He treats life like one long university education, where he can learn more every day. You can too! Steve Jobs noted that the only way to be satisfied in your life is to do work that you truly believe in. We never know the outcome of our efforts unless we actually do it. Keep your vision clear at all times. Reid Hoffman, co-founder of LinkedIn, noted that the fastest way to change yourself is to hang out with people who are already the way you want to be.
The world is full of great ideas, but success only comes through action. Walt Disney once said that the easiest way to get started is to quit talking and start doing.
No one succeeds immediately, and everyone was once a beginner. No one succeeds in business alone, and those who try will lose to a great team every time. Build your own great team to bolster your success. As you build your team, hire for character and values. So plan for that. Set goals and remind yourself of them each day. Many entrepreneurs point to mistakes as being their best teacher. Bill Gates once said that your most unhappy customers are your greatest source of learning. Let unhappy customers teach you where the holes in your service are.
Assuming what customers want or need will never lead to success. You must ask them directly, and then carefully listen to what they say. When you spend money on your business, be careful to spend it wisely.
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Still, it can be difficult in some circumstances to find an investor to tell you what you are worth. In this case you can choose a valuation, usually by looking at comparable companies who have valuations. Please remember that the important thing in choosing your valuation is not to over-optimize. The objective is to find a valuation with which you are comfortable, that will allow you to raise the amount you need to achieve your goals with acceptable dilution, and that investors will find reasonable and attractive enough to write you a check.
The difference between an angel and a VC is that angels are amateurs and VCs are pros. Although some angels are quite rigorous and act very much like the pros, for the most part they are much more like hobbyists. Their decision making process is usually much faster—they can make the call all on their own—and there is almost always a much larger component of emotion that goes into that decision. VCs will usually require more time, more meetings, and will have multiple partners involved in the final decision.
The ecosystem for seed early financing is far more complex now than it was even five years ago. There are also several traditional VCs that will invest in seed rounds. New fundraising options have also arisen. For example, AngelList Syndicates lets angels pool their resources and follow a single lead angel. FundersClub invests selectively like a traditional VC, but lets angels become LPs in their VC funds to expand connections available to its founders. How does one meet and encourage the interest of investors? If you are about to present at a demo day, you are going to meet lots of investors.
There are few such opportunities to meet a concentrated and motivated group of seed investors. Besides a demo day, by far the best way to meet a venture capitalist or an angel is via a warm introduction. Angels will also often introduce interesting companies to their own networks. Otherwise, find someone in your network to make an introduction to an angel or VC. If you have no other options, do research on VCs and angels and send as many as you can a brief , but compelling summary of your business and opportunity see Documents You Need below.
There are a growing number of new vehicles to raise money, such as AngelList , Kickstarter , and Wefunder. These crowdfunding sites can be used to launch a product, run a pre-sales campaign, or find venture funding.
In exceptional cases, founders have used these sites as their dominant fundraising source, or as clear evidence of demand. They usually are used to fill in rounds that are largely complete or, at times, to reanimate a round that is having difficulty getting off the ground. The ecosystem around investing is changing rapidly, but when and how to use these new sources of funds will usually be determined by your success raising through more traditional means. If you are meeting investors at an investor day, remember that your goal is not to close—it is to get the next meeting.
Investors will seldom choose to commit the first day they hear your pitch, regardless of how brilliant it is.
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So book lots of meetings. Keep in mind that the hardest part is to get the first money in the company. In other words, meet as many investors as possible but focus on those most likely to close. Always optimize for getting money soonest in other words, be greedy 2. There are a few simple rules to follow when preparing to meet with investors.
First, make sure you know your audience—do research on what they like to invest in and try to figure out why. Second, simplify your pitch to the essential—why this is a great product demos are almost a requirement nowadays , why you are precisely the right team to build it, and why together you should all dream about creating the next gigantic company.
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Next make sure you listen carefully to what the investor has to say. If you can get the investor to talk more than you, your probability of a deal skyrockets. In the same vein, do what you can to connect with the investor. This is one of the main reasons to do research. An investment in a company is a long term commitment and most investors see lots of deals. Unless they like you and feel connected to your outcome, they will most certainly not write a check. Who you are and how well you tell your story are most important when trying to convince investors to write that check.
Investors are looking for compelling founders who have a believable dream and as much evidence as possible documenting the reality of that dream. Find a style that works for you, and then work as hard as necessary to get the pitch perfect. Pitching is difficult and often unnatural for founders, especially technical founders who are more comfortable in front of a screen than a crowd. But anyone will improve with practice, and there is no substitute for an extraordinary amount of practice.
Incidentally, this is true whether you are preparing for a demo day or an investor meeting. During your meeting, try to strike a balance between confidence and humility. Do not just walk out leaving things ambiguous. A seed investment can usually be closed rapidly. Deals have momentum and there is no recipe towards building momentum behind your deal other than by telling a great story, persistence, and legwork.
You may have to meet with dozens of investors before you get that close. But to get started you just need to convince 5 one of them. Once the first money is in, each subsequent close will get faster and easier 6. Once an investor says that they are in, you are almost done. This is where you should rapidly close using a handshake protocol If you fail at negotiating from this point on, it is probably your fault. When you enter into a negotiation with a VC or an angel, remember that they are usually more experienced at it than you are, so it is almost always better not to try to negotiate in real-time.
Take requests away with you, and get help from YC or Imagine K12 partners, advisors, or legal counsel. But also remember that although certain requested terms can be egregious, the majority of things credible VCs and angels will ask for tend to be reasonable. Do not hesitate to ask them to explain precisely what they are asking for and why.
If the negotiation is around valuation or cap there are, naturally, plenty of considerations, e. However, it is important to remember that the valuation you choose at this early round will seldom matter to the success or failure of the company. Get the best deal you can get—but get the deal! One reason safes are popular is because the closing mechanics are as simple as signing a document and then transferring funds. Once an investor has decided to invest, it should take no longer than a few minutes to exchange signed documents online for example via Clerky or Ironclad and execute a wire or send a check.
Do not spend too much time developing diligence documents for a seed round. If an investor is asking for too much due diligence or financials, they are almost certainly someone to avoid. You will probably want an executive summary and a slide deck you can walk investors through and, potentially, leave behind so VCs can show to other partners.
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The executive summary should be one or two pages one is better and should include vision, product, team location, contact info , traction, market size, and minimum financials revenue, if any, and fundraising prior and current. Generally make sure the slide deck is a coherent leave-behind. Graphics, charts, screenshots are more powerful than lots of words.
For me, I hate accounting. However, for the first year in business, I viewed getting a bookkeeper as a waste of money, because I could do all of the work myself.
2. Sell anything.
Removing the unwanted emotional, physical, and mental clutter in your office and in your head space will lead you to become a better and more confident decision-maker in life and business. Immediate-term problems have to be addressed, but make sure you create opportunities to be proactive as well. Network with other entrepreneurs and business leaders, read up on trends, attend professional development events, and hold workshops with your team to identify and start initiatives that will take your business to the next level.
Doing these things will help you get ahead of the fires in the long term and keep you energized in the meantime. You rarely can improve the attitude of an employee. However, an employee with the right attitude? You can give them the training they need to be successful in your small business. It really is a win-win for both the employee and business owner.
From employee productivity to sales and logistical information, working to understand how your company collects and analyzes data is an important project for every entrepreneur. After collecting this data, it is important to act on the analysis and work to make your processes more efficient.
A lot of companies are great at collecting data but do not leverage this data to make operational changes. Finally, whenever collecting data on employee performance, it is important to keep the process transparent and ensure that everyone understands that the purpose is for business development and not to micromanage performance. In a nutshell, this means to create a book of standard operating procedures. Then if they want to go on a vacation or were no longer here, their staff could follow the procedures in the book.
This is also very beneficial when they hire and need to train new staff. Documenting my procedures has made me examine everything necessary to run my business in detail and make processes more efficient. Constructive, timely, and candid feedback can boost employee and team performance. Entrepreneurs often hold feedback until formal reviews because they are caught in the day-to-day management of the business. Making transparency part of the day-to-day management of your employees will help them improve their work faster while accelerating results for the company.
This will help in two areas. First, you will know how much you need to sell in order to cover your overheads. Second, it will act as a guide to help your business grow! Many businesses see a budget as restrictive, but it is the complete opposite. At the end of the day, you will see how few of these tasks are but what a huge impact they can make to the success of your business. A penny saved is more often more than a penny earned, so it is important to save on costs everywhere you can. Take advantage of tax breaks, and if possible, outsource non-core business aspects. Some business owners might be too busy attending to details or a specific project and will neglect assessing their business models.
By enforcing a quarterly evaluation, a business owner or entrepreneur can avoid bad business moves and give themselves the chance to grow in the right direction. Hire a good business accountant, and ask your accountant to hold you accountable for staying engaged with your business finances. As small business owners, we have so many things to do that we often spend all our time in the day-to-day running of the business instead of actually growing it.