 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.
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Developed by 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.  An entrepreneur and team create a product, start to market and sell it, and then urgent problems sprout up as the sales and marketing process gets underway. Now the entrepreneur and team do what many young companies do – they bounce around from problem to problem, to sales attempts, to marketing tries, back to the problem, and back to some other urgent issue. Then after a period of sporadic sales and marketing efforts, predictably, panic occurs.
Surprise, surprise! Because of these herky-jerky sales efforts, deals are not flowing in, cash is tight, and the team is bewildered as to why their efforts to sell their new great product are not producing the expected results. There may be other reasons at this stage why sales are not happening, but the fundamental one usually is the lack of consistency in their sales and marketing efforts.  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. |
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