Let’s face it: businesses are easy to start. All you need is an idea, a laptop, and an internet connection.
But as David Lee notes in this post, the real test comes when you have to run and build that business. People don’t write about that part because it’s just not that glamorous. Most advice tends to focus on developing your MVP, finding your early team, and raising seed funding. Those topics feel cool and sexy.
But building a business and then running it take a ton of hard work, and all of that grit and resolve is critical to your long-term success. So in the spirit of the openness that underlies VestedWorld’s core values, I’d like to share some things we’ve learned as we continue to grow into the next ‘stage’ of what it means to become a business.
Hiring a Team and Building a Healthy Culture Are Insanely Hard
Your team and your culture will make or break your dream of building the next Google. But as an extension of yourself, your business will reflect the things that matter to you as a human being. The values you establish for your business will mirror your personal values. Always keep this in mind as you hire and build your culture. You shouldn’t hire people that are the same as you. Instead, take the more difficult path by challenging yourself and your cofounders to hire a team that builds on your weaknesses. Fill in your blind spots. Augment your skill sets. Be willing to be hire people who aren’t afraid to challenge your perspective.
Give Me Systems or Give Me Death
You know that startup proverb that says, “It’s better to get it done now and clean it up later”? Well, that momentary convenience has a way of becoming very inconvenient as you build your business. Monthly reports to investors. Government and tax filings. Contract reviews for partnerships. These things have to be done well or you’ll put your business at extreme risk.
You know those metrics you haven’t set up because you’re trying to get customers? Not the vanity metrics like pageviews or free app downloads. I’m talking about real metrics like customer acquisition costs, conversion rates, COG’s, and more. Those metrics indicate that health of your business. Take them off the back-burner. Set them up now. Start to learn and act on what’s actually going on with your business.
Your Best Marketing Is Your Best Product
As the founder of a startup, you never actually work for yourself. Any great business owner knows that, investors and corporate boards aside, they are always first and foremost working for their customers.
So build them the best product you possibly can. They are the ones who will determine whether or not your business will succeed. Deliver on the value you promise them, and they will tell everyone they know. At the end of the day, no amount of marketing dollars can sell a bad product.
Raising Funds Never Ends
If you take money from venture capitalists once, count on having to come back for more. Fueling success costs money. If you’ve taken venture funding and your business succeeds, you’ll most likely either get acquired (a liquidity event for your investors) or you’ll IPO (a liquidity event for your investors and another fundraising event for the business). If you don’t succeed, your business will die. There is little middle ground when you’ve taken VC money.
There’s only one way to reduce funding pressure: build your business and get out of the startup stage. Raising funding after your seed round is a completely different ball game. If you haven’t yet done this, search Google for seed or Series A funding. You’ll get loads of tips, tricks, and tactics from a diverse set of sources. Now search for Series B funding. What do you see? Probably just a handful of news stories reporting on companies that have managed to raise their Series B. All of the lessons have disappeared.
Rare is the blog post that talks about the grueling work of the next stage of fundraising on the path to building your business. Learn as much as you possibly can from your current investors and advisors, because once you move past Series A, you’re not going to get advice from anywhere else.
Don’t Lose Your Vision
As you build and run your business, you’ll constantly be faced with people and situations that will test how much you actually believe in your original vision. You’ll be tested by your investors, by your customers, and even by yourself when things get tough. A clear, defined vision should be your true north. It should keep you fighting through the fog of business model questions and the constant fluctuations of market circumstances. Once in a while, it’ll even be the ignition you’ll need to restart things on your path to building your business.
At the end of the day, never forget that running and building your business is a journey. Regardless of where you’re at on that path, never stop enjoying the adventure.