Top Six Core Competencies for any Internet Startup

March 1st, 2008 seph250 Posted in Internet, Startups |

One of the coolest things about going to business school at MIT is the General Catalyst Breakfast Series. Once a month, 10 MIT students and 10 HBS students wake up painfully early to go to General Catalyst’s office in Harvard Square to listen to a speaker give their take on entrepreneurship. Last Friday, we saw Paul English, the CTO of Kayak.com. Several people asked for my notes, so I thought I would post some of the highlights. Obviously, these are all Paul’s words, or at least how I interpreted them.

About Kayak

Kayak was originally conceived as the “google of travel”. Today, it competes with Travelocity and Expedia. Kayak does about 34 million searches/month while Expedia and Travelocity do 150 million each. Kayak is unique in that it is not an Online Travel Agency (OTA). Kayak does not book the flights for you, it just forwards you onto the site with the best price. It really is a vertical search for travel.

Startup Core Competencies

Paul described what he feels are Kayak’s six core competencies – but it’s interesting to see that these core competencies can be applied to any internet startup. I’ll list them and then elaborate on the first two.

1. Hiring/Firing
2. Interface Design
3. Customer Interaction
4. Business Development
5. Industry Knowledge
6. Fund Raising

Hiring/Firing

Kayak produces $150 million in revenue with just 50 employees. $3 million revenue per employee is the result of selective, aggressive hiring. Kayak now has 15 developers and only one UI designer. This is a site that manages 34 million searches per month. Paul says he looks for four things when hiring someone:

1. Bandwidth – only hire the best of the best. Super programmers can produce software an order of magnitude higher than average.
2. Attitude – Look for people that are extremely confident. These people are able to give credit to others and lift the whole team up. Also, look for people that are “Energy Amplifiers”. These are people that draw in other people. Kayak moves at “Kayak Speed” (extremely fast) without working nights and weekends. An example of this is that Kayak submits a new version of their product on a weekly basis.
3. Experience – Look for people that have a history of being extremely successful. As an example, Kayak employs an Olympic gold medalist! One thing I found interesting about this is that Paul does not look for industry experience. He has no interest in “domain knowledge” – as though this sort of experience will corrupt his thinking…
4. Lack of Dysfunctional Behavior – He didn’t elaborate on this much, but I think it’s pretty straightforward: No major assholes. 

Interface Design

Maintain an emphasis on site speed. If a new feature slows the site down, get rid of it. Paul talked about what he calls the 5 “B’s” of UI design. These are the things a user looks for when they get to your site. Providing them in a convenient way will provide for a more intuitive experience.

1. Bikini – This is the first thing a user looks for – either something pretty, or the data that I am looking for.
2. Button – If I don’t see the Bikini, I am looking for a button I can click that will take me to the Bikini.
3. Blue Link – If there’s no button or bikini, I am looking for some blue text that I can click on to take me where I want to go.
4. Box – If I don’t see any of the above, I am looking for a box that I can type into. Enter in my email address, or name, or type my search query.
5. Bullshit – Finally, everything else on the page is just bullshit and it is the responsibility of the designer to minimize the bullshit. Examples of bullshit is text that says “Click here to get the best deals on flights to Hawaii”. A website that needs text to explain how to use it should be redesigned.