Tag Archives: start-up

2 heads are better than 1… even if the experts say otherwise

Paul and Mary at No.10

I’ve always been a strong advocate of having a business partner and I practice what I preach by having a great relationship with Mary who’s been my business partner for over 7 years and 2 companies. I recently wrote about meeting John Teeling and one of his mantras is that if you are an entrepreneur you are on your own.. I agree with a lot of what John says but we’re on different sides of this one.. .here’s why: My honest view is that if Learning Pool had been led by Mary or I, rather than Mary and I there would be no Learning Pool today. This is because:

1. When things were really hard (and they were) in the early days there were times when one of us wanted to give up, change direction in a random way, or run away! On those days having someone to be the voice of reason or supply a kick where it was required saved the business more than once;

2. We’re more ambitious. I think the temptation as a one man band would have been to accept a certain level of success and not rock the boat. being a double act means that you have more confidence to stretch and that can mean your business grows further, faster or better;

3. 2 heads are always better than one and this leads to better decision making, fewer mistakes (regrettably not few enough) and more balanced thinking. Often the exercise of simply verbalising a problem gets you closer to the answer but if you don’t have a peer to share with, who do you talk to?;

4. It’s more craic!… we’ve had hours of fun making our team guess which one was good cop and which was bad cop… and you can’t do that on your own!

In the end I think businesses today are just the same as businesses of 20 years ago in every respect except one. The pace of business today is incomparable – things change so quickly and its impossible to keep up and keep your eye on the things that matter if you are on your own. Maybe this is because of how we use technology and maybe its because most start-ups are in technology. Indeed, maybe it doesn’t matter but I think it is a fact!

So if this is so important how do you go about finding the business partner who can share the biggest risk of your life with? The cynic would say that in a partnership you get 100% of the bad stuff and 50% of the good so choosing the right business partner could be the biggest decision of all. Regrettably there’s no magic answer to this one, but I do think there are some general principles to stick to:

1. Find someone with complementary skills to you;

2. It needs to be a partnership so it must be equal;

3. Ask yourself whether you can disagree with this person and not have a massive and unhelpful row every 5 minutes;

4. Don’t compromise on commitment – if you aren’t both equally committed to the project it’ll fail and it’ll be messy so be honest about what you want, what you are prepared to commit and what you expect. If you don’t hear the same its not going to work;

5. Work out a system where communication is effective and you both stay on the same page. This is increasingly important when you get a team because if you and your partner are on different sides, the team will smell it and it’ll be bad;

6. You don’t have to live in your partner’s pocket but you do have to get on.. whatever happens next its going to be intense from time to time so find someone you wouldn’t mind being stuck in an airport for 36 hours with.

Now if only there was a place to go to find great business partners we’d all be grand!

Sometimes meeting your heroes is OK!

I had the pleasure of meeting someone I’ve admired for a lifetime last weekend. I first ‘met’ John Teeling while I was studying in UCD and he came to talk to my post graduate class about entrepreneurship. He was captivating then and lots of what he said stayed with me. He’s since gone on to exit one of his companies, a whiskey distillery in Ireland that he sold to a US giant last year and has generally become one of Ireland’s seminal entrepreneurs. When I met him on Saturday I was a little nervous since it was a long time ago and the world has moved on… I need not have worried.

A number of things struck me about John:

John Teeling at #borderbizcamp

  1. He was remarkably down to earth and friendly, chatting comfortably with the event organisers and generally getting involved;
  2. His passion for business is probably greater now than when I seen him 15 years ago. I was left wondering what I’ll be doing (and looking like!) when I’m old enough to get on the bus for free!
  3. He was incredibly direct – it took him about 4 questions to get to the “are you profitable?” one… thank God I could give him the right answer on that!
  4. He is a true entrepreneur… who knows how he survived for so long as an academic! Pretty refreshing in a world increasing populated by plastic start-up guys.

His talk at #borderbizcamp was predictably well attended and entertaining. He talked about some fundamental stuff around being and entrepreneur and the crowd where on the edge of their seats. For John, the essentials of being an entrepreneur are:

  1. To have an idea and be the person who drives that idea with a single minded determination and focus;
  2. Having the resources to make it happen. He made some great comments about how entrepreneurs don’t often have the resources they need (especially money!) but can go about getting hold of them through fair means or foul!;
  3. Having the ability to deal with uncertainty – you often hear people talking about this but John articulates this quality better than most. This is not really about risk – plenty of entrepreneurs hate risk and regardless, we all do our best to manage or mitigate it. Its really about there being stuff (often bad stuff) out there that you don’t know and the fact that you don’t know it doesn’t make you panic. Regrettably of course this doesn’t mean you aren’t awake at 4am worrying about the shite you do know about!;
  4. Enthusiasm, drive and dedication. Plenty of the talks at #borderbizcamp reflected this and interestingly most of the speakers I listened to had similar stories about picking their business up after an initial ‘honeymoon’ period and forcing it to kick onto the next level. John’s point was pretty simple – if you don’t have this… just forget about the whole thing!

So all in all a great day and a nice way to checkpoint where I am. #borderbizcamp was held in the town where I grew up which was weird in itself but nice to see a few friendly faces. It was also the day where I learned that there a lot of similarities between e-learning and forklift trucks… but that’s for another blog!

Sell first, build later… Otherwise known as validate your market

When I talk to start-ups I often talk about the idea of sell first, build later. When I look back at the Learning Pool story, adopting this strategy was a key ingredient of our survival in the very early days and I have no doubt that ability to execute in this way has stood us in good stead as we’ve grown. Before explaining why I think this is good idea for early stage companies, a few health warnings:

  1. You can really only do this as an early stage company. When you get bigger the stakes and the expectations are higher and the risk around doing this becomes intolerable;
  2. Its easier in a business to business sale than in a business to consumer environment although you can do elements of this in a b2c setup;
  3. This is not a strategy really. It’s more a tactic to get into the market and get in front (virtually or physically) of a customer. You shouldn’t forget this bit because it’s maybe the most important element and you have to be ready to grow away from this approach;
  4. You simply must execute the build bit… otherwise your credibility, and with it your business will disappear down the toilet!

All that said, I think there are compelling reasons for adopting this approach, namely;

  1. Its all you can afford when you are a very early stage company with no cash and a window of opportunity that’s closing fast;
  2. it’s a great way to validate your market and best of all, you get to see, and if your lucky even talk to your customers to find out what they like, what they need and what they might want in the future;
  3. You find out whether you really can build this thing and identify the holes in your delivery machine that must be fixed;
  4. You get track record and proof, or otherwise that your concept is viable;
  5. You get to change direction and focus on the things that make the biggest impact for your customers based on real data and honest feedback. You also get to tweak the business model, pricing or pitch if you need to;
  6. It gives you working capital to get the rest of the product built.

One of my best memories of this in the Learning Pool story is when we’d sold a product to a large organisation before it was completely built. We were totally up front with them about it and immediately got to work on building the product so that we delivered on what we promised. A couple of months later we went to see the customer on a sunny day and sat outside their office meeting our contact and celebrate a successful project. She started the meeting by giving us a cheque for more money than the company had ever billed up until that point. When we got back in the car I asked Mary if she remembered anything of the meeting after seeing that cheque… Nope.. me neither! It was a great laugh nonetheless!

10 reasons not to start your own business

The ScreamA few months back I spoke to a group of government types about what life is like in a start-up. The plan was that Mary and I would speak to them about the cold realities of starting up a business so that they could be well prepared if they decided to cut loose from the public sector or if they were made redundant (which is happening a lot) and decided on this as a next step. Anyway the session was pretty much a car crash, I think because of a combination of Mary and I being too down beat, and the audience having a very one sided and positive picture of life in the start-up lane.

My opinion on this is that entrepreneurs are wired in to do this, not necessarily because of their genetic make-up, but because it’s the right thing for them to do right now. That being the case, nothing anyone tells a true entrepreneur will divert them from what they are going to do but at the same time, being forearmed with the knowledge about what it’ll really be like is useful to say the least.

So here’s the list of some of the reasons why you perhaps shouldn’t start a business:

  1. Failure – I like the start-up definition that calls it “something that is likely to fail”, not because I ever aim for that but because it’s true. Most start-ups do fail and as the entrepreneur, you get to carry 100% of that can when that happens;
  2. Age – you could be too old, too young, have kids who are too young, be planning to get married or go travelling around the world. If you think your age is a reason to not start a business, you might be right. On the other hand, there is never a good time to do this and sacrifices are inevitable;
  3. Bureaucracy – one of the lies entrepreneurs tell themselves is that they’ll start their own business so they won’t have to do mundane stuff. The reality is that there is no fun in VAT returns, PAYE, grant applications or tender writing, all of which you’ll have to do because no-one else can or will;
  4. Idea – not having an idea is a widely used reason for not starting a business. In my view it’s bogus though – plenty of entrepreneurs make themselves millionaires by doing someone eles’s idea better than they did;
  5. Cash flow – managing cash is a daily and horrible task when you are a start-up and is often the thing that kills a business. There is no fun in this and it can be extremely stressful;
  6. Selling – when you are starting up you have to sell. In fact, everyone has to sell all of the time. I’m always amazed by the people I meet who are afraid of selling of simply won’t do it;
  7. Fear – you might be too scared to start up a business in which case you really shouldn’t. If you do take the plunge though, expect to be shit scared pretty much all of the time for the first couple of years;
  8. Being nasty – when you are in charge you need to be prepared to be a pretty horrible person. You’ll have to sack people that you like and really care about, you’ll have to say no when you and your entrepreneurial instincts want to say yes and it’ll make you feel pretty bad about yourself;
  9. Family – if you are staring a business the next 2-5 years will be hard, uncertain and full of things that take longer to do than you thought. If your family don’t support what you are doing and aren’t prepared to make the sacrifices with or for you it’s going to be a nightmare. Have an honest conversation for god’s sake;
  10. Freedom – contrary to popular opinion, being an entrepreneur doesn’t give you unlimited freedom. Sure you don’t have to answer to a ‘boss’ per say, but you are accountable to your bank manager, your customers and your staff which can be extremely constraining and stressful. Being an entrepreneur does not necessarily equate to being able to do whatever you like.

So that’s a list of reasons not to start up a business. You can take this or leave it, use it as a reason not to take the plunge or use it as a reason to say “fuck you… I’m doing it in spite of all those things”. At least you know what they are though!

Refine your pitch, then refine it some more

I’ve met a few people recently who were pitching their new business. It struck me that Babe Ruthpeople often struggle to describe their business to an outsider in a way that makes it compelling and coherent. Getting the pitch right is one of the fundamentals of making your business work and over the years I’ve had some great advice on this, notably from Bryan Keating, Doug Richard and Bill Liao.

The basics of this are that getting your pitch perfected is the best use of anyone’s time and while it can be difficult and take a long time, it’s almost always free to do and is so completely worth it. Human nature means that businesses always do too much which creates a barrier to investment, sales and profitability. Having a well refined pitch can help avoid doing this and gives you a reason to stay focused and say “Nah, we don’t do that because its outside of what we’re good at”. A few gems that I’ve remembered:

1.       Narrow businesses succeed – make your business as narrow as you can early on & then execute relentlessly;

2.       Get your product to sell itself – this is possible only if customers will sell it for you so figure out what the single feature makes your product truly awesome and focus on that to the detriment of everything else;

3.       Write down a profile of your customers – give them names and tell the story about how they will use your product so you can understand how everything you do will help them or bring them to your company;

In all of this you need to teach yourself to describe:

1.       What your customers want. Customers buy a product for one of two reasons – to take away pain or to get competitive advantage. There are no other reasons. Decide why your customers will buy your product and build every feature with this in mind;

2.       Your story. It’s no good saying, that taxi drivers have a problem doing this or that. You need to be able to tell the story about the day you were in a taxi, saw that the driver wasn’t able to do something you thought was obvious or easy and you got out of the car in the middle of the street to go off and build your product. This is all about telling your story which, as Doug Richard points out, is the fundamental bit of making an early stage business work, not least because it’s the only thing you’ll have early on;

3.       Your promise. This is tied up in your brand and your company’s identity. Decide what you promise to do for your customers that no-one else can do or that you can do better than everyone. The promise might change a little in focus depending on who you’re talking to (bank versus customers) but if you get this right everything you do – your customer service, marketing, values and culture -  will flow from this. Everyone who knows says you should be brutally clear about this – rehearse it in front of the mirror and write it down. Also think how it will look on a web page or in a tweet as this is where most people will see it.

I think this stuff is incredibly important and it’s something that we work at every day at Learning Pool. Although we have grown a portfolio company we still try to make sure that we stay as narrow as we can to succeed while broadening the portfolio so we can grow. We also do A LOT of storytelling because it helps us achieve so much. Telling a story gives the people you are talking to a sense that things are real, they see the passion in your eyes for what you are doing and they learn to trust you. I sometimes feel sorry for the guys in the team who listen to me tell the story about the day we decided to build our first LMS product day after day but then I’m reminded… its 30% of our revenue and we wouldn’t have a bloody business without that story! Its also true and was one of the coolest days we’ve had at Learning Pool so its going to stay around for a while!