In 1949, Earl Bakken and his brother-in-law Palmer Hermundslie started a medical device repair shop in Palmer's garage. It was a terrible place to work – freezing in the winter, stifling in the summer.
We used a garden hose to spray water on the roof in a not especially successful attempt to cool the place down a few degrees. At least once during those early days, the garage was infested with flying ants.
Unlike your typical "successful" startup garage stories, they were in that garage for the next 12 years. In their first month of operation, they earned a whopping $8 of revenue. Even in 1949 money, that wasn't good. And, for the next several years, they just kept losing money.
In 1957, a chance encounter with Walt Lillehei, a heart surgeon desperately looking for a way to keep his patients alive during blackouts, led Earl to invent the world's first battery operated pacemaker. Earl and Palmer's company, Medtronic, would become one of the leading biomedical companies of our time. They invented the pacemaker industry. And for the next 30 years, dominated the market.
But by 1986, their company had fallen from a 70% market share to 29%. Despite spending many millions on R&D, the company couldn't compete anymore. The company was stuck again.
Could someone save it?
Mars, similar to Earth, rotates around its own axis every 24 hours and 39 minutes. And when a solar-powered rover lands on Mars, most of its activity occurs during Martian daytime. So engineers on Earth studying Mars rover data, adopt the ~25 hour Martian cycle. Laura K. Barger, Ph.D., an instructor at the Division of Sleep Medicine at Harvard Medical School, wanted to know what kind of effect that has. Does 39 minutes really make that big of a difference?
What she found from her studies was that NASA engineers who could correctly sync their own wake/sleep schedules with the 25 hour day did fine. But they had to make a concerted effort to adapt using countermeasures – take the right naps, alter their caffeine intake, use light exposure, etc.
But those people who couldn't adapt, or didn't bother to try, suffered significant performance problems from fatigue. She also found that on the first Mars rover mission, The Sojourner, engineers were so exhausted after a month that they formed what NASA managers called a "rebellion" and refused to work on Martian time any longer.
We spend billions of dollars on space exploration and engineering, lives are at stake, and simply getting our circadian rhythm synced correctly with our tasks and with our team could make or break an entire operation.
It underscores the importance of what appears trivial: achieving the right rhythm.
In 1987, Mike Stevens was assigned to be vice president of Medtronic's product development. When he looked at what was happening at Medtronic, he noticed that there were actually quite a few good ideas in the pipeline. But when they were just about ready to launch, a competitor would spring up with a similar product. Medtronic would delay the launch, debate, discuss, and try to figure out a superior version to launch instead. The company was in a cycle that led to a decade of no new products.
Steven's solution was incredibly simple. He put the whole company on something he referred to as a "train schedule". He and his executives set dates far into the future for when new products would be invented and launched.
I chose that phrase "would be invented" carefully. Because these weren't product ideas they already had and now just needed development. They didn't even know yet what they would develop and launch – just that they would launch something, anything, on schedule.
The effect was tremendous. The company could still debate and plan, but employees knew decisions needed to be made by a certain date or else they'd miss the train.
Medtronic's market share climbed back steadily from Steven's promotion date, and in 1996, they were back above 50%.
Years ago, I was sick of not having a bigger audience around my writing and software products. My Twitter account was stuck at 200 followers. And I didn't know yet what to improve, how to differentiate myself, or how to market my products better. So, I committed to writing and publishing at least one blog post every 7 days. That's it.
The first post, crickets. The next post, more of the same. And the next and the next. Very few people read what I was writing. But the rhythm got me through the points where many would have given up. And to the points where I started getting better.
And years later, I had gotten so much better that hundreds and then thousands of people began reading my blog posts at Ninjas and Robots. The new audience helped me launch a product, Draft. But of course, I had a familiar feeling of being stuck with Draft, writing software amongst a sea of other writing software.
I had no idea how I was going to compete, what I was going to build, how I was going to market the thing. But I did the same thing I did with writing, I committed to a cycle of launching as many new features and improvements as I could every few weeks. That's it. But the momentum fortunately caused a lot of excitement.
@natekontny dude, how do you release such big features so fast? I've never seen anything like it from another startup. It's just you right?!— Sean Everett (@SeanMEverett) May 16, 2013
Some folks even compared it to Christmas :)
@gooddraft It feels like Christmas receiving an email with the latest news about Draftin.— Amanda L. Goodman (@godaisies) September 17, 2013
No matter what my revenue looked like, or how terrible my user growth might be, I knew I had to release something. The rhythm trumped everything and kept propelling me forward.
Back in February of 2014, 37signals announced they were renaming themselves Basecamp to focus on their project management software. They would look at selling off their other products, especially their second most popular product, Highrise, a small business CRM tool.
You can imagine what that kind of announcement did to customer growth of Highrise. Even worse, as soon as the announcement was made, more than a few competitors took the approach of putting up mini-sites that read: "Goodbye Highrise. Highrise is shuttering; here's how you migrate your data to us." Highrise wasn't going away, but that didn't stop them.
So when Basecamp decided to spin-off Highrise as a subsidiary, I faced quite a bit of negative momentum as Highrise's CEO. But this looks like a challenge previous versions of me has faced before on a smaller scale.
On day one, I established a train schedule – we'd make major announcements on a regular basis. If something isn't ready, it misses the train. But an announcement is going out; something better be on it.
I didn't start with a big team. It was just me and one more developer, Zack Gilbert, but we were going to ship whatever we could ship in one month, and make a big deal out of it.
It wasn't an announcement filled with very big ideas or changes. We only had 30 days to begin learning a large code base, and had plenty of other tasks and support requests to handle. But we had a schedule to keep.
And our first announcement went out. Then another one month after that. And then another. Now with a bigger team, and even more experience with the product and advice from our users, the announcements are getting more interesting.
The result? Highrise HQ LLC has only technically been in business a little over 3 months. But our rate of customer growth has increased by 39%! And we're seeing growth numbers that look a lot more like what the numbers were before Basecamp made their announcement.
It's far too soon to proclaim Mission Accomplished, we have many mountains to climb still and plenty of low points along the way I'm sure, but it's apparent what kind of effect a rhythm can have on creating a product, syncing a team, and communicating with customers. And things are starting to look a bit familiar :)
Loving the new features on @highrise this morning. Feels like an early Christmas present.— Robert Walker (@robjwalker1) December 3, 2014
Paul Montrealon 11 Dec 14
Maybe I’m misreading this, but what it sounds like, is you’re using product updates essentially as a marketing / awareness tool.
Maybe this is an extraordinary time and it’s important to show that the product is alive and kicking after the handover?
But product updates for the sake of marketing, on the surface, seems so at odds with early 37 signals philosophy. And that’s more of a question than a statement. I’m interested in your thoughts. How does your train approach not end up giving you feature-itus if you’re only focused on developing one product (and not new ones)?
David Krellon 11 Dec 14
Love the idea of a schedule or train as it commits a team to being clear about what actions to take. To me it’s not really about building features per-say, rather it is about advancing your product/messaging. With customer development there is always something to push forward, having a clear and identifiable cadence helps your team and your customers. Something like “cadence builds coordinated velocity”.
Nathan Kontnyon 11 Dec 14
Hi Paul! Thanks for the comment! Let me try and repeat what I think you’re asking:
Re: Is the train approach just good for marketing our stuff?
Not at all. It definitely has that effect: getting our customers aware that things are alive. But it also is this great tool to sync us internally. We, just like Medtronic, are swimming in good ideas, but often if can feel like drowning. There’s too many things we want to work on. And even if we pick one thing, the discussion often brings up so many dependencies and what ifs. Those discussions are healthy, but they can’t go on indefinitely. The schedule keeps us boxed in so we know we still have to ship something.
Re: How does this not just turn in featuritus and product bloat?
A lot of what we’re doing isn’t just new features but improvements. Many of the announcements from my Draft schedule were actually the removal of things. (i.e. I just removed this because no-one was using it.)
And the guiding question I ask of myself and this team is how can we remove steps from tasks we or our customers have. So it’s not about adding a feature, but actually removing things that get in the way of you accomplishing what you intended to do in the product to begin with.
So right now, I don’t feel like we’re anywhere close to a place where we’re just coming up with ideas just to bloat an announcement. We’ll know when that is. Those meetings and discussions are very different when everyone is staring at each other without a clue of what can be made better.
Paul Montrealon 11 Dec 14
Nathan, fair enough, thanks for clarifying. :)
GregTon 11 Dec 14
IMO this is the best post on 37S in ages. Basically, you’re talking about habits. Good habit quotes abound. Here’s one:
Successful people are simply those with successful habits. —Brian Tracy
Jason Friedon 11 Dec 14
Great post Nathan! I love how you weave the stories together.
You’re doing a fantastic job. We’re all watching you and your team do great work – and quickly. You guys are exactly what Highrise needs.
Brandon Scott Bayeron 12 Dec 14
Excellent post, Nathan!! It was very well written and very informative, and the whole “rythm” idea makes a lot of sense. It seems similar the “20 mile march”. I actually live right around the corner from Medtronic, and so that story was very interesting as well!
Michaelon 12 Dec 14
Really enjoyed the post and seeing all the updates you have been doing.
Most of them are in the quality-of-life department rather than being the kind of feature that makes doing something else harder or more confusing – I think that’s a good place to start.
Rishion 12 Dec 14
Wow this was one amazing post! Great write up Nathan!!!
<a href="http://www.iridize.com">Eyal</a>on 14 Dec 14
I have been reading this blog for a while now. I can’t put my finger on why but I found this post to be quite motivational. Thanks!
Markus Wildon 14 Dec 14
Nathan, thanks for your frank post. As a longterm highrise and basecamp user I really like seeing things move forward. That’s the reason, your schedule approach makes totally sense to me. Could you please inject a little bit of your startup spirit back to the basecamp team?
Brittanyon 15 Dec 14
This is a wonderful story. As the marketing coordinator at a small start-up company, I found this post very motivational. I can’t wait to get together with my team and push for this new train mentality!
We’ve started talking about the impact of verbiage on growth. I believe that small companies need to resist the urge to align with larger competitors and continue to be themselves. If you’re tying to stand out in an over-saturated marketplace, the only way to do it is to not be afraid to stand out! You can see my recent post about this here: http://meteora.co/realtalk-be-genuine-brand/
Rahulon 17 Dec 14
What a great post.
This discussion is closed.