Ideas are only the beginning and execution is all-important.
My Start-up:Wigwamm makes renting property fair and transparent
So I’ve been doing this “startup thing” for a year now. There is incredible energy, passion, talent and commaradery around. There are also some great results. At the very least, in London, the startup community is making business a sexy topic (the Yanks take top prize for loving/obsessing about business).
There are, however, some pitfalls that nag at me now that I see the landscape with ever so slightly seasoned eyes.
Here are those parts of the startup ecosystem I’d like to warn newbies about.
CAVEAT: As with popcorn, kernels of advice should be taken with plenty grains of salt. Bittersweet popcorn ALWAYS leaves a lingering, nasty taste in your mouth that you remember at the most odd times.
1. Advisors - In any gold rush, there are always people trying to sell spades. And don’t get me wrong, it would be tough to dig up a mountain without the proper tools, BUT don’t pay for things you are not SURE about. Your startup is more about you and your potential customers. Advisors are going to add little-to-no value. Smile, don’t be as rude and condescending as I might have been… and say thanks, but no thanks.
2. Lawyers - These guys sometimes worm their way in as potential advisors. It’s bullshit. I’m not going to be nice about lawyers, especially considering the little value they add for work that is fairly standardised (in this day and age). And I’m talking about when you startup: don’t use lawyers. Certainly don’t pay any. When you get to raising a Series A, then you have little choice. But for Seed and earlier stage, there is PLENTY of knowledge, best practice, document templates and community to ask for advice. Use them. They love you.
3. Accelerators - It seems everybody and their Mum is running or investing in an accelerator. I won’t go into the pros and cons, as you can read about that here. What you should know is this: WHY THE HELL AREN’T YOU BUILDING YOUR PRODUCT AND TALKING TO CUSTOMERS? Filling in those endless forms is not going to help. It certainly won’t get you funding. Accelerators are not idea-stage, at all. The only exception is Y-Combinator. They are a bit special and their track record of accepting people with no traction (just talent) and helping/cajoling them into solving a problem is fairly unique. Otherwise, accelerator programmes are just an excuse to sift through all of you to cherry pick those with ‘traction’. IF you cannot work hard outside of an accelerator and build something, you cannot do it inside an accelerator either.
4. Meetups - I am definitely GUILTY of attending WAY too many events. In the beginning it is sort of necessary to do the douchey thing. But once you have a core group of compadres, just build, test and break stuff. Those evenings at meetups really, really aren’t helping. Well, they do, they sometimes feed you for free. And boggle your mind with alcohol. Oh, and make sure you lost 3/4/5 hours of your life. Cumulatively add up the amount of time you’ve wasted at meetups (include travel!). It’s pretty depressing. Build, and then go to where your customers are.
5. Negative people - Again, I’ve been guilty of this. People are more than happy to tear you down, rather than discuss what it is you are really trying to achieve. Because what you say and what is in your head aren’t always the same thing; especially at the start. Grow a thick skin, quickly, there are plenty of these people about.
6. Journalists - The biggest problem with these guys is access. They mostly care about following the money. And even then, they want the story served on a plate to them. Unless your company is called Apple, there is SO LITTLE real journalism and coverage of startups. And it can waste a LOT of time chasing these guys. Seriously, when YOU and YOUR COMPANY are ready for the press, they’ll already know about you and want your story. There is a reason why Paul Graham’s ‘Process’ chart shows a complete drop-off of interest after your ‘TechCrunch pop’: TechCrunch and Tech reporting doesn’t matter. If you want press coverage, talk to journalists in mainstream media that have the eyes, ears and respect of your target customer. I have found PR agencies VERY friendly and happy to dispense advice at no cost. Obviously, buy them a coffee, but they know how to navigate the quagmire of getting attention.
7. Twitter (and social media) - repeat the exercise from the meetups point: total up the time wasted on twitter and other social media. Then calculate how many customers gained, people hired and anything else tangible to come out of time spent on twitter. Don’t get me wrong, twitter has been incredibly valuable for SPECIFIC tasks: contacting investors for a coffee (their email is clogged), market research on competitors, and viewing sporting events live so you can code instead of turning on the TV. Just realise that twitter reputation means NOTHING unless you have a million plus followers. And let’s face it, you and I are no Beiber. Avoid trying to build a ‘social media reputation’. Once your company is up and running, ONLY have a twitter account IF you are going to maintain it, because customers WILL expect excellent customer service through the very instant, short messaging system.
8. Agencies - This ranges from people who want to build your product to those who want to file your R&D tax credits. You can spend a lot of time talking to agencies, as there are a LOT of them around. Some are genuinely useful partners. You’ll often have speakers at Hacker News London espousing the benefits of using an agency that worked wonders and had aligned incentives. And that is the key, make sure your incentives and those of people you work with are aligned. Bonus structures do not work. If people fail, there’s got to be pain. There will be for you, after all, if your startup fails.
9. Investors - There are plenty of people who say they are investors. There are plenty of VCs who say they have seed funds. Let’s just get one thing straight: there is NO seed money in London (or Europe). You want seed money? You need traction (like paying customers or explosive user growth) or you have to be someone famous (in the startup world at least). Otherwise, put seed funds out of your mind. The only money you are likely to raise is from Friends, Family and Fools (and accelerators, but that money is deceptive as it is NOT enough to get you to traction, but more than you have now).
10. Yourself - Seriously, the biggest hindrance to the success of Wigwamm is me. If I decide to spend time with my wife, I can guarantee I’ll be a bottle neck for everyone else. My advice would be to set realistic, achievable goals of ONE thing to COMPLETE each week. This way you can maintain real momentum and demonstrate that to co-workers, customers and potentially investors. Just like anything that requires PERFORMANCE, you need to prepare, know in your mind what you are getting yourself into, dip your toe in to make sure you can handle the heat and then commit to a timescale. For example, running a marathon. You have a deadline of when the marathon happens, you plan out your training in steps, you start with medium distances to see how you handle the exertion and above all you focus on VERY SIMPLE GOALS.
Good luck! You’ll all need it! And if you like or disagree with anything above, feel free to share.