Entrepreneurship is about doing, not learning, doing.
Many businesses are formed because the entrepreneur thought he or she could “do it better.” For example, Steve Wozniak felt Apple One could be a better computer, and Ferdinand Porsche built his sports car better than Ferrari.
Market leaders are weak in three ways:
- When a leader is committed to a way of doing business. For example, IBM sold its computers by using resellers, which paved the way for Dell to sell directly to the customer.
- When the customers of the leader are dissatisfied.
- When the market leader is milking a cash cow and stops innovating.
Three factors when forming a startup:
- Expertise – the sum total of your core skills
- Opportunity – existing market and potential one
- Passion – you should at least not hate what you’re doing
Find soulmates. People love the idea of the sole innovator. It’s wrong. Successful companies become so because of two or more soulmates. They need to have similarities and differences. It starts with one person dancing alone. The first follower brings credibility to the leader transforming the lone nut into a leader.
Partners need to have these similarities:
- Size – empire or lifestyle business?
- Commitment – 10-year commitment or flip in 2 years.
- Expertise – needs one to sell the product and one to make it.
- Orientation. Sweat small details.
Your company needs to develop a mantra. Something that’s easily said that can be repeated as part of your company’s culture.
There are many different ways to become profitable. You must pick your specific business model and constantly tinker with it to get it right.
Target a specific niche. The more precisely you can describe your customer the better.
If you can’t describe your business model in 10 words or if you were you don’t have a business model.
MATT = Milestones, Assumptions, Test, Tasks.
Weave a MATT so that you prevent from going after goals that don’t matter to your business. Refer to this at all times and stay focused.
Milestones: working prototype, initiated capital, field testable version, paying customer, cash flow break even.
Assumptions: market size, gross margin, sales calls, length of the sales cycle, etc.
Test: ask questions that are important and answer them honestly.
Tasks: any activity that doesn’t help achieve these is not important.
If you’re forming a small business consider an LLC, LP, or C-Corp for business structure. If going public, file a Delaware C-Corp which allows varying levels of shares.
Do something cringeworthy. If you are not embarrassed by the 1st version of your product, you’ve launched too late. How it evolves is important.
You shouldn’t write a business plan, you should get paying customers.
Your advertising budget should be zero. Use social media to get the buzz going.
Talk with as many people about your “secret idea” as possible. Get as much feedback as you can.
Do you need an MBA to start-up a business? Not at all. MBAs are used to fill an employer’s requests and HRs credentials. If you’re starting a business, you are the employer.
Blast your product out on social media and “flow with the go.”
Incubators provide shared workspace and access to shared services, like admin tasks that take valuable time and effort from a business owner’s day. Accelerators provide business expertise and access to capital. Using an incubator is the equivalent of going away to college versus commuting to college. You’ll be around fellow entrepreneurs most the time.
Demo Day: when pitching your startup, start with shock and awe. You have about one minute to captivate your audience. So don’t work up to a crescendo. No jokes. One person. No jargon. End on a high – finish on a high note.
The hard stuff is managing, motivating, and leading people. The easy stuff is accounting, finance, and operations – they can be learned.
Never show signs of defeat, especially not to employees. They must believe that you believe.
What gets measured, gets done. A person who asks for accountability and understands that he will be managed is a person that gets things done.
Hiring your dream team: Find your Morpheus – someone who will help you understand reality, not fantasy. Hire a devil’s advocate, which is literally someone hired to argue against the canonization of a saint.
“A” players hire “A” players. B players hire C players and so on. Hire people that are better than you. If you hire people that aren’t as good as you that’s the surest way to mediocrity. Since you may not be able to hire A players right away Hyer the minimum viable player who can get the job done right now and then fire them once the right candidate comes along.
It’s never been easier to bootstrap a business.
Be open about what you CAN and CANNOT do. Pick a fight with your market leader.
In any speech or pitch, explain yourself within the sixth minute. The people listening should know what your company does no later than six minutes in.
The 10/20/30 rule means you should have 10 slides, that fill 20 minutes, with at least 30 point text. Never read your slides. Use black slides and white text.
Build your bullets. Use bullet points and don’t let your audience read ahead. Practice your pitch about 25 times and videotape them. Also, pretend that there is a little man on your shoulder after every time you speak to ask the question “So what?”
Keep improving your business pitch. Business pitches are like Jeepneys in the Philippines, where ex-pats and US soldiers left thousands of jeeps from the army that became taxis grown to be beautiful vehicles with that capacity.
As an evangelist, your job is to facilitate the user groups that use your product or service.
To be a great business leader, you must be a speaker who gets standing ovations.
Social media is an entrepreneur’s best friend: free marketing that can reach millions.
Use every platform and churn rather than cogitate.
Repeat your tweets and shares, don’t worry about keeping repeating. If it doesn’t piss someone off, you’re not using it enough.
There are only two ways to get more followers on social media:
1. Share good stuff.
2. Jump on any new platform when they arise. A new platform is a landgrab you have to join before you believe this platform will succeed.
Never buy followers. Don’t retain the services of a digital ad agency and don’t outsource your social media marketing intern.
The Art of Rainmaking
Understand the guerilla markets that you are not paying attention to. Understand that your business is putting up plenty of flowers and if you don’t pay attention to the flower to reap the most fruit you’re not rainmaking.
How to Make a Sale: 1. Establish a place for your potential clients to ask questions. 2. Ask questions. 3. Listen to the answers and take notes. 4. Convey to the potential client how your product and fit that need.
When managing salespeople and rainmakers, make sure that you are holding them accountable to metrics. Salespeople need numbers to shoot for then don’t set the bar low.