Most startups don’t fail because they lose money. The downward spiral starts much sooner when entrepreneurs let managing their financials fall by the wayside. In fact, a CB 2018 Insights report found that 29 percent of small businesses failed because they ran out of cash, perhaps a result of poor money management by leadership.
Not everyone has the aptitude for financial management. Still, startup owners agree it’s a necessity.
Over the years, my company has seen a pattern with startups: Just as they hit their stride and growth takes off, they begin struggling with financials. There are many reasons for this paradox, including expanding into new verticals too quickly and failing to acknowledge the fina...
What do startup hiring and a Broadway production of Hamlet have in common? No, it’s not the murder, the Oedipus complex, and the existential crisis. (If it is, what kind of company are you running?)
In startup hiring, as in the theater, casting is everything.
When it comes to building a startup, you are who you hire. Not only do the people you bring onto your team determine the direction and destiny of your product; they also shape what it will be like to come to work every day.
Hiring is one of the most essential components of building a startup. But for some reason it’s also one of the least talked about. When you’re a founder, you’re frequently pulling double-duty as your own HR rep. But how many founders have you heard of that actually...
Somehow the startup world has convinced people to work for "free" on a regular basis, with the theoretical benefit of some big payout on equity later.
The truth is, those bets rarely work and once the pixie dust of the new startup wears off, what's left is a bunch of frustrated employees who can't pay their bills.
Although we have little to no money to pay today, we should always try to incorporate some level of cash compensation, even if it's incredibly small, to help offset the cost of life that our team is going to inevitably face.
When our team is more focused on going broke than contributing, we're not really doing anyone a favor!
Compensation doesn't have to be "all or nothing."
Just because someone mak...
Investors — As Founders we love you, need you and appreciate you. But the relationship feels very one-sided when we're pitching for capital. As Founders, we just need a better way to communicate not only the evil word "NO", but the equally evil word "Maybe." "Yes!" we seem to have figured out.
All we're asking for here is to be treated with respect and dignity. We don't need to be coddled, we just need a clear "No" when the time is right and ideally some basic kindness along the way. It doesn't take much, but we could really use some shifts in how we communicate these days.
I've met with and pitched hundreds of investors. If there's one thing that I could never figure out, it's why so many act like raging dicks. Not all of t...
At a recent Founder Group meeting, one of the Founders asked the rest of the group if they regretted selling. All of them had past exits, ranging from a few hundred million to over a billion dollars.
With so much money at stake, and in each case billions of dollars "left on the table" post-exit, not one Founder had a single regret. It had nothing to do with what they cashed out for, it had everything to do with what they were willing to "let go".
We all share the same concern that if we sell too early we're going to look back on what became a trillion-dollar company and cry about all that we left behind. But there are actually a lot of ways to not only help hedge that financial concern, but also come to terms emotionally with walking away.
...We wanted to find out, were these people telling us they liked the product just to be nice? Or was there something else that was going on?
Jeff Stefanis and his co-Founder Amber Wason were pedal to the metal on development of their electric bike startup Riide in early 2015. They had perfected their design, they had partnered with a top manufacturing company to build the bikes, and they were offering test rides around Washington, DC as a way to introduce DC commuters to the idea and turn testers into buyers.
There was just one problem: nobody was buying.
“Our conversion rate from test rides to buying was about 3%,” Jeff remembers. “Which is not great.”
The low conversion rate confused Jeff and Amber at first, because it seemed to directly co...
Recently Elon Musk had to do what every Founder dreads — tell his staff that they have limited funds, and if things don't improve, that it's game over.
Elon's doing it with $2.7 billion, but his problems are the same as if we had to do it with $2.7 hundred.
Letting our staff know we're running out of money while trying to rally them at the same time to succeed is a brutal game that requires extreme tact in messaging.
Now, and then later.
Right now let's be honest about where the company stands and what our challenges are going forward, no matter how significant.
Elon said "We're in code red" and that all expenses are being considered. He's pointing out that shit's gett...
It’s one of the oldest truths in marketing: in order to get customers’ attention, you have to live where your customers live. And today more than ever before, where customers live is on social media.
According to a study by marketing firm MediaKix, the average person spends 2 hours per day on social platforms. As the post helpfully points out, that amounts to 5 years and 4 months over a lifetime – enough time to fly to the moon and back 32 times or run 10,000 marathons.
With numbers like that, it’s no wonder that paid social media advertising has supplanted radio and possibly even television as the new darling of the advertising world. Mediakix predicts that social media advertising spend will hit close to $36 billion globally in 2017, and ...
Ever struggled to properly measure productivity within your business? You’re not alone.
A lot of growth-driven business owners have a hard time pinning down the productivity (and efficiency, for that matter) of their team members and of general operations.
As managers, we all care about productivity and the impact it has on the stability and success of our businesses. That’s why we often find ourselves thinking hard about questions like, “What is the monetary value of an employee working at maximum capacity?” and, “What processes are negatively impacting our bottom line because they’re inefficient?”
We all know how to identify productive and unproductive behavior, but the problem is, we don’t all inherently know how to best measure product...
When I started my first company I had no idea what unemployment insurance was. Nobody in my family had ever filed for unemployment as they had all owned their own businesses and it had never even crossed my mind as an option when I myself was looking for work at various times in my life. I can honestly say I never had even heard of it until I was forced to get insurance for my own company that I started. I definitely did not understand the negative impact on the business when someone tried to file for unemployment…
….Oh how quickly we learn when we start our own businesses. I have come to learn that unemployment benefits are the most abused and misused benefits in the workforce.
Here’s the thing: Unemployment benefits serve a purpose in an ...