Stay on Top of Enterprise Technology Trends
Get updates impacting your industry from our GigaOm Research Community
I recently read Alex Iskold’s great piece 36 Startup Tips and began thinking that had I read this a year ago, maybe my own startup experience would have been smoother. (I’m a co-founder of Makemesustainable.com.) It is a daunting task to incubate and eventually launch a company. Most of us founders start down this road because of a passion for our subject matter, in addition to any skill set we might (or might not) possess. But the vast majority of us won’t have the resources we need when we need them, no matter how successful we have been in the past. (And if you think you’re different, or doing everything right, be very wary.)
So, I put together this list of 10 “Un-Tips” because although plenty of people are willing to talk about what they did right, very few are willing to talk about what they did wrong. There are exceptions, like the folks at Path101, who are communicating with the public in a radically transparent fashion (and, in my view, finding great success in the process).
I wrote this as we were preparing Makemesustainable for SXSW, where we have set up an interactive “Carbon Tree” for attendees to reduce their carbon footprints as they network. So, one caveat: by the time I leave Austin, I’ll probably have another 3 “Un-Tips” for this list.
1) Don’t write your executive summary first. We wrote ours before we finished our business plan. Wrong. While the big ideas are there, it’s always the nuances in the plan, the order of things and most importantly the thought process put into the execution of the plan that count. The exercise is the best opportunity you have to poke holes in your own plan (and fix them!) before someone else does.
2) Don’t Pay attention the guy saying “if I were you I’d…”. Your idea can change, and you can take advice, but listen and filter. Someone asking questions is good, but if you’ve thoroughly outlined your ideas already you shouldn’t have to defend them again. I have learned invaluable information from VC’s, investors and advisers, but I’ve wasted too much time and energy on other’s ideas when my filter was not ruthless enough. Half the time a VC giving you a path to run on is a VC saying they are not interested in investing. The VC firm that really understood makemesustainable was the only group that refrained from telling us how to change the orientation of the company.
3) Don’t take a lot of “shot in the dark” meetings. We started by taking every call and meeting we could get and scaled back eventually to about 2 in 4. Time you devote to a “maybe-this-could-be-useful” chat is time, energy and mental broadband lost. Caveat here: any meeting with a connector, someone you know to be connected to everything and everyone, is useful. If you’re selling wombats and this person is in car sales, that is fine…if he sells cars to the top wombat buyers in the country.
4) Don’t rely on developer-consultants. We run a website, but none of us is a developer. Bad. We work with one of the top programming groups in our industry with a great track record, but we should have tried harder to get an internal developer, because when your company hits the top of Digg and your site overloads and crashes, you’ll need someone with the right incentives (equity/salary/glory), who isn’t afraid to get his hands dirty and fight it out in the trenches for you.
5) Don’t forget to set goals, early and often. Think about small: “Today I will write a blog entry and buy that printer we need so badly,” and large: “This month we’re going to wrap up the beta site by finishing the design pieces, sending out test-user invitations and incorporating in feedback.” It was easy for me to get lost in whatever was at hand and forget about the larger picture. Benchmarks should exist in your business plan (set them, you’ll do it sooner or later), within your team and in your weekly activities.
6) I didn’t back up all of my information. My hardware crashed and I lost contacts I’ll never get back. My laptop’s screen died about six months after starting the business. It was stressful. At tax time I realized that I couldn’t only get nine months of statements from my bank, the rest cost $10 a pop. Moral of the story, back it up, back it up, back it up!
7) Don’t moonlight. For the first 6 months of MakeMeSustainable, I was still working a consulting job. I’d go directly from work to the coffee shop to work until midnight when it closed. I didn’t have much of choice, financially it wasn’t an option to go full time. However, once I was full time, I was still working 80+ hours per week. What ended up suffering was my efficiency and attention to detail. Plain and simple advice: take a break, relax. You’ll still be working more then your buddy who works at the post office, but make it on your terms. I turn off my PDA email after around 9pm unless I know I’m receiving important information and I try to have one day of the week I do (almost) no work.
8) Don’t neglect Quickbooks. I know it is a pain in the butt. Have someone teach you, pay for a few lessons or ideally bring in a bookkeeper and sit with them in order to learn. You’ll thank yourself at tax time. I went through two versions of the company in Quickbooks before getting it right on the third time.
9) Don’t cut off your funding options. VC vs. Angel vs. Corporate/Strategic?
Fundraising is the bane of every entrepreneur’s existence. It is stressful, takes up mountains of time and requires amazing amounts of patience, attentiveness and humility. Everyone’s opinion on how to do it right is based on personal experience, success and/or failure. It is important to keep your options open.We got great advice, but focused quickly on raising an A round with a reputable VC and slowed the Angel search. We still haven’t raised that A round. But we might.
10) Don’t forget to prioritize communication. We are three founders, two in Boston, one in New York, all living separately. Communication could have been a lot better. Setting up weekly calls or meetings with your partners maintains rhythm and guarantees everyone is up to date, even when times are slow. Work alone? Set up a weekly call with your most key investor, employee, whomever. This is a great opportunity to check in on your goals and benchmarks.
David Delcourt is currently COO at MakeMeSustainable, which he cofounded with Ben and Adam Brown in 2007. Previously, David worked in investment banking with Banc of America Securities, where he specialized in natural resources finance, and with NERA Economic Consulting, in Boston, where he served as a Research Analyst. David jumped at the opportunity to transform his passion for the environment into a tool for change with MMS. It is his first entrepreneurial endeavor. As long as there is less then a few inches of snow, David can be spotted riding his mountain bike around Cambridge, where he lives.