Three startups later and I have made more than my share of mistakes. Some of them real whoppers. Maybe if I had read this beforehand I’d have made fewer…perhaps not!
The worst way of having your startup fail is never starting it. Its guaranteed to fail then. If you are reading this and do not have a startup – why not? Still waiting for that unique idea? It doesn’t exist! It really is all about executing better than the next startup down the street – that’s one way your business will be unique. How you deliver the value to the customer is how you will differ from all the other ‘me too’s’.
The Right Funds:
All cash is the same right? Wrong! When you accept someone’s money, then you have a responsibility to the investor – even Aunty Cathy. You need to take onboard their likes and dislikes, their suggestions and manage their expectations. It becomes part of your full time job. Be careful who you accept cash from – and try to get more than just cash – so always be on the look out for ‘smart money’ – so called because they add more than just the green stuff.
Keep the Cash Burn Down:
Whatever it is you probably don’t need it! Or if you really do need it, perhaps you don’t need to own it…beg, borrow, haggle perhaps go to eBay but whatever it is – don’t be tempted to pay full retail. Having it does not mean you are a real company – every cent spent before real revenue is another second off of the life of your startup. If you really, really, really need it – perhaps get it next week instead of today. If you got to where you are without it – give yourselves a few more days – you’ll be that much closer to revenue.
Meet the Milestones
Meet the milestones. Not just for your investors (if you have any) but for your employees, your fellow founders, yourself and perhaps even your customers. Make sure you have some small milestones too – ones that track the progress and growth of your wonderful idea. Have huge hairy milestones too but don’t gamble your reputation on achieving them – make those the ‘let’s get their soon people’ rather than ‘ we’ll get there next Tuesday’.
The Right Team:
Not just people that can do the job today but people who can do the next job next month and next year. People who won’t drive each other crazy – picking their feet over the workstation may be cute during your early tie die days but won’t help you if Kleiner Perkins comes calling. Think about the now and the tomorrow when picking the team – try not to be too relieved that someone else is just as crazy as you and wants to join – they’ll need more than that to make the cut as a valuable team member.
The Right First Customers:
The right first customer sees you for what you are and still wants to be your partner. Stop. A partner…not just a customer. The best and worst day for my first business was winning the big elephant deal – they were the most challenging customer we ever had! Certainly NOT a good first customer!
Don’t build it unless you absolutely and positively need it yesterday. Back to cash burn. But when you become a real engine propelled company, make sure you recognize when you need to take the company to the next level – they’ll come a point where the old, cute, cheap ways hack off the employees and even worse – the customers.
Introduce it from day 1. Especially from a financial perspective and its nice to be a ‘friend’ to everyone as the founder and CEO but the buck still stops with you. Make sure its respectful friendship because when the brown stuff starts to flow (and it will) – you need to be able to quickly and efficiently guide all the people in the business.
Focus everything on one perhaps two things – each new idea should not be pursued but saved for when the top 1 or 2 priorities come to fruition. Avoid flip flopping in your focus if something doesn’t immediately come through. Figure out why it hasn’t and try again. Save those great ideas – don’t chase them.
Publicity is king. Its almost free and people believe it a lot more than a one page ad in your magazine of choice. Don’t spend the cash on lots of marketing – but do invest in ‘looking’ like a big and real company through inexpensive means such as your website.
Just a few thoughts. Let me know your list!
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