fearless, but things now have to get uber ferocious before I get worried about it.
Good for you — not that you struggled but that you prevailed.We have to become our own psychiatrists from time to time — talk ourselves down off our own ledges.I often find myself counseling that guy in the mirror — hey, you’ve been here before and it’s gonna be OK. Guess what? It usually is.I also find that my instintcts are honed to see the problems earlier and thus ascertain that there IS a bit of quicksand ahead without having to develop the data empirically — while up to my neck in quicksand.An earlier warning system.There is nothing wrong with worrying — the issue is how you channel the energy. More worrying or action to change the outcome.In the end, be kind to yourself. You deserve it.
In the Rangers, whenever you go out on a patrol the patrol leader designates a CCS (casualty clearing/collection station). As a leader, I have always thought that to be a “negative” vibe and unworthy but ultimately quite necessary information to know. It used to seem a bit defeatist to me.If you get hit, where do you go or get taken to to get life saving medical attention? The CCS.This is what you do when you know that the likelihood of a bad outcome is truly possible.In business, we avoid thinking enough about “how” we can or might fail and thus we sometimes allow failure to creep up on us and catch us off guard. We fail to define the CCS.I am convinced if entrepreneurs would model the beginning of a “failure mechanism or process” that they would be able to counter it more quickly and effectively.I pray to the gods of “pre-mortem” and “post-mortem”.I like to ask folks — if this goes well, how will we know it? What will be the first sign?I also like to ask folks — if this goes poorly, how will we know it? What will be the first sign? What will we do about it?When I make an acquisition, I always like to keep and memorialize the original acquisition numbers, the due diligence numbers (these two sets of numbers are never the same because one is made by the deal junkies and one is made by the accountants — never try to close the gap, just make sure your deal works at either set of assumptions) and the forecasts.Six months and 12 months later, I like to sit down and compare the numbers to the actuals. I like to write up a bit of a critique and force all involved to reply as to what I have gotten right and wrong. Over time, the deal junkies get a bit more conservative and the due diligence guys get a bit more aggressive and the operations folks know they can produce the desired result regardless of what the conditions are.Everybody gets better by comparing the real to the plan over a period of time. This allows everybody to get better with time.A post-mortem does not have to be an autopsy or conducted to the accompaniment of a funeral dirge. It is an honest assessment of how we are doing.I am convinced that a little time spent evaluating things year by year — not unlike the Berkshire Hathaway annual message from Saints Warren and Charlie — can provide keener focus on “how” we succeed rather than on going around and bayoneting the wounded.
Great post. I think it’s also incredibly important to do a post-mortem upon SUCCESSES too, and for the very same reason. If you don’t understand why you fail (or succeed) you may not avoid it (or repeat it) in the future.
I wonder if USV would invest in a company founded by the founders of Wesabe. Knowing what went wrong and making changes in the future is a good exercise but does the faith and trust also change accordingly and thus makes these folks tainted for having failed or are they rewarded for acknowledging what went wrong and thereby having changed behavior or business tactics etc they are redeemed.I always hear how VC’s only invest in those with a prior successful record so the question is is there redemption and if so how does the decision s at a place like USV change to accommodate that thought.
we would absolutely do thatof course we have to like the plan and the other people involved
Here’s a list of 33 post-mortems done by startup founders when things haven’t panned out well, i.e. they failed. The wisdom and generosity in these posts is awesome. And definitely a great read for startups/entrepreneurs looking to learn from both those who succeeded and who did not.http://www.chubbybrain.com/…
As a user of Wesabe I was was sad to see it disappear. Now I am onto finding something else to help me manage my finances.It was really great to read the postmortem. It is really cool to be able to hear why Mark thinks Mint.com succeeded and Wesabe didn’t.Kudos Mark!
I’m glad you highlighted those 3 para’s. The third one didn’t stick out to me on the first read-through. I like it.
Perhaps it is just me, but I think that it was a bit tacky as Marc’s VC backer to reference the first quote, especially in an article where you reference the fact that this is your only failure.I’m just saying, the post would have worked without that quote.
This is really a great post/post-mortem. I work with enterprise software and feel constantly caught between the Scylla of ease-of-use and Charybdis of complex feature sets, so this really rang a bell.I think “But none of them matter if the product is harder to use, since most people simply won’t care enough or get enough benefit from long-term features if a shorter-term alternative is available.” is so important to know.However, reading through the original post, this was kind of interesting:”To be defensive for just a moment, their data accuracy — how well they automatically edited — was really low, and anyone who looked deeply into their data at Mint, especially in the beginning, was shocked at how inaccurate it was. The point, though, is hardly anyone seems to have looked.”But is it true that hardly anyone looked/cared? Marc also said that Mint’s traffic has flattened out. Maybe people did notice after a while.Maybe the reason why there is still a “wide open opportunity” in personal finance is precisely because it is so hard to make personal finance both easy and correct?