Last month I presented the slide deck above to an audience for Startup 101. The presentation was part of the Fusion Salon, a day-long segment of Vancouver International Digital Week.
And since the slides are pretty lifeless without some narration, here’s some idea of what I said with each of the 7 lessons I presented.
#1: Personal Finances
As early as you can in the life of your startup, get your personal finances in order.
If your personal finances are not in order, you can’t survive long as a startup founder and you spend a large amount of time distracted and scrambling.
Understand your personal credit score and how you will carry it the rest of your life.
When your personal credit score looks as good as it can, which is when you’ve had that plush corporate job for years on end with regular income from an employer, ask for credit. Ask for as much as you can get.
But don’t use it. Or use it and pay it back immediately.
Your ability to use money effectively in your personal life and company provide the lifeblood of your company — time. The better you are with money the more time you have.
The Monetorium is a concept I purloined from friends Lee and Sachi of Common Craft.
They used the Monetorium to maximize their travel and the exact same concepts apply to startup founders. Every item on your credit card and bank statements deserves scrutiny, especially monthly automatic payments.
Squeeze your expenses to a minimum and you’ll extend your runway to its maximum.
The key question here is how long can you go on $0 of income?
#2: Personal Relationships
As a startup founder you’re trying to do something hard that will occupy a big, big part of your life. So you have to tell the most important people in your life about what you’re trying to do.
You have to tell them and then keep telling them.
I wasn’t kidding when I suggested in my presentation that you schedule regular updates and stick to them with your personal relations. They’re investors too.
The alternative is them wondering what you’re up to, worrying about you and not knowing. And they won’t like not knowing. From my experience, they’ll like knowing a lot more.
You have to gather them around you and draw on their support. And you have to share information with them.
If you don’t, you create a very strong tension and you can’t go far with them in your life but without them knowing what’s going on in your life. Something’s got to give. So get ahead of that one.
After all, how long are you going to spend on your startup? 2 years? 5 years? Your personal relationships will (hopefully) last much longer.
The key question here — How far can you go alone? — is somewhat rhetorical because I don’t believe anyone can go very far alone.
#3: Know Thyself
We all get told growing up that we can do anything we set our mind to. But that’s not true, despite what your mom told you.
We all suffer from the single-lens problem. We all see the world from a limited perspective, from a limited series of experiences, from a limited background and with limited abilities.
We all have our default settings that are very hard to adjust.
So let’s just agree that we all need help to do what the company needs us to do to be successful. Not just what we’re good at doing. What the company needs us to do.
And let’s also agree that you need people around with with different perspectives, experiences, backgrounds and abilities. You have to find those people, then you have to make a judgement call on how valuable their differences will be.
But back to you. Once you know you, you will have to micromanage you.
I recommend a time tracking device of whatever sort you can make work. A web-based application called Harvest is what I use. Because the most valuable resource you have is your time. And when you reflect back on how you use your time, you’re almost always very bad at guessing how you use it.
So don’t guess. Track it. Then track your key performance indicators for the company. Number of client calls. Speed to market for your product. Sales.
You probably know the numbers but you don’t necessarily know the activities that lead to the numbers. And it’s the activities that you can control.
So get to know the activities, the time you spend on them, so you can control the outcomes.
The key question here — What if you were hiring and managing you?
#4: The Rollercoaster
Pick a day, any day. Here’s how you feel:
- Wins!
- Elation!
- Dreams fulfilled!
And some days are like that.
Now pick another day, any other day. And here’s how you feel:
- Failure!
- Depression!
- Doom and despair come home to roost!
Because other days are like that.
Through it all you’ll have to both be immersed in the experience and be able to remove yourself from the experience. Feel the rollercoaster pull you around and know that the next corner can reveal a whole other experience.
How you handle the emotional ride of running a startup provides a leading indicator of how you can lead the startup.
The key question here — How will you handle the highs and lows?
#5: People, People, People
You start your startup as 1 person. If you’re lucky, very quickly you add a co-founder.
A co-founder is not just a doubling either — of your capacity, of your productivity, of your stabilty. It’s more. It’s a guide and a partner.
Because your startup will only go as far as the people push it. No one is inviting the startup into the world.
You have to will it into being. You have to be an engine that powers it into existence.
Think of it like the intertia of the world:
…an object will always continue moving at its current speed and in its current direction until some force causes its speed or direction to change. This would include an object that is not in motion (velocity = zero), which will remain at rest until some force causes it to move.
Your startup starts at velocity = zero. No momentum. No direction.
The people behind the startup have to be the energy that propels it.
And that means you have to have the right people and the chemical equation between co-founders that either gives off energy or needs energy to persist.
Then each additional person you add to the startup needs to also add to the equation or they detract from the energy output.
So how do you build a team that gives off energy? You make them believe in the vision of what the company will be. You make them see a future that inspires them to great achievements.
Work on this ability and you’ll start to see the benefits of inertia.
The key question here — How will you make them believe?
#6: Eating the Fear
I basically stole this phrase from M. J. Sikorsky of Cambrian House, the subject of 6 tips on eating the fear.
You have to believe to make others believe. You have to eat the fear. It’s a natural product of the unknown and the reptile brain. Deal with it and use it productively.
There’s no real secret to this apart from confronting it, describing the details of the consequences of the fear and therefore making them less scary.
We always fear way more the unseen and unknown than the seen and known. So confront the fear and make it seen and known.
The key question here — How will you convince yourself and others to take the risks?
#7: The Scent of Money
Once you find some initial success, get on it. Get on it. Get on it.
Don’t sit back and wait. Get on it.
Find more customers you think are like the customers providing the initial success. Prove that either there is a market or there isn’t. Get on it and prove it.
No, it won’t likely fit into your business plan. It may not even fit into your vision. It may be a totally new business.
But the company needs you to put aside your ego and your ideas for how things should happen in favor of the proof you’re finding and reality in front of you.
This is hard to do. I find it effective to think in terms of what the company needs me to do. Think as the company.
And the only sustainable ways the company can survive is to get cash from customers.
If you find there is a market where you’re finding success, then, after you find some early success, you can decide if it’s a market that fits with the company vision. Yes, this will be hard to do.
But until you prove there’s a market — there’s no decision to make. There’s only the X number of days / weeks / months you have left in cash to prove a different market exists.
So why not tackle the one that you’re seeing success in? You can see that it exists. You can get to know it. You can find out if it works to make the company sustainable.
The key question here — How will sell what you have to be sustainable?
My goal in the presentation was to get beyond the strategies, tactics and execution steps to what really mattered to a startup — its people. And especially its founder(s).
No one ever taught me these lessons (and more) and I wish they had. I’m still learning them and reminding myself of them every day.
Because I may not have listened if someone had tried to teach me them. But it would have given me the chance to learn the easy way — from others’ experiences — as opposed to the hard way — from my own experience.
Thanks to Dean Prelazzi of the BC Innovation Council for asking me to speak.
Now what have I missed?
Tags:
BC Innovation Council, BCIC, Connect '10, Dean Prelazzi, james sherrett, presentations, slides, slideshare, startups
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