Building Something From Nothing
The life of a start-up founder isn’t always ringing the bell at the New York Stock Exchange on the IPO — or even getting dressed up in a $3,000 suit to testify before Congress. Overnight success usually takes years.
The fundamental challenge of running a start-up is that you are dependent on three mutually dependent things: cash to keep the business alive, customers and a product customers are willing to buy.
You may be able to raise some very early cash from friends and family to get started, but angels and venture investors usually expect to see customer traction before they’re willing to make a significant investment of cash in a start-up. It’s tough to get paying customers without a pretty good product. And you can’t build much of a product without cash.
To summarize: You need a good product to get customers, you need customers to get cash and you need cash to get a good product.
So, as a start-up founder, you have to try to keep all three balls (cash, customers and product) in the air, as best you can. Hence the need for a start-up founder to have a sense of urgency.
I’ve been involved in some great start-up successes, and I’ve been involved in some disappointing failures. I worked just as hard in the failures as I did in the successes. I probably made just as many avoidable mistakes in the successes as I did in the failures. Building a successful start-up is hard. It doesn’t always work.
Along the way, I have learned a few lessons (each of which I have forgotten and had to re-learn multiple times). So, here they are:
- No one cares as much about your start-up as you do. Not your family, not your employees, not your investors and certainly not the people you’re trying to turn into customers.
- Your prospects aren’t going to open all of your emails and respond instantaneously. Getting their attention and action will take persistence, great communication skills, understanding and empathizing with their needs, and, unfortunately, even some patience.
- It’s fine to be obsessed with your start-up. But try not to be awful to your family, friends and employees.
- Not everyone will love your product. (They may not even like your product.) That’s not a reflection on your worth as a human. Most start-ups go to market with an imperfect product. Early customers will give you the feedback you need to improve it. Criticism at least means the customer cares enough to tell you what they think.
- An important part of your mission as a start-up is continuous improvement. With each passing month, your product should get better. Your communication with the market should get better. Your customer support should get better. Your financial processes and ability to predict results should get better. Your team should get better. And you should get better as a leader. The corollary to that is that at the beginning, everything probably won’t be perfect (because otherwise, you wouldn’t need to improve).
- Use your time well. It’s human nature to do those things we’re most comfortable doing. But in a start-up, there are some things that will be outside your comfort zone but are in fact existential to the business. You need to focus your time on the things that matter most, not on the things you are most comfortable doing.
- Swallow your pride. You have an early product, limited cash, an imperfect understanding of the market and your business model, and not many customers. You need as much help as you can get.
- Success of your start-up doesn’t mean you have god-like powers, and failure of your start-up doesn’t mean you’re a failure as a person.
Nothing is more fun and exhilarating than building something from nothing. That’s why people love start-ups.
Bob Wiggins is CEO of Ohio State spin-out RedBud SoftWare.
Here at Lead Read Today, we endeavor to take an objective (rational, scientific) approach to analyzing leaders and leadership. All opinion pieces will be reviewed for appropriateness, and the opinions shared are solely of the author and not representative of The Ohio State University or any of its affiliates.
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