How Not To Fail

Start @1:08:30

But I can tell you how to avoid failure

All you need to do is not fail for a while.

71% - # of business that fail by year 10 (across all businesses)

17% - Information Tech companies operating after 4 years
58% - Real Estate & Finance operation after 4 years

Why did these businesses die?

52+34 = 86% >> No experience in record keeping, planning, taxes, borrowing, living too high etc.
Basic know how to run business things.

An entrepreneur is (maybe) not a founder.

The Goal of a startup to discover a new business model in an uncertain environment...not to grow an existing business model.
AND THAT MEANS LEARNING TRUMPS PLANNING

Steve Blank

A startup is an organization designed to search for a sustainable, repeatable business model.

Search - actively looking for it.
Sustainable - even without your daily involvement, it will continue to grow based on the actions of your customers.
Repeatable - I can do it over an over again.
Model - I can draw it, understand how it works.

An Entrepreneur is not a startup founder.

An entrepreneur is VERY good at a known business model.

• Known business model
• Out-execute the competition
• Less risk, less reward
• Steal and improve

Eg: Salon... I am going to cut peoples hair and make money from it, and just do it better.

A Startup Founder is looking for a new business model.

• They are trying to discover a new product and a new market first.
• They are focused on a lot of risk but with a lot of reward
• They are defining and inventing a new business model.

Roof rack can be sold independent.

Steering wheel - what happens if and when the carmaker builds their own?

Your company is your product...

You should have a pitch deck for your product and for your company.

Spend like a day a week, where you look at your company as your product.

97% of all exits will be acquisitions...shouldn't you spend some time focusing on the acquisition as a likely exit?

Founder is on the left researching, digging.

Entrepreneur is on the right with a solid business plan.

Growth is oxygen - early on its everything....you need customers to keep learning.

If you don't have users, you can't try out ideas.

Growth is a substitute for solvency... people will lend you money based on demonstrated customer engagement or growth of engaged customers.

What are you really growing?

There are really these three currencies

• Money
• Reputation (page rank, twitter followers etc)
• Attention - awareness about a thing

As startup, if you don't pay attention to these you are making bad decisions.

Startup success is often about the exchange rate between these three currencies.
If you are really good at spending at small amount of money and driving attention, that's great..that's your key success factor.