I’m currently coaching a program called Summer of Startups. It’s an ambitious project started by student-run organizations in Helsinki to encourage students to create a startup during the summer rather than taking a summer job. The government-funded program offers €750 per month to each participant and runs from July through August.
My job as a coach is to encourage, challenge and provide feedback to the 10 teams that were selected. In early July, they were mostly wild ambitions and ideas-on-paper, but after one month of working on their prototypes, meeting mentors and taking part in a pitching competition, they have become early-stage startups. Being a startup founder myself, I find it very easy to relate with them. However, this is my first time on the other side of the table, and this new perspective taught me a few points I would like to share.
Be contagious
Early startups are exciting and inspiring. Most people seem eager to help these young founders. Experienced entrepreneurs want to tell their war stories and help avoid hardships, friends and colleagues want to add their 2 cents. People are happy to share your victories and to support you in your defeats. Let them.
It’s easy to lose focus when all you have is an idea and lots of ambition. New teams have a general idea of what they want to achieve and what space they want to be in but usually lack a clear vision of what they need to do to get there.
Focus on a Vision
Because of this, they try many different things, and see how that affects their offering. One of our teams, Incspark put it very well: “It’s a bit like we’re building something random, take a few steps back and say, ‘It seems that we have been building a car!'”
Stop Thinking – Deliver
Business schools seem to train people very hard to make project plans, business plans and financial forecasts and to monitor the competition very closely. Sure, it’s fun to plan how you’ll get 100,000 users in six months and how you will kill Google in three years. Plans are a great way to procrastinate and have the tendency to become obsolete very quickly.
Instead of thinking what your users might want in the future, start gathering users now and ask them. Don’t overdo plans, but be lean, focus on building a prototype and lower your development cycles so you can keep pushing updates and learn.
Step Up to Your Role
Our teams have on average three members with rather undefined roles. It seems they do not consider themselves businessmen yet. They are not CEOs or CTOs but Chief Everything Officers.
It’s important to define your tasks and to have an idea of who makes the calls on certain topics from the start so you can delegate to the right person.
Build a Great Team
It helps to have a good idea: ranking search based on links, making a clean social network, but there are only so many ways to execute successfully. It takes a great team to build such a thing.
What makes a great team? Experience helps, but keep in mind that you need balance (where do you have gaps?), communication skills (divas are difficult to manage), ability to commit to plans, to deliver and to learn. But more than anything, make sure you surround yourself with people who will complete you and stick around when the hard times come.
Learn to Listen; Learn to Fail
Your product probably sucks. It’s unfinished, unpolished, it crashes all the time and only works on your browser. This is normal. Everybody fails: Google launched Wave and Buzz, Apple has the Apple TV and the iPhone 4 antenna. That’s is not what we remember these companies for.
Listen to people’s complaints, however negative, badly formulated or nonconstructive they are. Sure, they are criticizing your baby and it hurts, but keep in mind that your users are not paid to give you hints on how to make a better product. So don’t try to counter-argue with them and explain how they are wrong, or convince yourself that they are wrong and wouldn’t have liked your service anyway.
Pitch With Passion
The goal of pitching seems obscure to new entrepreneurs. Many of them suffer from what I call “
.” His advice is excellent, but many early pitches sound like business school presentations slapped on top of Guy’s structure and a 30px font.
A pitch is not about convincing, informing or educating and it doesn’t have to be formal. It’s not a keynote or a presentation – it’s a sales argumentation wrapped up in a show. People most likely aren’t experts in your field or understand your technology. You need to convince them to invest their time, contacts, content or money in your idea. Win them over with a value proposition and a story that sounds strong, memorable and believable. Give a great demo, deliver on bold claims and don’t sound like a tool.
Summer of Startups teams meet Jaiku founders
Don’t Seek Funding (Yet)
This goes hands in hands with the over-planning: young startups love to think about raising money. Who can blame them, when them keep hearing that raising funding is a long and difficult task and that it’s never too early to start looking? Another notion is that more money will help fix all your problems.
The problem is that, without experience, or even a prototype, you’re unlikely to get good terms, and risk getting diluted and burnt very quickly. If your burn rate is buying noodles and living at your parents, you don’t need to raise money, so focus on creating value first!
Do Your Homework
Many young startups don’t do their own due diligence: know your field, find out who your competitors are, register to their service and try it. Find out who’s relevant to you and you should meet. Check if the domain name and trademark you want are taken.
Before you meet people, try to learn something about their agenda on LinkedIn or Facebook, maybe you can help, maybe they’re on the board of a competitor. When you scout for VC, look them up on TheFunded.
Prepare yourself, so you can ask the right questions, offer the right things, and filter the bullshit.
Be Visible
Many of our teams were not active on Twitter or Facebook, because they felt it wasn’t important, or they didn’t want to spam their friends. The idea that “if you build it, they will come” and that you can rely on being viral is deeply rooted, as if random people would suddenly find out about your service and fall in love with it.
Network, attend events, share your thoughts with others, bounce ideas, blog about your daily progress, share your story with others. Don’t postpone it because you think that your product isn’t ready or that people will judge you. Tell the world about your passion, and they might just be willing to listen.
What I Learned
Before the Summer of Startups, I – like these new entrepreneurs – used to underestimate the value of pattern recognition. But patterns are what’s behind the motivations of angels and the values of serial entrepreneurs. They see in new startups the mistakes and successes of startups that have come before – and they want to improve that pattern.
I think that anyone with experience has a duty to help the newcomers. I’ve learned that the role of a coach is not so much to encourage people, but to continuously push, question and challenge them, so that they can find their way by themselves. In that sense, my role is to help recognize failure and success. If those of us with experience do this early and often enough, maybe we’ll see less of the former and more of the latter.
