Category Archives: Leadership

Crowdsourcing for Information

Posted on by
Reply

Recently, the Accelerator expanded our program offering from one, 5-month immersive program into three separate components, Iterate, Accelerate, and Launch. Our new, modular programming design allows our clients to better understand their market opportunities and take advantage of the module that offers the next best step for their venture.

Our pre-accelerator program, started last May and refined in November, is called “Iterate.” This successful four-week program is focused on problem/solution fit. In fact, this program is in such high demand that our last program was oversubscribed. We can currently accommodate only 25 teams.

Our second program is a shortened version of our former 5-month program. This new program is called “Accelerate.” Accelerate is a two-month program focused on product/market fit. We use the Business Model Canvas and customer development methodology for this program. Getting the product/market fit right was often the most difficult task for our clients, and thus, a good place to pause and reflect.

Our newest offering is “Launch!” The focus of this program is to create an operational company and develop a repeatable selling mode. In Launch, we focus on the critical left-hand side of the Business Model Canvas. An outline of the program is located on our website under Launch. Links to Iterate and Accelerate are also located there as well.

In developing Launch we turned to our trusted advisors, mentors, alumni and friends to provide input and feedback to assist us in creating this new program. We have many detailed aspects of the program already in mind, but we have asked our advisors to add, delete, and help us find the missing ingredient to better assist our next cohort. This is truly a collaborative effort.

Our goal is to design a groundbreaking program based on the collective wisdom of all of us. In the first round, we requested respondents to use as much detail or as few words as you wish. We indicated that we would be happy to meet or talk with you and learn more about your thoughts. We were not particular about the form of the advice. Email responses work, too. We were focused principally on content.

The first round process is simple. We start with a very broad base of questions. We also provided the opportunity to opt out.

We anticipate a second round of questions that enables us to collate and narrow the groupthink. At some point after this, we will adopt a ranking system. We will ask that respondents categorize items by importance, or make suggestions to drop aspects that while thoughtful, may not be a fit for our goals.

We seek the broad picture. The Launch part of the program is focused on becoming operational. At this point, only companies that have a valid product/market fit, an MVP and some component of a team will be admitted to “Launch!” The program will be conducted over 5 months.

Some of the monthly topics we are tossing around include strategic partnerships; managing growth, burn rates, and proformas. We are also considering administrative functions such as legal and transactional issues, human resources, and accounting and record keeping. We are also deliberating on operations and value chains as suggested topics.

Here are some of the questions that we would like for you to ponder:

  • What general topics should govern those five months? Any ideas on the specific subtopics?
  • What three things do you wish you learned prior to starting your own venture or helping others get started?
  • What three things do you wish you knew while or before scaling this enterprise?
  • What were the biggest unforeseen obstacles or challenges that needed to be overcome?

As I write this, a few responses have arrived. As expected, building teams was a leading response. A few early indications included soft skills such as negotiation and hiring techniques, culture building and selling skills.

There will be more to come as we continue through this process.

Getting Past First Impressions

Posted on by
Reply

My last blog on first impressions matter focused on the Gust platform application process that most angel groups use. After loading information on Gust, you will receive a pre-screening call. With some Angel groups there is a presentation involved in the process. I have previously discussed the components of making a good pitch and here. However, in preparing your pre-screening or screening presentation there are a number of important elements upon which to focus.

Entrepreneurs first need to understand each Angel group’s process. For example, how they make decisions and how much money is provided per round is essential. However, of key importance is discovering your chief advocate in the Angel group. Remember that in most Angel groups, this is a competition with only one or two winners.

When making your presentation, always focus on the whole story of your company, from value proposition to target market and product market fit. Investors will also want to know whether there is a large market and a great, pressing need for your business or innovation and if you have evidence of good progress in establishing your business. There are other things Angels will be looking for:

Does your plan provide an exit and a reasonable return on investment?

Do you understand the industry and how your competitors fit in the marketplace? Do you know their strengths and weaknesses? Who are their customers and why do they buy from your competition? Why will customers buy from you instead? Have you delighted your current customers?

How will you use the funds? Do the funds you seek match your plans to scale the business? What will you do if our group is unable to complete the funding round with sufficient cash? Do you have a sound plan for the future? How do you currently make money?

Is there anything that might raise a red flag? Is there any criminal record or bankruptcies on the senior team? Any pending litigation against the company or key players? Are any of the co-founders in a personal relationship? Disclose early and don’t be afraid that these issues are deal killers. They are not necessarily. Disclosing the warts early only strengthen your position as an honest person and leader. Failure to disclose can and would likely be a deal killer.

While you present investors are watching to see whether you have the moxie to be an effective leader and have the ability to execute on your plan. This usually comes up during the question and answer time. Angels want to see how you respond to questions, how articulate you are in your response to posed questions, and how well you understand the ability to scale your business. Another principal concern Angels may have is whether the rest of your team is flexible and adaptable to changing market conditions. It’s your job to demonstrate that by showing their experience, savvy, and ability to engaged under changing conditions.

Tell your story engaging all of your pitch points. Using a customer’s point of view, talk about your company with a script format. Prepare it like the screenplay for a movie. One colleague of mine used the story arc ABDCE:

  • Set the Action
  • Build the Background – this is the setup
  • Develop
  • Climax – Why you are a winner (in the movies, the end of the second act)
  • Execution

Remember, this is showtime! Show energy and enthusiasm.

The Short Rules of Entrepreneurship

Posted on by
Reply

Today I offer you my personal rules for entrepreneurship. This set is by no means complete, but they are hopefully food for thought.

Rule 1: Entrepreneurship is about action – The Captain’s chair is yours.

Rule 2: Some people dream about doing great things. Keep your eyes wide open and your feet on the ground, and then do great things.

Rule 3: A sports metaphor for Rule 2. There is no crying in baseball. There is no sleeping in entrepreneurship.

Rule 4: Focus on customers and building a business that is client centered rather than focused on technology. Make sure your company solves customer pain or creates great results for your customer.

Rule 5: Entrepreneurship is not fair. Neither is angel or venture capital funding.

Rule 6: Treat your 3F (Friends, Family and others (known as Fools) round as if they are professional investors. All 3F angel investors have an investment committee – their spouse. Respect the relationship.

Rule 7: Angel and venture capital is like a series of locked doors. Someone must unlock the door for you. Find the people with keys.

Rule 8: Build your company by building a customer base. Build for one client at a time. Later, build for multiple clients.

Rule 9: You have exactly one minute to make your pitch. Practice making them.

Rule 10: Learn the language of entrepreneurship and tell the truth. (Do not tell the typical lies: “Our market cap will scale up to $27.1 billion in five years” or “our competition is too big and slow to move as fast as us,” unless you are Elon Musk and build spaceships in your spare time.)

Rule 11: Get a champion who will work with you.

Rule 12: Bootstrap. Frugality is a virtue. Put some skin in the game.

Rule 13: You are only as good as your cash.

Rule 14: So what? Why you? What have you accomplished so far?

Rule 15: Build a team. One person cannot do everything.

Rule 16: Be a good listener and a better filter.

Rule 17: Network!

Rule 18: If you build it they will not come. You must sell to them.

Rule 19: Never BS yourself or your team. Always pause to understand the bias in all decision making.

Rule 20: This rulebook is incomplete.

Do you have additional tips for entrepreneurs? Feel free to add to the list.

Managing Risk and Managing Decisions

Posted on by
Reply

Early in my career I worked in investment banking and international banking. So, later on when I taught finance I reflected on the issue of risk, and the basic elements of financial risk that all business ventures should consider:

  • Understanding the types of risk;
  • The fundamentals of risk; and
  • Managing the risk.

The fundamentals of risk management involve:

  1. Identifying the risks
  2. Measuring the potential impact
  3. Deciding how each risk should be handled.

In a recent Harvard Business Review article on business model innovation, I noticed a commentary on marketing. This particular article contained a major section about when to make key decisions and identifying who should make those decisions. It occurred to me that the elements of risk are almost identical to the innovation model. Both focus on reducing risk in a venture.

In a past blog I discussed the garbage can model of decision-making, and focused on being novel in decisions. Today, I am looking at reducing the risk and uncertainty inherent in any startup.

Risk identification is a process that systematically and continuously identifies current and potential risks that might have an adverse affect on a startup. The impact of the risk is affected by both frequency (lots of events) and severity (potential big losses). Most companies don’t worry much about frequent small losses. Office supplies disappearing or the local candy store missing a few small low cost items are two examples of a small loss. However, with severe losses, many organizations take precautions to protect events from occurring. Examples here might include large ticket items missing in the isles of retailers or a few items being chained down so that only department managers can help you try on the expensive goods.

In decision-making, the risk inherent about when key decisions should be made is often due to the lack of sufficient information to reduce the uncertainty. Strategies to deal with this issue may include:

  1. Postponing the decision. Sometimes decisions appear urgent but are not.
  2. Splitting up the decision into a series of real options. Break the decision into small bite size pieces this reducing any significant investment.
  3. Changing the order of decisions. Sometimes a client may ask for customization that may not benefit the strategic direction or value of the organization. In response, the startup can change the sequence to only payment upfront or with proof of performance before investing in the customization.

The CEO may not always initiate all important decision-making. Empowering employees is a very effective way to deal with every day minor decisions. If the decision is too important to delegate, then another way to manage the risk is to consult with a board member or trusted advisor. Even then, always try to find the HIPPO (the industry’s Highest Paid Person’s Opinion). Delegating up or outsourcing may be the best option when dealing with risk issues.

Managing risk and decisions can also be accomplished through insurance, or outsourcing. Startups often hire distributors and/or transportation companies to take on the logistics of moving product not only because it is less expensive but also because these outsource companies have the know-how to manage these specific operational risk.

In startups there are other types of identifiable risk that may include market risk, supplier risk, default risk by clients and others that are usually addressed in the planning process. Managing risk and managing decisions travel in lock step with similar processes. However you manage risk, make sure the process is around a strategic framework and one that allows for continuous monitoring.

Garbage In, Garbage Out: The Garbage Can Solutions Model

Posted on by
14

The children’s story “Alice in Wonderland clearly identifies the paradigm of the Garbage Can Solution model. When Alice meets the ever-elusive Cheshire Cat they have this conversation:

‘Would you tell me, please, which way I ought to go from here?’

`That depends a good deal on where you want to get to,’ said the Cat.

`I don’t much care where–‘ said Alice.

`Then it doesn’t matter which way you go,’ said the Cat.

`–so long as I get SOMEWHERE,’ Alice added as an explanation.

`Oh, you’re sure to do that,’ said the Cat, `if you only walk long enough.’

The question is if SOMEWHERE is the right place.

“Entrepreneurship is […]a way of thinking that emphasizes opportunities over threats,” according to strategic thinkers such as Krueger, Reilly and Carsrud. The “somewhere” alluded to by Alice can be either threatening or opportunistic for an entrepreneur. It can also be both. The trick is to know the difference.

The “Garbage Can Model” is one tool that is often used by entrepreneurs. The garbage can model is one where all of the entrepreneur’s historical decisions and solutions are thrown into a metaphorical can. When a problem arises, the entrepreneur is able to reach into the can to find a solution to their current problem. We see this often with serial entrepreneurs who look to their past success to solve a different set of problems. This has also been referred to as the sophomore jinx.

Traditionally, the Garbage Can Solution model describes the accidental or random confluence of four streams. A number of academics believe that decision making occurs in a random meeting of: choices looking for problems, problems looking for choices, solutions looking for problems to answer and decision makers looking for something to decide.”

In fact, one well known academic questions the validity of this particular model when she asks, “Does the garbage can model describe actual decision making or is it simply a labeling of the unexplained variance of other, more powerful, descriptions of strategic decision making?”

Additionally, does the garbage can take into account our existing bias based decisions? If we fall back on choices that worked for us in the past, does that mean they will work for us today? Do we need to solely rely on what is currently in our leaders’ bag of tricks to creatively develop new ideas, solutions, or products?

In more establish organizations, famous social scientists Cyert & March tell us that “Exogenous, time dependent arrivals of choice opportunities, problems, solutions and decision makers” are thrown together so that any solution can be associated with any choice. Never a good way to approach decision-making. What they are alluding to is that solutions, problems are often thrown together from previous experience with the hope that the right problem hooks up with the right solution. With unlimited resources and time, this may result in relevant information.

However, is the time-constrained, resource scarce environment of the entrepreneur an appropriate place to utilize this model? This is exactly where entrepreneurs slip. In seeking repeatable processes, creativity is lost. All start-ups should look to the creative solution making process as much as possible.

The answer, as usual, is it depends. Although The Garbage Can Model is not a rational method of strategic thinking, there is significant research backing up this school of thought on decision-making. On first look, this is not a particularly creative approach, nor is it direct and focused on finding specific problems and solutions. By definition the Garbage Can model of decision-making assumes that nothing new is added. The only items in the can are what has already been done or considered. It is history rather than innovation that drives this approach.

However, the creative entrepreneur is not focused on what’s already in the garbage can, but rather what the entrepreneur could be doing to add to the can in order to make rational, novel, and strategic decisions. Unfortunately, for many entrepreneurs, the right solution never gets added to the mix of ideas, problems and solutions.

The best response for entrepreneurs is to find creative answers for their start-ups that are removed as much as possible from prior bias. In order to accomplish this, entrepreneurs must be exploratory and experiential, note boundary limits and consciously develop an environment where all parties involved in the project have a strong, relevant voice. This assures more team buy in to the project. Eliminate power plays and look for the important breaks in typical industry patterns.

So get out of the building, find customer data (however imperfect it may be) and go somewhere. Whether your team decides to dumpster dive or not, I will leave that up to you. However, you should be aware of the upside and limitations for utilizing this business model in your start-up.

Convertible Notes or Price Valuation: A Question of Risk and Alignment of Interests

Posted on by
Reply

I am not a fan of convertible notes for entrepreneurs for a number of strategic issues. I also understand the reasons why convertible notes have become so popular with entrepreneurs and investors because of the simplicity of the closing. I believe series seed equity can close just as quickly and inexpensively as convertible notes.

For the uninitiated, convertible notes are debt instruments with an implied interest rate, maturity date and a convertible option to shares usually offered with a discount offered to the next pricing round. The intended purpose for investors is to avoid negotiating a valuation with the entrepreneur that might affect the follow- on round negotiated with the next group of investors. For entrepreneurs, convertible debt offers a faster option to close, and ergo cash in hand.

On the other hand, priced rounds offer each investor a price per share. Because of negotiation over valuation they can take longer to develop.

One of my favorite posts on why convertible notes are unfavorable to startups comes from Mark Suster. He offers significant details on the terms of the note and why they are not a good idea for entrepreneurs.

In addition to what Mark has written in detail, my take on this is much more strategic and focused on the alignment of interests between investors and entrepreneurs. First, by placing a maturity date on the convertible note, the entrepreneurs must strategically change their focus from company building to fundraising. Often the maturity date for the convertible note is set for approximately 18 months away. A better date for the entrepreneur would be 24 months, although sometimes they are set as low as 12 months, which is disastrous for the entrepreneur. Given the hunt for funds from new investors, due diligence and the negotiation of valuation—all of this activity can take time away from building and running a company.

The pro convertible funds side of the equation believes that that the time involved on a convertible round is much faster and settles quicker, ergo the whole purpose of a convertible note. My belief is that the function of the convertible note should not be necessary if the interests of the investor and the entrepreneur are strategically aligned.

In early stage companies, the best way to build a startup is through customer development and acquisition. What would an early stage investor prefer? Using their money toward the next fundraising round or focus on customer building? This leads to be an inherent conflict in strategy between the entrepreneur and investor on a convertible round. There is a specific imbedded date to obtain new funds. If that funding is not achieved by that date, the funds become a debt—and entrepreneurs sometimes need a longer runway to launch their companies.

The second issue regarding convertible notes revolves around the purpose of Angel investing. First or second sources of funding after the first formal funding round means to accept the significant risk involved with early stage technology financing. Angels understand that investing at this stage is inherently risky, and the reward is a significant uptick in pricing on subsequent rounds. Convertible notes are an attempt to hedge the risk by not pricing the financing round. Are the protections from down rounds or failures truly built into a note? Yes, a note may be higher in the pecking order of a fire sale in case of a failure. However, if a startup fails, what are the assets truly worth? If the round is not priced, the value cannot be determined easily.

What happens if the entrepreneur does not achieve the steps needed to get the next round of funding? The original Angel has a choice, put in a second round or let the company go broke. However, if the entrepreneur has been able to find another investor, the golden rule applies: “He who has the gold, rules.” The investor leading the next round may decide to offer to fund with the original note holders waiving a number of their protective rights.

Pricing a round allows the Angel to see the negotiating techniques of a founder and the founder to see how helpful an Angel is to the startup. They can begin to see whether their interests are truly aligned. Are both negotiating with the same sense of fairness and aligned interests? Why not have that difficult conversation about pricing, now? It shows the mettle of your CEO. It determines Angel alignment with company goals. If a valuation can’t be agreed upon fairly quickly then perhaps the deal should not have been done at all. Fred Wilson of Union Square Ventures said it well, “Equity is simple and you own what you own.”

As an investor, I attempt to understand the upside risk and prefer a clear valuation. After all, this is my risk capital portfolio. I want my entrepreneur to focus on building the company by creating a sound customer base, so that the next round is a growth round, not another marketing round.

Time Tips

Posted on by
Reply

Time Killers

Time killers are things, processes, people or anything that diverts our attention to activities that are unnecessary and without benefit. Time Killers harm our effectiveness as entrepreneurs. I believe these tips may be credited to Stewart Levine and his book Cut to the Chase, but I was unable to verify the references. Nevertheless, they are excellent tips and worthy of repetition.

Tip 1 – I GOT IT

As soon as you understand exactly what someone is explaining, indicate in one way or another, “I got it.” Doing so frees them to move on and cover more ground. Similarly, if someone else says “I got it” to you when you’re explaining a point, stop.

If you’re not sure if someone got your point, listen carefully to the person’s responses. If it’s clear there’s still a misunderstanding, say “I’m not sure we’re on the same page. Let’s make sure we understand each other.”

Tip 2

YOU”RE KILLING ME

What happens if you have said, “I got it” to the person and they keep right on talking? You feel trapped. You know the clock is ticking. This is the third time you have heard the story. Everyone in the room is already in violent agreement. Instead of getting angry or giving up, look at the other person, laugh, and say, “You’re killing me. I’ve got the point. Let’s move on.”

By being both direct and funny about it, you do two things: (1) you break the tension that everyone probably feels; and (2) by keeping things light, you move the conversation forward without offending. Odds are that the speaker is so wrapped up in the point being made that he or she has stopped observing what was going on around them. You’re offering him or her, a graceful way out and helping to keep things moving.

If you’re not comfortable saying, “You’re killing me,” try “Time out.”

Tip 3

CLOSE THE LOOP

Have you ever had a test at your physician’s office, and the nurse said, “We’ll call you if there’s a problem”? Two weeks later—and still no call. You begin to wonder, “What if they lost the test? How can I be sure everything’s okay?”

When people don’t close the loop, they leave the other person hanging. Not only is it distracting, it can subtly erode the relationship.

Anyone can follow up. It’s a simple matter of being conscientious and disciplined.

When a colleague introduces you to a new contact, tell your colleague when you’ve reached out to the new person. After you’ve connected, tell your colleague how it went.

Respond to invitations and meeting requests promptly. It’s a lot easier for others to plan an event when they know who’s coming.

When you receive details or specifics, acknowledge them. When you receive a question by phone or e-mail, answer it or forward it to the person who can.

Acknowledge your action with the person who raised the question. A simple e-mail reply saying, “Got your message, see you there” will eliminate any confusion or uncertainty over whether you received the e-mail and were able to attend the event.

Never let yourself be known as someone who leaves other people hanging. Once that label gets applied, it’s hard to shake. On the other hand, when you consistently close the loop, you build a reputation as a dependable professional.

Tip 3

Never let your iPhone become iCrack

We’ve become obsessed with staying connected at all times. If not used wisely, these tools, instead of helping us cut to the chase, can usher in a relentless stream of interruptions in our professional and personal lives.

Do you ever find yourself irritated at a fellow commuter who talks nonstop on his cell phone, sharing private and privileged information, while you are attempting to catch up on industry reading? Have you ever been tempted to strangle someone at a meeting who checks his email while others are speaking or presenting?

These productivity tools should serve us, not the other way around. Turn them off when you’re in meetings or working on something that involves others or requires concentration.

You can check in and respond to e-mails when the meeting or work session is over.

Set an after-hours limit as well—one that works for you, your family, and friends.

Tip 4

Tell them the Baby is Ugly

When I asked a colleague to review my initial outline for an article, he agreed under one condition: “I need to know that I can tell you if the baby is ugly.” I told him that not only did I agree, I was counting on him to constructively challenge my thinking.

When someone has a new idea, he or she often loses objectivity. After all, the idea reflects on his or her creativity and quality of thinking. It’s hard to tell someone that you don’t like an idea. But it’s a lot easier to have that discussion before you launch a new product or service than after your company spends countless hours and dollars to develop it. In fact, the sooner you point out that the baby is ugly, the less time everyone wastes developing a flawed idea. A smart innovator counts on your honest feedback. That’s why he or she is asking for it.

An easy way to provide constructive feedback is to give or ask for: three things you like about the idea, three ways to improve the concept and if you dare three things not liked about the idea. This last question is difficult as many humans are programed to be polite and the politeness barrier is a difficult one to crack.

Tip 5

Know your weaknesses, but play to your strengths.

Most people focus on their weaknesses and try to improve them. But the most successful executives realize that this is a waste of time. Everyone has strengths and weaknesses, whether they are a CEO or a management trainee. While it’s important to be aware of your weaknesses, devoting time and energy to strengthening them will give you only limited gains.

You’ll become much more effective by building on the things you already do well.

Tip 6

Life is a negotiation

If you’re breathing, you’re negotiating. Every day you’re trading “this for that”—whether requesting a better compensation package from your employer, negotiating a deal with a client or vendor, or deciding where to dine that evening with your spouse. Make every negotiation a little easier by limiting your wish list to the two or three things that matter most.

Unless you’re negotiating a multiyear contract or a peace treaty, don’t bring a long laundry list to the table. You’re bound to lose something important if you do. Negotiation takes time. Invest it wisely in the important work—knowing exactly what you want, listening to what the other party needs

Tip 7

On it. Pending. Done

Develop a shorthand with your close colleagues. You’re all busy, so give each other permission to dispense with the niceties. On it, pending and done is one I like to use. Another CEO, when he wants someone to move on, e-mails or says “PAC.” It stands for “Point accepted. Continue.” His team knows it’s nothing personal.

Tip 8

Good Enough is the Enemy of Perfect

There’s nothing wrong with wanting to do your best. But striving for perfection when “good enough is good enough” is a waste of time. Don’t let unhealthy perfectionism keep you from cutting to the chase. Know when to let things go.

Tip 9

Take back the Weekend

It’s 4:30 on Friday afternoon. You’re ready to go home. After putting out fires all week, you’re the one who’s burned out. But you’ve got a pocketful of business cards, a pile of receipts to sort through, and at least three people waiting to hear back on something. You decide to go home anyway and “catch up” over the weekend.

Stop!

Unlike on weeknights—when your goal is to clean up quickly and respond to anything time sensitive— Friday afternoons are the time to close every open loop and catch up on those easy-to-put-off tasks that clutter your desk and mind.

Before you leave the office, make sure you’ve delivered on promises, reviewed everything that needs your input, and returned all calls and e-mails. Stay late if you need to. Better yet, set aside time earlier in the day so you don’t have to.

Tip 10

Know when to put the book down

If you’ve grown irritable or are snapping at people, if you’re exhausted or can’t focus, if you can’t fall asleep or are waking up in the middle of the night, take a step back. It’s time to do more than “turn the page” on a workday. You need to put the book down. Whether it’s a long weekend or a true vacation, you need a break. Things aren’t going to improve until you take some extended time off to reenergize.

Every one has effectiveness tips. Feel free to add yours.

The Last Mile

Posted on by
Reply

Fitness experts and athletes know that when they are lifting weights, the number of sets and repetitions within each set vary according to weight. On normal days their weightlifting tends to be three sets of 10 to 15 repetitions. Good athletes understand that the first eight of ten or thirteen of fifteen reps do not make the muscle grow. It is always the last two or three reps that causes the growth. They put all of that work up front, just for the last few reps.

If you have ever pumped a bicycle tire then you understand that after during the first ten pumps, the tire still looks flat, like nothing has changed. The same is true for the athlete. Work too hard in the gym and their muscles react and feel fatigued. That reaction is called over training. Over pump a tire and it explodes.

The same is true with entrepreneurs. It takes a significant amount of work upfront to understand customers, markets, and value chains in order to ultimately lead to a business model. Validating and testing customers as well as building prototypes is just preparation to get to the starting line. What about that last lift to finish? That’s just one more repetition to get to a first sale. And it is that last “rep” that is the hardest.

The same is true in all sports: Running a yard short of goal doesn’t make a touchdown, hitting the goalpost doesn’t score a goal, landing a golf ball an inch from the cup doesn’t matter at all. Nothing matters until a score is made.

Sports are games of inches, preparation, and work, and so is a startup. Entrepreneurs need all that preparation in order to travel that last inch and beyond.

Entrepreneurs and Athletes – Just Like Mike

Posted on by
Reply

The staff opened the doors to my gym in Los Angeles particularly early one day. At 5:00 am, there was only one other person with me in the facility. As I stepped on the treadmill, I noticed out of the corner of my eye that the other early bird in the gym was a large athletic fellow on a stationary bike. It was early in the morning, and I was in robotic mode; I wasn’t thinking much, I wasn’t noticing much. I was simply focused on the run and the tunes in my iPod.

He was pumping hard on the bike and finally I heard grunting noises through my sound isolating earbuds. This was very loud grunting from someone who clearly didn’t care who heard him. I glanced over and did a double take, noticing the mans’ distinctive facial tattoos: Mike Tyson working out in my gym. Mike reminded me of a great analogy: Why athletes are like great entrepreneurs.

Years of experience as an entrepreneur and an athlete have taught me that entrepreneurs are similar in at least six ways:

1.  Training and Muscle Memory: Just as an athlete repeats the same motion in order to perform action without thought and develop instinctive reactions, an entrepreneur must find that repeatable sales process in order to grow a business. What benefits does a client receive from the product or service that they can’t do without? Need sells products and services, not just wants. An entrepreneur’s training comes from talking to potential customers and bootstrapping.

2.  Laser-Like Focus: You have to practice hard to play hard, and practice often. Entrepreneurs run alpha tests, and then beta tests over and over until they get it right. Such practice will make them ready for the ring. Focus on that one big problem that needs to be solved. Everything else is gravy. Pete Carroll, now coach of the Seattle Seahawks tells his athletes not to play the game of their lives, but rather to play the game the way they have been training to play.

3.  Disciplined Behavior: Athletes get up early to workout, eat right, and sacrifice time elsewhere. This active discipline is comparable to spending countless hours editing the website, making the time to listen to customers, or giving up weekends. Successful entrepreneurs just can’t turn it off.

4.  Vision and Focus: Vision is long term and focus is in the moment.  Your vision is to win the championship; your focus is on one punch at a time. Entrepreneurs need to have long-term vision and day-to-day focus. How will you build the company over time? How will you meet this week’s payroll?

5.  Finding Your Voice:  Focus + Vision= Your Voice.  Whether you want your voice to be like Iron Mike or Steve Jobs, it takes the same focus, just a different vision.

6.  Teambuilding: It takes a team to be successful in all sports. Even solo sports like boxing or tennis have a team of trainers and promoters to guide the athlete toward the winning pathway. Entrepreneurship is a team sport. It is very difficult to go it alone.

As an entrepreneur, how are you going to train, focus, and be disciplined? How will you build that great team?

The answer? Just like Mike.