In my last post, I wrote about the two biggest money blocks that startup founders have to overcome if they want to invite wealth in all its forms into their life. To me, wealth isn’t simply about the dollar figure on your profit and loss statement or the assets on your balance sheet. These things go up and down. The real question is: do you have the key ingredients in place to ensure that you can exponentially generate wealth?
If you don’t, then it’s the ingredients you need to fix–not the numbers. The numbers are simply a reflection of the ingredients that are going out…and coming in. Number crunching aside, the whole formula is really quite simple.
For a startup, it comes down to the team, the product and the customer. There is really no need to complicate it in your mind or anyone else’s. Despite all the fancy pitches I’ve seen over the years–from Silicon Valley to Singapore–it really just comes down to two pivotal factors.
The ‘who’ and the ‘what’.
Who is in the startup team? Do they have what it takes to start from scratch and create equity for the business? And secondly, what is the business selling? Is there a demand for it or is there the potential to generate demand in the future? Is there a customer willing to pay for what you’re selling or are they only interested in freebies?
There are lots of clever forecasting formulas out there if you’d really like to sit down and write make-believe whilst you futilely forecast the future. If you ask me, time-strapped startup founders are better off focusing on the ‘who’ and the ‘what’.
I am a dream. I have a desire. I have a gift that life wants me to give the world.
Not all founders are visionaries. Many of them have simple ideas that they are able to execute brilliantly. Others have the capacity to sell to millions. It doesn’t matter which category the founder falls into. The founder always comes first. Not everyone will believe or buy into the founder’s vision. The world has never been short of naysayers and gossipmongers. Put on your headphones and turn on a tune. You have better things to listen to.
Quite simply put, the founder should see something in the world and about the world that most people don’t. He or she must have the vision to create something that didn’t exist before. But the vision itself isn’t enough. The founder must have a burning desire. A desire to create and a desire to achieve.
The Founding Team
At the very onset, a startup founder doesn’t need fans or followers. People who look up to you will never roll up their sleeves or get their feet wet. That is not to say that a founder shouldn’t be respected or admired. Just that if a team member looks up to you as a mentor or an advisor, they won’t be able bring anything of value to the table. If they have the entitled audacity to treat a startup like a school, you better start charging them tuition fees.
A startup team must have the drive to win. And win big. Over the past year and a half, I’ve often asked myself why people older and more experienced than me would roll up their sleeves and join me as I start from humble beginnings. The answer is simple. They want the adventure. They want to build something from nothing. And… they believe I can and will build a successful business that lasts.
Whilst people like that are rare, they are out there. If you find one–or if someone happens to find you–hang on and don’t let go.
A founder needs a second-in-command. While ordinarily called the COO, I feel this role has more fluidity than all the others. This is the wingman, the right-hand person, the personal manager, the part-time shrink and the ultimate cheerleader. This person should never ever play politics and is always be prepared to tell you what you don’t want to hear. Having said that, this individual should absolutely never be a risk-adverse naysayer. No founder needs that.
A startup also needs a product person, a sales person and a marketing person. Give them whatever fancy title you want, but that’s the crux of the main roles in the founding team. Typically, the startup founder takes on the role of the enterprise leader as well as one of the main organisational functions. It is not like working in a large corporation where all the enterprise leader does is make sure that everyone else is doing their work. If your team needs your help to do their work, it’s best you demote yourself from startup founder to manager. The founding team should be able to do their work independently and collaborate with the rest of the team to simply just get more stuff done together than they ever could alone.
If they can’t, then that’s simply not the right person. There are plenty of other opportunities out there. Show them the door and wish them well.
You, as the founder, have work to do.
Is it a pull strategy or a push strategy that you’re employing? This point is pivotal in deciding which marketing and sales strategy to use to reach your target customer. In the event that you’re selling something in which there is a known demand and a gap in the market, then the push strategy would be far more appropriate.
Get out there! Knock on doors! Close deals! If someone says no, try another door! Yes, it’s all a numbers game. Someone will say yes, eventually.
In the case of creative businesses, the pull strategy will most likely be more appropriate. The product is created first and the customer comes later. In this scenario, customer demand is ascertained through prototyping or testing different segments to see results and future decisions are made based around those findings. In the pull method, supply–not demand–is the impetus for growth.
Always, always, always apply the law of averages when dealing with customers, especially new ones. Your sales and marketing people need to be plucky, ambitious and courageous. Most new products are not going to be perfect. The people involved in product development may well be wallflowers. Their primary role is to create the product, after all. Nevertheless, they should be able to accept feedback from the sales and marketing people regarding what customers want so that they can make the changes necessary to make a sale.
The sales stream is the lifeblood of a business. Without revenue, growth is simply not possible. Having said that, loss leaders are a pretty common sales strategy. A company may choose to sell a product or service below cost to stimulate the sales of other products or services. But the big picture still needs to make sense if the business is to generate a profit.
In English, there is an adage, “Customer is King.” The Japanese take it one step further and say, “The Customer is God.” No business can stay in business without a paying customer. It’s not enough for there to simply be demand or supply. Someone must be willing to put their money down for what is on offer. Without that; there is no transaction, no exchange and no reason for a business to exist.
Be an achiever. Be surrounded by achievers. If that isn’t an option, be surrounded by people who have a burning desire to achieve something and will do what it takes to get there.
Leave the naysayers, the critics and the ‘well-meaning’ advice of your ‘well-wishers’ at the door. You, and your startup team, have work to do. Anyone who isn’t willing to roll up their sleeves and get their feet wet doesn’t belong by your side and in your team. You can politely ask them to be a customer and complain to your customer services department. You–and your team–have work to do.
As a startup founder, it’s easy to get bogged down in all the details of running an enterprise. Every time that happens to you, close your eyes and think of that distant pot of gold. And remember, that it is always within reach.
Dipa Sanatani is the Publisher at Mith Books and the author of The Little Light and The Merchant of Stories. In The Merchant of Stories, Dipa takes the reader on a personal journey–narrated through a series of candid journal entries–on what it takes for entrepreneurs and creatives to start their very first venture.