Journey of a Serial Entrepreneur

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How to get from where you are to where you want to be

5 Common Entrepreneurial Frustrations

“All that is necessary to break the spell of inertia and frustration is to — act as if it were impossible to fail.” Dorothea Brande

Lets face it, we all have days when things do not go as planned. We only know they did not go as planned, because we have something to compare them with…… days, everything went right. To experience life to its fullest we have to see it from all perspectives. The way we handle difficult situations shapes the course of our lives. Some of us choose the easier option, and do not experience life to its fullest, by preventing ourselves to be placed in vulnerable situations . If you are contemplating taking the path of entrepreneurship,  handling being placed in these awkward situations is what it is all about. Below I have listed five common frustrations which I  have experienced on my journey;

1. Idea Generation: This process can be extremely frustrating for individuals or teams if dragged over a long period of time . This is an important stage and opportunity, to gather all those thoughts in your head, put them onto a piece of paper and make sense of them. This process requires continuous action, it cannot be limited to a conference room! To read more about the frustrations of idea generation please click here.

2. Lack of Resources: Managing limited resources in a startup is always a challenge. When this challenge begins to hinder your drive and motivation to move forward,  is when frustrations set in. The idea of managing your business with an unlimited budget is an attractive one, it also comes with its own set of challenges. We have to stop blaming the lack of resources as the only reason for lack of success. Success depends on having a good team, good ideas, in the right market. To read more about managing frustrations due to a lack of resources please click here.

3. Team Dynamics: A major sources of frustration for startups arise when teams stop working well together. This often happens with a misalignment of value systems and goals. Couple this situation with poor leadership, and frustrations are bound to run high. Team development from the onset is a very important aspect of getting the success formula right. To read more about how to handle frustrations caused by team dynamics please click here.

4. Lack of Sales: If you have been through the arduous task of writing a business plan, getting a team together, and, despite every effort, have been coming up short, frustration is inevitable. However, if you let this frustration bog you down, it will convert into a continuous downward spiral which could result in eventual failure for your organization. Focusing energy on analysing why this situation occurred will result in more positive and constructive discussions and could solve your particular predicament. To read more on how to handle frustration caused by a lack of sales click here.

5. Time Management: If you constantly feel that you do not have time for the important aspects of your life, there is something very wrong here. The misallocation of precious resources often results in being frustrated, grouchy and generally not very happy about life. We need to learn how to allocate this resource more intelligently to enjoy life. This will only happen when we prioritize aspects which are important to us and allocate time likewise. To read more about handling frustration caused by misallocation of time please click here.

 Letting frustrations bring us down, means, we are essentially giving up on our dreams. It is easy to throw in the towel and blame everyone else for why success is not coming our way. It takes a lot more courage to face adversity head on and tell yourself , “I am going to get through this”. Thats what entrepreneurs are, anomalies in the system, who have the extraordinary ability to adapt and change according to circumstances. The word “quitting” does not exist in our vocabulary, if we decide to get something, then there will be little rest till we reach our end goal. Team squabbles, resources or unfavorable circumstances are tests which we must overcome. The next time you feel frustrated and ask yourself “Why”,  decide what you can do about it, rather than what it is doing to you!

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If only we had more time!

The great dividing line between success and failure can be expressed in five words: “I did not have time.” Franklin Field

Time and its correct management is a frustration felt by people from every walk of life. Time moves at an almost blistering pace, due to which one often loses track of it and suddenly, the day, week, month or even year has passed you by. It is amazing how, with all the conveniences we have in the 21st century, it has somehow managed to shrink the time available to us, rather than increase it. The entrepreneur also faces this challenge, often the inability to correctly manage our time leads to massive amounts of frustration.

Take my own example, I am constantly battling to manage my time across the multiple facets of my life. There are stretches where I experience disconnects from certain aspects of my life. It is not hard to get so caught up in the daily struggle, that you lose sight of the bigger picture. There are a huge number of stories regarding time management, one I read a couple of weeks ago stuck with me. In a nutshell, the story explained how we are often so involved in our lives, that it takes a brick to be thrown at us to slow us down. (Actual Story) What happens is, we forget to live in the present because we are so busy making plans for the future. Whenever I have talked to people who have followed this path, many of them did not get that sense of satisfaction when they eventually made it to the finish line of the race they wanted to win. 

Learn how to balance your life as soon as possible. I have found that people who complain about managing their time, are the ones who do not allocate it usage well . In the end, it comes down to how disciplined you are, and also to realize how precious every moment of life is. When people ask me question about when they should start their own business, I have a standard response in most circumstance….”as soon as possible”. Sitting on the fence ,debating whether to jump in or wait for the “right time” is just an excuse. If you want to find time for something, you have to make a concentrated effort to make it. Otherwise, it will be just another thing which will continue to drag along and frustrate you further.

For those who are currently managing their own business and are finding it difficult to manage time, the first thing you need to do is to take a step back. Find out what you really want to achieve in life, then picture the life that you want to have. Next you will have to see how you prioritize your time according to the life you want to be leading in the future. Learn not to make excuses about not having time for this or that. If that something is a thing you value highly, make sure you make the time. It is only when you find equilibrium in  all aspects of life will you be able to lead a richer, happier and more productive life. If you have not prioritized what is important to you, I would strongly urge you to do that right now and make sure that you allocate your time likewise.

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Why isn’t anyone buying?

“Show me someone who has done something worthwhile, and I’ll show you someone who has overcome adversity.” Lou Holtz

This statement may color and trouble your thoughts, be it in a team discussion or over a cup of coffee with your significant other, and can be a significant driver of frustration on your startup journey. It troubled me greatly at the start of my journey. We would get everything ready, ranging from basic operational procedures to our sales and marketing strategies, however, when we put ourselves out there, no one was biting. Put yourself in the shoes of individuals who have dedicated 6-8 months straight in developing a product/service and get nothing but “maybe’s” during their sales cycle. This is fairly major frustration. This happened to me a couple of times in my earlier ventures and really got to me. It affected both my performance at work as well as my personal life. 

What happens at this point is, we begin to play the blame game. The market is lousy, we don’t have adequate resources, our competition is too strong or we are too inexperienced. This attitude permeates into other areas of life, you are more tense, short tempered and life loses its flavor. All that energy which had you jumping off the walls six months ago seems a distant  memory. What often happens at this point is,  you begin to lose hope and if left unchecked, eventually call it quits. This is a familiar scenario as it has happened to me in the past. Today, I work with a different perspective, slowly realizing that doing business is one thing and doing it successfully requires a completely different level of patience, persistence and belief.

Instead of blaming your circumstances and other factors, there are several more constructive questions and pointers you can look into, to find out the reason your product/service is not hitting your level of expectation:

1. Product/Service: Were your initial market demand estimates overly optimistic? Is the market for your product not as developed as expected? Take all this feedback and put it to use by adjusting your product/service to the market requirement . If the market is completely undeveloped, look for ways you can carve out a niche, if it is cost feasible. Remember to pay attention to both your product, as well as market requirements.

2. Positioning: A lot of the time, due to lack of experience, or market knowledge, we position our product/services towards a wrong segment of the market. If you experience sub par performance, evaluate your current target market to determine if the right one had been selected. Positioning your product towards different segments of the market is also a strategy you can look into. 

3. Pricing: Have you overpriced your product/service? Does the market understand the value that they get for paying a premium price? Getting answers to these questions, from prospects, could help you develop products/services which cater towards their needs as well as an acceptable price level . Have a strategy for the reason you price your product/service a certain way and make sure that it fits into the bigger picture.

4. Promotion: Have you put yourself out there? How are you marketing and promoting your product/service? What strategies have you used and what sort of return have you got on them? What are new strategies you can use to promote your product/service to your target segment. A lot of the time, we forget the fundamentals, promotion must be incorporated into your strategy if you want to drive sales. 

There is no doubt in my mind that you will get frustrated when your sales pipeline is not moving. When this happens, remind yourself, that to achieve great things in life you need to give it your best too. It works hand in hand, a half hearted attempt or lack of belief in the product/service will result in average results which leave you in a state of limbo. Trust me the younger you start on the journey the better, take advantage of fewer responsibilities. Keep in mind, most of the time we quit when we are really close to breaking the barrier holding us back. Do not make that mistake!

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Can we really work together?

  “Coming together is a beginning, Keeping together is progress. Working together is success.” Henry Ford

Team work, team work, team work. At the core of any great achievement is a great team. A team who understands each other, brings out the best in each other, challenges each other to go further and motivates each other to take that next big step. To get to a point, where the dynamics of being individuals merge together to become a winning team is often a long and frustrating process. This process occurs in various situations in life, we experience frustration at a number of levels on a daily basis. Dealing with the frustrations of team dynamics in startups however, can be quite complicated. This is true particularly for new ventures where team members have limited experience in handling such situations.

I have worked with startup teams in different capacities. Without a doubt it has been an exciting ride. In retrospect, even though we had our share of awkward and uncomfortable moments, I can not help but look back at all the good times I have had with great satisfaction. Frustrations with team dynamics arise for a host of reasons, some of the more critical ones are outlined below:

1. Misaligned Value Systems: When you have 4 individuals working together, and all four want the same thing, for example “success”, the way they envisage achieving it, can be very different. One individual may believe the way to success is through strong team effort. Another team member may believe however, that the way to success is to work in isolation to allow for greater focus. This team has a major problem on its hands. Find people on your team who share same values, work ethic and belief systems, otherwise, you are in for a bumpy ride.

2. Misalignment of End Goals: When you have 4 people on a team, each of them wanting to go a different direction with the business, you are bound to have major internal conflicts. These can escalate into extremely frustrating situations, being pulled in multiple directions, leaves team members confused and directionless. Your business/venture goals must be clearly defined and have buy-in from the rest of the team. 

3. Poor Leadership: Selecting a CEO or leader is a tough call. Ask 4 guys right out of college and working together this question, this is food for an interesting discussion. In many situations a group leader emerges naturally, he/she has innate characteristics, making them more qualified to take on that position. Make sure however, the team understands the reasons for this selection, and the leader what is expected of him/her. Being selected the leader places great responsibility of steering the ship, most of the time with no compass. Selecting a wrong person as leader, is a sure shot way to red line frustration levels, even to the point where team break down is a real danger.

If there is advice I would really like to give, it is, be as candid as possible when working in a team. Speak your mind without fear of being judged, the worst thing you can do is to bottle up your emotions and concerns, to have them explode later in a messy situation. At the same time, learn to be patient and when you take a stand, make sure it is supported with adequate research and evidence. If you can cross this hurdle, believe me, success is not far away!

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If only we had more resources!

“Money never starts an idea. It is always the idea that starts the money.” Owen Laughlin

Two common scenarios and attitudes take root when entrepreneurs hit a high in frustration. The first scenario is about individuals planning on taking the plunge into entrepreneurship. This group is worrying constantly about the need to have lots of money and resources in place to start the business. They start using this as a scapegoat for delaying the decision to get into business. Frustration levels build up as they continuously play the  “if only I had some money” refrain in their head. In such a situation however, frustration is often a natural by-product. What I recommend to this group is, stop complaining, cross this initial barrier and write down what they want to do and how much money they would need realistically. Sometimes the obvious becomes blurred with too many things clouding judgement. 

The second scenario concerns entrepreneurs in the initial phases of development. This is before raising sufficient capital, when they realize how much more they could do, if only they had more resources. The focus switches away from the current situation and the “what if’s”  take over. Once again frustration levels begin to hit high levels when they start feeling that their office space is too small, marketing budget too limited and that they are sacrificing their time, which has a high opportunity cost. I have experienced this situation many a time. I am sure many entrepreneurs feel this way as well. Being lucky enough to reach the flip side when resources are plentiful, helps you remember those early days fondly. Those days do teach you the value of time and money, in a way few other experiences can match. Use them to learn, and prove to yourself that you have what it takes to succeed.

In both scenarios frustration causes a change in focus, away from the end goal. Instead of using this opportunity as an opportunity and learning experience, we tend to blame our circumstances. In reality, there is a lot of money out there, searching for a good team, a good idea, in the right market. These three factors are pre-requisites that need to be in place before, you get access to those resources. Channel all that frustrated energy positively, to help you achieve those pre-requisites as early as possible, soon you will be well on your way. As a bonus, stories of surviving on maggi noodles and 4×4 shared office spaces or garages are always a lot more interesting to relive and share! 

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5 Essential Facts about Revenue

“A computer can tell you down to the last dime what you’ve sold. But it can never tell you how much you could have sold.” Sam Walton

An organization can have a great product and a great team, without any revenue however, they have very little. Revenue is the life blood of any enterprise; it fuels growth, motivation and success. Every organization strives to develop perfect products/services, most of the time however, they are developed with inadequate attention to revenue streams. What follows are shattered dreams and expectations, because a business without solid recurring revenue streams has nothing to stand on. Over the course of this week I have shared some basic facts with you regarding revenue streams, I have re-capped briefly below:

1. Revenue & Business Models: If you are writing a business plan or, are in a new startup venture, identify your revenue streams as clearly as possible, and understand what resources need to be put into place to realize their true potential. The future of your organizations rests upon these strategic initiatives. The business model must be based on sound revenue streams in order to succeed. To learn more about revenue and business models please click here.

2. Revenue & Market Segmentation: Once identification of a business model has been made, correct mapping of its target market is essential. Having a strategy to aim a product/service at ambiguous market segments results in spreading yourself too thin, especially when resources are tight. Market positioning of products is of paramount importance for successfully generating revenue at a quicker pace. To learn more about revenue and market segmentation please click here.

3. Revenue & Investment: Investing in correct revenue streams can be the difference between an organization that succeeds and one which does not. It is critical that metrics are put into place to ensure that all revenue streams are closely measured. This will lead to informed decisions on whether it makes financial sense to continue investing in a particular revenue or to focus energies on another stream to ensure that financial stability is maintained. To learn more about revenue and investment please click here.

4. Revenue & Change: Our world is in a constant state of flux. We are living through a time where we need to become adept at forecasting as also adapting to changes taking place. This principle applies to all aspects of our lives, in the business sense, it has far reaching implications. We have to avoid becoming rigid at all costs to maintain a competitive direction in the global market place. Failure to do so will result in an inevitable downslide of your organization. To learn more about revenue and change please click here.

5. Revenue & Metrics: Metrics are mandatory components of any successful business. Measuring your revenue streams is essential as you need to be aware of the growth rate of your streams, how quickly your pipeline is being converted, what sort of market share you hold and how the industry you operate in, is changing. Such metrics provide information that will allow you to make informed choices. To learn more about revenue and metrics please click here.

In todays day and age there are a plethora of startups which have no clear business model, some are purely developed attractive acquisitions while others wait to see how they develop. My advice is, go in with a plan on making money from day one if you want to build a strong and well founded organization. When developing your streams ensure that you cater to each level of your market segment and create opportunities for scalability and cross selling. Doing so will put you in a favorable position to succeed. 

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Metrics for Revenue Streams

Every company has metrics that track performance. The key question is whether these metrics really provide visibility to performance as viewed by the customer.” Steve Matthesen

Working at a startup, there are always a host of things which need to get done. It is a constant battle with time to stay on track and achieve goals and targets. In the midst of this daily commotion, we are inundated with information from all sides. To keep abreast of all these developments, it is essential to develop a system which provides dashboard views about current standings. This is where metrics come into play. They need to be incorporated into every major business function to provide real-time statistics and keep the focus in the right direction.

The metrics for revenue streams used at some of the organizations that I work with, range from being very simple to relatively complex depending on the nature of the business. I have experienced that there are a few metrics which need more focus than others where revenue is concerned. They are:

1. Revenue Stream Growth: This metric provides data regarding development of each stream of revenue by quarter. It involves data which includes percentage growth numbers, pipeline activity and deal closures. These figures provide detail analysis on streams that are growing at a faster pace than others, the stages of revenue facing plateaus and how projected business is forecast in the coming quarters for each stream. 

2. ROI on Revenue Streams: It is one thing to have an extremely high turnover and a completely different story when that is not being converted into bottom line results. This metric provides data regarding the profitability of each segment and a break-down of investment into the stream, as well as marketing costs and cost of goods/services. Constant vigilance helps regarding which streams need to be promoted and which need to be ceased. 

3. Market Share & Industry Analytics: This metric keeps track of current growth trends in the industry the organization operates in. It constantly updates data regarding major changes on competition, government policies, economics climate and company position. This requires constant study to stay current with the rapid changes taking place. 

While keeping all the metrics in mind make sure that you take time out to compare them with related metrics to customers, vendors, suppliers and distributors. This will ensure a complete picture of the current situation. At an early stage startup, complicated metrics are not necessary, what is required however, is the ability to put these metrics into practice at basic levels. This will ensure that the position and development of the company is dealt with more effectively.

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Change and Revenue Streams

“The key to success is often the ability to adapt” Anonymous

Our world is in a constant state of flux. We are living through a time where we need to become adept at forecasting as also adapting to changes taking place. This principle applies to all aspects of our lives, in the business sense, it has far reaching implications. This story has been heard time and time again, companies become complacent and rigid about rapid changes taking place and soon find themselves compromised. A story, very much in the news these days is, Yahoo!. This company once dominated web search. Today, it finds itself in a messy situation involving corporate raiders and hostile takeovers. What went wrong?

Yahoo! pioneers and leaders of web search throughout the 90’s became complacent about changes taking place in their domain space. A new entry startup called google started to develop traction. Before you knew it, they became a formidable player in the search market. Yahoo! failed to adapt to this change and continued diversifying their business model into new markets. They failed to defend their primary revenue stream, including a missed opportunity to buy-out google for $3b. This is an example of how the pace of change can turn positions in a matter of years, even for such a large firm. However, this is not the first story of its kind, nor the last, these mistakes take place on a daily basis.

If your organization has developed revenue streams which have potential of exponentially increasing over the years, it is your foremost responsibility to protect fiercely. This is done by continuous improvement of the processes, as well as developing complementary assets as barriers around that stream. If done diligently, you will be able to protect yourself from inevitable complacency, which could lead to an unfortunate outcome. On the flip side if you are struggling with your current revenue streams and not being able to develop them further, pay close attention to changes occurring around you. If you are promoting a product/service which has no place in the current market, you need to rethink strategy, and, as soon as possible.

Incorporating systems to account for changes in domain, industry, economics climate and external factors is critical to success. Make sure you have them in place to avoid trouble !

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Investment and Revenue Streams

“Sometimes the best investments are the ones you don’t make.” Donald Trump

Multiple revenue streams are extremely valuable assets for any business. Each revenue stream has to be positioned to address certain components of the overall strategy. Every revenue stream is not created equally, some are based on low margin and fast moving products/services while others facilitate growth of higher end products/services. The key factor to be addressed here is not only the creation of renewable revenue sources positioned for the right markets, but also correct investment into these streams. 

For example, if your business currently provides you three streams of revenue, you need to have certain measures in place to gauge the level of growth of each stream. These metrics will provide you critical data to measure which streams have the potential of exploding, as compared to others whose growth is relatively stunted. Without these metrics, we could make a fatal error of investing in wrong revenue streams which could have negative impact on the overall bottom line. Concentrating your investments on the right revenue streams is a strategy used by all successful companies. 

In my personal experience, one of the most telling signs of focusing on wrong revenue streams, is near the end of the quarter when the entire team has to push itself ridiculously hard to reach set targets. If this happens in a consistent fashion, quarter after quarter, you could be backing the wrong stream and costing the organization dearly. Develop flags for each of your streams and when things seem to be going off course consistently, look into revenue streams rather than blaming the economy or your team.

Are you investing in the correct revenue streams?

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Revenue and Market Segmentation

“The perfect business model must have a way to build in its own high-margin products that can be sold while processing reliable renewable revenue streams at any margin.” Mitch Thrower

 Once identification of a business model has been made, correct mapping of its target market is essential. Having a strategy to aim a product/service at ambiguous market segments results in spreading yourself too thin, especially when resources are tight. Market positioning of products is of paramount importance for successfully generating revenue at a quicker pace. For example, I was consulting with a startup organization who is launching a business in the mobile social networking area . They have specifically developed a service for the 15-21 age range, exclusively for the Chinese market. Even though the market is exploding for mobile usage in China, by selecting a niche segment they can become a much stronger adversary to competition.

It is only after a market segment has been selected , a niche market to operate in identified, that you have to develop revenue strategies. These strategies can be aimed at capturing multiple subsets within your market segment. For example many online service providers give you multiple options to sign up for their service. At one my companies we use Highrise(CRM tool) which allows you to sign up either as a single user, small medium enterprise (SME) or a full fledged enterprise implementation. This strategy gives them the capability to develop revenue streams faster, at multiple levels. Ultimately this provides the company with growth, stability and flexibility to adapt itself to changes in economic situations.

The example mentioned above shows a company which has not selected any clear market segment to promote its products in. Many SMEs find them a more cost effective alternative to other such CRM tools. Positioning a product for mass market appeal is a strategy which I have not used extensively in any of my ventures. It is a harder process and one, I think, you could grow into rather than jumping into the deep end for it. For every facebook, google or amazon there are thousands of similar services which never got similar traction. Correct market segmentation provides you with structured direction and enables you to develop specific competencies. These can result in major competitive advantages in the long run. 

When developing your Go To Market strategy, paying attention to niche markets and building multiple level revenue streams around it, could become your winning strategy. 

 

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