Most every serial entrepreneur will tell you to focus on the process and discipline (building a great product, iterating collecting customer feedback), not on the outcomes (getting sold, going IPO or raising funding).
Process (or approach) is the methodology to achieve something.
Outcome is the result.
Outcomes are decided by various factors, some within your control and others outside. Luck for example.
Most people outside the startup tend to focus on outcomes. “Wow, you got sold”, “Whoa you raised a lot of money”.
Inside your startup the only thing you need to focus on is the process.
If you have a great outcome, without a great process, it is likely luck and not easily repeatable.
If, however, you have a bad outcome and have a process, you can revisit your process and tweak it to ensure better outcomes.
A strong process is a guarantee — not of outcome or results, but of the highest probability of obtaining desired results.
I was reading a great research piece in the Journal of Consumer Research the other day about “Semantic framing“.
The primary reason was to keep up with not gaining all the weight that I had lost over the last year or so. I found out about the power of “I don’t vs. I cant”.
This is a really neat hack that I am using to avoid certain foods that are really bad for me, which I used to be “addicted to”. Specifically I was a sucker for Reese’s peanut butter cups. I had to get the fix each day after my lunch, which blew all my diet from my breakfast and lunch.
I have never had coffee in my life and tried tea a few times only to give up. I “don’t” drink coffee.
So, giving up things is not unnatural or out of habit for me.
Both the authors of this research have concluded that saying “I don’t” is more empowering for self-talk towards goal-behavior than “I can’t”.
For goal-directed behavior, meaning if you want to achieve a specific goal, using the word, I don’t do X is more powerful and gives you a sense of being in control than I can’t do X.
For example, just me starting to say “I don’t eat Reese’s, has helped me avoid the chocolate 21 days in a row”. 45 more days and I can comfortably kick the Reese’s habit for good, based on the the 66 days to habit formation research.
I started to wonder where else I could use this and as I have mentioned before, I tend to do a pretty bad job of working on a project for extended period’s of time. I tend to have “shiny object syndrome”, which causes me to lose focus on the one thing that matters many times in a project.
That’s one of my resolutions to fix. I think I am already on the path to fix that since I have successfully figured out the exercise routine I need, the food and the fact that I have been writing for 9 months without missing more than 4 days.
This new hack is a trick in the book that I plan to use for more time to keep focus on the projects that matter, but saying to myself and others “I don’t”.
Instead of “I can’t make time for a new advisory position”, I am saying “I don’t have time”.
Less endearing to the receiver, more blunt, but more effective.
Well, maybe now I have to work on the empathy part.
The real use of this new tool of “semantic framing” is around focus on projects.
“I don’t work on more than 1 project at a time” is more empowering to my mind and prevent it from accepting multiple projects and failing at them all.
I often hear entrepreneurs tell me how they don’t have cash to fund their startup dream and that’s why they are not even going to try.
I understand there are many circumstances where you just don’t have enough cash to fund the business for growth, and many situations where the cash is needed to pay the initial expenses, so I am mindful of telling most folks that this is an excuse and that “you really dont want to get started”.
There are though, an increasing number of ways to bootstrap your business and I thought I’d ask many of my friends who have built a good business to tell me how they got started and generalize the means to do it for others.
Customer funded software assignment. Many software companies actually get started this way. A customer with a problem asks for a bespoke / custom piece of software to be written that they can use. A good friend Greg Anderson, actually got started this way. When Cisco systems wanted a configurator for their order systems written, he wrote the version 1 and licensed it to them. They were the first customer and then Comergent was created.
Consulting assignment: Possibly the most frequently used bootstrapping method ever. This is how I got my start early on. A consulting engagement with 2 companies led me to understand the market and need for reverse auction systems. After 2 consulting engagements, we started on building a generic platform for the same.
Freelance your skills, on Contract. Slightly different from consulting, where you spend most of your time with one client and actually build the product and learn it for the first time, the “freelancing” opportunity is more to help you get “cash flow” to keep food on the table while you work on your startup. eLance (UpWork) is where one of my friends got started, doing small gigs and projects, building websites and working on SEO, for other businesses before starting his company.
Factoring receivables. This is more risky, but one of my friends, Ricardo Jenez got started. eTimeCapital did factoring for a long time. The basic idea is to finance your receivables and ensure you get cash early to fund your expansion or growth of your business. It is debt finance, where you expect to get money from customers, over time, but another company or organization (typically a financial institution) tends to loan you the money before you get it. They do charge you an interest for the loan.
Side projects: Many of my friends have a side project, while they have a full time job. This is to bootstrap their business as well. The side project is typically in a different business than their work, and you have to ensure it is declared free of conflicts of interest to your employer, but this is another way to bootstrap.
Crowdfunding campaign: A good friend actually paid for his book completely with a crowd funded project, which they resulted in speaking engagements, paid consulting and now a good steady software SaaS business. The crowd-funding revenue was enough to last him 4 months, which was the time he needed to write the book and in the meanwhile, he also helped get his speaking engagements lined up.
Credit card debt, savings funding etc. This is possibly the most risky, but also most frequently used mechanism I have heard of. Many entrepreneurs I know were in lots of credit-card debt before they built their company and many others have dipped into their “Rainy Day Funds” to start their company as well.
The bottom line is if you are motivated and passionate, you can find a way to get where you want to be. Else you will find many excuses to make capital a key bottleneck to getting started. Choose wisely.