I had an interesting discussion with one of the founders of txtanium, a company I have recently invested in. The topic was about how startups often end up doing something completely different to what they had originally planned on doing. This is something I have personally experienced many a time. As you bring your product/service to the market, start receiving feedback and measure traction, tweaks have to made. Sometimes products/services are launched in areas where the demand has not yet been developed. Other times, our target market may need a variation, or a complimentary product/service, that supports the one that we had initially planned to provide.

Regardless of the situation, one should expect a fair amount of change in the original business plan, the one that was conceived when the product/service was just a concept. Ground realities are usually very different from what they appear to be when you are in the planning phase. Inability to adapt to these realities can result in companies having to close business down. In essence, this brings out a key characteristic found in successful entrepreneurs, flexibility. The ability to change ships before they sink is a typical quality of a serial entrepreneur. When the odds are stacked up against you, it really comes down to the entrepreneur’s ability to be able to side step and duck.

One needs to have a finger on the pulse of the business constantly:

1. Monitor your cash flow situation at all times. Long sales cycles, delayed payments and over stocking on inventory can have devastating impact on your bottom line. If you are not being able to generate revenue fast enough, it is time to start exploring alternative paths.

2. Focus on customer feedback. Setup systems to constantly monitor what your customers and prospects are saying about your product/service, as well as the overall industry you operate in. Choosing incorrect niches is a common mistake that many startups tend to make. This is usually because we tend to overestimate market size or demand levels.

3. Keep an eye on your competition. How are other companies doing in your niche? Is everyone selling a relatively homogeneous product/service? Who is leading the pack? What are they doing differently? How fast have they been growing over the past 12 – 24 months? If your company is getting left behind, take a look at existing practices and systems. It may be time to bring in some major changes.

These are just some things to stay on top of it all. The main takeaway from the system is the entrepreneur having the ability to make those difficult changes when things are going as planned. This is not as easy as it sounds, it takes a lot of heart and flexibility to accept that one was heading down the wrong path. However, if you want to create a successful business, your ego has to be put aside. I am a strong believer in the fact that no effort is ever wasted. All good things take time, patience and flexibility are cornerstones to success.

The world is becoming seemingly smaller by the day, with new technologies allowing us to make connections with just about anyone from anywhere on the planet. Globalization, as a topic, has been talked about endlessly, and everyone has been affected by its influence to a certain extent. As an entrepreneur, it’s implications have been enormous, however, I do not think that most entrepreneurs are taking adequate advantage of the tools that we have at our disposal today.

I believe taking your business global must be a integral strategy and should be adopted from the very beginning of your venture. Thinking about expanding overseas when you have X number of clients, or have $X in revenue, is putting yourself at a huge unnecessary disadvantage when compared to your competitors. Looking at business plans today, I am seeing an increasing trend in the way businesses are positioning themselves to facilitate overseas growth right from the get go. Here are some things you should be doing as well:

1. Similar Market Identification: Start looking for parallels in the type of markets that you serve locally in the regions that surround you. For example,being based out of Singapore, one can start looking at how one’s product/services can be promoted to huge markets like Indonesia, Malaysia & Thailand. Singapore is miniscule in size when compared to these countries. By focusing on these markets concurrently, you can achieve escape velocity at a much faster pace. Identify markets where your product/services can be marketed, without too many modifications, and start making inroads.

2. Leveraging on Social Networks: Linkedin, Facebook, Twitter and a bunch of localized social/business networks provide the ability to identify prospects in our highest priority overseas region. Start cultivating these relationships as soon as possible. It does not matter that you plan on entering the market 6 months later. By building relationships with these contacts, we position ourselves a lot better than someone who just drops by their office cold, without any history.

3. Conferences & Trade Shows: Search for events taking place in your niche, in the regions you have an interest in. These networking events provide qualified prospect lists of customers and vendors, that are potential partner material. Traveling and taking part in such events is expensive and time consuming. As a startup, with limited funds, make sure you do your research well on events you want to take part in. At such conferences, network extensively, not just a collecting name cards strategy, but actual connections with people. 5 meaningful connections are far greater than a 100 name cards.

4. Partnerships: When selecting partners in a new region, do your best to avoid any agreements that may get you locked in with exclusivity contracts etc. On the surface, these may appear to be ideal platforms to enter the market in, however, until you have a good working relationship established, do you best to keep things as open as possible.

These are just some initial steps to start thinking in the right direction on how to take your business global. Do you have any experiences regarding taking your business global? What were the challenges you faced? How did you overcome them? Look forward to hearing your thoughts.

An elevator pitch is essentially a concise, focused and well re-hearsed description of your business. It is called an elevator pitch because it should be constructed in such a way that it may be delivered during the average elevator ride, which is around 30 seconds. An elevator pitch is not to be used only on investors or during business plan competitions. It is essentially what you should tell everyone when they ask you, what you do. It is hence critical for every entrepreneur to have a carefully constructed elevator pitch. Here are three things I think are vital in an elevator pitch:

1. Define the problem you plan to solve: Even though you have a very short time frame to give your pitch, it is important to incorporate some background into it. Much of the time I find elevator pitches just rush through the entire process, I hear buzz words like enterprise grade security, scalability and user friendliness, but miss the point about the problem they plan on solving.

2. State a clear value proposition: Avoid buzz words as much as possible in your pitch. Keep your value proposition as concise as possible. As clearly as possible let the prospect know how they would benefit directly from the product/solution, and how it solves the problem.

3. Make it personal: Integrate the word “you” and “your” into the pitch as much as possible. The elevator pitch has to be personalized to avoid it from becoming an abstract concept. There is a tendency to overuse the “we” in pitches, whereas this should be replaced with words that talk more about the prospect.

Develop a set of elevator pitches that can be customized to what the target segment wants to hear, and how your concept applies to them. These three components should however remain standard throughout all your permutations. In order to perfect the elevator pitch, rehearse it well enough to know it like the back of your hand. The slightest hesitation in delivery and pitch can be the defining difference between getting that follow up meeting, or not!

I am a big fan of the Lean Startup model. In the economic climate we live in today, the old way of developing a full fledged product and hoping that a market accepts it for what it is, is a recipe for disaster. The first component of the lean startup model is “Customer Discovery”. This component replaces what was called “Product Development” in the older model. Instead of just creating something and hoping that customers will buy your product, we have to invert the process. We need to leave our offices and garages and go directly to our target customers.

It all comes down to listening to customer needs and requirements at this stage. No matter how much research we do, or hypotheses we create, they will be invalid unless validated by a customer who is willing to pay for what you are developing. At this stage what you need is a rough prototype, one you can get customers to test, then get feedback regarding how it could be improved or scaled. The key to this step, is to get to a stage where you find a sales model that has the ability to be replicated easily, and quickly.

If you are planning a new startup, or, are part of a new startup, my advice is, get yourself out of the office, and be where your customers are. Your aim must be to find a niche, one where you can find a large enough market to cater to, using a scalable and repeatable sales model.

As humans we are bound to make mistakes. What really impacts us negatively is, when we do not learn from our mistakes, and continue to repeat them over and over again. As entrepreneurs this can be very costly, in the end this is the reason why some of us succeed, and some do not. Listed below are some of the bigger mistakes I have made in the past, thankfully I have learned from them .

Not Listening: When we are on a roll, or think we know more than almost anyone else in the room, we make our biggest mistakes. When I was very young, my grandfather would tell me we have been given thirty teeth to guard one tongue, and two ears in wisdom and for a reason. I did not fully understand what he was saying till much later. However, after making a series of mistakes that could easily have been avoided by actually listening to some of my mentors, advisors and friends, instead of saying I knew it all and better, I began to truly appreciate the wisdom of those words.

Lack of Focus: Getting distracted is something I think entrepreneurs suffer from, more than anyone else. Any new project excites us to the extent that we drop whatever else we are doing, to move onto the next big thing. This leaves a trail of semi finished products/services that could have been so much more. My advice to all new entrepreneurs is, select one project and give it all that you have. Building one company successfully is a huge challenge. Make sure it gets your undivided attention.

Incorrect Niche Selection: This mistake hurts a lot ! If you get this one wrong, a domino effect follows. I repeatedly see entrepreneurs picking niches that are too small, or saturated. Doing your market research upfront, and picking the right niche , can be the difference between success and failure.

Cash Flow Mismanagement: Spending money is easy. Spending money wisely, is a long learning curve . Countless times I have seen new startups spend way too extravagantly in the beginning, well before they have any customer. As they progress, further mistakes made in mismanagement of credit terms and sales cycles, put enormous pressure on the company as a whole. Cash flows represent your life line in the world of entrepreneurship. Once it runs out, the end becomes almost inevitable.

Giving up too early/too late: If you have not read “The Dip” by Seth Godin, I strongly recommend you do so. First things first, startups on average take a minimum of 24 months to gather traction, make sure you can commit that much time to your venture. I see too many people quitting way to early when things do not go as planned. Get used to things not going as planned….if you cannot, I recommend you choose another line of work. On the other hand, when things are obviously not working after 36+ months, it may be wise to throw in the towel, analyze what went wrong, and learn from your mistakes.

These are some common mistakes that end up costing entrepreneurs dearly. Which mistakes would you add to this list ? I look forward to hearing from you soon.

This question always spurs an interesting debate. Specially when the individual concerned has the skills to build a business himself, but realizes that getting another person to join in will help liquidate his/her stake in the company. I believe both sides can be argued for. A lot also depends on the circumstances, and type of business that one is starting. However, in most circumstances, I would tend to favor having a co-founder, rather than going it alone. Some major reasons for this are:

1. The ability to convince one, or more, smart individuals to help build your company, validates your idea to a certain degree. If you are a sole founder, this is something that you will not always be able to assess, which leaves one in a vacuum, assuming that the concept is going to be the next big thing!

2. By doing it all oneself, we sacrifice the ability to excel at one thing. Each of us has one or a few core strengths that we excel at. By having co-founders who complement us, we can develop our strengths, with our partners neutralizing areas we are not so strong in. This helps form a stronger and more cohesive team.

3. Building a company from scratch is extremely tough. We need someone there to lean on, often just provide support when the chips are down. When stuck in a predicament, a co-founder often helps us see the bigger picture, and bounce off ideas.

4. When you want to raise funding for your startup, VCs and investors strongly favor funding teams, rather than sole founders. From the investors point of view, a team has the potential to get a lot more done as compared to a single person. In addition, the pressures of a startup, make it a risky investment as a sole founder set-up only.

The main challenge is finding the right partners. Partnering with the wrong person, will negate all the above points , which will in turn start to work against us, placing us in far more vulnerable positions. I always follow my 8 point checklist when evaluating new partners. It has been a great help to me.

What do you think? Do you think going it alone is the answer? Why?

Related Posts:

How to pick a co-founder

Beginner’s guide to finding the right business partner