Last week, I tweeted something about startup names that was a result of a conversation with a founder.
His startup had a name that I couldn’t immediately catch or spell, and I told him that this was going to be a problem. His response was that his co-founders had made their mind up. They wanted this complicated name because it was a nerdy in-thing only they understood.
Exactly the problem, I told him, and wished him all the best.
James Currier of NFX, a San Francisco venture firm, has a blog on this that makes the rounds often. It features this great quote: "When you’re not in the room, the name of your company is what gets passed between people. It speaks for you when you’re not there."
Currier illustrates this, the power of a great startup name, with several stories.
I woke up to the power of company names when we screwed up my startup’s name in 1999. We called it Emode which was hard to spell, impossible to remember, and dated within 24 months. With coaching, we changed it to Tickle. Traffic shot up 30%, journalists started writing about us, ad spend became 20% more effective, and no one forgot our name.
What’s more, before the name change, we had an acquisition offer for $45M. Just four months after the name change, we received an offer for $110M. A name change started a series of changes in how the customers perceived and reacted to us, how investors and acquirers thought of us, and ultimately, how we thought about ourselves. The power of language increased our valuation by 2.5X.
On Infoseek vs Yahoo:
I was an Associate at Battery Ventures when the firm invested in InfoSeek, the first US search engine. InfoSeek rarely won attention from press or consumers even though they had the superior product. Simply put, Yahoo was orders of magnitude more interesting to talk about. And the numbers showed it. InfoSeek eventually sold for $72M and Yahoo reached a peak of $120B.
On Trulia vs Zillow:
My partner Pete Flint was the founder and CEO of Trulia. His largest competitor was Zillow. He has said that the Zillow name was better than Trulia’s, so his battle was always uphill. While Trulia merged with Zillow in a $3.5 billion transaction, Pete believes his odds of overtaking Zillow would have been even better had he chosen a stronger name.
In conclusion:
Companies like Domo, SkyMind, Jiff, Datadog, and Slack have given themselves a big advantage in the enterprise space by having memorable, spell-able, and evocative names. Not so much for InsightSquared, WellTok, and HipChat, their competitors
How then, should the founder I spoke to go about it? A few responses I got to the tweet are worth sharing, as answers to this question. There’s no right and wrong, remember. And this is marketing, so there will always be subjectivity.
First, the spell-ability rule.
Second, why Confinity became PayPal.
Third, the genius of a name like Afterpay.
This may not be exactly what you need, but it’s a simple enough framework to start.
And finally, founders/operators need to understand that if there’s an advantage to be had when you are a startup, you need to take it. Having a great name that’s immediately spell-able, repeatable, and friendly is an advantage. You can choose not to use that advantage, but why?
You are a startup, you won’t get that many anyway.