The most challenging test faced by a startup is finding and securing those first customers willing to bet on the company when no one has heard of the firm and when the product has yet to be battle-tested.
At this stage, trust is your number one product feature and that will carry the deal. Trust is forged separate from the product and created during the sales process. And it’s the human part of the sales equation. When you’re trying to capture those first customers, it’s important to realize that any action that negatively affects the trust created can derail the sale.
In a startup, everyone is highly anxious about getting these early deals signed for many reasons. To the person working the account it can feel like everyone from the CEO on down wants in on the sale to make sure that it gets closed. If a company is not careful, this all-in, pile-on effort by the CEO and others can blow up a deal by damaging the trust built up between the prospect and salesperson.
Many in the startup world simplify the entrepreneur journey into three stages – Build, Scale & Exit. However, it helps the entrepreneur to look at the process more granularly - more definition provides more direction. For this post, we break the startup lifecycle into six actionable stages from ideation to value realization, with each being an essential part of the journey on a company's growth curve.
By delineating and defining the steps along this curve, the entrepreneur can better understand where they are on their journey, where they must go, and what must get done. In turn, this assists her in acting and communicating more succinctly and clearly with her team, investors, and other key constituents about what steps to take to achieve her goals. This engagement then helps the company build a stronger foundation from which to scale the business, deploy capital, and create value for investors.
Tim Bates, Dan Kinsella,
Jim Moar & Kent Lillemoe
for the MESA Organisation
A Call to Arms about Cash Management
For many companies, time is money. For early-stage companies, money is time. This framework underscores this brutal reality.
You need loyal customers and super-duper products for startup success. However, they're rendered useless if you don't respect the fact that cash will always be king, and you need it to survive.
A simple truth, cash-flow surprises kill many startups. One out of three startups dies from a cash crisis. Therefore, as an entrepreneur, you need to understand and, more importantly, master cash management basics before mismanagement bites you in the ass or, worse, puts you out of business.
In its simplest form, proper cash management means controlling your inflows and outflows of cash, so you never run out!
Here, we outline seven fundamental concepts of cash management that every startup founder must adhere to to minimize cash-flow crises or an all-out business implosion.
Trade shows: It seems we have all attended them or helped organize one or two. Intentionally or not, over the years, I have used them and other such events to launch new businesses and products. As I look at them through the entrepreneur lens, I see that they are more than just marketing exercises. They are forcing functions* that can drive overall company growth.
As an entrepreneur, you should recognize and embrace the power of these forcing functions. Don’t just let them happen or go to waste. Seek them out. Use them to manage the growth of your business and propel it forward.
Think about how people in your company act day in and day out. There is a routine. Everyone thinks they work hard. They are smart, and they put in long workdays. Then reflect on how everyone responds when there is a hard stop when the company needs to present and demo its latest, greatest product at a major trade show or deliver it to that first customer.