Requirement Analysis​

• A distributed blockchain accounting and smart contract system
• Nodes have minimal trust in each other but need to be incentivized to cooperate
  • Transactions are irreversible
  • Do not rely on trusted third parties
  • Protect privacy, disclose minimal information
  • Do not rely on centralized authority to prove that money cannot be spent twice
• Assuming performance is not an issue, we will not consider how to optimize performance

Architecture Design​

Specific Modules and Their Interactions​

Base Layer (P2P Network, Cryptographic Algorithms, Storage)​

P2P Network​

There are two ways to implement distributed systems:

• Centralized lead/follower distributed systems, such as Hadoop and Zookeeper, which have a simpler structure but high requirements for the lead
• Decentralized peer-to-peer (P2P) network distributed systems, such as those organized by Chord, CAN, Pastry, and Tapestry algorithms, which have a more complex structure but are more egalitarian

Given the premise that nodes have minimal trust in each other, we choose the P2P form. How do we specifically organize the P2P network? A typical decentralized node and network maintain connections as follows:

1. Based on the IP protocol, nodes come online occupying a certain address hostname/port, broadcasting their address using an initialized node list, and trying to flood their information across the network using these initial hops.
2. The initial nodes receiving the broadcast save this neighbor and help with flooding; non-adjacent nodes, upon receiving it, use NAT to traverse walls and add neighbors.
3. Nodes engage in anti-entropy by randomly sending heartbeat messages containing the latest information similar to vector clocks, ensuring they can continuously update each other with their latest information.

We can use existing libraries, such as libp2p, to implement the network module. For the choice of network protocols, see Crack the System Design Interview: Communication.

Cryptographic Algorithms​

In a distributed system with minimal trust, how can a transfer be proven to be initiated by oneself without leaking secret information? Asymmetric encryption: a pair of public and private keys corresponds to "ownership." Bitcoin chooses the secp256k1 parameters of the ECDSA elliptic curve cryptographic algorithm, and for compatibility, other chains also generally choose the same algorithm.

Why not directly use the public key as the address for the transfer? Privacy concerns; the transaction process should disclose as little information as possible. Using the hash of the public key as the "address" can prevent the recipient from leaking the public key. Furthermore, people should avoid reusing the same address.

Regarding account ledgers, there are two implementation methods: UTXO vs. Account/Balance

• UTXO (unspent transaction output), such as Bitcoin, resembles double-entry bookkeeping with credits and debits. Each transaction has inputs and outputs, but every input is linked to the previous output except for the coinbase. Although there is no concept of an account, taking all unspent outputs corresponding to an address gives the balance of that address.
  • Advantages
    • Precision: The structure similar to double-entry bookkeeping allows for very accurate recording of all asset flows.
    • Privacy protection and resistance to quantum attacks: If users frequently change addresses.
    • Stateless: Leaves room for improving concurrency.
    • Avoids replay attacks: Because replaying will not find the corresponding UTXO for the input.
  • Disadvantages
    • Records all transactions, complex, consumes storage space.
    • Traversing UTXOs takes time.
• Account/Balance, such as Ethereum, has three main maps: account map, transaction map, transaction receipts map. Specifically, to reduce space and prevent tampering, it uses a Merkle Patricia Trie (MPT).
  • Advantages
    • Space-efficient: Unlike UTXO, a transaction connects multiple UTXOs.
    • Simplicity: Complexity is offloaded to the script.
  • Disadvantages
    • Requires using nonce to solve replay issues since there is no dependency between transactions.

It is worth mentioning that the "block + chain" data structure is essentially an append-only Merkle tree, also known as a hash tree.

Storage​

Since UTXO or MPT structures serve as indexes, and to simplify operations for each node in a distributed environment, data persistence typically favors in-process databases that can run directly with the node's program, such as LevelDB or RocksDB.

Because these indexes are not universal, you cannot query them like an SQL database, which raises the barrier for data analysis. Optimizations require a dedicated indexing service, such as Etherscan.

Protocol Layer​

Now that we have a functional base layer, we need a more general protocol layer for logical operations above this layer. Depending on the blockchain's usage requirements, specific logical processing modules can be plugged in and out like a microkernel architecture.

For instance, the most common accounting: upon receiving some transactions at the latest block height, organize them to establish the data structure as mentioned in the previous layer.

Writing a native module for each business logic and updating all nodes' code is not very realistic. Can we decouple this layer using virtualization? The answer is a virtual machine capable of executing smart contract code. In a non-trusting environment, we cannot allow clients to execute code for free, so the most unique feature of this virtual machine may be billing.

The difference between contract-based tokens, such as ERC20, and native tokens leads to complications when dealing with different tokens, resulting in the emergence of Wrapped Ether tokens.

Consensus Layer​

After the protocol layer computes the execution results, how do we reach consensus with other nodes? There are several common mechanisms to incentivize cooperation:

• Proof of Work (POW): Mining tokens through hash collisions, which is energy-intensive and not environmentally friendly.
• Proof of Stake (POS): Mining tokens using staked tokens.
• Delegated Proof-of-Stake (DPOS): Electing representatives to mine tokens using staked tokens.

Based on the incentive mechanism, the longest chain among nodes is followed; if two groups dislike each other, a fork occurs.

Additionally, there are consensus protocols that help everyone reach agreement (i.e., everyone either does something together or does nothing together):

• 2PC: Everyone relies on a coordinator: the coordinator asks everyone: should we proceed? If anyone replies no, the coordinator tells everyone "no"; otherwise, everyone proceeds. This dependency can lead to issues if the coordinator fails in the middle of the second phase, leaving some nodes unsure of what to do with the block, requiring manual intervention to restart the coordinator.
• 3PC: To solve the above problem, an additional phase is added to ensure everyone knows whether to proceed before doing so; if an error occurs, a new coordinator is selected.
• Paxos: The above 2PC and 3PC both rely on a coordinator; how can we eliminate this coordinator? By using "the majority (at least f+1 in 2f + 1)" to replace it, as long as the majority agrees in two steps, consensus can be achieved.
• PBFT (deterministic 3-step protocol): The fault tolerance of the above methods is still not high enough, leading to the development of PBFT. This algorithm ensures that the majority (2/3) of nodes either all agree or all disagree, implemented through three rounds of voting, with at least a majority (2/3) agreeing in each round before committing the block in the final round.

In practical applications, relational databases mostly use 2PC or 3PC; variants of Paxos include implementations in Zookeeper, Google Chubby distributed locks, and Spanner; in blockchain, Bitcoin and Ethereum use POW, while the new Ethereum uses POS, and IoTeX and EOS use DPOS.

API Layer​

See Public API choices

5 Parties​

1. Cardholder: an authorized user of the card. e.g., anyone who has a credit card.
2. Issuer: an institution that issues credit cards to its users. e.g., Chase, BOA, discover, etc.
3. Merchant: an entity that provides products or services, and accepts payments via credit cards. e.g., Uber, Doordash, etc.
4. Acquirer: who provides card services to merchants. e.g., BOA Merchant Services, Chase Paymentech.
5. Electronic payments networks: a clear-house for acquirers and issuers. e.g., VisaNet, MasterCard, Discover, American Express, etc.

Are Square and Stripe acquirers? No, they are payment aggregators.

2 Workflows​

1. Authorization: The cardholder provides the card / card info to the merchant, who processes it and sends (card number, amount, merchant ID) to the acquirer. The acquirer contacts the issuer via the electronic payments networks. The issuer checks against the credit line and fraud-prevention system, and then authorize or decline the transaction.

2. Clearing / Settlement

   1. batching: At the end of the business day, the merchant asks the acquirer with a batch of payment information for clearing.
   2. clearing and settlement: the acquirer coordinates the clearing with the issuer via the electronic payments networks, and the issuer settles the funds and bookkeeps the transaction for the cardholder.

Research shows that individuals with mentors perform better, advance more quickly in their careers, and experience greater satisfaction in both work and life. Mentors also benefit from the relationship, gaining insights while teaching others. Despite the many advantages—76% of professionals believe mentors are important for growth—over 54% of people lack such relationships.

The issue often lies in people not knowing how to find a mentor or build a relationship. The following nine steps can help you.

1. Clarify Your Goals and Specific Needs​

Take out a pen and paper and write down your career goals. Ensure these goals are SMART. Then, list the biggest obstacles to achieving these goals. These specific needs will help you determine what kind of mentor you should seek. Perhaps you need to develop new skills, expand your network in a specific field, or build confidence for tough negotiations. Once you understand the person you want to become and the gaps and opportunities to get there, you can identify how a mentor can truly assist you.

2. Write Down the "Job Requirements" for Your Ideal Mentor​

Knowing your goals and how to achieve them, think about how a mentor can help you. Describe the type of mentor who can help you seize the greatest opportunities or navigate challenges. Specifically, you may need a mentor to help you complete a project, introduce you to someone at a certain level in a specific industry, or guide you through difficult negotiations. Be sure to include "why" in your job requirements—just as companies want potential candidates to understand their broader direction, explain why mentoring you will yield greater rewards. When you reach out to potential mentors, share your job requirements so they understand why you're seeking mentorship and are more willing to help (as mentioned in points four and five).

3. Look for Mentors Through Your Second-Degree Connections​

Mentors can come from anywhere. They might be part of your LinkedIn network, professional circles, or people you meet at conferences. Importantly, while people are undoubtedly busy, being invited to be a mentor is a tremendous compliment. People may decline, but it remains a positive interaction; be bold in trying and making requests, even if you think they might not have time for you. Let them decide whether to accept or decline.

4. Make Your Request (and Keep It Simple)​

Asking someone to be your mentor for the first, second, or even third time can feel a bit awkward. You likely have never been invited to be someone else's mentor or taught anyone how to make this request. Embrace that discomfort. There's nothing wrong with asking, but take it slow. Invite others for an initial conversation to learn about their work and interests. Once you both know each other better, and if there's mutual agreement, you can make more requests for them to be your mentor. Conversely, sending a long email asking a stranger to be your mentor is less likely to be accepted.

5. Conduct the First Conversation​

Your first conversation with a potential mentor has two goals. First, you want to determine if this person is the right mentor for you. Second, find out if they are open to mentoring you. How you conduct the conversation will depend on you, but generally, you’ll want to do the following:

• Make the other person feel at ease. Choose a convenient location for them, prepare coffee (or tea), and keep the meeting low-pressure.

• Spend time getting to know them. Ideally, let the mentor speak more, keeping your speaking time under 30%.

• It’s okay to ask for small help right from the start. In fact, it may even help build the relationship.

• Make a clear request: "I really enjoyed this conversation. If I make some progress on my goals within a month, could I follow up with you?"

• Express gratitude, then follow up via email to thank them again.

6. Start Simple​

For your next meeting, follow up on the previous one and keep it simple. Once they confirm a follow-up meeting, send an email outlining the agenda and hinting at building a long-term relationship. An example could be, "In our next chat, I’d like to quickly review what we discussed last time, and then I want to expand on that topic. I’ll prepare some specific questions that I think you can help me answer."

7. Establish a Structured Accountability Process and Draft a Mentor Agreement​

After having one or two simple conversations, try to make a more formal request: would this person be willing to sit down with you once a month for the next six months until you achieve your goals or solve your issues? If they agree, consider drafting a simple one-page document outlining the tasks you aim to complete during these six months. While this may seem a bit excessive, it will clarify the goals for both you and your mentor. It will also help you define clear meeting content for each session. You might suggest, "I really appreciate your time and help, and I want to ensure I make the most of it. I was thinking I could prepare a simple document outlining my goals, my commitments to you, and the milestones I hope to achieve in the next three months. I think this will help keep me accountable and prepared for our conversations. Do you agree?"

8. Keep Following Up and Say Thank You​

After each meeting, be sure to send a thank-you note. Additionally, when your mentoring relationship concludes, continue to express your gratitude. I once had a mentee email me two years after we worked together, and it made me very happy. In return, I helped her establish some new and interesting connections, and she did the same for me. So remember, asking for help is okay, but always ensure you express appropriate gratitude!

9. Use the Right Tools​

To efficiently implement the above steps, I created a dedicated tool for myself Guanxi.io - End-to-End Encrypted Personal CRM, Free Registration, now open source, welcome to star.

Why some ideas survive while others die? Two principles: being memorable and making people eager to spread. In the book Made to Stick, the authors have summarized six elements to make ideas stick, SUCCES for short, which represents Simple, Unexpected, Concrete, Credible, Emotional, and Story.

Simple - Cut down to the key message of an idea​

Too often, we want to explain an idea thoroughly, but revealing too much detail is not good for people to understand. They will soon forget all the details and even the core message. We should simplify our message and understandably convey the idea, just like journalists would create good headlines for their reports to grasp readers’ attention.

Unexpected - Draw people’s attention by surprising them​

The human brain would neglect selectively to things familiar to save energy. Only something surprising can draw its attention. The fact implies sticky ideas are also unexpected. It proves to be effective to use curiosity gaps to grasp attention. If you present some surprising facts or statistics in your idea, curiosity will drive people to get more information.

Concrete - Use concrete materials to be understood and remembered​

Abstract terms are hard to understand, let alone to be remembered. When communicating an idea, we would better use concrete and understandable terms, along with examples and descriptive imagery.

Credible - Make an idea believable so it can spread​

Ideas ought to be credible if they want to be spread out. Generally, there are three ways to add credibility to a plan. The story has experts or people with relevant experiences to back up Use realistic facts and statistics to add credibility to the story Encourage the audience itself to be a reference

Emotional - Appeal to people’s emotions rather than present dry data​

Imagine we have the campaign to ask people to donate to starving African children. There are two options: presenting the population of starving children, or showing a picture of a child in need of a donation. Comparatively speaking, people are more likely to take action upon the latter because it appeals directly to human emotions. Therefore sticky ideas should focus on emotional triggers instead of dry facts.

Story - Inspire people to action by telling a story​

It is a common mistake to focus on an empty slogan without any story when people are communicating ideas. A slogan is sticky, but it can not inspire people to take action like a story. For example, Subway has benefited immensely from the true story of Jared Fogle, who was an overweight man but managed to slim down by having two Subway meals per day.

When you are talking non-stop, it can be hard to notice that you are being overly enthusiastic. You may not even realize that the other person is only responding out of politeness or hinting that they want to leave.

Talking to others happens in three stages. In the first stage, your goals are clear, targeted, and concise. But then you may unconsciously find that the more you talk, the easier it feels. It’s so wonderful for you, relieving your tension, but it may not be as interesting for the other person. This is the second stage—when you feel good talking, you don’t even notice that the other person is not listening.

In the third stage, you have lost control of what you are saying and start to realize you might need to pull the other person back in. At this point, your monologue is disguised as a conversation, and you subconsciously sense that the other person is a bit annoyed. Can you guess what happens next?

Unfortunately, the typical response at this point is to talk even more to gain the other person's attention, rather than finding ways to get them to speak and listening to regain their interest.

Why does this happen? First, the reason is simple: everyone has a desire to be heard. But secondly, talking about oneself releases dopamine, the pleasure hormone. One reason talkative people keep talking is that they become addicted to this feeling of pleasure.

There is a method that has helped me, and it may help you too. It’s called the traffic light method. It is effective when talking to most people, especially Type A personalities, who often have less patience.

In the first 20 seconds of a conversation, you are at a green light: as long as your comments are relevant to the topic and serve the other person, your audience will appreciate you. Unless you are an exceptionally gifted speaker, talking for more than about half a minute will generally be considered boring and too talkative. So, in the next 20 seconds, the light turns yellow—now the other person starts to lose interest or thinks you are too verbose. By the 40-second mark, you hit a red light. Occasionally, you might feel tempted to run the red light and keep chatting, but most of the time, it’s best to stop, or you’ll be in trouble.

The traffic light method is just the first step to preventing you from talking too much. It’s also important to understand the underlying motivations for why you talk so much. Are you talking more just to feel good? Are you explaining your thoughts? Or is it because you often have to listen to others, and when you find an opportunity to speak, you just unload?

Regardless of the reason, talking too much usually leads to interruptions in the conversation and may result in both of you talking at each other instead of having a dialogue. This does not help advance the conversation or your relationship.

One reason some people talk too much is that they want to show the other person how smart they are, even though deep down, they may not feel that way. If this is the case, you should know that continuing to talk will only diminish the other person's impression of you.

Of course, some people just talk too much because they "may not have a sense of time passing." If this is the case, the solution is not to introspect but to cultivate a sense of how long 20 seconds and 40 seconds are. For example, use a watch to time yourself while on a call. You will gradually develop the habit of stopping when your traffic light is still green or at least yellow.

Finally, remember that if you do not involve the other person in the conversation, even a 20-second monologue can be off-putting. To avoid this, you can ask questions, try to build on what the other person says, and find ways to engage them in the dialogue. This way, you can achieve a real conversation instead of an ineffective one.

Product Market Fit​

Product market fit refers to whether your product is good enough; if it is, you can start investing more in paid customer acquisition channels. User retention may be the best measure, after all, actions speak louder than words.

What you need to clarify is: "Is the product effective? Is word-of-mouth and retention growing on its own?" Usually, the answer is no. So make sure you try enough times—focus on the solution rather than the problem or the mission. The solution is the reason people use your product.

Product Channel Fit​

Do you have repeatable and scalable channels? The two most common repeatable and scalable methods for consumers are Search Engine Optimization (SEO) and referrals.

• Search Engine Optimization (SEO): Generate unique user-generated content
  • SEO takes time to set up; you won't see benefits right away. It's more like "If this company wants to grow in 5 years, SEO must be done well." Therefore, you shouldn't spend 100% of your time on it. More like 10% of your time setting up the basics ("Set it and forget it").
• Referrals: Provide an incentive mechanism that encourages people to invite their friends for rewards
  • Referrals can start working from day one.

Important Metrics​

In the early stages, the quality of data is more important than quantity (e.g., retention rate). A 50% or 10% long-term retention rate is more important than user growth rate. In some cases, Daily Active Users (DAU) are important. The metric is not "Can this acquire users?" but rather "Can this retain users or convert them to paying customers?" Many companies over-focus on monthly growth rather than whether the product has genuinely improved. At the beginning, data is scarce, and you might convince yourself that it is effective. But if retention is low, growth won't be sustainable.

Control Analysis​

Segment users into control groups so you can analyze how user behavior changes over time and with product changes. You can determine if there is natural churn and whether your changes have unlocked new behaviors.

Lifetime Value (LTV) / Customer Acquisition Cost (CAC) Payback Period​

Using just a few months of data to calculate LTV for future predictions is not very instructive. What people want to know is, "How will this product grow over time?" So you should focus on what it will look like as it scales.

Payback Period (PBP) can sometimes be better than LTV/CAC. It means if I spend $1, how long until I can recoup not just revenue but also profit. The importance of the payback period is that unless you have a quick return on investment, it's hard to build rapid growth on paid channels.

What you really need to ask yourself is, "Can I reinvest this money into more growth?" If it takes one or two years to get that money back, then you need to rely on another source of funding to support your growth.

Why Should We Avoid Spending on Customer Acquisition Initially?​

If possible, try to avoid spending on customer acquisition at the beginning. Companies with a long-term mindset and large companies do not spend money to buy customers. Avoiding it will force you to find ways for viral growth. Unless you can prove that spending $1 can yield$5, and you don't have a high churn rate, then you can consider using paid acquisition.

Running a business can be like playing an infinite game in which there is no final score to determine the ultimate winner. So the main goal for each participant is to stay in the game as long as possible. Nowadays, too many people analyze businesses based on their stock prices. It seems that they forget one point: high profits at one time may collapse to zero overnight if the business cannot sustain.

To create businesses that last for generations, we should get back to long-term thinking and focus on making products people want instead of striving for short-term revenue. Simon Sinek, the author of The Infinite Game, introduces how to equip your business with the infinite mindset.

Start with a Just Cause​

As Adam Smith put in the book The Wealth of Nations, the interests of consumers should come before the interests of the company. However, in 1970, Milton Friedman published an article writing that the primary responsibility of any free-market enterprise is to make money for shareholders, which signals a shift from being consumer-centric to being shareholder-centric.

A Just Cause is an inspirational goal that encourages your employees to fight for. If companies strive for longevity in the Infinite Game, their goals need to be consumer-centric. If they do not follow this principle, take the GPS device company Garmin, for example. It claimed to be “the global leader in every market we serve” and mentions nothing about their customers in the vision. Then no wonder why it is only worth one-third of its value in 2007.

Build trusting teams​

A company culture of distrust is fatal to business operations. If employees do not trust the company, poor performance, or even unethical behaviors may take place. And this is due to the simple reason that employees don’t know whether to speak up honestly when something unpleasant happens.

Such is the case of Ford Motor Company before the year 2006. The CEO at that time had a habit of blaming and even firing those who brought bad news to him. And then, gradually, employees only reported good news on meetings. The culture of distrust was turned around only after Alan Mulally became the new CEO, who took actions to encourage everyone to bring up bad news.

Be flexible and learn from worthy rivals​

Whether in the sports field or the business world, a good opponent forces you to improve yourself and learn new techniques. When Allan Mulally became the CEO of Ford Motor Company, Ford had lost 25 percent market share over the past 15 years. Instead of adopting promotion strategies, Allan turned to study rivals like Toyota and Lexus, trying to figure out why consumers preferred those cars over Ford.

It is the same case with Steve Jobs. He changed Apple’s plans instantly when seeing Xerox working on the GUI technology and decided to implement this new technology on Apple’s new computers. Now you can see how successful that move is. And this cannot happen if Jobs cannot embrace new technologies with his flexibility and fast execution.

Running a business can be an infinite game, with no final score to determine who wins or loses. The ultimate goal of a company is to stay in this game for as long as possible. Too many people today are accustomed to using stock prices to judge a company's performance, but they overlook one crucial point: if the business is not sustainable, a temporary stock price can vanish overnight. To create a sustainable enterprise, we need to refocus on how to innovate and create products that people need, rather than just generating more wealth for shareholders. Simon Sinek, in The Infinite Game, proposes that companies should establish a just mission, build teams based on mutual trust, embrace change, and learn from worthy competitors to gain an advantage in the game.

Establish Long-Term Goals​

Adam Smith advocated in The Wealth of Nations that businesses should prioritize consumer interests. However, by 1970, Milton Friedman argued that a company's primary responsibility is to generate profits for its shareholders. This marked a shift in business goals from being consumer-centric to focusing on short-term profits and growth.

A lofty goal should be inspiring and motivate people to strive towards it. If businesses want to operate for the long term, their goals should revolve around consumer needs rather than merely pursuing profit. GPS device manufacturer Garmin once claimed its goal was to be the leader in every market it participated in, without mentioning customers at all. It’s no surprise that its current market value is only one-third of what it was in 2007.

Build Teams Based on Mutual Trust​

A culture of distrust within a company can be fatal to its operations. If employees do not trust the company, their performance will decline, and they may resort to unethical business practices. The root cause of this often lies in employees not knowing whether they should be honest when faced with uncertain situations.

This was precisely the case at Ford Motor Company before 2006. The then-CEO had a habit of reprimanding or even firing those who brought him bad news. Naturally, employees would only share good news in meetings. It wasn’t until Alan Mulally took over and encouraged everyone to report bad news that the culture of distrust began to change.

Embrace Change and Learn from Worthy Competitors​

Whether in sports or business, a good competitor can push you to improve your skills and learn new ones. Learning from competitors can help a business go further. When Alan Mulally first became CEO of Ford, the company had lost 25% of its market share over the past fifteen years. However, Mulally did not rush to launch promotions or cut costs; instead, he began studying competitors, including Toyota and Lexus, to understand why consumers preferred those vehicles.

Similarly, when Steve Jobs discovered the GUI technology being developed by Xerox, he immediately changed Apple’s original plans and decided to implement this technology in the new computers. Today, the widespread use of GUI validates Jobs' successful decision. If Jobs had not embraced new technology with the right mindset and execution, these transformations would not have occurred.

What is Customer Relationship Management (CRM)?​

Customer Relationship Management (CRM) software allows you to manage sales leads, convert them into customers, and track data and sales performance. To establish a CRM for your startup, you first need to determine the following:

• The process your customers go through from sales leads to active customers
• How to differentiate among potential customers
• The CRM software you will use

The following article assumes that your startup has a product to sell and sufficient customer activity to track and manage. If you do not yet have a product or customers, please bookmark this article for future reference when you are ready to use CRM software.

Identify Decision Points in Customer Conversion​

Before purchasing any CRM software, you must first create a framework for your customer conversion process. This framework should outline the decision points in the customer lifecycle, from initial contact to lead to deal to active customer, as well as all the smaller decision points in between. To understand how your customers convert, you need to talk to existing customers and identify the different decision points they encountered in deciding to use your product. At this stage, it's best to do this with pen and paper, although software like TechValidate may be helpful.

Customer Conversion Framework​

Most frameworks will include the following elements: Leads, Prospects, Marketing Qualified Leads (MQL), Sales Qualified Leads (SQL), and Opportunities.

Leads​

Leads are known potential customers with whom you may or may not have established a relationship. The collection of leads is sometimes referred to as an outbound database or a prospecting database, typically stored in a CRM or integrated with one.

Prospects​

Prospects are another commonly used term, although in some sales funnels, prospects are defined as being one step closer to becoming customers. When companies distinguish between leads and prospects, they often note that prospects have communicated with sales representatives or responded to them (for example, they may have replied to an inquiry call and scheduled a follow-up conversation).

Marketing Qualified Leads (MQL)​

While leads may not have interacted with your company or product, "Marketing Qualified Leads" refer to leads that have taken certain actions indicating interest in your product. You need to define this behavior; some common examples include long or frequent website visits, filling out online information forms, attending events, downloading or requesting whitepapers, or clicking on ads. Not everyone you engage with is a Marketing Qualified Lead; you need to define what these parameters are based on your product. For example, if you only offer products in the U.S., but someone with an international IP address downloads your whitepaper, this action indicates intent but does not meet the qualification criteria.

Sales Qualified Leads (SQL)​

Sales Qualified Leads are those leads that show a high intent to purchase. They express their willingness to buy your product by requesting live demonstrations, quotes, or conversations with sales representatives.

Opportunities​

Once purchase qualification and intent have been confirmed in the sales process, Sales Qualified Leads become "Opportunities." This is the final stage before becoming an active customer.

Build Your Funnel​

Not every sales cycle or product will follow this exact formula and funnel. While each process has its unique steps, most software, hardware, and services will follow a similar path. When building your CRM, it is your responsibility to map out these decision points and potential outcomes—primarily focusing on what causes a lead not to continue in the process at each step.

Differentiate Among Customers​

A company rarely has a single type of customer. B2C companies target customers based on age, wealth, geography, technological maturity, mobile operating systems, online activities, and countless other attributes. Similarly, B2B companies target customers across size, tenure, geography, industry, technology maturity, online activities, and legal entity types, among others.

Therefore, treating every customer equally in the sales/CRM process is often a mistake. If your product supports self-registration, you may find that some customers prefer to register themselves, while others want support or sales assistance. This is a common form of segmentation among customers. Another common differentiation point is that some customers are transitioning from similar products, while others have never used any competitor's services.

Regardless of the specifics, taking the time to identify relevant differences among your potential customer base before establishing a CRM is crucial to your sales approach.

Choosing CRM Software​

There are many excellent SaaS options available today, particularly for startups. A good approach is to look at the software you are already using or software that someone on your team has used before.

Zendesk and Hubspot​

Typically, startups often use Zendesk for customer service or Hubspot for marketing categorization and campaign management. If your startup falls into this category, both software suites include CRM (Zendesk acquired Base CRM in September 2018). You might consider using these existing software solutions for your CRM as they are convenient and cost-effective. Using them may be free or require only a small monthly user fee.

Salesforce, Pipedrive, and Copper​

If no one on your team has a CRM preference, or if you have not used an embedded CRM software platform, or if you want to purchase a standalone CRM from existing software, popular options include Pipedrive, Salesforce Essentials, and Copper (formerly Prosperworks).

All three are good choices. Some users prefer the "native" integration between Copper and G-Suite (they share similar design principles, such as allowing you to use Copper without leaving Gmail), while others appreciate Pipedrive's simplicity and cost-effectiveness. It is worth noting that a common complaint about Pipedrive is that it may feel more suited for small to medium-sized businesses rather than startups, and its email integration only allows you to associate one email address with a deal. Complaints about Copper include its lack of customization in reporting and its high cost.

Finally, if you are looking for a lightweight, open-source, personal CRM that protects your privacy, I recommend Guanxi.io. Why is there a personal CRM like this? This article explains it.

Management consulting firm ghSMART studied 17,000 senior executives over 10 years and identified three types of "career launchpads" that help "accelerators" become CEOs faster:

1. Retreat to Advance. The most common approach is to move to a smaller department or organization, or to start your own business, taking on greater responsibilities, even building a business from scratch to maturity. Your position will rise along with the growth of the business.
2. Leap Forward. More than one-third of individuals said "yes" to opportunities that far exceeded their own expectations and abilities. Of course, becoming a CEO at a young age means they can succeed without relevant work experience.
3. Take on a Hot Potato. This may seem counterintuitive, but solving problems that others cannot is the most direct way to prove your value. This hot potato could be an underperforming business unit, a failed product, bankruptcy, etc. A chaotic situation means challenges and opportunities to get things right. Over 30% of accelerators rose to positions this way.

The path to becoming a CEO varies, and effectively utilizing these three career launchpads is especially important for professionals facing obstacles, such as women. Generally speaking, women take 30% longer than men to become CEOs.