As a serial tech entrepreneur you might be expecting me to comment on changing algorithms, the impacts of AI or the latest innovations coming out of Silicon Valley. Fascinating though these topics are, I think readers will be more interested in my insights about entrepreneurship, as I believe the lessons I’ve learned over the last 20+ years are universal for anyone founding or running a business.
Starting a business is easy; thousands of people do it every day. Being an entrepreneur is different. Great entrepreneurs identify a gap in the market for a product or service that either doesn’t exist or is poorly delivered by existing providers.
But taking an idea from the drawing board and turning it into a sizable and valuable business is challenging and can often be a lonely and highly stressful experience for first-time founders, especially if they put their own money into the business.
My advice to first-time founders, however great their idea, is to write a business plan. I know that sounds obvious but many first time founders get a bit carried away with the novelty and excitement of building a business from scratch. This sense of newness, however, heightens the sting of the first business screw-up.
Putting pen to paper forces you to clearly and concisely explain the opportunity you’ve identified, how your business will solve it and more importantly how it will make money. Don’t be afraid to share your plan on a confidential basis with relevant contacts to see if your idea and plan are convincing; they may provide insights that will improve it.
A business plan will also help you raise money. First-time founders will sometimes mortgage their house or they’ll sell something and put the money into their idea, and they think the world will respect that they put their own money at risk. I believe this is the opposite of what they should be doing.
The problem if you’re a first time founder – which is risky enough as it is – is if you’re risking your own financial situation, you’re doubling the risk. More importantly, pitch the idea to raise money, and if others are buying into it, then that should give you more confidence that you’re onto something.
Many founders are also very single-minded and can be guilty of underestimating or romanticising the risk they are taking. So I always encourage founders to seek external advice. Try to build networks with other experienced founders and entrepreneurs who are further along the journey. They will understand the challenges you’re facing will be able to provide insight and advice and encouragement.
This can often be the difference between success and failure. My organisation, Helm (formerly The Supper Club), was founded on this idea of giving founders space in which to access the invaluable power of hindsight from people who have been on the same journey they are.
In future columns, I hope to share my experience of building, developing and scaling businesses, but if you only take one thing away from this, my first column, it’s that no one has a monopoly on wisdom, so seek advice from people with similar experience, wherever you are on your personal business journey.