This is a digest and recap of highlights, quotes, and comments from articles and discussions posted on this date on the Applied Entrepreneurship, LinkedIn group site.
*Be Where The Puck’s Going To Be by Wil Schroter
“Hockey legend Wayne Gretzky, when asked how he was always on the puck before anyone else, pointed out that he was by no means the fastest skater on the ice. Instead he explained that he always just focused on skating toward where the puck was going to be. Gretzky knew that if he couldn’t be the fastest in the middle of the game, he would have to figure out how to stay ahead of the game”
“Instead of wasting your energy trying to keep up with the big boys, think like Wayne and get your edge by moving ahead of the game.” “Taking the shorter path allows you to get in early and pick up a lot of the low hanging fruit.” “You gain a potentially huge advantage from building early relationships in your space before your competition or your customers even know how big it could potentially”
“When you progress ahead of the existing market you get into a position where there few (if any) customers looking to buy. To avoid this, it’s helpful to pick a point ahead of the game that gives you a first-to-market advantage but still leaves you enough room to do business in the with current customers. Startup companies are often strapped for cash, so being too far ahead of the curve without any ability to generate revenue while everyone catches up can be disastrous.”
*Can you Afford Not to be an Entrepreneur by Wil Schroter
“The day you start your own company, the only person that will ever determine your income is you. If you’re as good as you think you are, the sky’s the limit.”
“Consider the fact that Bill Gates, Michael Dell, and Steve Jobs were all around 30 when their companies went public. Can you imagine how little they would have been paid (by comparison) if they had stayed in their salaried jobs? Clearly their ages had nothing to do with their capability, and starting their own venture was the only way to prove that.”
“Even if you’re incredibly well paid in your current position, it doesn’t change the fact that you’re only one person. You can only earn as much as your own time and contribution will afford you. At some point, in order to get to the next level, you need the company working for you, not the other way around.”
“When you add up how much value you’re losing by taking a paycheck every week, you start to wonder what was keeping you from taking the plunge in the first place. In many ways, starting your own company is the only way to eliminate the risk of not being paid enough.”
*Cover the basics before you raise capital by Ed Sim
“If you want to raise capital from anyone, you need to have the basics covered.” “We all know that coming up with market sizing and revenue forecasts for a startup is as accurate as the weatherman predicting the weather. That being said, VCs want to understand the logic behind the numbers as much as the numbers themselves.”
“Accumulating users and worrying about revenue years from now is yesterday’s news. Unless you have tremendous scale when you show up at a VC’s door, then don’t bank on ad revenue as your only revenue source.”
“If you want to get funded, you better have a clear answer on how you will make money and either be implementing that model today or in the short-term. What VCs are looking for is a revenue model today that makes sense – this can include premium subscription revenue, analytic revenue, and even lead generation revenue, but don’t pitch massive scale and advertising as your go-to revenue source 24 months from funding. You will be shown the door quite quickly. ”
*Get focused on getting customers by Emily Maltby
This article is about expert help for a furniture seller whose Web site needs to make a better first impression.
Your Web site should give customers what they expect. “”Like anything on the Internet, it takes less than three seconds to get a first impression.”
“The first page of the site should show them very quickly what you offer. Only after you get their attention will they be interested in reading about the details. Once you have a visitor, you want to keep them.”
Your Web site should clearly show why your business is unique. “”You have to sell them on the company before you sell them on any product,” Schefren says. “Put in information that is useful. I don’t care when you started the company, but I might care that you grew up in the furniture business. Now prove to me that you are the best vendor.”
“You have to sell them on the company before you sell them on any product,” Schefren says. “Put in information that is useful. I don’t care when you started the company, but I might care that you grew up in the furniture business. Now prove to me that you are the best vendor.”
“Consistency is the key in making users feel comfortable on a Web site.”
* Occam’s Razor and the current state of venture by Ed Sim
“Giving companies too much money too early can lead to a growth at all costs mentality, a lack of focus which means chasing too many opportunities at once, and a lax attitude on how to generate revenue.”
“From an entrepreneur’s perspective, Occam’s Razor can be applied to many different avenues. As we all know, a great entrepreneur must be able to effectively allocate his scarce resources of time and money to fulfill a market need. The longer it takes to develop a product that the market wants means that it will cost more money and that it also opens the door for a competitor to step in before you.”
“Rather than spend cycles creating the perfect product with every bell and whistle, many nimble startups have focused on a more reductionist theory of releasing an often simpler product quickly with the idea of getting market feedback for the next iteration.”
“Occam’s Razor also applies to how an entrepreneur should operate his business. Don’t pursue too many markets at once, focus on what is delivering the most return for the dollars invested, and hire people and scale your business when you absolutely have a repeatable revenue model. I have been burned like many others by aggressively building out a sales team too early without a repeatable sales model.”
“The idea of less is more certainly applies to raising capital. With the rise of open source software and cloud computing, companies can now get started with less dollars and scale more cheaply and efficiently than before. As all entrepreneurs know, raising less capital means retaining more ownership.”
“It is becoming increasingly clear that Occam’s Razor and the idea of less is more will continue to spread as the cost of technology continues to decrease, as entrepreneurs get even more efficient in building businesses, and as a non-existent IPO market and the factors above lead more VCs to create smaller more nimble funds to capitalize on the new market realities.”
What I Think
I think one common thread in the articles posted on this date is doing more with less. Call it anticipating where the puck will be if you are Wayne Gretzky, Occam’s Razor if you are a venture capitalist, or simply focusing on what the customer expects to see and is searching for if you are redesigning your Web site.
The same is true if you are an employee and not yet an entrepreneur. There are only so many hours in the day and so many days in a lifetime. As Wil Schroter’s article points out, at some time the company has to work for you, rather than you working for the company. The sooner you get started on that, the sooner you can realize the efficiency of doing more with less.
Likewise, whether it be raising money from an investor or optimizing a Web site, don’t make your customer (i.e. investor or Web shopper) work for it. Distinguish yourself. Focus on what they expect to see or want to see. Everything else should spring from that. The fewer the words of explanation as to why investing in your company is better than other opportunities in which to invest, or the fewer the clicks to get to the goal of the Web search, the better the experience and the more likely you will be rewarded.
Before and during the “dot com” bust, VC’s threw money at companies, regardless of burn rate. Time didn’t seem to be much of a factor, in terms of anticipating when the ROI would arrive. Everything seemed to turn to gold. Some thought they saw signs of coming distress in the markets, but the stampede of others rushing to cash in seemed to drown out the sound of reason. Those days are gone for now.
Now it is all about not being able to raise money, and therefore finding business models, which don’t require it. Self-funding businesses are the current lean and mean revenue model, unless you are Twitter or other Web 2.0 models, which still cling to the theory that bigger must be better.
Can’t wait for Web 3.0 business models. Since we already have some glimpses of where the puck is not, maybe it is time to get the puck out of Dodge City and find those new revenue model opportunities before the competition does.
If you enjoyed my impression of these articles, why don’t you read them for yourself and see what you and I missed or hit? Join the Applied Entrepreneurship group on LinkedIn. Membership is free and I try to post about ten articles a day there. We have some great discussions going and if you are an entrepreneur, we hope you will join us.