10 good advice for a start-up
If you’re a non-technical founder looking to build a tech product, pay someone to give you some basics. You’re not looking to become an expert, you’re looking to become comfortable talking with developers as well as learn how to communicate complex technical jargon for other non-technical individuals.
Books are great of course, but actually talking to real developers is 10X better.
- Sit in on some classes at a local college or dev bootcamp
- Buy an experienced developer coffee or lunch a few times and pick their brain
- Spend an hour or two a week with your existing developers for the sole purpose of learning
- Lean on the developers you work with. They’re not just there to write code.
Practice explaining technical things so you’re comfortable answering questions from investors, advisors, biz dev partners, future hires, and reporters.
Consistent > Unique
It’s one thing to get your product working, it’s something completely different to get it working consistently. Users/customers need and expect predictability and simplicity above uniqueness.
Use Every Interaction
Don’t stop asking people questions about your existing or future products. Even if they’re hypothetical questions, people will always surprise you with their answers.
Input from others is also a great way to build brand awareness, affinity, and excitement for your product. Make them feel like they’ve contributed to your product/business somehow.
Your Timelines Are A Joke
For your first year, triple your timeline projections.
If your developer says 2 months, plan for 6. If your revenue forecasts say 6 months, anticipate 18. If you need 3 months to raise a round of funding, you actually need 9. You’ll keep your sanity, impress customers & investors, and start at a manageable pace from which you can improve.
Investor Relationships Start NOW
It’s never too early to reach out to investors! The most used phrase in an investors vocabulary is; “Not now, but…”
…but keep me updated.
…but contact me when you reach $20,000/month in revenue.
…but get a lead investor and I’ll jump in on this round.
…but when you’re raising your series A, give me a call.
This gives you permission to keep them on a list of investors you have established rapport with and can keep updated with a monthly or quarterly email.
Think of the long term potential of this kind of a list!
- 6 months down the road you find product market fit and they pull the investment trigger.
- 18 months down the road you’re ready to raise a Series A round and all it takes is a few phone calls to the most enthusiastic on your list.
- 36 months down the road these guys are beating down your door to somehow get in before an IPO or acquisition.
- 5 years down the road you’re raising a seed round for your next startup and without hesitation, the entire list takes your meeting and they begin competing just to get in early.
- 10 years down the road you want to start your own venture fund or simply join one part-time. Each individual begs you to join their firm or throw money your way for your own fund.
Even if your company fails, you got further than most. You’ll message these individuals, quickly explaining what you learned while building the team, product, and business model.
These people are always looking to learn, so don’t be embarrassed it was a failure. End your message with a note about planning to start something new in the near future and that you’re hoping to stay in touch. This gives you ‘permission’ to pitch them again and again.
By the time you look to retire, you’ll look at this list and realize it’s quite possibly one of the most valuable things you own.
Stop Staring At Screens
Get out from behind your computer!
You’re not spending as much time working on important things as you think. Sure, browser apps & plugins can help limit your social media usage or disable specific websites during customizable hours of the day, but you’re monkey brain will always find ways to procrastinate.
My go-to’s were long walks while listening to audiobooks and podcasts, bike rides when I wanted to “go fast”, and Spikeball when I needed some competitive fun and social interaction.
You Don’t Need A Designer Early On
High fidelity mockups are great, but until you get the product in consumers hands, settle on basic sketches. Most developers can handle basic sketches and mockups, but if yours can’t, just get someone to throw together the main screens so your developer has something to work with.
DO NOT let a designer convince you to pay him or her for high fidelity designs early on. These designs are guaranteed to change based on UI/UX and user feedback which means you can flush that money you spent on a designer down the toilet.
Save the money and obsess about design later on.
Communication Should Never Stop
Don’t stop communicating with your team, investors, customers, prospects, etc…
You may think giving your team space to work, to be nimble and flexible, and solve big problems organically, is a great thing, but it’s not early on. I left my team to their own devices for two solid weeks.
It was as much a test for them as it was for me. I wanted to know how effective they would be when left alone and whether I could even be hands off for that period of time.
It wasn’t worth it. Teams and team members need consistent check-ins, time frames, goals, and an understanding of your expectations. A light touch is sufficient, but don’t leave them alone and expect miracles.
Investors love predictability and patterns. It’s really the only thing they’re looking for. They track it, measure it, and invest in it.
This is why a great way to establish an early pattern with potential and existing investors is with clear and consistent communication. The best way to do with is a monthly email that gives them a high level summary of that months wins, losses, revenue, customer pipeline, challenges, and next month’s outlook.
Some investors may ask for more info, most won’t respond but simply read and stay abreast of your traction.
Another piece of info to consider adding to that email each month is a ‘Need’s section. You may only value the capital infusion they provided, but your investors are worth MUCH more than that! Ask for strategic introductions, social shares of specific content, or even participation at meetings in which their insight, influence, or presence will be of value. They’re not just there to write you a check.
Potential users need to be updated. Sure, you may not have much to tell them and some may not enjoy the teasers, but prolonged absence will be worse than too much “hype”.
This is a struggle for Hivecast, as our beta release date has been pushed back multiple times due to technical and capital challenges, which makes us feel like we’re teasing people too much and not living up to the expectations we set.
Don’t let this fear stop you though. Spend an hour or two a month to engage with potential customers and you’ll be rewarded once your product is available.
The individuals that are begging for early access are those early adopters that will evangelize your product or serve. Consider creating a real relationship with these people and tap more than just their enthusiasm.
BIZ DEV PROSPECTS:
Consider prospects the same way you consider investors. A “No” just means “Not now”. Establish a relationship with prospects before your product or service is ready. Like your user community, prospects should be throwing money at you by the time you’re ready to monetize.
Ask at least one random person a question every day. Polling people can be an effective way to find unique markets, ways to phrase questions, or honing your pitch. Use random interactions, networking events, and scheduled meetings to clarify a theory or question.
You could even set it up formally. Each week, pick a new question and attempt to collect 20+ responses from random people. Collect and assess the data. The next week move onto a different question.
Take Advice When Given, But…
Get good at taking everyone’s advice but analyzing just how valuable it is. You’ll find patterns in both good and bad advice and learn to recognize them easily.
Be skeptical and verify.
If people get mad at your for this, you know their ideas, authority, or expertise is total bullshit.
Crack out the 3 most important things on your to do list as soon as possible in your day. You can then call it a productive day and consider anything over and above those 3 tasks as gravy.
This requires you to be excruciatingly honest with yourself regarding what tasks actually help you reach your goals. You’ll be surprised just how much time you’re wasting on bullshit work.
Execute on what you say you will, but don’t expect other people will until they’ve proved it.
Establish yourself in other people’s minds as someone that always does what he or she says they’ll do. If the business fails, people will at least see you as someone who can execute and get shit done.
Execution > Ideas
Qualifying Business Relationships
A good way to qualify an advisor, mentor, business associate, or even a friend is to ask for an introduction to someone in their network. If they successfully connect you, it’s worth investing in the relationship. There are too many bullshitters and name droppers in the world.
On the flip side, don’t forget to be open to connecting people to your network! Do this without being asked and you’ll be rewarded in the future.
How I’d Build An MVP
Your Minimum Viable Product (MVP) should not use the technology you wish to build.
This is as much of a way to prove you can build a business as it is a proof of concept for the business itself. Hack together a basic website and grow traffic, sell the service and get your first 5 paying customers, produce a crappy product and sell it. Sure you’ll want to build the tech to assist with growing the business but those first customers and early wins prove there is a market for what your’e selling, shows potential investors you have early traction, and can give you early revenue and a reason to bootstrap the business yourself.
Using Hivecast as an example, I would have sold a service that brought targeted locals and social influencers to attend and shoot vertical video at client events, edit their video in post, and have them share the video via Instagram and Snapchat stories.
This would not only prove that businesses are willing to pay influencers to produce and share vertical video but would give us some early revenue/traction, all without having to build a single piece of technology.
For more on minimum viable products, read The Lean Startup by Eric Ries. This should be required reading for all business, marketing, and engineer students in my opinion.
Know Who You’re Talking To
Do more research on prospects and introductions than you think is necessary. It sucks finding out a potential investor doesn’t invest in the industry you’re in while on the phone with them. Wasting other people’s time because you didn’t do your homework is embarrassing.
If you come under prepared on someones background or focus, don’t hesitate to ask them to give you a brief overview of their experience and industry focus.
Never Leave A Conversation Without Getting Something
In 90% of your meetings, your goal is to simply get to the next meeting. No one writes you a check after the first interaction.
This little change in perspective helps you re-frame your goals during meetings because your “ask” can change to fit the situation.
Whether it’s to schedule a follow up discussion, get a warm introduction to his or her contact, receive permission to reach out at a later date, or simply acquire knowledge they have on a specific topic, leave the meeting knowing you’ve come out ahead.
Here are some questions I’ve asked at the end of meetings to ensure I didn’t walk away empty handed.
- May I add you to a list of individuals I keep updated with occasional emails?
- If I come across a founder looking for investors in your industry, may I make a connection?
- Do you happen to know any Angel’s or VC’s that have interest in my industry?
- Would any of your portfolio companies benefit from using my product or service?
- What are the biggest challenges you find founders come across in your industry focus?
- What are the biggest challenges you come across as an investor?
Don’t forget to offer something in return. Make it a mutually beneficial exchange and you’ll be rewarded.
Getting Out Of The Pit Of Sorrow
You can always do SOMETHING!
The pit of sorrow most entrepreneurs will find themselves in can come at a cost. Disappointment, stress, sleepless nights, shitty eating habits, the torment can seem to never end.
Elon Musk even compared entrepreneurship to “eating glass and walking on hot coals at the same time”.
This is the mental model I go through when I’m sitting in that pit;
- What specifically is still in my control?
- What would this look like if it were easy?
- What can I remove to reach the goal?
If you can’t find a way forward after working through those three questions then you’re not being creative or resourceful enough.
“The more I feel backed into a corner, the more rewarding it is when I get myself out of it.” – Steven Spielberg
Bring Other People Along For The Journey
Protecting you equity is a fools errand for a first time founder or co-founders. Be open to opportunities as they come your way and understand that it’s impossible to do it all on your own. Be willing to find success with other people.
“When businesses succeed and everyone gets a nice slice of an exit, you’ll be proud that you built something together and more likely to assist each other again in future ventures.” — Jason Calacanis
Get Comfortable Making The Ask
Come prepared with your #1 and #2 asks of anyone you’re pitching. It doesn’t have to be for money. Good businessmen and women know you asked them for a meeting to get something and great ones will simply cut to the chase and ask you at some point in the conversation (most likely before they waste time in a meeting).
Tell them straight up. Don’t laugh if they laugh. Simply ask in the least amount of words and wait. Be silent. Keep waiting. You don’t need to fill the void with more talk.
If you want their money, ask for it. You’re not asking a friend to borrow a couple thousand dollars because you’re in the hole. Angels and VC’s are meeting with you to be asked, so don’t beat around the bush.
If you want something else, be specific and tell them how it will help you.
Don’t Just Go To Sleep, Prepare For Sleep
Put away the screens by 9 or 10 p.m. If you didn’t finish your work for that day, push it to tomorrow. If you’re still on your phone, computer, or television that late, it’s probably just shitty entertainment. Put it away.
Find something not related to business, technology, startups, politics, etc… to occupy your mind for at least an hour before going to bed. I’ve spent countless sleepless nights laying in bed worrying, strategizing, calculating, etc… and it’s going to take a toll.
Don’t Neglect The Legal Work
A great lawyer is a must but be upfront with him or her about your funding situation. When you’re running low on capital, the last thing you need is legal invoices piling up. Most startup lawyers understand that funds are limited and are more than willing to work with you. They’re taking a bet on you as much as investors are, so treat them well and they’ll treat you even better.
If you do have some early funding, set apart 10–15% for legal fees and tell your lawyer that’s the budget you’re working with. They’ll optimize their time for the best outcomes.
Don’t let people scoff at your work to patent your ideas or tech. It’s another legal cost but it’s better to have the protection than not.
Some investors don’t care and they’ll still invest. Others do care and they may not invest because your IP’s not protected. Better to just handle it and cover your bases.
Pause. Breathe. Relax.
Save for immediate health or legal trouble, there is very little that wouldn’t benefit from a quick pause to take stock, think through, or even forget altogether.
The same way occasional vacations help you catch your breath over the span of a lifetime, pausing for a moment or taking a day to consider everything can help over time as well.
Be strict with these times of reflection. Schedule them and keep the meeting.
The Startup Reality
The startup narrative you hear everywhere is absolute bullshit.
If your dream is to be or build “the next big thing”, you’re in the wrong line of work.
Here’s the reality;
- Nothing in life has or will prepare you for entrepreneurship, besides entrepreneurship.
- If you’re not obsessed with the problem you solve, the solution you’re building, and the community of existing/potential users, you already lost.
- No one will, or can, tell you what to do or how to do it. Business models, mental models or historical patterns only get you so far in business.
- If you can’t talk to anyone and everyone about your venture, it won’t get off the ground. “Stealth mode” is for well funded early stage startups only!
Recognize Incredible People When You Meet Them & Stay Connected
You’re going to meet people that completely blow your mind.
Whether it’s their skill, experience, poise, enthusiasm, candor or simply their kindness, you should try and take note of these individuals and what draws you to them.
It’s likely the people you’d least expect.
Here are a few indicators I noticed over the last year;
- Did the 1 hour meeting turn into 2–3 hours?
- Did he or she take the time to pick apart your business or product and provide you with actionable advice?
- Did he or she ask; “how can I help?” or “what do you need?” and take the time to take action on these inquiries?
Take note of these interactions, the specific details, questions, or ideas they brought up and make a plan to establish a better relationship with them. These are the types of people you want on your side, working with you, and succeeding together in the long term.
I have met exactly three notable examples in 2017. Out of hundreds of interactions, calls, meetings, and events, just three!
What’s more is that if those three individuals joined me in building something, anything — I’m confident we’d change the world. That’s the power of surrounding yourself with amazing people.
Collect Stories To Tell
Tell stories about your business, product, team, wins, losses, growth, etc…
The #1 question you’ll receive from people is; “How is your business going?”
I never really had a good answer because at any given week, day, or even time of day, it was going different. Plus, you don’t quite know the last piece of info he or she heard about your business.
Start collecting little tidbits here and there. No matter how small, these little hints or stories help people wrap their head around you and what you’re building.
A side effect that occurs is that these “stories” become part of your personal and business narrative.
Don’t neglect your narrative!
Schedule Randomness Into Your Life
Be open to, trust, and plan for serendipity.
This was a topic brought up in an audiobook I should have listened to years ago called “Do More Faster: TechStars Lessons to Accelerate Your Startup” by David Cohen & Brad Feld.
Brad Feld purposefully places randomness in his schedule. He takes 15 minute meetings with people he normally wouldn’t spend time with or consider their proposals, ideas, or industry.
He would not have been the co-founder of TechStars had he not taken a 15 minute meeting with his co-founder and co-author.
Thinking back to the wins I’ve had while building Hivecast, nearly all have occurred due to some kind of randomness.
Yes, looking back we can justify anything as consisting of some sort of randomness, i.e. “Had I not been in that place at that exact time…” or “Had I not gotten that introduction to…..”, etc…
The point is that we can continue to make decisions, but the randomness that occurs after, and because of, these decisions should be wholeheartedly accepted and appreciated.
Investors Need You To Spell It Out For Them
I don’t know why it still surprises me, but I’m shocked that some people still need me to qualify the size and scope of the smartphone market.
Is it not obvious that the mobile device (in whatever form you like) is a massive market with over 2.6 billion people carrying smartphones?
If I get one more suggestion to add this type of “market data” to my pitch deck, I’m going to flip out!
The moral of this rant is to always assume stupidity, ignorance, or lack of knowledge. No one knows your market, business model, customers, or technology better than you.
Simplify everything and never assume.
People Qualify You And You Should Qualify Them
Don’t be offended if someone is qualifying your integrity, experience, or knowledge, prior starting a formal relationship or introducing you to one of their contacts.
They don’t know you from Adam and you should be doing the same to them anyway!
Be Comfortable With Being Misunderstood
No one, besides other founders, will understand what you do for a living.
My closest friends and family ask me all the time what the hell I do every day. There’s really no good answer besides, “anything and everything to grow my business”.
One day I have back to back to back pitches and calls, the next I’m rewriting my pitch deck, and still the next I’m researching backgrounds of angel investors and their portfolio companies.
To be honest, I like to revel in the mystery.
Build It With Someone
Don’t go it alone! I fell into the trap of romanticizing the idea of being a solo founder and I implore you to reconsider if you’re looking to launch a new venture.
This goes back to my earlier point about founders being far too protective of their equity.
It’s better to own a small portion of a multi-million dollar company than it is to own 100% of a company worth nothing.
As of writing this journal entry, I have offered Ryan Daulton the Co-Founder position and we’re working out the details.
Here are some thoughts regarding finding and setting up a great co-founder relationship.
- Know your strengths and weaknesses. I’ve tried starting company with a close friend of mine that is far too similar in talent, knowledge, and demeanor. We figured out fast that founding a company together would be challenging and our friendship meant more than any potential business success. Be self aware enough to know what value you add to the relationship and make sure any goal setting and measurement is based upon these strengths and the actual role you’re playing in the partnership.
- Take your time. Ryan and I talked at length prior to diving into a working relationship. Luckily we were ending a contract with our prototype developer and design team which allowed Ryan to move in as our technical lead. We worked on the beta product together for six months and then started discussing whether coming on as the technical co-founder made sense.
- Formalize the co-founder agreement with goals, timelines, clear roles but acknowledge that these will remain fluid as the relationship and business changes over time.
There is far more I have learned that I did not find the time to write down but I hope the above notes provide you with some things to consider while launching your own venture.
The last thing I’d like to suggest is that you take the leap. There will never be a better day than today.
Test your theories. Scratch an itch. Solve a problem.
“Entrepreneurship is jumping off a cliff and assembling a plane on the way down.” — Reid Hoffman