Wow, what a buzz to get a call from a friend to come and help him in his startup. After spending 1 day with him and his partners, I knew I could help… or could I? I quickly went about creating order, process and getting the right kind of conversation around what I thought were the issues. After all, leading a team was my bread and butter. Within a week I was an investor and director and things were looking up for me in my newfound entrepreneurial career. At our first alignment meeting I said to my partners that our business would only grow as fast as we can. This has been more true than I could ever have imagined and I have watched our startup lapping at the heels of our own personal growth and development. If only I could learn faster then our startup could grow faster, but learning is like a seed that needs to be planted, watered, germinate and grow little by little. Of course, there are ways to accelerate learning and one of the ways is sharing learnings as I am doing now with you. So not only am I hoping to share with you, but I hope that you will enrich the learning through sharing with me by leaving a comment.
So what are these aspects that one needs to learn and act on if you are to take your startup from an idea to a successful venture? Most of what I will be writing about will be hot off the press as my journey has only started and I continue to learn something new each day.
To start with, if you have come from an established organization, the first thing you need to understand is the difference between a startup and a company that has a profitable and sustainable market.
In a startup everything is up in the air and requires validation. You are trying to understand the problem and you’re trying to find out if anyone will pay money to get it solved. Here we made the classic error of having early adopters who were not paying. Ask for money – there is no other way to know if you have something that is seen to be of value.
In effect you are making it up, as you go, a big no-no in established companies. You and your partners are ‘IT’ when it comes to doing the work, figuring out the strategy and making the decisions. You are the chief cook AND bottle washer, so to speak, who needs to know a bit about everything that has to do with a company. Finances, human resources, legal, safety, shareholding, directorship, marketing and the list continues. Don’t stress, do some just-in-time learning, of course Google is great for this. Here it helps if everyone in the team is teachable – if not, some resentment could build up if team members are not learning to do the things they have never done before.
Flexibility is the name of the game. Plans only last a day, if you are lucky, then new information necessitates different activity. Planning and budgeting go hand in hand in established companies and tend to not change for at least a year until the next budgeting period comes around. Given my project management background, I was insistent on a plan. I quickly learnt that detailed plans were simply a waste of time, but high level deliverables with some time estimates are helpful as this enabled us to understand when what is going to be delivered and if the limited resources are able to complete it in that timeframe. If you don’t have a complex technical solution, just keep planning simple. If you are not willing to change planned activities often, then a startup is not for you.
You mostly have no idea who your customers are, how you can reach them and the size of your market. So you need to get creative and find your customer and talk to them. What a novel idea, in big companies only the marketing or business development teams ever need to talk to customers and if you were not one of them, then this is very new to you. I forced myself to talk to customers and that really helped us to refine our unique value proposition and improve our solution. Here the best advice I can give is tap into your friends and their connections. I was fortunate enough to have a really good friend who connected me with some real players in our industry.
You have an unwavering passion for what you believe the solution is and because of that you cannot imagine that there will be one person who cannot see the value of your solution and buy it instantly. This often makes you deaf to real feedback from customers and finding a profitable and sustainable market. In established companies they already have a track record of sales and returning customers and a growing business has validated their solution, but not so for your solution. I know this is your baby but presume that your customers are not as keen on your offspring as you and be prepared to change the solution to solve the problem. Always remember that you are trying to develop a business and not simply save the world.
A startup is one of the few places where if a solution is given to customers in a less than perfect state, that is considered a good thing as this means less time and resources have been wasted. Resources, time and money that you don’t have. Quick release to customers of your solution even if it is only a mock-up allows you to have a conversation with the customer and figure out what the best solution is that they would be willing to pay for. Try doing this in an established company and it will not end well for you or your team.
Of course, all of the above signify an adapted or different skills set and the ability to learn quickly and, dare I say it, “fail quickly”.
In the next blog posts I will be talking about the startup’s true north, its vision, startup leadership, the team, the real cost of a startup, customers, the product and how to view growth.
In the meantime, can I encourage you to read the books and blogs of Eric Ries, Ash Mauye and Steve Blank as there is no reason for you to reinvent the wheel. Simply build on what they have already learnt.
Please build on this learning by leaving a comment. I look forward to us continuing our start-up journey together…