Five essential books for company founders and early employees

These are the books which I’ve found the most useful and hopefully help others build successful companies. If you are a company founder or worked in large organisations, then you should read all of below. If you have a technical background and want to understand how startups build products then focus most of your time on lean startup.

The Customer Funded Business by John Mullins

Raising venture capital has become the preferred option for many new founders. This book explains how you can fund the early stages of your business without raising expensive venture capital. It doesn’t argue that you shouldn’t raise venture capital. Instead it makes the point that getting funded by your customers is a better and sustainable way to grow in the early stages. The book outlines several different types of business models which startups can use. Not all business models are suited to a customer-funded approach and in some market situations, you cannot survive without raising venture capital. John outlines when a customer-funded approach makes sense with lots of interesting case studies. A must read.

The Hard Things About Hard Things by Ben Horowitz

If you’re a new founder of a new company then this is your operational bible. It’s an honest account of a founder who is now a VC. This book will tell you about the challenges you could face and how to deal with them. It’s split into different chapters covering everything from hiring, firing, pivoting, keeping your customers, raising funds in a bearish market, managing teams in a rollercoaster environment and the mindset you’ll need to keep going.

Four steps to Epiphany by Steve Blank

It’s been a long time since I read this book however the key messages have stayed with me. Building a company is not about building a product. It’s about customer discovery. It’s about talking to your users or customers to figure out what causes them pain, what fix you can uniquely provide and whether your customers will pay for it. The core message is get out of the building and talk to customers. This book coined the term ‘customer development’ and made it the default approach for building new companies.

Lean Startup by Eric Ries

Eric Ries Lean Startup combines the customer development and agile development methodology into a ‘build-measure-learn’ loop. The main idea is simple. Build technology in small iterative steps. In each iteration, build something tangible and get feedback from customers. This way, you don’t over-invest in building a product no one wants. This book coined the concept of a minimum viable product which is how most small companies market-test products.

Crossing the Chasm by Geoffrey Moore

This is a classic book from the 90s. There were two key principles which I took away. The first, the lead customer and how to get one. The book talked about finding a champion with an innovator mindset in a large organisation who would pay for the early development of your product. The second was that the characteristics of your early or lead customer would differ from the mass market. As a product builder, you would have to ‘cross the chasm’ of product requirements to go from early traction to a mass market product.

If you’re looking for a more specialist topic, then Steve Blank has a good list here.

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