HOW TO BUILD A BRAND FOR YOUR STARTUP

By | Startup Success | No Comments

How to build a brand for your Startup

The thought of building a brand for a new startup can sometimes be daunting for those who think they are not especially creative. But truthfully – this is the fun part! The key to building a recognizable brand is: message consistency. The following 3 questions form the base for building a brand and establishing a message. 

  1. What feelings or emotions do my customers have?

Your company is solving a problem for a particular customer segment and this segment has emotions that may be more prevalent than others. Colours that reflect certain emotions are a great way to relate to your customers through your brand. For example, red is often identified with anger, embarrassment and love. Blue relates to shyness, sadness and calmness. And so on. Begin by making a note of what you think may be your customers’ predominant emotions and then find colors that are relevant. A helpful tool to find colors is http://www.mikesclark.com/web_management/html_colours.html.

  1. How do I want them to feel after using my solution?

After customers use your solution do they feel more confident, happier or excited? All of these emotions could be used to find the type of font for your branding. For example, if your customer feels strong you could choose a bold font. Ultimately you want to choose aspects that will truly connect and resonate with your customers. A tool that is helpful is http://www.fontpicker.net/Online. Here you can find hundreds of different types of fonts and compare styles.

  1. What 3 adjectives would I like my customers to use after using my solution?

Thinking about adjectives you would like customers to use after using your solution is beneficial when choosing different elements of your logo. Depending on the name of your solution and your elevator pitch you could use these adjectives to add to your design or to make it more unique. Remember don’t make your logo too busy because this could cause confusion once used on different platforms.

You will use the answers to these 3 questions to guide you through creating your brand. It is important for you to know that there is no right or wrong when it comes to branding and you shouldn’t overthink it too much. You want to be good enough today because it is better to get out the door today than it is to wait. Things change and new competition enters the market. So the faster you get out, the better chance you will have to build something great.

4 Common Startup Pitfalls

By | Startup Success | No Comments

pitfalls to avoid in business

Building a startup is difficult and launching one is even HARDER! Many new entrepreneurs have very little business background. Learn from those who have been there, done that.

Here are 4 common pitfalls that new startups face:

  1. PUTTING ALL YOUR RESOURCES INTO PRODUCT DEVELOPMENT

Product development is just one aspect of a new business that needs resources. For example, resources also need to be allocated to marketing, customer acquisition and the team. This is difficult for first time founders to realize because their main concern is finalizing the product. Although you should plan to allocate resources for product development, you should do the same for all other aspects of your business. Keep in mind startups are able to generate funding from investors with only a concept through Kickstarter campaigns.

  1. CANNOT FIND A PROBLEM WORTH SOLVING

Many founders believe that if a problem exists for them, it must exist for everyone. Although this is a great place to START (finding a problem you are currently experiencing) it does not mean it is a problem worth solving. Find a customer segment to focus on then validate that this segment is experiencing the same problem by conducting face-to face interviews. This validation process is often missed by new entrepreneurs but it is a key success factor.

  1. BEING A ONE MAN TEAM

Many founders find it difficult to trust others with their new business idea. They may feel like they know everything about the industry but sometimes forget about other areas of a business such as finance, marketing, human resources, client services, IT, etc. Finding a partner and team members is crucial for startup success. In order to get to the point of scaling a business, startups need 3 distinct skill sets; business acumen, domain knowledge and operations experience. These skills can be held by one founder, two founders, or even a team. But before scaling a startup you should have all three corners of the talent triangle covered.

  1. WRITING A BUSINESS PLAN

A business plan in the 21st century is called the Lean Startup Methodology. The lean startup methodology uses information to navigate the path to a successful startup – it tells you where to go, when to turn, and when to persevere and grow at maximum acceleration. A traditional business plan is dormant; it becomes obsolete the minute it’s printed. Why? Because your startup will be evolving and pivoting constantly and the best way to display your startup is on a Lean Canvas. The lean canvas is a 1-page, point form, summary of your business model, that can be completed quickly. Once you start developing your Lean Canvas, you will start to see your startup come to life.

Learn from others and the 4 most common pitfalls for a startup. Overcome the above and you will be one step closer to startup success!

Good luck.

Dealing with Rejection when STARTING A STARTUP

By | How to Start a Startup | No Comments

Dealing with Rejection when Starting a Startup

When starting a startup, rejection is inevitable. That’s why all successful entrepreneurs require a high adversity quotient. The concept of Adversity Quotient was first coined by Paul Stoltz in 1997 in his book Adversity Quotient: Turning Obstacles Into Opportunities. An adversity quotient (AQ) is a score that measures the ability of a person to deal with adversities in his or her life. The AQ is one of the indicators of a person’s potential success in life and is useful in predicting attitude, mental stress, perseverance, longevity, learning, and response to changes in environment. After years of study, we know that all successful entrepreneurs have high AQs. If not, they would quit at the first sign of rejection.

Rejection and entrepreneurship go hand in hand, yet for many first time founders it can be soul crushing. The lean startup methodology is all about getting out of the building and interacting face to face with early adopters to turn business model assumptions into known facts. That means interacting with hundreds of potential customers before building anything. During these customer discovery meetings, entrepreneurs test their assumptions in the real world. They do this before they build, to ensure that what they will eventually build will be bought. The idea is to fail fast, removing misleading assumptions (e.g. early adopters in X customer segment want a solution for problem Y) and confirming underlying concepts that solve an unmet market need.

Fail Fast: Fail Often is a mantra adopted by many startup founders engaged in the lean startup methodology. The idea is that business failures can be a good thing as long as you learn the lesson. These founders believe that this mantra is not just a way to console yourself after things go wrong: it is actually a strategy that can help a company grow. Fail Fast: Fail Often is a philosophy that values extensive testing and development to determine whether an idea has value. An important goal of the philosophy is to cut losses when testing reveals something isn’t working and quickly try something else, a concept known as pivoting. In the real world founders must learn to embrace rejection. Here are some of my favorite things to keep in mind when dealing with rejection:

  • You always miss 100% of the shots you don’t take. Even Basketball’s Michael Jordan, failed to score with every shot he took. But he definitely missed any shot he didn’t take. The same is true with entrepreneurship. The only true failure is not to try. So when you do decide to try, accept that you are already winning.
  • It is only a failure when you don’t learn. If you never fail, you never have a chance to learn, to improve, and to grow. Even the world’s greatest athletes accept failure, not as an eventuality, but as a teacher. After if you never fail, you really aren’t challenging yourself.
  • Eliminate what doesn’t work. There are a multitude of possible solutions to any problem. By failing at some, one learns what doesn’t work. Once you eliminate what doesn’t work, you are left with …what works! And isn’t that the point?
  • Overnight success takes years. Despite the movies and stories of wunderkind, 99% of overnight successes are years in the making. Don’t fall victim to sensationalized stories in the media about billion-plus dollar exits or news of companies raising astronomical amounts of capital. These stories can be discouraging for founders, but they need to realize that success doesn’t come overnight.
  • Everyone gets rejected. There are literally thousands of stories of both large and small companies facing rejection in one form or another – only to persevere and win. Starting a Startup is a marathon not a sprint. The goal is success but the road will be long and full of bumps along the way.

Now that you have those 5 things firmly in your mind, here are a few techniques to help you deal with rejection:

  • Celebrate small wins. If you celebrate all wins, no matter how small, then rejection gets lost in the sea of success.
  • Not about you. The sooner you realize that it is not about you, the easier it will become for you to find the lesson in any rejection. So be sure to leave your ego at home, and instead come at rejection with an open mind and appreciate the feedback.
  • Focus on the goal, not the path. You are trying to start a successful startup. That is the goal, along the way YOU WILL PIVOT. If you accept that, then you can accept that failure leads to pivots, and pivots get you closer to your true goal.
  • Share the pain. You are not alone. Founders all over the globe are struggling just as you are. When rejection is getting you down, go see some other founders. Grab a coffee or beer and swap stories of rejection. Before long, your mood will change and the sense of comradery will make you stronger.

So whether you are following the lean startup methodology or agile development or even the 100 Steps 2 Startup™ program, accept and embrace the rejection in your future. After all, that’s how you learn.

The secret to finding a good business idea

By | How to Start a Startup | No Comments
How to find a good business idea

The secret to finding a good business idea

The thought of starting a business is frightening for many people because of the risk of failure. 42% of respondents in a Fortune magazine survey state, “lack of market need is the number one reason startups fail.” New entrepreneurs must validate their idea with a defined market. Not every idea is a good one. A bad business idea is an idea that sounds great on paper but never generates revenue. By asking yourself the following three questions you will be able to eliminate the risk of moving forward with a bad idea.

  1. What do you love to do?

Take a moment and think about what you love doing on an everyday basis. LOVE is an important word. You must be passionate about what you’re doing instead of doing it simply because you perceive it to be a strength. You will be spending days, months, and years on this project and in order to stay focused and motivated you MUST love what you’re doing.

  1. Who do you hang out with?

Who else do you know better than the people you are surrounded by? You understand their problems, interests and their everyday behavior. All of these factors play a part in finding a good business idea. Many founders reverse the order of finding a customer and finding an idea. They start by coming up with what they think is a great startup idea then they look for customers. This can result in new founders spending time and resources building a solution only to find out that their initial idea wasn’t as good as they thought it was. Find your target market first and then create a solution that solves a problem they have told you they have. You understand the people you see often. They are your friends, family, co-workers or people who enjoy a sport/hobby that you enjoy. You have easy access to them. This will allow you to more easily validate a business idea than if they were part of a group you rarely saw.

After you’ve identified a group of people you know well, and have easy access to, you will be able to conduct interviews in order to discover the challenges they are facing and problems they are trying to solve.

  1. What do people say you are good at?

People have different skills. These skills stem from years of practice, learning and experience. It is important to have some knowledge of your idea’s industry. This is called, Domain Knowledge. Having a moderate degree of Domain Knowledge allows you to better understand the industry terms and keep up with current trends. It also allows you to consistently test your assumptions and validate your idea.

What is the secret to finding a good business idea? Start with a segment of the market you know well, ask as many members of this market as possible about the problems they encounter, collate the results of your surveys and create a solution to the problem that arose the most often. In other words, define your market FIRST, and after you have discovered their unmet needs, you’ll better be able to create a solution, or a new startup idea.

The next step will be to test that idea with that same market segment to determine if your solution to their problem is a viable solution and if it is, whether they would pay for it. But one step at a time.

Good luck!    

What is Currency?

By | How to Start a Startup | No Comments

In 100 Steps 2 Startup™, the concept of currency is a fundamental part of Phase 2, particularly step 11. The term currency refers to what a startup gets in the exchange of value with the customer or user.  Currency can be money from the sale of an item, a signup on a social media site, content for a feed or whatever you expect from the customer in exchange for your product.  For Facebook, Advertisers pay Facebook money to put ads in front of Facebook users.  The currency in that transaction is dollars for access. But there is also a second transaction fundamental to the first. Users pay for Facebook services (e.g. storing pictures, posting messages, reading up on friends’ activities, etc.) with their attention, their eye balls, their time. The currency in this transaction is Attention for User of Facebook. The more one uses Facebook, the more attention they contribute and the more Facebook prospers.

In the legal world, Currency is referred by its’ historic name, consideration. Consideration in contract law is simply the exchange of one thing of value for another. It is one of the six elements that must be present for a contract to be enforceable. Different types of business / revenue models leverage different forms of consideration and therefore use different forms of Currency. For the most part Currency takes one of the following forms: money, experience, data, service, product, exposure, attention.

The term currency refers to what a startup gets in the exchange of value with the customer or user.

 

 

Can you think of several startups that use different forms of currency to fuel their business models?

Below are logos of famous companies, each representing a different business model.   For each company, consider what the “currency” is? Ask yourself what the value being transferred is? And see if you can name the business model.

company logos

For the answers we turn to Mark Johnson’s Seizing the White Space: http://www.game-changer.net/wp-content/uploads/2015/01/list-of-business-models.png

 

 

Whether you call it consideration or currency, whether your model relies on money or attention being traded for your solution, you need to find a model that works and that will allow you to both scale the venture and remain sustainable throughout. If you don’t, you will either end up with a great small business (not scalable) or you will end up losing more money by growing (not sustainable). So give currency your consideration as you progress in building your awesome venture.

You can learn more about this issue in Phase 2, Step 11 of the 100 Steps 2 Startup™.

How to Startup a Startup

By | How to Start a Startup | No Comments

The Chicken or The Egg: Startup Style

how to start a startup

The chicken or the egg causality dilemma is commonly stated as “which came first: the chicken or the egg?”. The dilemma stems from the observation that all chickens hatch from eggs and all chicken eggs are laid by chickens. On your entrepreneurial journey, you may ask yourself a similar question: what do I do first – find a problem worth solving or find a customer worth serving.

You can answer by first asking yourself these questions: If startups don’t know who their customers (i.e., their market) are, how can they determine their needs? And if they don’t know their needs, how can they determine what products to sell them? So based on these questions, founders are best to startup with customer segments that they are: passionate about, have insight into and most importantly have extensive access to. Investing the time to identify and understand their target market drives financial success for startups.

Now many startup founders get the order of finding a problem and finding their customers mixed up.  They start by coming up with what they think is a great startup idea, then they go looking for customers.  That’s backwards. By following that path, founders often end up spending a lot of time and resources building a solution only to find out that early adopters won’t pay for it, or worse yet that their initial idea wasn’t as good as they thought.

Not only that, but founders who start with a product idea, before a customer segment, run the risk of becoming emotionally attached to it. This can prevent them from observing the world as it really is. In other words, they are less likely to listen to bad news or customer feedback about their idea and therefore they are reluctant to pivot.

On the other hand, if you start without an idea, come in as a blank slate, you are actually in a very powerful position because you are ready to listen to all the information being given to you. The Lean Startup method is about working with customers to mitigate risk of failure.

If startups don’t know who their customers (i.e., their market) are, how can they determine their needs? And if they don’t know their needs, how can they determine what products to sell them?

You can learn more about this issue in Phase 2, Step 7 of the 100 Steps 2 Startup™.

Entrepreneurship isn’t a game….but it can be

By | How to Start a Startup | No Comments

This startup business simulation lets you experience the entire life cycle of a startup in hours not years.

Wikipedia defines a simulation as the imitation of the operation of a real-world process or system over time. The act of simulating something first requires that a model is developed; this model represents the key characteristics or behaviors/functions of the selected system. The model represents the system itself, whereas the simulation represents the operation of the system over time.

Over three generations of digital startups (dot.com boom, Web 2.0 & the current Age of Unicorns) academics and scientists have borne witness to the birth, evolution and (in many cases) the death of thousands of startups. This has, over the last two decades, allowed for far greater insight into Entrepreneurship than has ever been available before. This insight, in turn, has allowed academics and scientists to model the Startup Process and its key elements (e.g. pitching for investment). This model has been turned into a simulation, a game that you can learn from without fearing traditional negative consequences including bankruptcy, martial breakdown, and failure to find product/market fit

The game is called The Founder.  And you can play it here: http://thefounder.biz

It is Francis Tseng’s dystopian startup business simulation. It’s a lot of fun and results in more learning than you would think. Players choose their products, marketing and growth strategies, co-founders, location and more and discover that each choice has its own consequences. Hire too quickly, and burn through your cash. Hire too slowly, and miss the market. While playing The Founder once is fun, it is only by playing it dozens of times that one can see the true genius of simulation. The ability “do over” bad decisions and learn from your mistakes is invaluable. The ability to make different choices every time you play allows you to see the consequences of your choices; short and long term, good and bad. And because it is simulation you can experience the entire life cycle of startup in hours not years.

Playing The Founder gives the user several key advantages, including:

  • Improves confidence;
  • Offers immediate and applicable feedback (there is a virtual mentor);
  • Improves business knowledge retention;
  • Mistakes become safe training opportunities and reduce negative real world consequences.

Playing simulations, especially accurate ones, allows for practice to make perfect. Plus it is a lot of fun.

Another recent sim I’ve fallen in love with is pitchbot.vc (www.pitchbot.vc). If you have every considered, or sought, capital from an angel, an incubator, an accelerator or a venture capitalist you know the stress of the investor pitch. An investor pitch is a short meeting in which founders try to convince investors that their venture is worth investing in. Having heard more than 20,000 of these investor pitches over the last two decades, I know first-hand that many of the questions investors ask, questions which stump entrepreneurs, are common and can be prepared for. These key meetings require preparation. QuickBooks Canada’s newest study shows that most 61% of entrepreneurs spent less time preparing for their pitch than planning a vacation. No wonder 99% of pitches fail.

That’s the glory of pitchbot.vc, it lets you pitch your deal to an artificially intelligent text bot that asks questions and responds just like a real investor. Answer the bot’s questions well and you get an offer of investment, including a valuation. The better you pitch the more likely you are to get a deal. Pitch well and the quality of the offer gets better. If practice makes perfect, then this simulation is the perfect tool to tune your pitch.

So while entrepreneurship definitely isn’t a game; parts of the journey can now be simulated. So why not take advantage?

Onward & Upward,

Sean

screen-shot-2016-11-06-at-2-30-42-pm

 

8 Ways to Find Investors for your Startup

By | How to Start a Startup | No Comments

8 Ways to Find Investors for your Startup

In our entrepreneur-focused world, it is easier than ever before to meet seed-stage investors.

Here are a few of my favorite ways:

  1. Connect with founders in your city who have been funded. Ask for their advice. Impress them and let them introduce you to their investor.
  2. Apply to an accelerator (e.g., Techstars) and nail it on demo day. The audience is filled with seed-stage investors.
  3. Attend an event featuring seed investors and ask for their advice after the show. Requests for advice are a great way to showcase your venture.
  4. Kickstart your project. Raise funds and engage early customers. Nothing impresses investors as much as sales and users.
  5. Leverage Clarity, LinkedIn and Product Hunt.
  6. Use the same service providers (i.e., lawyers, accountants) your ideal investors use and ask them for an introduction.
  7. Find out where your ideal seed-stage investors source their funds and ask those LPs for an introduction.
  8. Apply to present to your local angel group.

Most seed-stage investment deals happen within these realms, so get involved in one, pitch your idea and if you nail it the investors will come to you.

Onward & Upward,

Sean

 

screen-shot-2016-11-06-at-2-30-42-pm

WHEN TO QUIT YOUR JOB FOR A STARTUP

By | How to Start a Startup | No Comments

When Should I Quit My Job and Work on My Startup Full-Time? 100 Steps 2 Startup

I’m often asked:  “How do I know when to quit my job and work on my startup full-time?”

A full-time commitment to the new opportunity matters. If the number of full-time founders is zero, you have a problem. Remember: ideas don’t count. Execution counts and execution requires focused founders. If no one is working on the opportunity full-time, how will you make progress? The more people who are all-in and working exclusively on the opportunity, the greater your chances of success will be.

Working on a new opportunity full-time demonstrates commitment. If you aren’t able to do that, consider other ways you can show commitment. Investors want to see what is commonly known as “skin in the game,” a term that refers to founders having something at stake in the outcome of their company.

Most investors are hesitant to invest in something that the founders won’t commit to on a full-time basis. However, many founders need funding to be able to focus on the opportunity financially, which results in a big catch-22. So what do you do if you aren’t ready to quit your day job? If you can show that your product already generates revenue or users while you continue to work on it part-time, then you can make a credible case that taking on investment and going full-time would propel you to greater success. Today, most digital ideas can be proved by early experimentation and customer discovery. So while it’s always important to show early proof of your concept, this is even more important when you aren’t able to commit full-time to your opportunity.

During the 100 Steps 2 Startup, we don’t think you should quit your revenue generating job until you have third party evidence that your startup has traction. Often this is just after finding PROBLEM SOLUTION FIT.

Bottom line: work on the idea, turn it into an opportunity, follow the 100 Steps 2 Startup and Lean Startup methodologies until you have enough evidence to give you the comfort you need before quitting your job.

Onward and Upward,

Sean

 

sean-wiseDr. Sean Wise, BA LLB MBA PhD
Co-founder, 100 Steps 2 Startup