Tag Archives: Entrepreneurs

5 Keys to Starting A Successful Venture

The other day I was asked the following question: How did you develop a for profit initiative within the heart of a traditional non-profit? What was it that allowed you to do it successfully?

The question took me aback. I really didn’t have a good answer. It just felt like the organization was presented with an opportunity and ran through the door.

An explanation like that, however, is vague and uninspiring. More importantly, most stabs at building out a social enterprise (application of capitalistic strategies to achieve philanthropic goals), or any business for that matter, suffer a horrible fait. Yet entities do introduce new products/services, expand into new markets, and acquire proven assets everyday. Once a certain level of momentum is obtained the right steps tend to standout from the crowd. But, how does one start?

The answer is to pick a idea (it just has to be good not perfect) and work it. I would describe the process as follows:

  • Test the concept. Get out and talk to your confidants about what you’re thinking. Absorb all the feedback. You’ll find that there are literally hundreds of reasons that it might not work. This though alone stops the vast majority of projects. Be different.
  • Study and be able to explain the value proposition from the customer/consumer point of view. Get it to one sentence;  X helps me  Y by  Z .
  • Find strategic alliances that allow you to bootstrap market entry. For example, leverage someone else’s under utilized space or link with a complimentary product to create a bundle.
  • Get real world feedback, adjust the value proposition and refine internal processes.
  • Present the evidence to stakeholders who can provide the resources to expend the initiative.

Ok, so its not as easy as learning how to ride a bike, but it is skills based. And, skills can be learned so over my next five posts we’ll explore each step in more detail.

Q: Where are you getting stuck in the process?

 

Contract. When?

How about now. Right now.

If you’re having this discussion in your head, stop. Pick up a phone and start having it with an attorney. In fact call an attorney before you finish reading this post. If you haven’t thought about it, or think this doesn’t apply to you. Stop. Think again. You’re in business? With other people? You need a contract. SERIOUSLY.

In the past month, I’ve had this exact discussion with at least five entrepreneurs who are getting involved with others (either bringing others into their business, going into a partnership with someone else, or being brought into someone else’s business) who are proceeding without a contract. They ask me, “Should I have a contract?” My answer is yes. BEFORE YOU GET INVOLVED.

That way everything is on paper and everyone knows the score. Upfront. I can’t emphasize this enough. One entrepreneur suggested that he was doing the work and would worry about contracts and business dealings after the product had reached the proof-of-concept stage (proof that the product actually works) – because if the product didn’t work, what difference did it make. The answer is: When the proof-of-concept phase is reached, it’s too late. Remember the story of Facebook and the two brothers, Tyler and Cameron Winklevoss? Well, there are a million other stories like that. They just didn’t make the news.

And as the company progresses, you never know what will happen. Decisions have to be made for situations you never dreamed would exist. And you and your partners may have very different opinions. That could mean the end of the company. And then where are you? More often than not, companies and partnerships break up. Especially between friends. Especially between family. Especially between colleagues you’ve worked with for years, even decades.

Hey, it happened to me. And I had an airtight contract. I’m suing now. If I didn’t have the contract? I wouldn’t have a chance in hell.

Okay. I’m off my soapbox.

Well, not quite yet. Lawyers tend to be expensive. Even the cheap ones. But think of it this way – it’s cheaper to spend the money now, upfront, than to have headaches or losses later that can be very, very expensive.

Sandra Holtzman teaches CEO 035: Licensing.