“Your babies not beautiful” and other startup advice….
The other day I hosted an entrepreneur chat led by Todd Dean who is now CEO of Brace Audio. Todd has a resume full of entrepreneurial pursuits, the most recent being founder of Keiretsu Forum, an angel investor forum based in the northwest. I invited Todd to share startup advice with the MBA students at Northwest University.
We had a lively conversation that centered around common startup mistakes and myths.
I thought I’d share some of the take aways. And thanks Todd for leading the conversation and being so generous to spend time with the students and I. If you’re an entrepreneur located in the greater Seattle or Bellevue area and want to be invited to our next entrepreneur chat, make sure and drop me an email at pam @ pam hoelzle.com or call me.
Start up Advice. Startup Mistakes. Entrepreneur Myths.
1. “Your Baby Is NOT beautiful.”
Entrepreneurs often fall into the same category as new mom’s and dads. They fall in love with their creation; idea, product, service or venture. Soon they become so enamored with their prodigy they can’t see reality from fantasy.
Let’s be honest. Your ‘baby’ isn’t beautiful.Every entrepreneur thinks they’ve invented the coolest thing since sliced bread.
Now, get over it. More important than ‘is your startup beautiful?’ is; is this the right time to launch your baby? Is this the right business model? Do you have right team and the expertise to sustain success? Have you really developed something of value? Are you bringing real innovation to the market? And do you have the resources? Here’s a quick overview on the startup process so you can get over staring at your ‘beautiful baby’ and begin building it…
2. You are trying to do too much, with too little. Your aim is too wide. That’s too big of a chunk to go after, at first.
Time and time again us entrepreneurs want to eat the entire pie. We resist the urge to niche and focus. We want to do this + 40 other things all in one business model. Refusing to focus, niche and prioritize is one of the reasons many startups crash and burn.
Get over yourself. Get real. Where is the real opportunity that you have an innovative solution for? Now drill into it; focus, niche, segment. And put together a plan to win ‘this’ space, this battle. Then expand. Here’s a free business startup tool kit I’ve developed if you need some resources.
3. Your business model is all wrong.
Entrepreneurs have some sort of affection for business plans. Business plans don’t really count, sorry to tell you.And most of the time Todd and I concurred, what’s wrong isn’t the ‘plan’ ‘it’s the business model itself; the way the venture delivers value and innovation, how it makes money.
Business modeling is a fine art. Most entrepreneurs have great ideas but could really use help putting it into a model that can succeed. A business model is like a bike. It’s the vehicle to transport you from here to where you want to go. It’s dynamic and flexible; you can change it up during the journey-based on the terrain you find yourself in.
4. Wrong client.
Most entrepreneurs over focus on the consumer and under focus on other customer segments, targets. Whose under served? Who has the most pain? Often business to business plays, serving one of the players in the distribution channel can offer loads of opportunities.
Most entrepreneurs have a freedom, pride, independence issue. Great. But look around. Almost no one has all the skills, knowledge or resources to do it all.
Team up. What expertise, knowledge and resources do you need to succeed? Now how can you get these people on your team – even if it’s just in an advisory position?
6. Timing does matter.
Don’t be stupid. Timing is darn near the most important element. TIMING, market timing matters. Just talk to the owner of the horse and buggy cart or the manufacturer of records.
7. Eyeballs are NOT equal to Revenues.
Go take those eyeballs to a group of angel investors and see what they say. Most people we know, still prefer revenues to eyeballs. And if you have both. Better yet. SWEET.
8. Traction matters.
Get over the idea that sales, contracts don’t matter. Especially now in this current economy. Create traction. Get into an alpha ( if you need a technical term) sell something, prove this ‘beautiful baby concept’, get some contracts. Traction matters especially if you want to attract other people’s babies, I mean money.
9. Leadership does too matter.
Entrepreneurs often pooh-pooh leadership. Who needs a leader? I’m the entrepreneur ALMIGHTY. Well you might just be Richard Bronson the second. But if this baby is actually beautifully profitable and it starts growing this venture is going to need a leader.
One of the primary reasons startups fail is the lack of leadership. Some entrepreneurs are crappy leaders. Accept it. Deal with it. Get a leader on the team.
10. Revenues do solve a lot of problems.
Drive Revenue. Really.
11. Don’t override your gut.
Intuition is your friend. I call it ‘God whispering’. Listen to your gut throughout the startup journey and surround yourself with a team of advisors that are rich in startup experience and startup advice and counsel, who are great at listening to their ‘guts.’
12. Running out of money is not fun.
Most entrepreneurs launch on too big of a front, scale and then run out of money. And then they do it again. We are an insane bunch aren’t we?
How about creating revenues and growing in sync with your sales, profit traction and cash? Or how about not launching till you have enough money to achieve the goals necessary to get someone else to invest?(Boy I wish I’d listened to this startup advice years ago!)
Start up advice. What’s yours? Your baby might not be beautiful…..
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