June 30th, 2008
In a Mar-14-2005 article on SandHill.com entitled “Bootstrapping: The Secret to Entrepreneurial Success” Greg Gianforte, CEO of RightNow Technologies and author of “Bootstrapping Your Business: Start And Grow a Successful Company With Almost No Money” offers “eight solid reasons why Bootstrapping will consistently deliver better results than the fund-and-burn model that has become entrenched in Silicon Valley and elsewhere.”
- Bootstrapping ensures that you build your business on a legitimate, real-world value proposition.
- Bootstrappers initiate the critical sales learning process sooner, not later.
- Bootstrappers don’t waste money; they make it.
- Bootstrapping accelerates time-to-market and time-to-profitability. You can start immediately!
- Bootstrappers are less likely to make big, fatal financial mistakes. They don’t have huge amounts of cash to spend.
- Bootstrappers are forced into unconventional thinking. Necessity truly is the mother of invention.
- Bootstrappers have more freedom and flexibility. No external funding parties to answer to.
- Bootstrappers wind up owning much, if not all, of what they create.
I think these are accurate, especially if you understand what’s not said.
- Or you go broke quickly.
- Or you go broke quickly.
- Or you go broke quickly.
- You get more information from trying to sell to customers than investors.
- You are in a battle of maneuver not attrition, you have to out-think and outperform–not outspend–the competition.
- If you don’t attack undefended hills and “hit them where they aint” you will not win.
- But advisers can help you steer and consider overlooked possibilities.
- You also should know when to trade in your small pie for a piece of a larger one.
June 19th, 2008
I had jotted down some notes on various 3×5 cards of some good comments and suggestion I’ve heard at different breakfasts in the first few months of this year.
- “Perfect is the enemy of good enough” getting started–and keeping in motion–can be more important than making it better. John Morgridge used to advise Cisco folks to be “Early if not Elegant” which has not caught on as well as “Go Ugly Early”
- Focus more on your business proposition, technology can be a comfort zone that you have to leave to make money. Imagine a day in the life of your prospect if that helps to focus on when/where they will use your offering and how it will make a difference.
- There is a big difference between hiring employees and finding partners. It can be hard for employees to appreciate, even when the “lines of the box are clear” that input/revenue leads to salary/profit; help everyone see the big picture.
- It’s critical to hire strong people in the beginning. It’s hard when need is clear and you can tempted to compromise. Skill deficiencies can be overcome, but attitude and values typically don’t change.
- CRV’s Quickstart model may represent a shift in VC thinking to respond to dramatically lower cost of launching an Internet site (order of magnitude $10K). Ycombinator is clearly another example
- Three outsourcing sites to be aware of:
June 3rd, 2008
A couple of suggestions from breakfast discussions over the last three months
Hiring a sales guy too early is not effective. If you haven’t discovered a successful model for who buys your product based on what needs, it’s unlikely that a sales person will be able to figure it out: they need a clear process and appropriate material in order to find and close business. For example, if they have a huge rolodex, how will they know which customers to target if you don’t know who you are selling to.
An effective approach is to find another company that has a partial solution where you both can target the same customer and offer a complete solution to their needs. This is called a 1+1= 3 strategy.
If you have a champion inside a prospect’s organization who really likes your product, talk to them. They will outline exactly what you need to get the business. They know the decision maker, and will tell you what answers and features you need to get the decision maker to buy.
Can you show them the before and after (what change does your product or service make in their business). What can you tell them about their business that the did not already know? How can you substantiate the benefits of your solution: testimonials, benchmarks, customer success stories, …?
Sean attended an SVASE CXO forum last year and blogged about some practical tips that were presented here:
http://www.skmurphy.com/blog/2007/01/04/tips-for-hiring-and-firing-a-sales-person/