Author: Stefano

What I’ve learned building my first company

Building my first company at a very young age was

I found this article sitting in my Drafts today…who knows why I never published it, but here we go! I wrote it in 2018.

Be careful: I did not do any proofreading…because I might end up not publishing it again!

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Last December was the end of an era for us: my former partners and I decided to shut down our former company and to stop following HostingTalk.it. I haven’t been involved in that for a few years now as I went fulltime building Cloud Academy.

I have been procrastinating on writing a final article on the website for a few weeks now, and while I try to put together my thoughts, I wanted to share what I learned with that experience.

We registered HostingTalk.it in February 2006!

I owe a lot to HostingTalk.it, it helped me achieve much more I could have expected when we started it. Back in those days, I didn’t know anything about startups, venture capital, Silicon Valley etc. In fact, I didn’t know English at all! The web was a very different place 12 years ago, Facebook was just getting started and blogs were still a big thing. I was finishing my high school in Italy and spending most of my time in front of a computer, building things, experimenting, sometimes just wasting time and having fun.

Why HostingTalk.it

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In 2012 we have incorporated WeTalk Group SRL, the company managing HostingTalk.it. That was a big move for us but HostingTalk was born years before, in 2006!

We started HostingTalk.it (we have always called it “HT“) for the best reason you can have to start a business: to solve a problem we had ourselves. Just a few months before launching HT, Luca and I were spending our nights on building a platform to host your own blog (it was called IlBlog.it). Based on the first alpha (!!) of WPMU (WordPress Multi-User) and hosted on one of the first virtual private servers available in the Italian market around 2004/2005. It was a mess, the site was continuously crashing and we didn’t know what to do. We had no money and definitely no idea of how to manage a Linux server. Even with that, we ended up having about 5000 blogs on the platform and we learned a lot about Google AdSense, interacting with users and the challenges of offering something for free.

Once we sold that platform, we felt we had a lot of fun and we wanted to tackle something new. We knew we could have done much more with that platform but our poor knowledge about web hosting solutions and servers ultimately didn’t allow us to develop it to the next level. Also, we felt like we took the wrong path deciding to build a free service and trying to make money just out of Google AdSense. We didn’t have much money and, to be honest, we were reluctant to hire external consultants or people to do it.

We loved working on websites and platforms and we started thinking about what was next for us. We ended up building a community for people that had our same issue: understand more about web solutions to host websites and build online businesses.

We had a few discussions about the name, remember talking about “hostingforum.it” and finally, we ended with “HostingTalk.it”, mostly inspired by “webhostingtalk.com”, a big community in the US. The initial community we built attracted several professionals from the webhosting industry. From there, we built a news section, reviews, business services and much more, transforming a small community in a business.

What I have learned with HostingTalk.it

A lot, it would be too much to list everything we went through, but I would like to underline a few lessons that proved to be critical in the next years building my entrepreneurial skills. Most importantly, I became aware of the importance of a few lessons really just years later, thinking about them in a much different context.

All the points are reminders to myself. They don’t necessarily work for everyone and I want to make sure, that from time to time, I can come back here and immediately remember what I already know is wrong.

Building a business is about selling a product. The sooner the better.

The first contract we closed with HostingTalk.it was worth 120 Euros! Holy cow! We couldn’t believe someone was buying our product! We didn’t know exactly what we were doing, we knew that we didn’t want to run Hostingtalk.it as a free platform as we did with other websites before. It turned out to be a critical lesson.

As an entrepreneur, you need to be focused on building something people want to buy. As soon as you have an MVP, a tool that works or just 10% of the product you would like to have, try to sell it. It doesn’t matter how bad you feel about it, how ugly it is, try to sell it to someone and learn as much as you can about it.

The sooner you start selling your product, the sooner you learn how to expand and build more of it. You need paying customers because they will give you a real and honest feedback and that will help you like nothing else does. The temptation of giving all of that away for free is very common: people that are not paying for your products will not give you a feedback as valuable as the one of your paying customers and ultimately it will be hard for you to understand if you are building something people want.

Bootstrapping your business is critical 

I didn’t know this at the time, but this became very clear to me several years later while I was raising money for Cloud Academy in Silicon Valley. Our first angel investor was a very successful entrepreneur that built several businesses in the US. One day while we were talking about raising money, he told something that stuck with me since then: “Stefano, the moment you will have $10M in the bank you will just act in a different way. Everything will be feasible, you will spend 10K on this and that, just because it’s only 10k and you will lose focus on what really matters.“. Bootstrapping forces you to focus on what really matters for your business to keep it alive. Having limited resources and being extremely frugal is actually a great condition to create a successful business: you will focus only on what really matters and forget about every other possible distraction.

With HostingTalk.it this was exactly the case. We were young, brutally inexperienced and we did know about one and one only way to build a business: sell something and invest that money to build more. It worked extremely well and it’s been a key lesson for me since then on starting a new business.

Don’t be afraid to ask for what you want

This is hard and something I still remind myself today. Sometimes asking is the best way to get things. Around 2007 I wanted to have Aruba.it (one of the biggest European hosting providers) as a customer. I reached out to their CEO and offered to visit him to sell our services to him. He invited us, showed us the company, the data center and finally told us “sorry guys, we are not buying your services now, but thank you for the visit”. It took other 2 years to land them as customers.

This lesson is still something I have to remind myself constantly. It’s easy to see difficulties, to see why “he will never reply” or “they will never pay this much for our product“. Every time I ended up taking that risk, putting aside all my concerns and fears, I found an opportunity. Don’t get me wrong, it still requires a lot of work, but you will find it incredible once those people and opportunities will finally materialize.

Hire people that are 10 times better than you. Really.

Potentially our biggest mistake and the one I couldn’t see. We didn’t look for people better than us. In fact, we didn’t consider that. Hiring people better than you is just a fundamental step to build your business. If you don’t do it, you will end up with a bunch of people that are not helpful for the business and that, at the end, will just make it mediocre. Your job as an entrepreneur is to find people 10 times better than you and put them in charge of things you are not good at, you don’t like or you simply don’t have time for.

Hiring great people will have a strong consequence on your business: they will bring other strong and even better people. You will be impressed by how great that is for your business.

Build a product, not a consulting service

At HostingTalk.it we ended up building more a consulting company than a product one. We compromised on several things and we missed a big opportunity experimenting with more products. Our revenues were coming from advertising and consulting projects for web hosting companies. We were not really able to move on and we ended up building something that couldn’t scale and was not that exciting. We loved building products and communities, but we hated consulting.

A product will open more opportunities, will challenge you on finding a product market fit, but when you do you will simply love that and you will spend days and days building on top of it.

Build a global business and think big from the start

I have this funny picture in mind of myself coming home from school, having a quick lunch with my parents and rushing to my computer picking up an English dictionary and translating articles for our website. I was 16/17 and I couldn’t speak a word of English! Part of that was me being just a very young student with no clue about the world, another part was having just a tremendous relationship with my English teacher back then.

Years later, thinking about that always gives me a smile. HostingTalk.it could have been a very global business, writing that in English from day 0 would have opened so many more opportunities for us and today we would be in a very different place.

Instead, we focused on the Italian market and we built something that, by design, couldn’t become big. Today there is no reason why you shouldn’t target a global audience and a global market, no matter the type of product you are building. It will make your business bigger and not constrained by the conditions and limitations of a single market or nation.

Believe in yourself, no one else will do that for you

The big advice everyone should tell you right there when you start. The biggest challenge building something and scaling that will be dealing with your own psychology. You will feel in charge of the world some days and you will feel miserable for a lot more days.

Entrepreneurs usually get a ton of suggestions and advice. Being able to consider them and still make your own decision is a key, vital, aspect.

It can happen for a big number of reasons:

  • People are telling you that you should things differently
  • Your competitor is running faster than you, with new features, products. How can you win?

I miss how the web used to be

Some days, I wake up to the Internet and wish it were still 2010.

I feel like I’ve had enough of the influencers, the everything-coaches, and the constant content creation pressure for every person and business. And yes, I miss people on the internet helping you or commenting your content because they care and want to help. I miss forums a lot and everything they somehow represented. Every single place on the internet became a way to show off, sell you something, or get your likes. It used to be a lot different than that. When I started my first website (it was actually called p2pzone) or later on when we started HostingTalk people loved to contribute and help.

And still, I know I have to face another LinkedIn wall that tells me everything I do wrong and that person does right. I know their amazing product link is in the first comment, and I know their company is not doing as well as they say. There are more people lined up there to answer and contribute to the conversation, just to get a bit of visibility too.

The sad part about all of this is that I somehow need to play with this like every other person running a business online.

I know I’ve said this already; is there a way back to 2010?

Stefano

5 learnings building Cloud Academy for 10+ years

I promised myself I would have tried to list down learnings from my 10 years building Cloud Academy, my previous company where I was CEO and co-founder. I left the company in September 2022.

I will start with some that I’ve been thinking about a lot. I will start today and hopefully I will add some more over time.

  1. Everything starts small, everything
  2. Trust the compounding effecft
  3. You can’t work with mediocre people
  4. You shouldn’t do what others do
  5. Demand customer obsession from your team

1. Everything starts small, everything

Like any business, we started small. This is something I keep reminding myself years later: every company starts small. When I drive on the highway I love to look at the many companies you see and ask myself how to they got there. How did they become a 100, 1000, 10000+ people company? They started small, with one or two founders and an idea. Even the biggest business in the world started there.

It’s something I really strive to remind myself because it motivates me and it gives me hope. Building a business takes 10+ years and everyone started small. It’s possible, things will grow and change as time passes.

2. Trust the compounding effect

I wish someone explained this to me 20 years ago. The compounding effect is one of the most impressive things you can experience in life. While building a business you should remind yourself of the power of compounding. If you write 2-3 articles about your product every day, for 10 years, you will likely achieve millions of visits and those articles will rank in the first page of Google. The same happens with everything for your product: that could be a newsletter, building an audience or adding features.

Do that every day. The first month you will feel bad, like you are going nowhere. After 12 months things will be slightly better and you will see the first results but you will still doubt yourself from time to time. When you do that for 10 years, every single week, you will be amazed by how much progress you made. It happened and you almost did not notice it. We did that on several things at Cloud Academy, some more than others but every time we have been consistent with that, results have been impressive.

Entrepreneurs that are incredibly dedicated and consistent in their execution always go far. It’s just a question of time. Whenever I find myself starting something new I like to think about the compounding effect of repeating that for 2-3-5 years and the results that it will create. My day immediately gets better and I find the right motivation to keep going.

3. You can’t work with mediocre people

Like every entrepreneur I used to try to make everything work. It’s a good principle and it works with almost everything assuming you have time: you can try and try again until it works. But it doesn’t work with mediocre people. If you are working with someone that is mediocre, it will be almost impossible to change that and your business will ultimately suffer. Your best people will leave when someone mediocre is in power and sometimes even when that person is just part of the team.

Get rid of mediocre people as soon as possible. It’s better not to be able to do something that having someone mediocre executing on it.

There is not much else to say on this point mostly because there is no solution to this problem if not letting mediocre people go!

4. You shouldn’t do what others do

What I mean with this is the following: don’t do what everyone else in your space does (in terms of software, product, marketing, sales playbook, you name it) because you think they are winning. You don’t know that, you are just looking at the final results (sometimes with bias) and don’t know why they are doing that! Great companies are created when people stop following what everyone else does and start creating something new, without knowing what will happen. A similar principle applies to competitors.

In these 10 years I’ve worked with brilliant people that could see the future, constantly taking risks and innovating, but also with people that spent 30 years in their industry trying to do whatever their competitors would do, always fearful of trying something that was not sustained by market research and tons of data. In the end, the latter always lost. They got beaten by competitors and by smaller companies that did not have any fear of trying something new. Most importantly: they got defeated without seeing that coming. When they realized that, it was simply too late.

As entrepreneurs it’s difficult sometimes to trust ourselves but it’s important to have the courage of trying something new. Build software that doesn’t work like every other software in your space and simply ignore how everyone else had done that until now. It could be a business model, it could be your marketing strategy or your product. Do something unique, that others are not doing. If you succeed, it will give you a competitive advantage that is difficult to achieve otherwise.

At Cloud Academy we have built enterprise software that looked very different from our competitors. We did not even look at some of them and we created functionalities and features that were considered “useless” in our industry. It took us quite a lot of time, but those features became incredibly powerful and customers would pick us because we were different.

We couldn’t have done any of that listening to people that told us to follow the “rules” and do what the market was expecting us to do.

5. Demand customer obsession from your team

We could have done better here. It’s a learning I really try to keep in mind. The moment your engineers don’t care about your customers’ issues anymore, you are in trouble.

Everyone likes to say they are customer obsessed but it’s difficult to see that in action and even more difficult to make it happen in your organization. Your team needs to be reminded every day that customers are their #1 priority. Ideally you need to have strong rules in place to make sure everyone takes care of customers and does that quickly, always with a smile. I can’t think of a better combination to grow your business: customer obsession + sense of urgency.

Looking back I would have loved to do more on this matter. Your customer support and success team should be measure on speed and ability to really be obsessed by helping customers. But so needs to be the rest of your organization: I hate listening to engineers or PMs complaining about customers, and I hate even more seeing customers’ problems becoming just one of the many things listed in the backlog. It usually goes like this “If we do this for them, we will need to do that for all the other customers as well” or “This account is small, they did not pay enough for having priority support” or “If they wait until Monday it will make no difference“. That’s when I started shacking! All of that is wrong. The way you operate with small customers defines you as an organization. You know why? Because small customers become large customers and if they stay small…they talk to a lot of other small, medium and big customers.

Customer obsession is something you need to build in your culture from day 1. From the CEO to the last person in the company, everyone needs to talk to customers and be obsessed by them. And if you think your team is not acting with that principle in mind, stop everything and make it a big deal until everyone understands that customers are their #1 priority. When you do this everything else becomes easier, starting with sales and renewals. Most importantly, your customers know they are your #1 priority and they will think twice before leaving you.

Leaving Cloud Academy

After 10 years I am leaving Cloud Academy. It feels strange to write it but I am getting used to the idea by now and it’s time to get back to writing.

We started Cloud Academy in 2013, even if we really started working on it in 2012. I was 24 back then and if I look back there are a few things that come back to mind: in 2012 I was running another company in Italy, I did not know much about the US, I did not speak English (not well, at least) and the only way I thought you could build a company was bootstrapping it.

Back then Cloud Academy was a bit more than idea and we were trying to understand what it could have been a few years later. I felt confused about it, not sure it was the right idea but the more we worked on it the more passionate we became about it. Everything changed a lot in 10 years, our product did, our vision improved and evolved and we matured as founders. Reading my emails of 10 years ago is a fantastic experience!

Cloud Academy has been an incredible journey for me and for everyone that has been a part of it. From day we obsessed on creating something unique and I feel we achieved it. I can’t use a post to describe what I’ve learned and how it changed me, but I am planning to write a few more to remember all the lessons we have learned.

When you build a business like Cloud Academy and scale it to millions in revenues and hundreds of people, the most important thing you remember when you leave are people. Not the product features, not the contracts, not what you have done in that business trip. Your thoughts and memories are full of people and I am planning to talk a lot about what I have learned about people and companies. The idea is to share lessons for new founders, executives, managers and anyone else is involved in building a new company.

This is it for now 🙂

If you are wondering: I am good, Cloud Academy was my life for 10 years so losing it meant losing a part of me but I am fine!

Stefano

Back to blogging

Many years ago I used to write a lot. I used to write every day, sometimes multiple articles, that’s how I started p2pzone, hostingtalk and later on also Cloud Academy. I was young and with that I did not have much fear of what people what have thought about my writing, which I think is a strong advantage.

I miss writing and now that I have a lot to think about (more in the upcoming posts), I will try my best to go back to writing!

Going long

Most companies require 10-15 years to get to something meaningful. You, as a founder, will spend that time to grow, grasp and finally master your product and your market. Your company will become very similar to you and so will your culture.

I have been extremely fascinated by the idea of building something that doesn’t have an expiration date. Call it IPO, exit. Nothing.

Going long allows you to always make the right decision for your customers and most importantly, for your people. It forces you to always prioritise what will make them successful and have the time to keep doing it over and over. And with that comes an operational and financial discipline in running your company that it’s difficult to build otherwise.

The aspect that I love the most about it? Having the time to really build something great, whatever it takes in terms of months or years.

It took me a while to understand that this would probably the best thing I would enjoy as an entrepreneur in my future venture. Going long.

Startup Therapy podcast

There is a podcast that has been helping me a lot in the last 12 months.

It’s made by Startups.com‘s founders, two very serial entrepreneurs who started 14+ companies (yes, amazing) in their lives and talk about all the aspects you go through as a founder and CEO. The podcast name itself is amazing: https://www.startups.com/community/startup-therapy

There are great episodes that will clearly makes sense to you if you have started a company before, it doesn’t matter of which size, venture backed or bootstrapped. Will and Ryan, the two founders, do a fantastic job describing how you feel as a founder as they describe what happened to them in several companies. Most of the times you will find yourself saying “Fuck yes!”, as they clearly have been through a lot themselves and are able to explain what to do and not to do. Not just that, for a founder it is not easy to understand that what is happening to you, it’s normal and it’s common for other people in your role as well.

If you are building a company I highly suggest this podcast. Most of the things they talk about are really things nobody will understand if not other founders, and I know how difficult it is to find support and talk to someone who has been through this before.

I was driving home tonight and I just listened to “Bouncing back from failure” that is a fantastic one!

What’s so hard about Leadership

Leadership is a never ending discovery of yourself and that comes with lot of challenges. But what I always admired the most about true leaders is how good they are at protecting their people while things are bad. 

It’s incredibly difficult to be positive, not letting your team down and be present while things are bad. Even more when you don’t believe you will be able to fix that. Your investors, a bad board meeting, that customer you were supposed to win last month, payrolls knocking at your door and so on. There are moments in your company where everything goes bad and it gets worse day by day. It’s incredibly hard to show up to your all-hands and be strong, positive, smiling. It took me years to manage myself into that and understand that be there for my people was the most important thing to do anyway.

It’s incredibly difficult to be a shield for your people.

It’s something I still need to get better at, but every time I see a founder dealing with it, it reminds me what’s really difficult about leadership and why it has such a toll on you as a person.

People to avoid while building a company

This is something I would love to tell to a younger Stefano. I recently (finally) met a great mentor who reminded me how important it is to surround yourself with the right people while building your company.

While you build your company you should ignore 3 types of advisors/mentors:

  • Corporate guys: they are top manager in a BigCo, never been entrepreneurs and never will be. Almost always useless for entrepreneurs as mentors/advisors unless they want to buy your product or invest in your seed round but even then it should be it, don’t give them control/board seats etc. They don’t understand what you deal with but they will pretend to and give you more issues than benefits.
  • “The wannabe“: I met many in my journey. This is a tough one. They might present themselves as entrepreneurs but once you dive deep they will likely be involved in 34 different things at the same time, they are advisors, mentors, CEOs and talk like they have seen it all. They are always looking at a conference to attend and ideally speak at. They are building their brand and trying everything to see what works but they are usually clueless. The first rule for an entrepreneur is to focus on one and one only thing. They will waste your time and sometimes do also damages, mostly due to their inexperience, like saying things they shouldn’t about you to other people or give you (really) bad advices on how to manage your company.
  • People that are doing it for the money: the best advisors and entrepreneurs help other people because they enjoy it and love it. It’s a great way for them to give back and something that they naturally feel the need to do. Yes, they absolutely need to be compensated (don’t commit a mistake here, always pay them, mix of cash/stocks with clear expectations) but they are genuinely involved because they like you, believe in you and have really something to say. They probably don’t need your money but paying them (stocks, with vesting, is the best thing), even something small, makes a difference in your relationship. The best people in this category do something amazing for entrepreneurs: they will be there for you when you need them but they are humble enough to step back when they don’t know/understand something and they will be transparent about it.

Why a mentor is so important is something for another post 🙂