Team to Start http://teamtostart.com Wed, 22 Feb 2012 14:56:09 +0000 en-US hourly 1 The Concept of Business Education is…. http://teamtostart.com/2012/02/22/business-education/ http://teamtostart.com/2012/02/22/business-education/#comments Wed, 22 Feb 2012 14:56:09 +0000 http://teamtostart.com/?p=377

I was thinking about this topic today.  The concept of education is BS in many ways.  Maybe…I’m just different, in the sense I didn’t learn anything from school.  What about the rest of you?  My education was self taught, either by reading, listening to others experiences, or simply by…doing.  But tell me, honestly, how valuable is school really that we spend so much of our lives and money on it?  And how hard is it to disrupt this industry?   Because since the beginning of time, is has been embedded into people’s brains that education is just something you have to do.

Here is why I’ve come to the conclusion the concept of business education is BS:

The start of this article stemmed from sitting in a coffee shop today trying to think of something to write about.  There is this woman with her kid.  They have the books spread out over the table, doing homework while the mom gulps down some coffee.  Mom is definitely an entrepreneur, I know her from the other business down the street.  She’s trying really hard to understand this stuff her daughter is learning.  I overhear their conversation.  They are trying to figure out this V/CV syllable variables thing.  This kid is maybe in the 3rd grade.  The kid gets up to go to the bathroom, and the mom jumps on Google trying to find the answers before the daughter comes back.  I laugh at her…and she looks up, and says:  “This is ridiculous.  When is she ever going to use this in real life?”

For those educators that say they are smarter then us entrepreneurs, I have a challenge.  Here is a very simple, real life, formula for you to ponder…

The Cost of a MBA

The guy I’m using in this example is real, first of all.  This guy has 2 MBA’s (That’s right.  Not one MBA, but 2 MBAs).  The math begins with figuring out how much that MBA costs.  Your average MBA costs upwards to $100,000.  This guy has 2 MBAs, so we can safety say he has upwards to $200,000 invested in his education.

How Much He Makes

This guys makes (drumroll, please…) $45,000 a year.  But wait, he has benefits so maybe we should bump that up to $50,000.

How Much The Average Entrepreneur Makes

The average entrepreneur makes $120,000 year; and over 70% has an education that doesn’t usually go past high school or a secondary school.  And you know that $120,000 isn’t the real number, because we’re smart enough to hire a good CPA.  We work around the clock…so pretty much everything these days is a write off. (my luck I’ll be audited after writing this :o , but I just wanted to say it for the record)

Might I add on that note, this whole Startup America thing.  Us entrepreneurs all see right through it….they want your revenue projections for a reason.

Business School is Like Accounting

Let’s talk about business school specifically now (I’ve been to business school), it is also BS.  They teach absolutely nothing about real business.  You have to pass Accounting II & advanced English before you can get a business degree.  When over 90% of business owners outsource their accounting anyway (except the ones that own accounting companies of course).  Understand it, yes, you need to.  But taking those classes is intended for people who want to be experts in accounting.

Reminds me of when I went to a Small Business Development Center.  They have classes teaching business owners how to do their taxes and accounting.  Are you kidding me?  No entrepreneur wants to spend weeks sorting through paperwork.  That’s just not us.  The 10 hours it will take them to do it themselves, will only take a real accountant 1 hour to do.  So in reality, they end up spending more money trying to do it themselves because it’s not their strength.

How about some classes on delegating to an accountant instead?

Business Planning Classes

Business planning…another idiotic class.  Write a business plan in college, and they’ll grade you on format, punctuation, and spelling.  With no grade over the strategy behind it, no grade on whether or not it would actually work.  No grade how identifying an unmet market need, no grade for realizing what your customers want.

I should also add on that note, over 50% of the world’s most successful entrepreneurs still don’t have a business plan, and never had one.  Why?  Because true success isn’t planned.  What no one tells you…is success really comes at a merge point in one’s life, where their past connects the dots to their future.  Their passion, their purpose, so to speak…

Don’t Get Me Wrong

Don’t get me wrong…I’m a very curious person who loves to figure stuff out (like most entrepreneurs).  I’m all for education if it has a real purpose, other than to make me learn shit that I will never use.

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Why Silicon Valley Isn’t The Best Place to Hire Tech Talent http://teamtostart.com/2012/02/07/silicon-valley-place-hire-tech-talent/ http://teamtostart.com/2012/02/07/silicon-valley-place-hire-tech-talent/#comments Tue, 07 Feb 2012 02:30:29 +0000 http://teamtostart.com/?p=373

I wanted to write this up and do some research on this topic for all the entrepreneurs recruiting technical talent…outside of Silicon Valley.  The start of this article stemmed from a local tech startup in Tampa (finally) being funded with Venture Capital: $2.5 million, in October at their beta release.  The company was a social network competing with Facebook, and received a lot of heat in the media about a lack of programming or tech talent in the area.  My companies are also located in Tampa, and we’ve felt these kinds of impressions from others as well.

Well, there is good news…if you are an entrepreneurial founder, it’s actually easier for you to recruit tech talent outside of Silicon Valley…then it is in Silicon Valley.  And alot cheaper.  I will explain the data in just a second….

So what’s up with hiring tech talent in Silicon Valley then?  Why such the big hype about moving to Silicon Valley?  Because if you are programmer or tech, you’ll get picked up almost immediately.  But, if you are an entrepreneur….you actually wouldn’t be doing your company a favor by moving there.  Here is why:

 

 

 

 

 

 

 

 

 

Areas not known as “startup hotbeds” actually did better in hiring technical talent…and they did it faster (yes, places no one has heard of); with Boston coming in next.  So if you don’t live in a booming startup area, you should average 0-3 months to recruit your talent.  The biggest issue to overcome in these areas, will be adjusting technical talent to early stage risk/ equity positions, because it’s not the norm in other parts.

The most competition for entrepreneurs attempting to recruit programming talent?   And the place it will take you the longest to get technical talent?  Silicon Valley.  Half of their companies take over 6 months to recruit technical talent, and a large portion are still looking over a year later.

So in conclusion, yes…the money may all be in Silicon Valley.  But the talent pool is too narrow.  After all, money doesn’t do you any good…without talent.  Get out there and network, do some convincing, eliminate early risk by outsourcing to help get your tech talent on board; because the talent really does exist, and you actually do have an advantage as an entrepreneur recruiting tech talent outside of the Valley.

Whoo raa…

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Jump Off the Cliff! http://teamtostart.com/2012/01/30/can-i-be-happy-owning-my-own-business/ http://teamtostart.com/2012/01/30/can-i-be-happy-owning-my-own-business/#comments Mon, 30 Jan 2012 16:21:36 +0000 http://teamtostart.com/?p=370

Guest post by Dennis Valenti.
Can I be happy owning my own business?  What will happen and will I make it?
I get this question often and it makes me thinking of a cliff diving analogy.  You’ve seen other people do it and they make it look so easy, fun, and exciting that you one day want to give it a try yourself.  You climb to the high cliff and take a deep breath before you look over the edge.  Once you look over the anxiety and all those conflicting issues start to cloud your head.

What am I doing?!

Am I going to get hurt?

I remember hearing stories that inexperience people critically injure themselves doing things like this.

What if I hit the water wrong? I can break my neck!

What about the rocks beneath the water?

What if I hit me head?

I also remember doing something similar but much easier than this and when I jumped in the water it was so cold that it took my breath away that I struggled to get to shore (safety).

What about the sharks, jellyfish, or parana?

Is there anyone around to see this great feat or what if I need to be saved?

Who will help me?

You think “I want to do this so bad!  I worked so hard to get here!”  Well, you can climb down and tip toe into the water to see the temperature and if you like it or not.  Check for all the rock and if any dangerous fish are around.  Or you can jump.  You finally decide “I’m going for it!”  You take another deep breath, think how crazy this is, and jump.   The adrenaline kicks in and you hit the water; hard!  The smack stings your entire body and the water is freezing cold.  Your breath is taking away and you immediately scurry for shore.  On the way to safety you realize that almost every part of your body, internally and externally, is in serious pain.  “Turd balls!!!  What did I do? Am I going to make it?  How bad is the pain?  Am I bleeding?  Are the sharks coming?!”  You swimmer harder and faster.  Taking every last effort of energy to get out.

“Whew, I made it.”  You begin checking your physical status.  “I MADE IT!!!”  You conclude that you did hit your head from a terrible entry.  You have a great big gash on your leg.  Was it the parana or sharks or those stealthy sting rays?  You are woozy.  You throw up a dozen times recounting all that went wrong with that adventure.  Your self esteem and ego are bruised as well as the multiple areas on your body.  As you stand up and try to shake off the pain and review the discomfort and confusion of what went wrong, you realize most of these issues are your own mental roadblocks and obstacles.

You finally concluded that you forgot to take your money out of your pocket during the jump and it is all gone….Lost to the sea.  What do you do now?!

I chose to climb back up that cliff.  I’m jumping again!  I’m going to do it bigger and better than before!  I’m going to have a stellar entry.  I’m anticipating some of the stinging and cold waters but I know I’ll make it better this time.  And if those parana or sharks get in my way…well, if I have to, I’ll bite them back if necessary to survive.  Also, I’m getting my money back and I will conquer!  And if not, I’m going to have fun doing it.  And I will do it again and again and again!

The experience proves extraordinary.  You know why those few before you made the jump.  You encourage other to make it but you instruct the others that they will need to battle their own fears and to do it.

LET’S JUMP!!!

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10 Tips for ADD Entrepreneurs http://teamtostart.com/2012/01/06/10-tips-add-entrepreneurs/ http://teamtostart.com/2012/01/06/10-tips-add-entrepreneurs/#comments Fri, 06 Jan 2012 19:24:18 +0000 http://teamtostart.com/?p=362

Sit down in a group of business owners & entrepreneurs.  Look at the entrepreneur to your left, now look at the entrepreneur to your right.  One of you have been diagnosed with ADD or ADHD.

Someone with ADD or ADHD is also 300x more likely to start a business than the average Joe, and believe it or not…have the highest potential for success (given the right support).  So today, I wanted to share some of my own tips, and others tips, for managing ADD as an Entrepreneur:

1.  Get a Coach Who Understands You

“I have seen coaching and being connected save more entrepreneurs struggling with ADD, than any type of medication or time management strategy”, says one ADD coach.  With my own situation, I keep a small list of other entrepreneurs & mentors that understand it, that I can call on (without shame or guilt) to talk about any problem with my company, or even just a life issue.

2.  Get a Good Business Partner

One of the best things you can do for your company, is have a trusted good business partner; one that is skilled in organization and finances.  I’m not talking about an assistant who comes in and organizes your books (although those help too), I’m talking about someone at a higher level who you can trust to take charge of organizational & financial decisions.  My business partner, Dennis, can be annoying because he’s a lot less riskier than me, he’s a very detail oriented manager, but we’ve avoided several huge financial mistakes because of him.  It’s actually comforting to have a non risk taker investing their time and money into your company, because if it were all just us crazy risk takers, who knows if we’d wake up broke & homeless one day.  In fact, I think if it weren’t for him…our taxes would never even get filed.

3.  Pace Yourself

The same ADD coach in the first tip also says this from his own experiences an ADD Entrepreneur: “In my life, I’ve built multi million dollar companies overnight.  Unfortunately, I’ve also destroyed them overnight without even realizing it”.

Understand you’re powerful, and that same drive, risk taking, and determination that started that business…can also be the same thing that destroys it.

4.  Conquer One Obstacle At a Time

This is why many high growth entrepreneurs set milestones.  The ADD Entrepreneur’s mind is constantly onto the next thing.  Start with your end goal (where do you want to be in 5 years?), then break it down into smaller milestones.  Like one every 6 months.  Stay on that goal; try hard not to move onto the next one until that other goal is achieved.

5.  Learn About Others

Looking back at my life, I’ve had several occasions where people all of a sudden just stop talking to me, and it turned out I somehow offended them without realizing it.  For example, one of my mentors/connections was kind of hinting around he had to come to town, and I said “Oh, great…are we going to meet up?”.  He sighed, and said “You haven’t invited me yet”.  Needless to say, I’ve learned how to pay closer attention to my business relationships, act as a host for my company, etc.  And if you have people that will tell you what you did wrong, that’s all the better.

6.  Change Your Environment

This one took me a while to figure out.  For years, I constantly tried to adapt to the environment; instead of changing the environment.  Now, my home, my schedule…everything is built to suit me, the way my mind works, and to help me function better.  So figure out what works for you, and build your life around it.  After all, most ADD’ers become Entrepreneurs simply because they’re trying to figure out what works for them.

You have so much drive, ambition, & need for change; that if you don’t have something like your own company to channel that energy to…you’ll usually end up wrecking havoc on other people lives, or your own (ever heard someone say an ADD person will either wind up in jail…or they’ll be a millionaire?)

7.  Have a Happy Place

It sounds really corny.  But the fact is almost all Entrepreneurs with ADD have emotional roller coasters.  It doesn’t apply to just female entrepreneurs, and in reality…there is little difference between a female entrepreneur with ADD, and a male entrepreneur with ADD.  Both typically think the same way.

The happy place…it’s a place to go to in your head or even a spot by the lake, when you get that devastating news that sets you off.  And it will happen millions of times as an entrepreneur.  As you grow, things will become more stressful, because now you’re not playing with a couple thousand dollars, you’re making hundreds of thousands of dollars worth of decisions.

Get yourself a stress ball, remove yourself immediately, run to the bathroom and scream, do whatever you can to avoid setting off in front of other people.  Eventually, it will happen so many times you will get to the point that you become used to it (or at least this is my experience).  Once you get used to it, it really won’t bother you as much…and you’ll be able to handle the stress and deal with it on the spot (without running away from the problem).

8.  Pick the Right People

Try to focus on your strengths…if you’re an entrepreneur it’s probably ideas, vision, innovation, connections, management, inspiring people, motivating people, etc.  Try to find people who match your vision, have qualities that can help you achieve your vision, and believe in it; rather than trying to manage every detail of people or what they produce.  This makes delegating so much easier.  For example, graphic designers.  Instead of just picking a graphic designer at random, then trying to change their style to what you want…find one that already has that style.  That specializes in that style.

9. Let Go of Control

Part of delegating is letting go of control over somethings.  This is especially applicable to ADHD Entrepreneurs.  The author of a well known book about adult add (shes also an entrepreneur) says “I used to think my dad was an SOB because he had to control everything.  Now I know, it helps those with ADHD feel safe when they’re in control of their environment”.

The more you learn about yourself, and how to control your mind, the less you feel the need to control what’s going on around you.

10. Don’t Make Promises

I saved the best for last.  One of the greatest lessons and I think of this thing an ADD person told his wife before they got married. He pulled his fiance aside, and said:

“I have ADD.  I am an impulsive risk taker.  I can’t promise I won’t offend you, or ignore you, or smother you at times, or have an affair, or gamble away our life savings, or be there for kids, or destroy your life.  If you are not willing to take that chance, please run away now.”

Last I checked, they’ve had a great marriage for over 20 years…and none of the above has happened.   So the lesson now becomes: don’t make promises, just make something great happen.

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The Greatest Lesson for Founders: Your Team http://teamtostart.com/2011/12/06/role-founders-team/ http://teamtostart.com/2011/12/06/role-founders-team/#comments Tue, 06 Dec 2011 16:27:14 +0000 http://teamtostart.com/?p=355

Perhaps the biggest lesson of all for Founders, is to try to understand your own role in founding a company; and what you need to do to make your vision reality.  And, understand the human dynamics that make up a team.  The team aspect of it, can often seem insignificant.  To most entrepreneurs, it will be simple: I hire someone, I pay them money.  However, I’ve learned a few things along the way in my own team building journey, and wanted to share with you guys today:

But maybe we should back track on that for a second, and start with what we are calling a founder.  I’m going to use this simple definition someone gave me of the differences:

Founder- A founder is commonly referred to as someone who is building an organization around culture and vision.  They are not an inventor, as inventors typically set out to build a product.  They are also not the same as a “small business owner”, most small business owners are service providers who have what we call a “lifestyle business”.  Think of it as more as a personality, because a founder can still build a product, or be a small business owner.  Confusing :) but maybe this will help.

So the other day, I took this role assessment test we”ll be incorporating into Synergy Hub.  It’s really awesome in defining your natural role, and what you can do to fit your role according to your own individual strengths and weaknesses.  Sometimes, people take the test and figure out they are not a founder.  Sometimes they take a test and figure out they are a communicator (who should partner with a founder).  Or even a scout, vision mover, or vision executor.

The Role of a Founder

In my case, I was a Strong Founder, and secondary role of an Explorer.  Pretty cool, huh?  But what does it mean?  And how do you know if you are really a Founder?

The guy doing my test started by telling me “I already knew you were a founder before you even took the test”.

“Probably because I am a founder?” I asked.

“Well no actually.  90% of the time people are in a role that’s not right for them.  But you’re an inspiring storyteller who skipped school” he told me smiling, “Classic founder and explorer.  You skipped school because you needed to be out….exploring everything.  You’re young, but you probably feel like you’re 40 because you’re a Founder, Founders have a long range, holistic view of the world”.  I kinda titled my head sideways thinking alright…this is scary.  All my friends are in their 40’s.

Then he goes on to say “You’re probably very frustrated right now because you want to lead your vision, but can’t because you’re constantly trying to do the tasks needed to execute your vision.  In reality, as a Founder your strength is in hiring specialists and coordinating their individual strengths to align with the vision as a whole.  As an Explorer, you should be out in front of the company, spotting trends, new ideas, talent, strategic alliances, major sales, and bringing them back into the company.  Think of your job as a bowl…your job is to fill the bowl with resources & skills, then distribute it to your Communicator & Vision Movers”.

Identifying Gaps in a Startup Team

Gosh, what a great point.  So this past week, I went out exploring….and found a specialist in an area our company has been struggling with: technology development.  We have 1 programmer already.  He has some great skills, but also has a few weaknesses, one being organization and architecture.  He likes to jump around alot, moves fast (which is great) but we had that missing other piece that was preventing the technology from being finished.  I realized he was a “P” function (in personality terms), who needed a “J” function with him in the tech department.  “P”‘s are better at starting things, “J”‘s bring closure & organization to the things “P”‘s start.  So we hired another “J” and this was the story of my life this week:

The Result of Filling Gaps in Your Startup Team

I run into the office, slid into my chair, and fly across the floor toward my computer.  I was excited (ahh!!), my techs like to work at night because it’s quiet for them to code.  In the morning, I’m always so excited to see what they’ve done.

So I check my email…and start reading through all the conversations.  Then I realized…there were no questions for me?  They were collaborating and working on their own.  I read Chris directing the new programmer on the vision I had instilled into him.  I yell at Dennis (my co-founder) “Come here!”…he slides his chair across the floor and reads the emails.  We both start shouting: “They both get it!!  They get the vision!” (this may not sound like a big deal to some, but for “founders” it’s huge when we finally learn how to successfully instill our vision into others).

“Wait…they don’t need me anymore.  It’s kinda sad.  What do I do with my time now?” I tell Dennis.  He pats me on the back “It’s OK Amanda, it’s supposed to be this way.  This is good.  Go…explore…I guess, keep filling the bowl for everyone.”

Partners to Founders: Communicators

And what did Dennis’s role assessment come back as (my co-founder)?  A communicator.  Turns out they are a natural partner to a founder.  Founders struggle with communicating, and can be somewhat distant from the team (external management vs internal management).  The communicators are someone who is described as friendly, approachable, facilitators so to speak.  They’re personable enough to build a strong relationship with the founder, understand the vision, organize it, and communicate it back into a practical way the team can execute on.  They make great internal managers.

The Point to All This

The point to this story for other founders and business owners, is how good it feels to do what you were meant to do.  It’s a long run, with tons of sacrifices (like paying others when a company doesn’t make money yet).  Not to mention the time you have to spend instilling a vision in your first employees, and the trust it takes to let someone take control over something.  But this is good :)

 

 

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5 Things Entrepreneurs Should Remember About Mentors http://teamtostart.com/2011/11/23/5-entrepreneurs-remember-mentors/ http://teamtostart.com/2011/11/23/5-entrepreneurs-remember-mentors/#comments Wed, 23 Nov 2011 15:40:22 +0000 http://teamtostart.com/?p=352

I have a special place in my heart for mentors…because I was there once.  I was 17, on my own, living in my car.  I also have bad ADD, and could never seem to do anything right, and always seemed to be a failure.  A mentor took me into McDonald’s one day and bought me sausage biscuit.  He told me “See that person working the drive-thru?  You’re not going to turn out like that”.  He was no one special, just an old entrepreneur that ran a commercial real estate development company.  I’ll never forget the day, because it was the first time in my life anyone ever thought I would make something of myself.  As the years went by, I started to learn about who I was, and started to create my own path.  Then when I started Synergy Hub and Plan to Start, the first people who came out to help me where…mentors.

So I thought I’d write something about mentors today, with a different twist.  Instead of writing about your problems today, I’m going to write about their problems (as mentors), and what as an entrepreneur you can do to help them.

Here are 5 things Entrepreneurs should remember about working with mentors:

1. You’re Not Entitled to Anything

This is an issue alot of mentors experience from entrepreneurs, and even anyone like myself, who blogs for entrepreneurs or helps entrepreneurs.  For every person thankful for your help, there are two more that have a sense of entitlement beyond belief.

Remember, no one has to help you; good mentors are not sponsored by the government, they are not paid by a non-profit, they aren’t even paid at all….other then to hope one day their good work will change the course of someone’s life.  They do so out of their own compassion for what you are going through.  So drop the ego trip.  The more people running around out there snapping at our mentors, the more our mentors…don’t want to mentor.

But just because you need help, or guidance, doesn’t mean you have an ego trip.  What we are talking about, are the entrepreneurs that feel they have the right to come out and say things to mentors like “I hate you” or as we see one Entrepreneur’s comment in the Startup Foundry’s post: “You can’t see how great our app is because your head is so far up your ass”.

The problem is alot of Entrepreneurs will automatically view mentors as people that told them “you’ll be a failure”, or “no, don’t do that” back in their childhood.  You’ve got to let the past go, and accept people that just want to help.  Understand you are just different (and there is nothing wrong with that), but it can be difficult for people to understand how to work with you.  You’ve got to help them understand you.

2. Be Respectful of Time

Again, let’s remember mentors have to survive because they don’t get paid for it.  This means they most likely run another company, or many companies, as well as probably have a family.  Try to pay for coffee, lunches, whatever you can.  They probably won’t let you pay for it, but it’s the gesture that counts.  Try to go where your mentor is, and be respectful of their time and schedule.

3. One at a Time

Don’t be mad if a mentor can’t dedicate time to you.  Many mentors are one-on-one type coaches, and can only handle one (or two) Entrepreneurs at a time.  Once you answer a question, or sometimes two questions, you are pretty much bonded to that Entrepreneur.  You become someone they trust, and you can’t break that trust.  They’ll return to you again, and again, for questions and resolutions to their problems.  This is great…it’s what mentors love helping with.  But just understand, mentors have to commit fully to you…or not at all.

Mentors usually decide within the first question or two, if they are going to commit to you.  On the flip side, it’s ok to have more then one mentor.  Often, a mix of different types of mentors can give you a whole outlook on situations.  But don’t get too many to where the “voices” stress you out more than help you.  Focus on the one or two you resonate most with.

4. Give Back the Mentoring

If you’ve been fortunate enough to have been saved by mentors, go back to mentor.  You also don’t have to make it all the way through before you start giving back.  Sometimes, it can help other entrepreneurs to go through experiences together (like I’ve been doing here :) ).  Although, the grey beards, as my friends calls them (saying this kindly), tend to have more time on their hands to help you.

5. Don’t Complicate Things

Your situation is complicated enough.  Don’t overload your mentor with legalities like NDA’s, non-competes, etc.  This is a trusted relationship.  If you don’t have enough trust in your mentor to not flip out NDA’s….then the mentor/mentoree relationship isn’t going to work.  Most mentors have their own companies as we talked about above.  This does mean with any mentor you can run into potential competition, but mentors have high personal values (if they didn’t, they wouldn’t be mentoring in the first place!) to not use your information for their benefit…and 99% of them won’t respond, or even read your information, if they feel they could be potential competition.  So in short, don’t worry about it.


 

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Multiple Founders? Probably Not. http://teamtostart.com/2011/11/08/multiple-founders-not/ http://teamtostart.com/2011/11/08/multiple-founders-not/#comments Tue, 08 Nov 2011 17:37:45 +0000 http://teamtostart.com/?p=342

I was reading a post today talking about multiple founders in a start-up and this collaborative community.  Yes, it sounds nice…doesn’t it?  Wouldn’t it be great if we all just started a business together with no thought over who was getting what?  Nice, like rainbows and sunshine.

Nice thoughts…until one of your founders doesn’t help pay the bills.  Until the other has to pick up where you left off.  Until one of you works fulltime for the company, and the other works at a regular job.  Nice….until real money starts coming into the business.  At the beginning, you look at that and say “no big deal!”, I pick up slack all the time.  But founders in the idea phase can tend to forget, it becomes a whole different world when your life becomes about loosing your home vs keeping that business moving forward.  When you have to bootstrap for 2 years (I believe the average break-even is 18-24 months!!).  Please…think about that.  If that other partner or founder is not 100% ready for that, to ride that storm with you….it’s not a real partnership.  Of course, people always claim they will…but doing and saying are two different things.

They have a very common occurrence in partnerships…and there is a reason why investors like to invest in partnerships that have a history in another business.  Anything over 2 business owners (founders) and most investors won’t touch it with a ten foot pole.  Because partnerships usually break at one of two points:

  • a) when you run out of money
  • b) when you get money

Obviously, the more people that are founders creating multiple founders in your start-up, increases this chance of it happening; as illustrated in this graph about the number of founders most successful start-ups have:

Multiple Founders in a Startup

In my case (not bragging at all or anything, I just know sometimes it can help to hear other experiences) my partner and I (now my co-founder of Synergy Hub) had an old business together.  It was a low risk business because it was services, but it I knew being founders together in Synergy Hub wasn’t a problem even with the higher risk due to it being a product based business.  Just a service business, but it still went through many of the up’s and down’s this company has and will continue to experience.  We actually tried to bring on another “founder” to compliment us in the technology department…that didn’t work, but thank goodness we didn’t get to the point of signing anything.  After that experience, we pulled all our resources together and hired someone young & hungry instead.  Sometimes, as much as we need multiple founders because money isn’t there, you have to just suck up the money aspect of it.

So while brainstorming ideas in collaborative groups is nice, don’t ever forget….it feels good right now, because you haven’t run out of money, and you haven’t gotten money.  And at the end of the day….that company is going to put on the shoulders of one (sometimes two) founders at the most.  YOU, and possibly one other person, will bear the sole responsibility of paying people, bills, and just moving forward.

If you are young and not connected, or having previous experience with other founders in a start-up, the best advice I can offer is: start a service based business first.  It’s less risk if a partnership does fail, and will give you an opportunity to source & establish trusted relationships with others you may found a product business with.

Also, beware of “co-founders” and “developers” who have equity in multiple start-ups at the same time (not applicable to investors and board advisors of course, that’s their job).  Beware of people like…me (I’m not a developer or involved in multiple startups, I just already have my own business).  I would not make a good co-founder for you.  I’m saying this because I’ve had founders who got mad because I didn’t want to join their start-up as a co-founder.  Often, if someone else is already involved in a start-up (with a significant equity portion)…they are committed, they are building a business, they are caring a heavy burden on their shoulders (or should be, if they are real founders).  They can be great part-time mentors though; so don’t discount them there.

Being involved in a startup isn’t about jumping from startup to startup for a “love of the startup life” (because in reality, having a startup is hell), or else you would never make money.  It’s about having a dream that you care about, and holding tight to it through good days and bad days to see it to success.  Most founders and CEO’s don’t leave their companies for 5 years or more.  Are you (and your co-founder) prepared to run a business for 5-10 years?  Can you grow it to over 100 employees?  Can you stand to loose sleep for years?

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4 Ways Entrepreneurs Can Save on Start-up Technology http://teamtostart.com/2011/10/21/4-ways-entrepreneurs-can-save-on-start-up-technology/ http://teamtostart.com/2011/10/21/4-ways-entrepreneurs-can-save-on-start-up-technology/#comments Fri, 21 Oct 2011 15:08:35 +0000 http://teamtostart.com/?p=335

When I first pitched my idea for a technology, someone laughed at me and said “This is going to cost a couple hundred thousand dollars and 2 years to build”.  Because I wasn’t a developer, I was an Entrepreneur.  This is a guide for other Entrepreneurs in the same situation, and how I cut that cost down to $20,000 and 9 months.  Enjoy :)

I wanted to talk about a non tech being a tech company founder today, because almost every single entrepreneur start-up I know has died at the hands of programmers or developers.  That was founded by an Entrepreneur that is, not a developer.  Mine almost did…but luckily we got back up, and learned from those mistakes.  So…I feel it’s really important to help other Entrepreneurs ahead of time, before you make the same mistakes.  This isn’t meant to offend the founder/developers out there either; as you guys make up about half of my readership.  I relate to both of you, because I work with developers so much.  But, I am a visionary Entrepreneur.

Death By Developer

When I was starting my software company, one of the hardest things for me was the fact that I wasn’t a developer or programmer.  We know so many of the software developers are “computer science” graduates or the all around “INTP” (detail oriented, very logical); completely the opposite type of personality from the big pictured, visionary Entrepreneur.

It’s no secret either.  It’s really hard for visionaries to develop software.  Why?  Because there are far too many details, little pieces that have to connect everywhere.  Everything has to be well thought out, to the tea.  Not only that, but you have to learn how to speak programmer language in order to ever be able to talk to them.  You have to learn what engineers/programmers/developers want, how to motivate them, how to direct them….or you can just say screw it all and get yourself a “tech intrapreneur” to manage the project.

Every Entrepreneur I meet needs two things: technology and money.  Why?  Because we need money to pay the developers to build the technology.  Problem is, that costs ALOT of money.  Here are some lessons I learned, and how to build your software and found a tech company, without being a developer, and cutting those costs by over 75% (you can do this!):

Design First, Then Code

Cost: $2,000-$5,000

Bottom line, I don’t care if the developer tech founder does code first, that doesn’t work for Entrepreneurs.  If you try to do that first, you’ll get lost.  It’s best for the Entrepreneur and a creative to get together first, and design the software.  A standard good UI/graphic designer will cost you around $40 per hour.  Seems expensive, but my software design only totaled about $3,000.  Try Matt Cannon (www.matt-cannon.com).  He did ours, he is so good…I actually got excited everytime he sent me his designs (Matt also works with all Entrepreneurs too with tech start-ups).  Our software is listed right there in his portfolio: Synergy Hub.

The developer tech founder goes in a standard order:

  • He has an idea
  • He wireframes
  • He codes
  • Launches the software
  • He pitches to raise money

The Entrepreneur tech founder does this (or should be doing this):

  • Sees an opportunity
  • Has an idea to solve the problem
  • Maps out a strategy, from the end to beginning
  • Secures LOI’s or proof of concept through customers
  • Designs the software
  • Then codes it
  • And attempts to raise money anywhere in between
  • Launches the software

Because of the difference between what one tech founder does, compared to the other; all Entrepreneurs have the issue of raising money.  Now, investors are way too used to seeing code in a matter of weeks.  But, there is more risk, and a lot more to do afterwards.  Now, the Entrepreneur can’t fundraise until after they code…which is usually one of the last steps an Entrepreneur takes.  With the Entrepreneur though, there is far less risk; and you wind up with a product that was built for a market opportunity & the customers.

Get Requirement Docs From a Professional

Cost:  $3,000-$5,000

Next comes the requirement docs.  And once you design the software, it’s pretty easy for those requirement docs to be done since the developer can specify all the functionality based on your design.

I would just have the docs done, without code, by a professional.  Because it gives you the ability to outsource the code yourself and wind up with a total product cost of about $20,000; instead of the $200,000 a professional development company will charge you to build the whole thing from beginning to end.  Then you’d also wind up with a product that is nothing like what you wanted.

Think of requirement docs as what translates your vision into something a programmer can understand.

Now, Outsource the Code

$5,000-$15,000

As long as you have those well written instructions for programmers, you can outsource the code yourself….and you’ll probably be mad when you realize how much money all those developers are making off of Entrepreneurs.  Try freelancer.com; this is really really good for outsourcing code.  You may want to have your requirement docs translated though into their language ;) because the majority of programmers are from India.

Server Space – The Amazon Cloud Free Tier

Amazon (yes, it’s weird) has cloud space for your software.  They have a free tier too, so you won’t have to pay anything the first few months you launch your software.

 

 

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Does an Entrepreneur Have to Be a Business Owner? http://teamtostart.com/2011/10/12/entrepreneur-business-owner/ http://teamtostart.com/2011/10/12/entrepreneur-business-owner/#comments Wed, 12 Oct 2011 15:15:32 +0000 http://teamtostart.com/?p=331

I recently had someone ask me this question: “Does an Entrepreneur have to be a business owner?”  So I decided to take in the opinion of other entrepreneurs to answer this.  What do you think?

An Entrepreneur by real meaning, is someone who takes a risk and makes money for themselves, instead of a salary.  You are the first person who takes the risk, and starts the business.  So yes, an entrepreneur has to be a business owner.  Now, whether or not you have legally registered your business is another issue.

Anyone who makes over $500 in a year providing services or selling their products has to legally register.  If you haven’t done that yet, which is why I’m assuming you’re asking this question, go somewhere like BizFilings.com and register yourself for goodness sakes.

On the other hand, there are several serial entrepreneurs that no longer own their business; but still consider themselves Entrepreneurs.  Mostly because once an Entrepreneur, always an Entrepreneur.  They may have sold their business, failed, or returned to the battle field to mentor.

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The 3 Things that Make Partnerships Successful http://teamtostart.com/2011/10/02/successful-business-partnerships/ http://teamtostart.com/2011/10/02/successful-business-partnerships/#comments Sun, 02 Oct 2011 18:31:21 +0000 http://teamtostart.com/?p=327

We’ve looked around at some of the most successful business partnerships…to get out there and see what’s working, and what’s not working.  You might find it’s different than what we’ve assumed it would be, or may be different than what you’ve heard:

Common Vision

Anytime you have a business partnership (probably either a founder and co-founder relationship or a profit & loss type business partnership) the vision needs to be the same.  It’s personally what we have found works, along with what others have found make the most successful business partnerships.

Without a common vision, a business partnership is misaligned.

It’s like a bad marriage: for example, one partner has the ideal that their perfect marriage is raising a large family in the suburbs.  The other partner has the ideal that the perfect marriage is just the two of you, with freedom to travel and not be held down.  No matter how much these two people get along…it wouldn’t work because there is not a common vision.

Opposite Skill Sets

I still laugh when I remember this one time at a networking event.  I’m talking to this guy, he owns some big PR firm here in Tampa.  He introduces his business partner and says “this is my partner, he handles all my backend operations”.  Aside from me turning this into a perverted joke, it’s very true….they had opposite skill sets and it’s what made that PR business so successful.

Opposite skill sets in business partners can be anything between selling vs building.  External operations vs internal operations.  Practicality vs risk taking.  Slow vs fast.  Creative vs strategic.

With my business partner, every thing about our personalities are the opposite (but our vision is always the same).  He hates being on the internet, he’s probably the only person in the world without a Facebook account.  But he loves being hands on with large groups of people.  Me, I don’t mind at all being on the internet or writing here.  But I don’t do well in large groups.  In fact, I hate large groups.

Equal Risk and Equal Gain

I read a lot on the internet about how “it’s never good to have a 50/50 partnership”.  Honestly, I think this is BS.  Obviously, whoever owns the majority (51%) has control over the business.  There are cases you want to keep control and protect the company, but this isn’t against your business partner….if you have to worry about protecting the business from your partner, then they’re not your partner.  They’re probably more of a key employee, a vendor, or an investor.

The Founder, turned VC, of Hub Spot actually mentions this exact same thing about business partnerships in his “Raising Capital for Start-ups” video.

He also says because of this, choose your business partner carefully.  You can’t have a real co-founder or business partner without equal gain, but understand there is equal risk.  Most founders and business partnerships won’t be able to recover from the loss of their co-founder or business partner.  So perhaps…the best question to ask yourself before you take on any business partner is:  Could I leave the fate of my company in this person’s hands?  Because that’s what you’re doing.

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