More than 20 years ago, Kevin Costner and the movie “Field of Dreams” gave us one of the all time great movie lines; “If you build it, they will come.” While that may be true in the movies, it couldn’t be more wrong for launching a new venture.
Successful entrepreneurs know this only too well. It’s not simply enough to build a better widget in order to be the next great Microsoft®. It’s about developing the right business that can get all stakeholders to embrace the company’s ideas and philosophy as their own. This goes beyond sales and more into generating buy-in from folks that can help an organization grow big and smart at the same time. So while building a better mousetrap along with a disruptive marketing strategy are crucial elements for a promising startup, companies will plateau much earlier than its industry unless it also does these three things well:
- Find the right financial backers. Banks, venture capitalists and angel investors as well as friends, family and business acquaintances can be the life blood for a company in its early stages as they work to get a product out the door. However, money shouldn’t be the only thing they bring to the table. In fact, financial support could come in a number of ways; from in-kind or pro bono legal, accounting and operational help to introductions with people and institutions that could provide seed capital to get things going. In all cases, the critical element here is to find true partners who can support the organization beyond the actual hard dollars they may offer. They should also be willing and able to open doors to new sales, partners and other investors. Taking their money without such a commitment could do more harm than good in the long run.
- Build the best executive team possible. Any investor will tell you that good ideas are a dime a dozen; many of them never seeing the light of day or a profitable return in large part due to the failings of the executive team in charge of starting up the company. There is no substitute or alternative for good leadership and solid execution, and not securing the right team will put the new organization at an even greater disadvantage than they already are. Attitude is just as important as experience here. I’ve seen a great number of companies retain an executive with a wealth of domain expertise, only to not meet expectations. Successful managers of an upstart firm must have a fire in their gut that can only be quenched by seeing the company realize its full potential.
- Hire hungry people. Creating a culture that personifies aggressive, smart, team-oriented characteristics is key to getting things off the ground in the early stages. Clock-watchers need not apply or be hired, and instead, start-up firms must bring on folks for their “can-do” attitude and dedication to one another as much as for their technical skill sets. That kind of spirit will get an organization through the rough spots that will undoubtedly occur.
None of this is to say that a company can generate significant sales and returns for its shareholders simply by retaining good money and good people. Far from it – a marketable product that solves a pain point for customers must be present. However, a successful new venture must go beyond the product if it is to be more than a footnote in the chronicles of its industry.