Over the last 15 years working with startups and entrepreneurs, I have finally figured out where I can add the most value and have the most fun as well.
I call that the “napkin stage” of the startup.
There are 3 most important reasons why I love the stage:
1. There are no bad ideas and no bad markets. They are all based on experiences and personal opinions. Which means I learn a lot of new things. I love learning about markets, sales growth and building scalable marketing channels, but after a while it gets to be more of the same.
2. If the idea is simple enough that you can express it on a napkin, instead of using a PowerPoint slide or need a complete prototype for someone to get it, then I get excited about the possibilities.
3. Entrepreneurs are most excited when they dont have to deal with hiring problems, marketing challenges, customer churn, etc. So, I get to work with them when there’s sunshine and roses all around. They have nothing but optimism at this stage.
There are challenges as well.
1. 90% of the ideas never “take off”. The market is too small, the customers dont need the product or the value is very limited.
2. The idea maze leads to a lot of churn, and many back of the napkin ideas really are a big waste of time.
3. Teams pivot constantly, are never settled and sometimes will change their mind to pursue a “job” if the idea is not appealing enough
I believe there are 5 most important things I bring to the table at this stage:
1. Customer development and validation. Getting early customer validation by talking to 10+ people and understanding the “real problem” excites me a lot. I have a decent enough network to ensure that I can call on 10 folks and get to understand any market in technology enough to understand if there are opportunities.
2. Market research and knowledge. Understanding, analyzing and projecting market needs is something I have enough experience with, and have done it for long that I really enjoy both the top-down and bottom’s up analysis of the markets and segmenting the customers.
3. Helping build your team, or finding a cofounder. Over the last 15 years, I have helped 19 startup founders find early (#1 or #2) employees, and about 11 founders find their cofounder. I love putting people together who I think might work well together and complement each other’s skills.
4. Build an early prototype, mockups or alpha version of the product. That’s the true use of the napkin these days anyway. I enjoy this the most. Reducing complexity and figuring out “Enough” to get by for a MVP is the most enjoyable experience in my mind.
5. Coaching the entrepreneur on structure of the company, financing landscape and whether they need to raise VC funding or make it a lifestyle business instead (which I actually have no problem with at all).
So, I am thinking about how I can help, add value and enjoy the ride with the “earliest” of early stages of a company – The Napkin Stage.