Two Failure Modes

Paul English has been founding, running, and selling companies most of his adult life. He’s had six successful exits, most notably $1.8 billion for Kayak.com.

According to English, there are two ways companies fail.

Bad culture. If the culture of a place is rotten the people will be too. 

There are a couple of ways to address getting the right people. First, network. It’s impossible to predict when the next coffee, conference, or call will lead to the next great person. It’s a lottery - so collect a lot of tickets. 

The second is to focus on the first five people because they will hire the next fifty. The core group of people sets the mold.

Bad product. If you create something people don’t value, no one will pay enough to keep the lights on. 

FunContact.com, a QR code replacement for business card swaps, is one of English’s projects. It scratches an itch but isn’t a business. Maybe it’s not a bad product, but it’s not something people value. 

While building Kayak, English installed a red phone connected to the customer helpline. Whenever it rang, whoever was closest had to answer and assist. English recalls the customer's surprise when they reached the co-founder. It was a ringing reminder about the right product. 

There’s a lot of business advice, but good people making good things is a good place to start. 

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