Posts Tagged ‘Entrepreneurship’

“Startups are damn hard”, but rewarding..

May 9, 2011

I read Jazzy Chad’s emotional and brutal ‘Startups are hard post‘ and wanted to add my own comments. I don’t know Chad but in my opinion he’s being very hard on himself. His lack of reaching his goals and achievements seems to be tearing him apart and making him frustrated and bitter. Yes I agree startups are damn hard, but they are also rewarding, fun and fulfilling. Let us not forget this.

I’ve drawn out and condensed some of Chad’s text and added my comments. I thank Chad for his passion, honesty and putting this in the open.

Startups are hard. No, startups are damn hard.

“Startups that die rarely talk about it publicly because it is frustrating, embarrassing, and most of the time the people involved want to forget the whole mess and move on rather than sit around talking about the fact that they failed.

Most people don’t want to admit that startups are hard, either, because to admit something is hard is to admit that you don’t know everything there is to know about a certain topic and to display weakness.”

I whole heartily agree (admit) that startups are damn hard. I’ve always said this 5 ‘Shocking’ things founding a startup, Startup vs Home Life, Entrepreneurs: Beating the employee out of you.. You have to admit something to truly embrace it. We failed when we started.

My co-founder and I spent seven months and a pile of cash building something that went nowhere. It took us time to get over it but we did. There were lessons to be learnt from this experience, they just take time before you see all the dots join.

You’re Nobody Till Somebody Loves You

“In the Valley, you are a Nobody until you are a Somebody. Trying to launch a new product as a Nobody is hard. Trying to get press as a Nobody is very hard because nobody knows who you are and so they don’t care about your product.

Raising money as a Nobody isn’t just hard, it is nearly impossible. There are a few major factors that investors look at when making an investment decision. Two big factors are Traction and Revenue.”

We’re not in the valley, so I can’t comment on this location, but I know nobody is listening to us where we are! In my mind the only people that real love comes from is your customers. We prefer to focus on them.

“Jealousy… is a mental cancer.” -B.C. Forbes

“Am I jealous of other companies’ success? I would be lying if I said no. I am slightly jealous when I wake up and read another story about some company raising a million dollars for some idea that makes absolutely no sense to me, or seeing an acquisition of a company for a product I did not feel was particularly well executed.”

I do also suffer from this sometimes. My ego gets in the way. But then I remember the reality: it’s not easy and that mostly everyone will have been through many, many challenges to become a success!

Sacrifice

“Startups demand sacrifice… Has it all been worth it? If you are expecting me to say “Yes, of course!” you would be wrong. The truth is, it hasn’t been worth it at all… yet.

Financially speaking, we are much worse off now than when I took the plunge. Of course the goal is for it to be worth it someday, but it is unclear how long it will ultimately take. In other aspects of my life, it may have been worth it so far, but it is hard to quantify those things.”

Yes, startups demand sacrifice! Has it been worth it for me, hell yeah. I’ve said this before: “You have to let it all go…fear…doubt & disbelief…Free your mind! and Life, death & startups. Why’s it been worth it – because startups aren’t just about the money.

They’re about life. More specifically life experiences with people around you.. Don’t get me wrong money is vital. It’s the lubricant for our companies. But money is not the heart and soul of an organisation, a company. It’s in the people: co-founders, colleagues, friends (including your customers).

Startup Depression

“…The ultimate reality, though, is that we failed utterly at fundraising. We ended up wasting a lot of time. We had dozens and dozens of intros which led to about 40 or so meetings. After spending 3 months and hearing “No” 39 times we decided to just give up raising money. We looked around and felt like everyone around us was raising insane rounds with no problem. The net effect was that it killed our morale dead.”

After hearing, “UR DOING IT WRONG!” so many times, it’s hard to think that you’re doing anything right. At that point it’s very hard to soldier on. We had made a terrible mistake; we had given control to the investors, and they weren’t even giving us money!…

The lesson here is, if you are having trouble putting together a round in the first few weeks of actual investor meetings, just say, “screw it,” and get back to working ASAP.”

Every time I go into a conversation with an investor or investment adviser, all I hear is demand after demand.. This has happened right from the beginning of our startup. They want a solid product, more revenues, more customers, longer term contract, etc.. On and on it goes.

On the other hand you have customers. They are different. Yes, there are demands but they are willing to pay if you’re of value. Don’t get me wrong investors are vital but customers come first and I think Chad is getting that wrong way round.

Going Forward

“Which leads us to: so what now? Paul and I are not ready to quit. I personally don’t really know how to quit. When I make a commitment, there is very little that will stop me from following through, even in the face of adversity. I believe you have to adapt to play the cards you are dealt. We are willing to see this through to the bitter end if necessary. If this means changing course and trying something new, then sobeit, but while there is money in the bank we will continue on. We have some ideas and are investigating them further.”

For me knowing when to quit is the hardest question for any startup founder! Unfortunately startup founders often become obsessed by achievement at any cost. They become like sports people who over-train and leave little time for recovery. This leads to burn out or diminishing returns. A vicious circle of in frustration and bitterness is then formed. Sometimes you have to take a break to see the bigger picture or quit to succeed!! 

Advertisements

Loving the Underdog! PART2 – City of creation

April 8, 2011

This is my follow-up post to Loving the Underdog! PART1 – The 800lb gorilla

My startup, Aware Monitoring, was recently invited to a local business club event as an example of a innovative and entrepreneurial company. At the event I was blown away by the growth and leading market positions of the other companies presenting!!

It occurred to me that a strong local business and startup eco-system is absolutely vital to nurture young ‘underdog’ startup companies like ours. Success breeds success. We must all invest in our local eco-system and everyone in the city will reap the rewards.

In this Invest in Nottingham Club video I talk about my underdog
startup and the potential of Nottingham

My startup is based in the provincial city of Nottingham. Our city is the centre of business within our region. Nottingham is well known for its creativity, innovation and of course, Robin Hood. We have some big great companies here including Boots, Experian, Raleigh and Capital One. The city has a world leading biotech cluster and is a UK centre of gaming which hosts GameCity, an annual global videogames festival.

The city has a strong tech community, with social groups such as Nott Tuesday and Geekup bringing developers, designers, bloggers and online entrepreneurs together to share ideas. And we have some great tech companies including Esendex, Prime Principle and Outso.

However the City has a long way to go before becoming a leading cluster for web tech on the scale of BioCity, a Nottingham based biotech cluster. I’ve been extremely impressed by BioCity and the eco-system of companies and people working around it. Several of the companies at the event were based at BioCity. This type of light touch commercial eco-system with small and large niche companies working together seems to work incredibly well.

The ingredients which go to make a city of creativity that forms clusters such as BioCity, Silicon Valley or TechHub include:

  1. Startup facilities – Low cost, industry specific incubators which are commercially supported and run.
  2. Second generation founders – Industry specific founders who become investors and mentors in startups.
  3. UniversitiesThat attract and develop talent from across the nation who then settle locally.
  4. Larger companies – Who’s staff leave the corporate world to branch out their own.
  5. Institutional investors – These are needed to help continue to grow successful companies.

I was blown away and inspired by capability and growth of local companies presenting. This is both the companies that are part of BioCity and the ones who have done it own their own. These events show what can be done locally in a provincial city like Nottingham. The companies demonstrate the resourcefulness, commitment and innovation that founders are capabile of.

In some way its better to be a in city fighting to create something new. It brings people together to focus their efforts on creating something of meaning and value.

My next ‘Loving the Underdog’ post will be Loving the Underdog! PART3 – Why we Love ’em

You got the love for building businesses?

January 26, 2011

Watching Morten Lund at Geek’n’Rolla it occurred to me that our entrepreneurial future lies in our past. This video is a must see – he’s a very excitable and wacky character. Morten exudes life and Zen. He said ‘I’m an entrepreneur’holic’. He can’t stop building businesses!

I’ve not been doing it myself for 18 years. Looking back into my career, family background, I’ve been building businesses up for about the same time. Of course,  in my career this was for other people’s companies. However, I believe that we can still be entrepreneurial working for someone else.

Please bear with me as I use my past employments to demonstrate the point:

  • NetCare (part of ComputerLand UK Plc) – I took on the job of turning this fledgling IT managed service into something big. At the time I was offered a much more stable alternative position with a higher salary. It seems strange to take a more difficult position for less money but I saw the potential and wanted to build something of value.
  • Novell – I had always dreamt of working for a successful global software company and when Novell offered me the chance I was extremely excited.  At the time Novell had suffered some serious set backs. When Eric Schmidt   (now Charmian of Google) joined and the share price was on the up, I could see this could be a turnaround. It was the chance to help re-build Novell. Unfortunately I was proved wrong. Eric left and the company continued it’s slide downwards.
  • NetMan – This was a niche boutique consultancy. They specialised in Novell and Intel LANDesk. Only eight people were employed when I started. At the time I was offered a job at a much, much larger  systems integrator but felt NetMan had more exciting potential. We did well. The business grow significantly and was acquired by ComputerLand UK Plc. We built something of value.
  • Business Systems Group (BSG) – We made this company  into the fastest growing systems integrator in the UK at the time. I loved being a key part of that growth. I built up several product and service streams whilst at BSG. This included their software support business. At the time BSG had virtually no support services. They mainly sold PC hardware and software. I build their software support service into a healthy and profitable service. I also grow BSG’s Apple Mac business and helped build their software development services.
  • WARNING PLUG = Today, I have my own startup, Aware Monitoring – We have a website, web app, e-commerce performance monitoring service. If it’s down, with error or slow – we let you know! We  started from scratch!  Building it has been intense. What an amazing feeling doing it for yourself!! It’s such an incredible feeling when a major company and new customer says they’re ‘delighted’ with the service. Very different from doing it for someone else..

I love building businesses or product/service streams from very little. For me its the challenge of making something new that was not there before. I look back further into my family history and see a strong heritage of trading in great trading cities like York. Looking closer, my close family have had or still run their own businesses.

Having a startup and growing a business into something real is not for everyone. It’s not easy. It takes great persistence, sacrifice and belief. The more I think about it, the more I realise that building businesses has to be part of you. It’s part of your past and your future. I don’t think you wake up one day and say ‘I feel like starting a business today’. You have to be committed. Really committed – Like Morton! It has to be part of you!!

Startups: Keep it secret, keep it safe..

September 21, 2010

I hear this from entrepeneurs all the time: “I’m keeping my startup idea secret”.   In my opinion and that of others, don’t! Talk about your idea to almost anyone who will listen.  Everyone! Investors, entrepreneurs, friends, ex-coworkers, etc. In fact, anyone! Why? Because the more people you talk too, the more you will learn.

In Eric Karjaluoto classic post Why your web startup will fail’, Eric says: ‘No one is looking at you. No one is listening to you. Even if you create a portable fountain-of-youth, your startup’s biggest challenge will be to get anyone to pay attention. Really–it’s that hard.’ You therefore have to talk to lots of people and there’s a ton of benefits when you listen to their responses:

  1. Evolution – Others will give the idea refinement and improvement suggestions.
  2. Make better – By taking to people you will discover flaws and hopefully correct them.
  3. Learn – You’ll understand a lot more about the sector and industry you’re aiming at.
  4. Competitors – You will learn about competitive products that exist or are being built.
  5. Find needs – You will gauge people’s excitement level for the product and for various features.
  6. Practice – You’ll refine your all important sales and investor pitch.
  7. Bad idea – You might even discover your idea is a bad idea and save yourself a world of pain.

Despite the clear benefits there’s always the counter argument: “but someone will steal my idea”. In reality there are, at most, a handful of people in the world who might actually drop everything and copy your idea. Unfortunately, most people will think your idea suck’s.  However his does not mean your idea is stupid. Entrepreneurship is about seeing needs that other don’t always understand immediately. So, who’s going to copy you..?

  1. The big company employee – They or their company will steal your idea. Not likely! Their employers normally have a product in the market and its hard to change direction, particularly for big companies. They are personally in a big company because its safe. Are they really going to leave their fat paycheck for the unknown.. I doubt it!
  2. Other entrepreneurs – Most founders, who are going to build something, are already working on their project and are highly unlikely to drop everything to copy you.  Even if they are in the idea generation phase, high integrity entrepreneurs are unlikely to copy your idea.
  3. VC’s –  They will either like your idea or not. If they like it and like you enough, you’ll get funded.  VC’s prefer to fund an existing teams than taking an idea and building a team.  The team owns it! The one risk is if they have entrepreneurs workingon a similar project.  But most VCs will disclose this first and let you decide.

The handful of people in the world who might copy your idea are entrepreneurs just starting up with a very similar idea.  Don’t worry competition is good and their will always be smart founders out there with similar ideas. Remember ideas are cheap and execution is everything. Also remember, an idea changes as it grows.

Finally, the conversation moves onto the NDA (Non-Disclosure Agreement) – I’ll tell you if you sign an NDA”. Unfortunately this blows everything:

  1. Shows inexperience – Few experienced entrepreneurs or VCs will sign them.  Asking them to is widely considered a sign of inexperience.
  2. Consequences – There value is not clear unless you are a big company. Are you really going to spend years suing someone who signed an NDA and broke it?
  3. Time – As a startup you don’t have much time. Don’t waste it writing unnecessary documents.

Ideas grow and branch off in unexpected ways when they’re given the light of day. Don’t keep them secret to protect them. Talk to everyone who will listen and you’ll probably learn a thing or two 😉

Startup vs Home Life

September 9, 2010

I Love my home life (family, friends and adventure). I also love my startup. Like my children it embodies the future! With all this love to spread around, there’s not enough time for everything. I’m not alone in this startup vs home life situation. One of my good startup friends is in the extremely intense phase of finishing his app, Annot8, before launch. He’s working all hours!! His kids now think his office is ‘Daddy’s house’. From all I’ve read startup, home life, and physical/mental well-being needs to be carefully balanced to help make a successful startup.

The trouble starts, as it inevitably does, when a startups becomes an obsession. Driven from a desire to succeed and too much to do, a startup can take over your entire mind. Until you think and talk of little else.  You become so connected to your startup your emotions are driven by the highs and lows of the company. Obsession is not all bad. It pushes and creates. However there is a personal price to pay:

  1. Family life suffers –  My blogger friend Giff recently talked about entrepreneurship and parenthood saying ‘young kids take a huge amount of time, require flexibility, and put a lot of constraints on a founders schedule’. His excellent point is that the only answer is ‘compromise’. Like most things in life its a balancing act. You have make time for both life’s. In Steve Blanks great post, ‘Lies Entrepreneurs Tell Themselves’ he very honestly talks about the need to be realistic why you’re starting-up. It’s often for selfish reasons and not thinking of others!
  2. Your body suffers – In Mark Suster’s ‘The Yo-Yo life of tech entrepreneurs’ post Mark talks about how your body suffers with weight gain. You more often eat unhealthy food and may consume more alcohol. You have less time for exercise. This isn’t good. We all know exercise is great for stress relief. I’ve certainly found it challenging to keep training whilst growing our startup. Be strict and make time for your body.
  3. And you Mind suffers too – It seems to achieve great things one needs to leave the norm behind. ‘There is a fine line between entrepreneurship & insanity’ – Anita Roddick. To be great you have to concentrate on one thing. You can see this in any great sports person. However total concentration without any relief builds-up both physical and mental exhaustion. You ‘burn out’! The uncertainly of startups can also cause you to constantly worry. Here’s a interesting post on what a founders wife sees in her husbands start-up. Take a break from your startup and recharge your mental batteries.

When you become obsessed by your startup everything else suffers: your body, your personal relationships and ultimately your startup! The startup journey is a marathon. As founders we cannot do it on our own. We need a support mechanism. We must have help from family, friends and help ourselves. By isolating ourselves in our startup obsession we cut off the very support that can help us to succeed. Mike from crowdSPRING has some great tips on managing this difficult balancing act of life and startups.

I’ll leave you with one final thought from a great obsessive man: If A is a success in life, then A equals x plus y plus z. Work is x; y is play; and z is keeping your mouth shut”. – Albert Einstein

Valuing an MBA in a startup

February 3, 2010

Over the last week there’s been alot of talk questioning the value of having an MBA in a startup – Giff Constable, Rob Chogo, Jon Steinberg, and Charlie O’Donnell (All stateside and non of whom I know). I’ve an MBA in entrepreneurship, 20 years tech business development experience and now a startup. In my experience an MBA does not teach anything you don’t  already know or can work out for yourself. However it does say something about you as a person. Unfortunately this counts for squat in a startup.   As in sales and in a startup you are only as good as your last months or quarters sales.

“Reach for the sky!”

Why do an MBA?

From my experience meeting other MBA’s Jon Steinberg summarizes  really well why people undertake the MBA:

  1. Value in building a network
  2. Credential – certain employers require an MBA for certain jobs
  3. Need a break from work
  4. Career change

For me it was about adversity, learning and change. Adversity has been shown to be the number one  driving force for successful entrepreneurs. I don’t have a first degree and dropped out of  college. I’d been stuck on an educational ledge ever since. Some of my close family and friends strongly advised me against doing the MBA, particularly in entrepreneurship. Yet it was one of the best years of my life. I loved every MBA minute!

Experience v’s an MBA

During my tech career I’ve built significant profitable customer bases three times from scratch. It ‘s been an amazing experience with great highs and the occasional low.  In my last employment I grew a remote managed services business unit  into a highly profitable multimillion dollar Global business winning customers like Richard Branson’s V2 Records. Building customer bases from nothing is not easy. I’ve found building a company even harder.

There is much an MBA does not teach you. It does not show you the many practical skills needed in business. In particular skills like sales, marketing a small business, attracting resources – the list goes on..  There are  so many skills needed  to run a startup.  Given the choice real small business experience wins hands down over an MBA in a startup. However sometimes we forget that an MBA is an academic qualification. I’ve found that my MBA  has brought value to our startup.

We like difficult challenging times

Some of us perversely put ourselves into difficult and challenging positions where the odds are not good. It’s often not a comfortable place to be. However we keep going back there! The MBA is deliberately tough. It was challenging for me not having the educational experience and understanding from a first degree. The first semester was the hardest. Its like a bootcamp. They give you too much work. It was an especially hard as my mother was diagnosed and died of cancer during the first semester – all part of life and doing an MBA!

Does an MBA bring value to a startup?

After so many years at the practical coal face of business development the MBA has definitely helped me see things differently. I now look at decisions more objectively. It has brought a greater understanding of internal business structures and holistic competitive markets. Was it worth the $10,000’s of dollars it cost? Plus all the living costs and lost savings –  probably not. Would I make that decision again to do it – defiantly!

An old serial entrepreneur friend of my said that ‘a startup is an MBA of life.’ And he is so right. Nothing can prepare you for a startup. It is unlike anything I have ever done. It messes with your mind and body. We all know you didn’t need an MBA to start as business. So why do it? For me is it’s about exciting new adventures where you push yourself to the limit and learn new tricks. This could be doing an MBA, starting a new challenging job or having a startup. Keep learning and pushing your own boundaries. Life is boring otherwise. And why have a boring life! You only have one of them 😉

Yeah I know I’ve got an MBA, so I’m bound to be a bit bias. However on balance I highly recommend an MBA for those that have something to prove and love challenges. If your heading to startup ville and not moving up the career ladder in the same company an MBA will probably set you back. It will cost you lots of money and if your doing it to change career will put you back years. But these are  good things. They keep you fresh and hungry. It’s the learning and personal growth that really matters.