Coaching your business from its teen phase to adulthood
Ask anyone who’s worked at more than one startup and they’ll probably tell you the same thing: Young companies start to go off the rails once they hit 50 employees. I call this the “teenager” startup phase, and I’ve been there several times, both as an employee and an executive.
What does this look like?
Employee one through 10: At a certain point, the original employees stop learning new people’s names. They won’t come right out and say it but they start to resent having to show yet another noob how to do the same simple things. …
Save the big announcements for big deals
If you want to give your new business a decent shot at success, you need to build traction — clear, measurable evidence that people are interested in what your company is offering. And that won’t happen on Day One.
So why do startups make big, splashy announcements the day they launch? Because that’s the way it’s been done for ages. But that strategy can actually do more harm than good.
When no one knows who you are or what you do, you need to buck conventional wisdom and launch quietly, without fanfare. It took me almost 20 years and a dozen startups to figure out that my launch problem wasn’t that I was doing publicity wrong; my launch problem was I shouldn’t have been doing publicity at all. …
Let’s talk about how much you should charge customers for something when you’re not totally sure what that thing is yet.
A startup has to get its pricing right or the product will be dead at launch. The problem is, there aren’t a lot of hard and fast rules for pricing a brand new product. It’s an individual exercise, and the right answers are specific to your market, your company, and the as-yet-unknown value of the product to your customers.
Throw in the uncertainty surrounding a minimum viable product, and the pricing process usually generates more questions than answers. I know. I’ve been there. …
The more revenue you have coming in, the better the chances you can raise (and not waste) investor funds
At startups, the difference between survival and running out of runway always comes down to taking our eyes off revenue.
We don’t want to do this, and we certainly don’t do it on purpose. But when we’re in the middle of the startup run, it’s pretty easy to fall into a trap of wasting time on feel-good tasks that feel like progress but don’t bring in any money.
No entrepreneur is immune to this trap, myself included. It’s part of the drive that makes the successful entrepreneurs successful.
I’ve founded, worked at, and advised a ton of startups, and each one tends to make the same mistakes where revenue is concerned. Whether a founder is launching their first company or their fifth, there’s one universal fact they can’t ignore: The path to success starts with survival. …
Don’t be fooled by catalysts masquerading as permanent economic shifts
I want to talk to you big-thinkers and you trend-chasers for this post. Because I’m one of you, and I want you to avoid the mistakes I’ve made and I keep seeing others make.
Tread lightly around those market bubbles.
I’ve been there, I’ve been the guy calling for the rise of X and the disruption of Y leading to the fall of Z. Still do it. It’s a pretty common call to make, actually, driven by a special kind of human nature baked into the heart of every entrepreneur.
That drive to find the next new thing is what guides us, motivates us, and challenges us to solve problems that aren’t even our own problems. We want to be the pioneer in the new science. …
Five questions your model should be ready to answer
The world was not ready for the iPhone in 1993 when Apple launched it’s ill-fated Newton.
I have a huge amount of empathy for the founder who is too early, too narrow, or too buggy. One of my startup war stories is about the company three of us founded that was YouTube a couple years before YouTube. We had the tech and a product and revenue, but we couldn’t get the funding. It was our own fault, because we were too green to position and pitch it properly.
Don’t let that happen to you. Here are the five questions about your product investors will need answered before they’ll invest. …
Pay-as-you-go is the new normal from software to retail
The lure of subscription pricing is the guarantee of recurring revenue for your business. Once a customer flips the switch to turn on your subscription, it’s easy money:
- Easy to recognize your revenue.
- Easy to determine your margins and profits.
- Easy to enhance your product and extend that revenue out for months, even years.
While that’s true, converting a subscription customer isn’t as simple as flipping a switch. You can build a platform, launch with fanfare, offer all sorts of incentives and trials to attract potential customers — and watch as they disengage and lapse into limbo.
That’s the actual guarantee that comes with subscription pricing, and this will happen unless you cultivate a funnel that catches potential subscribers as soon as they learn about your product and follows them until their very last sign in. …
As I’m building Teaching Startup, a new, affordable way to advise entrepreneurs, I have to keep reminding myself that it’s not for everyone.
Yet.
There’s a real easy trap an entrepreneur can fall into when the lure of broad customer acceptance starts to compromise the original vision for the product. In other words, if I try to make my startup everything to all people, I’ll wind up with just another cog in the gears of the problem I’m trying to solve.
I know this to be true because I’ve been there in the past.
Even though I say, quite boldly, “Teaching Startup is for everyone,” I know very well that Teaching Startup isn’t for everyone. First of all, it’s for entrepreneurs. Sure. But even while typing “it’s for entrepreneurs,” I’m tempted to…
Fight or flight, this is how you maintain your integrity
In my long career as an entrepreneur, I can definitely say I’ve lost more times than I’ve won.
Not in the way you might think. In terms of outcomes, I’m batting well over 50%. But to get there, I’ve had to take a lot of Ls — from losing deals, to losing position, to losing face.
How do entrepreneurs deal with all of that losing? I mean, besides alcohol.
The deepest cut? Betrayal.
So yeah, I’ve had a lot of after-hours drinks with friends and associates, sometimes complete strangers, to hear their tales of having personal defeat snatched from the jaws of professional victory.
I’ve heard every story, from the founder who put every last penny and fiber of her being into an idea only to watch it fail due to a freak external factor, to the cofounder who built something game-changing, only to be forced out by people she trusted. …
When entrepreneurs become a sideshow
In 20+ years of founding and selling companies, advising entrepreneurs and executives, and even back when I used to invest in startups, I’ve seen way too many entrepreneurs — both young and old, both fresh and experienced — fall for some of the same sketchy shit over and over again.
These people aren’t stupid. In fact, most of them are quite brilliant.
The reason why they get lured into these traps is because, for the most part, the traps are built on the foundations of actual opportunities. They look a lot like the real thing, with a twist.
The twist is where they get you. …
