Rewriting The Startup Playbook:
A review in terms of alternate options.
The goal of this post is to enlighten startup founders and entrepreneurs to alternatives to the resource and program based standards.
The Startup Playbook is a good approach to taking the predetermined and required steps to build a successful startup company. Many of the companies we help today have actually been down this path and are seeking an alternative to building a company as a requisite to bring ideas, products and services to fruition.
The following is transcribed from The Startup Playbook’s marketing literature in it’s entirety. We have simply offered our response to these milestone steps vs. try to argue that their process is “wrong”.
1 TSP: Is a Startup for you?
Startups aren’t for everyone. In fact, we’d argue that very few people are cut out to be a founder. We’ll walk you through the characteristics and habits of successful founders. Don’t worry – not everybody has them, but if you’re still dead set on starting a company, we’ll show you how to build the skills you’ll need.
Our Response: If 9 out of 10 Startups Fail – Why even consider the option?
Not everyone wants to become a founder and given an alternative, would rather get their idea into the hands of a team to run with it vs. become a Startup Company set up to become a sad statistic.
2 TSP: Why You Need a Co-founding Team and How to Build it
You’ll want some company on the startup journey. In fact, if you want to shift the odds in your favor, you need to build a great co-founding team. Find people that complement you and that you can work with. We’ll show you how to find your co-founders, and then put the processes in place for you to succeed. Oh, and we’ll walk you through how to have one of the most difficult conversations you’ll have as a founder – how to split equity with your co-founders.
Our Response: The randomness of finding Co-Founders!
Face it -Co-Founders end up as typically anyone who will listen to your idea, your friend or are your school Lab partner.
Working with an established partner eliminates the need to show up to pitch day with “the most available, maybe committed and untested” Co-Founder. No dilutions and risky fail points.
It’s much easier to present a cap sheet that is undiluted. One that raises a lot of questions as to why your buddy the Co-Founder has 50% of the company.
3Open Labs and IoT Foundry become your co-founders!
3 TSP: How to Execute
You have the idea. You’ve built a winning business model. You’ve recruited a top-notch team and even raised money. Now what? It’s all about executing. You need to put all those ingredients together and deliver ever-increasing sales. We’ll show you how to organize your team, communicate clearly, and scale the business.
Our Response: Building a Team vs. Strategic Partnerships
Building a Company from scratch means hiring the best and most capable expert generalists who are committed to your success. Offering equity only or showing a short runway with a high burn rate will attract people that will “give it a shot”.
This is really where the high failure rates happen. Working with partners can get you into a GTM strategy which leverages Strategic Partnerships with highly successful companies.
They bring access to market via licensing and Joint Ventures for revenue sharing contributions which can be later exercised for equity optioning. Many M+A deals are done by optioning after a successful sales partnership first.
Our roadmap includes Growth Optimization, Partnership Development and Corporate Optioning Services.
4 TSP: How to Turn Your Idea Into a Winning Product or Service
It takes more than a great idea to build a successful business. We’ll show you how to turn the seed of an idea into a strong business model. From figuring out your value proposition to building your team to how you’ll differentiate your product or service in the market. We’ll address these questions and more to help you morph your idea and build it into a complete offering that your customers must have.
Our Response: Business Model Strategy and Pricing- Compete to Lose or Partner to Win?
3Open Labs utilizes Open Innovation to engage with target customers in segments you need to be in from the start. Developing your Business Model with customers involved reduces the thrash cycles of separate (and iterative) Product Solution Fit and Product Market Fit, where you take 18 months to create an MVP, PoC and Pilot projects with customers who won’t buy from you since you aren’t venture backed.
We gate your IP into the customer Lab with a focus on solving explicit customer problems, not pushing your early stage demo to “anyone and everyone”
We work with larger Technology Partners who can help with PoC by including your IP into the solution framework vs. trying to build a “walled garden”. This gets rid of all the friction in the traditional Startup Model.
5 TSP: How to Raise Money to Fuel Your Startup
Finding the fuel that you need to generate escape velocity for your startup is critical. We’ll walk you through your options and the pros and cons of each one. Then, we’ll show you how to research, hook, and close the right investors for your startup. The financing process can be challenging and we’ll demystify the steps setting you up for success.
Our Response: Why Pitch Days need to Stop
The most horrible step in the linear Startup Model is to run around and participate in the most random act imaginable: The “Egos and Icons” Tour. This involves investors whom are there to suit their own agenda, portfolio needs and current timing horizon. They are not there to help startups.
Getting involved in an Open Innovation Lab as a first option gives you all the access you need to seed or venture investments. This will come with interest from customers and potential strategic partners so you are never part of the 90% “Trying to build a fledgling Company”
6 TSP: How to Find People and Build a Killer Team
Arguably there is nothing more important than building a high-performing team. A great team can deal with the inevitable challenges that every startup faces. We’ll share our secrets on how to recruit and compensate your team. We’ll also talk about when its time to add senior leaders including, potentially, an outside CEO.
Our Response: Building a Team from scratch vs. joining a team
Getting into the inside track makes more sense for many IP based Founders. Most Engineers we meet have little or no interest becoming a CEO or living through years of hard performance reviews, valuation and board meetings to be told they are being replaced.
We have the capability to take “Nascent IP” or early stage concepts to customers and have partners deliver on the PoC and development, with funding options and growth optioning.
- Resource based programs which support the old linear startup model may help demystify and lead you to the next steps with some clarity, but the outcomes are still unfortunately in the 90% FAIL range.
- Mentors and advisory assistance can help get some facets of these steps aligned, but usually the outcome is centered on the Founder/ Co-Founder trying to develop and grow a Startup Company via these same steps. (see 1. again)
- The Open Innovation process is a very efficient and structured way to allow Canada’s IP to sustain in value and enter the marketplace without trying to beat all the odds.
It allows you to get onto your next project and we will keep your best asset -your ability to solve problems- moving forward with our Open Innovation Labs and IP as the primary output.