All posts filed under: Business Growth

Getting Ready to Launch – Your first 100 customers

Lessons from “The Minimalist Entrepreneur – How Great Founders Do More With Less.” By Sahil Lavingia Constraints lead to Creativity. If you are a minimalist entrepreneur the early stages of launching your business is all about constraints. You need to focus on doing one thing well and avoiding the temptation to try to do everything at once. Scope creep where a project or product launch becomes unwieldy due adding just one more feature and wouldn’t be nice if we could do this. Sahal Lavingia uses this check list to keep things manageable. Can I ship it in a weekend? Most prototypes of a product offering should be capable of being developed in 2 to 3 days Will it make my customers lives a little better? Is it likely a customer will be willing to pay me for this solution? Can I get feedback quickly? This first product does not need to be pretty. Maybe the best example of a popular but not pretty solution is Craigslist. It’s never been pretty, but it has always worked. …

Be Confident Be Minimalist

Lessons from “The Minimalist Entrepreneur – How Great Founders Do More With Less.” By Sahil Lavingia Don’t let self-doubt set in; build as little as possible. Writers are told, “Write what you know” for entrepreneurs it’s not quite that simple. When you are starting a business you are imaging something that has not been done before, or at least not in the way you are contemplating your business vision. This applies even if you are considering a consulting or coaching business, there may be many similar businesses out there, but yours will be unique because you will bring your skill sets and unique personality to the table. Unfortunately, this is when many aspiring solopreneurs decide that building a business is not for them. Although they have the passion, they let self-doubt set in. They convince themselves they do not have the hard skills they need to be successful.  Let me tell you a secret, every entrepreneur has doubts that their business with be successful. Even the most successful were not sure of success when they …

Finding your business niche

Lessons from “The Minimalist Entrepreneur – How Great Founders Do More With Less.” By Sahil Lavingia Give away so much value that you think you’ve given too much, then give more. Michael Port Book Yourself Solid Start with Community Sahil Lavingia starts this chapter with a story about entrepreneur Sol Orwell who, in 2009, was overweight and unhappy. He decided he needed to learn more about fitness and nutrition. He joined a Reddit community and the more he learned about the subject, the more he shared, he answered questions and posted about his personal journey of losing sixty pounds (27KG). Working with co “Redditor” Kurtis Frank, they built a community of 50,000 members. Kurtis and Sol noticed a common theme, many questions were raised around the subject of nutritional supplements. In 2011 together they launched Examine.com, they did not sell anything, just provided information. In 2013 they began to think about monetizing. By asking their audience Kurtis and Sahil identified a need for a single reliable source of information about supplements available in the market. They launched Research Digest a …

Taking the Long Game View

Making the impossible, possible When setting objectives for our careers whether entrepreneurial or corporate we often default to monetary objectives. That’s why business degrees are so popular, they appear to offer a more direct route to well-paid employment. But one of the best aspects of being an entrepreneur is that you can focus your activities on what interests you. Dorie Clark calls it optimize for interesting. One of my greatest regrets is that I spent my corporate career in a company that made products that really did not fire my imagination. My hobbies were fishing, boating and aviation, not construction chemicals. When considering where your business should take you, evaluate what you are already doing. What catches and holds your  interest? Set big goals for yourself. It may seem to you that making a living out of what interests you is impossible, so you elect to pay it safe. After all who wants to be loser. By playing the long game however, what appears to be impossible becomes possible. Making a living doing what you …

Michael Porter’s five forces. The incumbent’s strengths

What other barriers to entry might you face, the advantages the incumbent has over you when you start out and how might you counter them. Economies of scale in purchasing. The incumbent will have the advantage that they can spread their fixed costs over higher volumes lowering their production costs. Because of their purchasing power they will be able to command lower prices from suppliers. To overcome this disadvantage, you need to reduce one of the other forces, the bargaining power of suppliers. As much as possible use standard parts that can be obtained from multiple sources. Take advantage of special offers, providing there are not shelf-life issues. Befriend the salesperson managing your account. They are often on bonus programs that are triggered by meeting or exceeding a quota. Your demand maybe small but it could be enough to make a difference on whether the salesperson gets her/his bonus. Now is the time to negotiate a discount. Most public companies report quarterly results and there can be a drive to capture sales before the quarter …

Michael Porter’s five forces and the Entrepreneur Part 1. The competitive element

As an entrepreneur you instinctively understand that you are going to face competition from the day you start business. As part of your planning, you have identified your competitors, you understand their product offerings, you know their price points. You have compared your product to theirs and have assessed the comparative merits of each. Back in 1979 Michael Porter articulated forces other than your competitors that influence not only an individual company’s success but also the profitability of an entire industry. To help understand what this forces are, let’s take a look at the airline industry. Most people know that airlines operate on low profit margins when times are good and lose money when times are bad. Sadly, for airlines the bad times outlast the good times. Every economic shock, every oil price hike, even each new virus outbreak destroys their profitability. Why should this be? Why have few, if any airlines, managed to maintain a long-term reasonable return on their invested capital. (ROIC). The reason can be explained by Porter’s five forces. The most …

Three Strategic Options to Deal with Inflation. Which one is right for your startup?

Inflation is particularly difficult for startups. Typically there are three traditional options to tackle inflation, none of which is an attractive choice. You need another approach. A couple of weeks ago I talked about the move from abundance to scarcity we are seeing in many sectors of the economy. To listen click here. With scarcity comes inflation. Based on a poll of economists taken last summer and comments from the US Federal Reserve we may be in an inflationary environment for some years to come. Inflation is particularly difficult for startups. Typically there are three traditional options to tackle inflation, none of which is an attractive choice. You can raise prices and upset your customers. Difficult for startups, you do not have a long history with your customers. They have just started buying from them and now you hit them with a price rise. You can absorb the cost of inflation and cut your margins. Not easy if you are already barely, or not even, covering your overheads. Companies with an established profitable business can …

Can you start a business with no money? Of course! The noble art of bootstrapping. Part 2

In the episode 13 we looked at why entrepreneurs chose to start their business without external investments. Some of these reasons such as not wanting to share the profits with others, and willing to spend time chasing investors are solid reasons of going the bootstrap approach. Others such as not wanting to prepare a business plan, and fear of not having the necessary marketing skills to my mind are less valid. Any start up should have a business plan and you are going to have to market your product at some point. We also looked at the disadvantages that come with a low investment approach. Primarily the risk of running out of cash, In the episode I will share the advantages of bootstrapping, an approach that I highly recommend. But there are times when bootstrapping is not the right approach and that is when you need to scale fast because of the business you are launching. We will take a look at businesses that are not should not be launched by your bootstraps. The advantages …

Managing Change Part 2

What goes unmeasured goes unmanaged Today I am recommending David Michels’s article from Bain & Company, titled “Measuring Your Organizations Ability to Change” If the Covid Pandemic has taught us anything, it has taught us that the ability to drive change is critical. Mr. Michels states that companies that are good at managing change grow revenues up to three times faster than companies with lesser ability. Based on research the article identifies three skill sets and nine factors which, if they exist in an organization will enable it to manage and implement change. Lead Change Purpose: Although it is not stated in the article, but it is implied, explaining why change is needed and the expected benefits aligns employees with the company goals. Companies tend not to be good at this, so make sure you take the time to fully explain why you are making these changes. Direction: A clear road map on how you intend to get to the end goal. Connection: To ensure that employees are committed to the goal keep them informed. …

Managing Change – Part 1

Change is constant – Managing it is a Skill Today I am going to review the first three articles from Bain & Company, two of which were originally published by Forbes.com. I have linked these articles because they provide an effective path to implementing change in your organization. In Creating Change on the Front Line the authors recommend that you spend time learning from your star performers. Having identified the changes you wish to make, the author of Measuring Your Organizations Ability to Change identifies the critical skill sets needed to implement change. And finally in Walking the Talk on Change the same author reminds us that we must lead by example. As a leader of a SME you probably feel it is your and your management team’s role to solve problems. But you should not miss the opportunity to learn from your best performing employees, the stars, the employees who by their actions deliver above average results. The authors identify three steps to achieve success and remind us to look outside our organization for ideas: Analyze Data to find …