Five Outstanding Tips for First-Time Entrepreneurs

Written by on August 15, 2009 in Featured, Strategy - 6 Comments

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What’s it like starting a company in your early- to mid-twenties?  Where do you even start?  When is it time to take the product or service to market?  How do you sign on your first customer?  Where do you go for funding in order to grow?  How does the company mature over time?

These are fundamental questions that any first-time entrepreneur is bound to ask herself at some point.  Getting answers can often be hard.

Sean Benson, co-founder of Provation, a medical software company, told the story of his journey from start-up to acquisition at an alumni event put on by my alma mater today.  The talk was simple but fascinating and the topic so important I felt it necessary to share some of my take-aways with you all.

  1. Have a Co-Founder.  Entrepreneurship can be a ridiculously long and lonely journey.  It’s best to have a companion to share the road.  Find someone early on who can share your commitment and passion, and run with it.
  2. Be Unreasonable.  This is probably more of a prerequisite than a tip.  Entrepreneurs are by definition unreasonable.  But how unreasonable?…  What if I said you don’t have to know what you’re doing to get started?  You don’t have to know what your product is.  You don’t need a grand vision to stay excited about the work.  You simply need confidence, an ability to handle ambiguity, and a willingness to work insane hours and be totally unreasonable.
  3. Be Ridiculously Customer Focused. Sean and his co-founder spent their early years officing out of an unused hospital room to be closer to their customers (the physicians).  They tested every update to the software with these physicians on a daily basis, got their immediate feedback, incorporated suggestions the same day, and then started all over again.  That is being ridiculously customer focused.  Find a way to do the same.
  4. Beware of Too Much of  a Good Thing (i.e. investor cash).  Every entrepreneur dreams of endless streams of cash from supportive investors. But having a seemingly never-ending font of money to fund your growth can produce the same kinds of dysfunction as reliable sources of charity.  You forget about profitability and never think about streamlining operations in order to run more efficiently and generate better returns.  Similarly, if unsustainable revenue sources (e.g., business fads, economic bubbles) are fueling your growth, then having too much support can actually lead to over-investment in the business.  That’s something you’ll regret later.
  5. Observe the Golden Rule. The world is too small to make enemies as an entrepreneur.  The person you treat kindly or alienate today could be determining your destiny tomorrow.  So be nice.

Mike Shoemaker

Mike is a graduate of St. Olaf College in Minnesota and a former Fulbright Scholar at the Universidad de los Andes in Bogota, Colombia. Mike currently manages strategic alliances for a global consulting firm, is a volunteer and advisor to The Ayllu Initiative, and blogs at Human Ventures.

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  • http://twitter.com/Suzane_Fadrik Suzane Fadrik

    None of these matters until a company is actually traded. Call that a liquidity event, and investors call that the exit.Famous entrepreneurs That’s when those shares suddenly mean money. It used to be that successful startups would “go public,” meaning they’d register their stock on one of the major markets, following carefully regulated procedures, and then it became legal for normal people to buy and sell the shares. That’s also called the IPO, or initial public offering. Until then, only “accredited investors” could buy them. Meaning that it was pretty hard to sell them; usually impossible. Shares can also be worth money when a big company buys a startup. If the buyer pays cash, then people with options get to cash in as long as their option price is lower than the per share price of the acquisition. These days IPOs are extremely rare, so exits are usually by acquisition.

  • nostriluu

    one of the easiest way to immediately dismiss blog posts is bad cliché clip art

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  • http://jenniferdcarroll.com/2010/04/women-the-recession-a-warning-for-the-single-ladies/ Internet Marketing Success

    Thank you for a great post

  • http://www.wizardsextreme.com http://72.249.12.201/wordpress-mu/elsalvador/?p=67

    There are some interesting points in time in this clause but I don’t know if I see all of them heart to eye . There is some validity but I will take hold opinion until I look into it further. Good clause, thanks and we want more! Added to FeedBurner besides.