The Power of Focus And The Peril Of Myopia

By Dharmesh Shah on June 19, 2012

Greed is good. ~Gordon Gecko

Focus is good. ~Steve Jobs

I'm a big fan of focus. I'm such a big fan of it, I try to apply it to as many things as possible. [just kidding]

It's really, really hard to argue against focus. Who doesn't like focus? Who would contest focus? Focus is like motherhood and Apple (the company). I honestly have no issue with focus. I see the value in it every time I do it. My problem is that I also see value sometimes when I don't focus. The decision to focus is not hard. The hard part is deciding what to focus on and what level of focus I'm thinking about.

onstartups telescope

Let me elaborate by using Apple. Steve Jobs has said a lot about focus. Rumor has it the most important lesson Jobs passed along to Tim Cook (the new CEO of Apple) was “focus is key”.

Way back when, Jobs returned to the company he founded, he observed that the team was working on too many different things with a troubling lack of clarity. So, he simplified. He drew what was later revealed (at Macworld 1998) to be the simple 4 quadrant product matrix that is shown below. Two types of users: consumers and professionals. Two types of use cases: portable and desktop. This effectively reduced things down to just 4 products. It was a great demonstration of focus (and also the power of clarity of vision). 

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The iPod: Brilliant — But Was It About Focus?

Now, after this big, bold move towards focus, Jobs made two huge decisions that would change the course of the company dramatically.

The first was the iPod. Apple was primarily a computer company. Their customers were people that wanted/needed computers. They sold a fair number of them. They were really good at making them. Some could argue that they were far ahead of the competition (and those people would be right). At the time, one would think: Hey, the focused thing to do is to figure out a way to exploit their strength at building computers and figure out how to take over the world. It's not that there weren't enough people to sell computers to — it's that not enough of those people were buying computers from Apple.

But, instead of focusing on their core, Apple decided to build an MP3 (music) player — the iPod. Sure, there's a computer chip in there somewhere. And sure, there's some operating software involved. And sure, they had the opportunity to make it aesthetically pleasing and highly functional, thereby playing to their strengths. But, it was a music player — arguably, relatively far from their core and not a very “focused” strategy. And, Apple didn't stop at just building the device. Oh no. Not only did Apple decide to build a music player, they also decided to build a music service (iTunes). And, not just build the service, but then go out and strike deals with the content companies to get music into the service. Notice now how far we have strayed from Apple's core “focus”. What's important to recognize is that if Apple hadn't done all three of those things simultaneously (the iPod device, the iTunes service and the content partnerships), the iPod would likely not have succeeded. And, if the iPod hadn't succeeded, Apple might not have succeeded to the degree that it did.

After that, there was the iPhone — with some similarities to the iPod — but another radical shift into a different industry with different dynamics (they had to go strike a deal with a phone carrier). Once again, you could argue it either way: You could say that this was a relatively “focused” play, given the success of the iPod. And, instead of building their own mobile phone carrier, they partnered with an existing one. Or, you could say they “drifted” into the smart phone market. What you can't argue though is the brilliant success of the products. Below is a fascinating chart that shows the percentage revenue by product line for both Microsoft and Apple. Notice that for Microsoft, things are pretty consistent over the years. But for Apple, the story is completely different. Apple now makes billions of dollars on new products (iPhone, iPad). I don't know about focus, but how do you like them Apples?

apple vs microsoft revenue small

A Fine Line Between Focus and Myopia

So, here's my point: Talking about focus is useless unless you consider the level of abstraction you're talking about. If you squint just right, any activity you're looking at seems de-focused. In the iPod example above, I could argue that Apple showed considerable restraint and focus by not going out and building a Hollywood production studio and creating content. Or, I could argue the flip-side and say they lost focus from their core.

I agree that focus is about saying no. But that's not all of it. By saying no repeatedly, what you're buying yourself is the ability to say yes to something much, much better. You're not freeing up resources just to hoard them away. You're freeing them up so you can apply them better — either by saying “yes” to something new or doubling-down on bets you've already made. So, the benefit of saying no to a bunch of wrong things is only realized when you find a way to say yes to the right thing. Important note: I'm primarily talking here about high-level company strategy. If we were talking about focus as it applies to product management, saying “no” to new features has intrinsic value by just keeping things simple.

Now, lets talk a bit about myopia (which is when things that are far away look out of focus). Often, focus is centered around now — not visionary things going out into the future. But, being too focused on what's working right now and not being mindful about where the market is headed and what customers will want/need tomorrow can be fatal. This is the classic Innovator's Dilemma (one of my favorite business books of all time). So, there's a fine line between focus and myopia. Finding the right balance between focusing on what's working now and looking towards the future is tricky — and critically important.

Finding the balance between focus and long-term vision gets harder as the organization grows. In the early days of a startup, the right answer is almost always maniacal focus. Resources are limited, and the product is likely innovative already. But, as you grow, you have more resources and the pool of possible options grows considerably. This is compounded by the fact that your existing product may be falling behind and innovation becomes necessary. This is when the team starts having animated debates about whether you should focus on the core business and making your existing customers happier with your existing offering — or whether you should defocus on the core — and spend some calories looking towards the future. The answer is almost never, um, clear — and it's almost never binary. It's somewhere in between.

Tips On Balancing Focus and Forward-Thinking

Here are some simple (but not easy) tips on deciding when to focus:

1. When in doubt, focus. Your default position should be to focus more, not less. The benefits of focus are non-linear — sometimes exponential. Even a modest improvement in focus can often reap massive rewards.

2. Often, you're either building a new product for existing customers — or taking your existing product into a new market. Between the two, it's usually safer to keep the focus on your existing customers or market — and build new things for them. Branching into new markets is much harder.

3. If you're considering building new products for a new market, think long and hard. This is frought with peril. Either focus on your current market, or on your current product.

4. Try to come up with a simple way so that some of your energy/resources are always spent looking forward (instead of remaining focused). If you don't make this deliberate effort, the “we should be more focused” argument will almost always win, and its not always going to be the right answer. Build a culture of innovation that can function alongside a culture of execution.

More examples of Focus vs. The Future

Beyond Apple, here are a few other examples worth considering:

Amazon: Started out selling books online.  Did a relatively focused expansion into selling almost everything online.  Then, BAM! got into the cloud computing market with Amazon Web Services (AWS)

37signals:  Jason and DHH at 37signals rightfully get a lot of credit for articulating the benefits of staying focused and keeping things simple.  Yet, they didn't stop at Basecamp (project management).  They expanded into Highrise (CRM) and Campfire (group chat).  

HubSpot (my company):  When HubSpot started, we set out to build a suite of marketing applications (including content management, SEO tools, social media, blogging, marketing analytics).  Later, we added email marketing, lead nurturing and other marketing automation features.  Now, HubSpot has the industry's first comprehensive marketing platform -- including a broad suite of applications, an app marketplace and a services marketplace -- all under one roof.  That's a lot of stuff.  And, uderstandably, we debate the topic of focus all the time.focus onstartups

Summary and closing arguments

Focus is an exceptionally powerful concept. But, to use it as a platitude (“we need to be more focused”) misses the larger point. There is no doubt you should be focused. More startups die from idea gluttony than starvation. But, deciding how much to focus — and on what, is a nuanced decision. History is replete with examples of companies that were too focused, to the point of myopia — and didn't see the future coming.

What do you think? How do you balance focus and forward-thinking?

Topics: strategy feature
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What It's Like To Be The CEO: Revelations and Reflections

By Dharmesh Shah on June 5, 2012

The following is a guest post from Paul DeJoe, founder at, Ecquire, which provides contact management software and EIR at Fairbridge Venture Partners. This article is adapted from an answer on Quora that Paul left responding to the question “What does it feel like to be the CEO of a startup?” I reached out to Paul for permission to share his thoughts with the OnStartups.com readership. At the end of the article is an epilogue with additional notes. It's worth reading too -Dharmesh
On May 20th, either right before midnight or right after midnight, I can't remember, I posted my rendition of what it feels like to be a startup CEO to a question on Quora. 1124 votes later and one last glance at a notification of an up vote from, Jia Liu, a social game maker from Zynga, I'm going to close the Quora tab and at the recommendation of Dharmesh, write what this last few days have been like, some of the cool things I've heard and some of the great people I've met as well as what I've realized.
With that said, here's the original post that sparked such a fantastic response.

What It Feels Like To Be The CEO Of A Startup

Very tough to sleep most nights of the week. Weekends don't mean anything to you anymore. Closing a round of financing is not a relief. It means more people are depending on you to turn their investment into 20 times what they gave you.

It's very difficult to "turn it off". But at the same time, television, movies and vacations become so boring to you when your company's future might be sitting in your inbox or in the results of a new A/B test you decided to run.

You feel guilty when you're doing something you like doing outside of the company. Only through years of wrestling with this internal fight do you recognize how the word "balance" is an art that is just as important as any other skill set you could ever hope to have. You begin to see how valuable creativity is and that you must think differently not only to win, but to see the biggest opportunities. You recognize you get your best ideas when you're not staring at a screen. You see immediate returns on healthy distractions.

You start to respect the Duck. Paddle like hell under the water and be smooth and calm on top where everyone can see you. You learn the hard way that if you lose your cool you lose.

You always ask yourself if I am changing the World in a good way? Are people's lives better for having known me?

You are creative and when you have an idea it has no filter before it becomes a reality. This feeling is why you can't do anything else.

You start to see that the word "entrepreneur" is a personality. It's difficult to talk to your friends that are not risking the same things you are because they are content with not pushing themselves or putting it all out there in the public with the likelihood of failure staring at them everyday. You start to turn a lot of your conversations with relatives into how they might exploit opportunities for profit. Those close to you will view your focus as something completely different because they don't understand. You don't blame them. They can't understand if they haven't done it themselves. It's why you will gravitate towards other entrepreneurs. You will find reward in helping other entrepreneurs. This is my email address: paul[at]ecquire.com Let me know if I can help you with anything.

Your job is to create a vision, a culture, to get the right people on the bus and to inspire. When you look around at a team that believes in the vision as much as you do and trusts you will do the right thing all the time, it's a feeling that can't be explained. The exponential productivity from great people will always amaze you. It's why finding the right team is the most difficult thing you will do but the most important. This learning will affect your life significantly. You will not settle for things anymore because you will see what is possible when you hold out for the best and push to find people that are the best. You don't have a problem anymore being honest with people about not cutting it.

onstarltups aviator 2
You start to see that you're a leader and you have to lead or you can't be involved with it at all. You turn down acquisition offers because you need to run the show and you feel like your team is the best in the World and you can do anything with hard work. Quitting is not an option.

You have to be willing to sleep in your car and laugh about it. You have to be able to laugh at many things because when you think of the worse things in the World that could happen to your company, they will happen. Imagine working for something for two years and then have to throw it out completely because you see in one day that it's wrong. You realize that if your team is having fun and can always laugh that you won't die, and in fact, the opposite will happen: you will learn to love the journey and look forward to what you do everyday even at the lowest times. You'll learn not to get too low when things are bad and not to get too high when things are good and you'll even give that advice. But you'll never take it because being in the middle all the time isn't exciting and an even keel is never worth missing out on something worth celebrating. You'll become addicted to finding the hardest challenges because there's a direct relationship between how difficult something is and the euphoria of a feeling when you do the impossible.

You realize that it's much more fun when you didn't have money and that money might be the worse thing you could have as a personal goal. If you're lucky enough to genuinely feel this way, it is a surreal feeling that is the closest thing to peace because you realize it's the challenges and the work that you love. Your currencies are freedom, autonomy, responsibility and recognition. Those happen to be the same currencies of the people you want around you.

You feel like a parent to your customers in that they will never realize how much you love them and it is they who validate you are not crazy. You want to hug every one of them. They mean the World to you.

You learn the most about yourself more than any other vocation as an entrepreneur. You learn what you do when you get punched in the face many many times. You learn what you do when no one is looking and when no one would find out. You learn that you are bad at many things, lucky if you're good at a handful of things and the only thing you can ever be great at is being yourself which is why you can never compromise it. You learn how power and recognition can be addicting and see how it could corrupt so many.

You become incredibly grateful for the times that things were going as bad as they possibly could. Most people won't get to see this in any other calling. When things are really bad, there are people that come running to help and don't think twice about it. Tal Raviv, Gary Smith, Joe Reyes, Toan Dang, Vincent Cheung, Eric Elinow, Abe Marciano are some of them. I will forever be in their debt and I could never repay them nor would they want or expect to be repaid.

You begin to realize that in life, the luckiest people in the World only get one shot at being a part of something great. Knowing this helps you make sense of your commitment.

Of all the things said though, it's exciting. Every day is different and so exciting. Even when it's bad it's exciting. Knowing that your decisions will not only affect you but many others is a weight that I would rather have any day than the weight of not controlling my future. That's why I could not do anything else.

Epilogue


In the post, I had shared my email with everyone to see with the hopes of encouraging anyone that needed any help to reach out to me directly. I was fortunate enough that so many people took me up on this offer. The exchanges we had ranged from skype calls, testing some new products, sharing ideas and even joining an advisory board. Most of the emails I got though were just people that thanked me for the post, shared their contact information, and said things like David did:
"…likewise, if there's any way I can be of help or service, let me know."
For those of you that have reached out to me and shared some of your life with me, thank you beyond words. It has been flattering, fulfilling and, and humbling. For those that have voted up the answer and said some of the kindest, coolest and most amazing comments anyone could ever hear. I thank you. And my startup parents thank you. Suddenly the 80,000lb student loan Gorilla with no income to feed him seemed to take the week off and was replaced with elation when reading some amazing comments. It meant a lot. Thank you again.
What might be a surprise to hear though is that it felt very uncomfortable to me to say "thank you" and I was doing it a lot. Seemingly overnight, there was a collective up vote from over 1,000 people that shared similar feelings and situations. I started to get the feeling that this wasn't me that wrote this and became uncomfortable taking credit. This post gained attention because it was the collective post by everyone who contributed with a comment or a vote and if I hadn't been lucky enough to come across this question, someone else would have wrote this. It might have been better or not but it would have at least been appreciated in the same way had another entrepreneur wrote it.
I don't recall seeing too many notifications of a down vote and that made me realize a few things:
This post became an online meet up for a group of people that are committed to changing the World. And rightfully, as well as fittingly so, it's very difficult and a sometimes a seemingly unsurmountable undertaking. But what was encouraging was not one person in the entire comments (go ahead and look) or in the emails that I received, said that they were overwhelmed or going to quit. They all found this inspirational and motivating and just the little encouragement needed that led to a found appreciation for what they do and and a reminder that they're not the only crazy ones.
The most common response I received however sounded like: "Thank you for this. I forwarded your answer to my friends and family to help them understand." One person even said that their Mom thanked me for the post (Thanks, Renee for sharing). Unfortunately, and sometimes rightfully so, entrepreneurs are commonly misunderstood by people outside of our networks and by people we love. It's mostly our fault. Although we are not understood most of the time, we take for granted that while we're often misunderstood, we are always accepted and supported. What we don't say thank you enough for, and what we often take for granted, is the very thing that let's us be who we are and chase our dreams. The people around us that love us unconditionally without regard for how bad we might fail is the equivalent of a superhero's cape. Without this, and without someone we can share the ups and downs with, great things do not happen. They can't. The things that are worth while to pursue and dedicate a life to involve something way bigger than individuals and have to be completely selfless or they are not big enough and not worth celebrating if the goal does not have the well being of others in mind. A collective thank you on behalf of this group of people that are crazy enough to change the World goes out to you. Thank you. If you are reading this because it has been forwarded to you, please know that you are appreciated and it's difficult for, often times quirky introverts to articulate. You don't have to change anything, we don't say it enough but it's with you in mind that we find motivation. You possess the most scarce resource of all: Undying and unnerving support. Thank you for it.
Lastly, undoubtedly the greatest thing that came from this post was an amazing calm that came over me that was during the most fulfilling, rewarding, interesting and fun week of this tumultuous journey to build a company. It came at the intersection of being able to interact with all of these individuals and being able to see all at one time, the collective resolve, ambition and just how dynamic these people are. The content of who these people actually are, how many of them there are and that they actually exist under our noses, let my imagination of what was possible wander in a positive direction for the first time in a while. It was powerful enough to spin the negative outlook I thought we were inevitably leaving for future generations. What I have just said, you would have not heard me say one week ago. It also made me realize something for which I will forever be grateful to all of those that contributed to this post. I realized what I am supposed to do to be fulfilled and happy in life:
Inspire.
I can tell you first hand, from over 1,000 data points and messages, that there is no better feeling than when you inspire or when you can help. When you genuinely help, it's a good feeling that is impossible to suppress. It's impossible to suppress for a reason: It feels good in the most selfless way possible. Entrepreneurs will make their own mistakes along the way, millions in fact. They have to to learn and improve. Don't discourage them from trying. There's no reason to. It's a useless thing to do and it might be enough to delay the doctor that cures cancer or the visionary that brings sustainable water to Africa when a simple word of encouragement was the only push they needed.
Inspire. Help and do so with other people and future generations in mind. Wouldn't it be the coolest thing in the World if we were the generation that consistently got punched in the face, didn't complain, didn't slow down, picked up our lunch pales and went out everyday to create sustainable opportunities for a generation that we haven't met yet? If that sounds crazy, ambitious, and delusional it's because it is and that's the way we have to have it or it's not worth our time. As crazy as it sounds, I can assure you that it will only require one thing for all of us to do for it to become real. It requires that we all inspire. 
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