Doing Things Differently

Every year Entrepreneur Country puts on two fantastic forum events. While I am an insider (i.e. part of the Ariadne team of which Entrepreneur Country is a part) I really think these events are totally stand out – and this is why. Yes this is slightly sales oriented – full disclosure…

1. They are charged – The Buzz is huge
2. They showcase success stories by amazing people
3. Deals get done

So after 5 years of these events, with the most recent attracting 400 people, keynotes from BBC Dragons and successful entrepreneurs – what makes Entrepreneur Country different? Read more…

A common and increasingly asked question I find myself getting from start-up entrepreneurs is “Do I need a CTO or technologist as a co-founder, can I not just outsource the pure technical development and own the IP?” I have 3 key reasons, based on experience supporting start-ups through funding and commercial success, as to why I think the answer to be “Yes, absolutely”.

I can think of at least a dozen such conversations just from the last quarter of 2011. I can also point to an equal number of examples where early stage companies had made the decision to outsource only then later had to reverse the decision and to in-house their technology.

So in my experience, yes… you do need a technologist as a key part of your founding team – assuming of course you are in the digital/online/technology world. There are, of course, many advantages in having an outsourced development team (either on or off-shore) but the actual ownership and delivery of the product needs to be owned in-house. I am not alone… I had a chuckle when I read Charlie Crystle’s blog (a Founder/CEO/Hacker) where he posted: “Two posts ago I lamented the news that a local startup might outsource their core dev.” So to the why… Read more…

5 Steps of Corporate Change to Adopting Digital

The corporate dilemma seems so well encapsulated by John Maynard Keynes’ quote: “The difficulty lies not in the new ideas, but in the letting go of old ones, which ramify, for those brought up as most of us have been, into every corner of our minds”

In the work I am doing, talking to corporates, the directors, CEO’s and heads of digital know this on one level and yet struggle to let go of the old ones. Talking to them about adopting digital as a ‘new born’ seems to get a similar reaction to suggesting we jump out of a plane with a parachute… fear despite knowing it is possible and probably safe… The reaction is something like

• “How can we cross the chasm?”
• “What is our parachute?”
• “How do we reconcile starting at 20,000ft and landing at ground level?”

To me, the answer is relatively straight forward in some respects, of course it’s not an easy migration – “the opposite of a bird in the hand” – let go and go after the two in the bush, they may, over time be worth more than the one… and if you execute well (read: iterate and learn quickly) one in the bush may be a goose that lays the golden egg!

Look at the ecommerce and mobile trends recently… who were the leading ecommerce players when that started being possible? It was the upstarts who could adopt new business models and methods to do the same thing in new ways. In mobile, the most succesful companies are the new ones who have no legacy of consumer adoption but an insight into how to grab attention…

For corporates today with strong consumer bases, a strong brand and a need to evolve the choices are clear, adapt or die…

Adoption can be done in so many ways I believe and some are low-risk, brand enhancing and can transport the business models along a travellator next to the walking competition. Commercial partnering and innovation incubation are to me the corporate bets that need to be made. At Yahoo we tried to embrace the ‘entrepreneur within’ with our Hack Days which enabled the developers to build test and show off their own ideas, some of which could be included in the Yahoo offering… quite a few companies do this as a means of satisfying the creative developers but why not programatise it, build it into a business model framework?

If you don’t get on the travellator now it will only accelerate and you will have to run faster alongside it to catch up. This means more cost, more risk, more time and a greater chasm.

I firmly believe that in consumer-led sectors especially (i.e. retail banking, media publishing, music, film etc) the corporates who adopt, adapt and test will be the winners in the next 5-10 years.

What are the steps then? I think there is a process to moving from analogue to digital, my 5 Steps of Corporate Change to Adopting Digital

1. Recognise the need to shift into digital – don’t assume you can do it all
2. Analyse the start-up trends for relevance and potential overlap – Think outside the box (analyse from outside not inside) & Look for the elements that are the dots you can connect
3. Connect the dots for your customer offering (this is your IP)
4. Define the success criteria for digital – it won’t be the same as traditional business as usual!
5. Build a framework for partnering and internal innovation – test, measure, iterate, test – constant iteration

There are more than enough change management professionals and business coaches to help manage the internal backlash and resistance but there are not enough frameworks to lean on. I think now is the best time to look at Apple or Paddy Power and not Microsoft or William Hill as examples.

As both perfectly ‘normal’ and depressed people, they benefit from the relationship with a therapist to get perspective and support in evaluating their situations, the same exists for Corporates! Get an outside opinion, build the relationship with a trusted advisor – a business shrink & a partner who helps shine the light in the dark and helps you know what you know and shine the light to discover what you don’t know… this de-risking is invaluable.

Learn to start to let go of the old ideas, build the new ones and grow with them. The digital layer is ever-more social and ever-evolving. Now is the best time to ask the audience – get your customers to be part of your evolution.

Innovate with risk. Define new criteria of success and let go of the (dying) bird in the hand – there are plenty in the bush, waiting to be caught!

The corporate dilemma is one of perception and behaviour change – get the corporate shrink, adopt the 5 steps and evolve – resistance is futile.

Today at the Entrepreneur Country and Smith & Williamson workshop event I gave a presentation about tailoring ones business plan to investors. Before me Duncan Cheatle (Founder of Supper Club and co-founder of Start Up Britain) spoke about building capital value in a start-up and after me Travers Clarke-Walker (Head of Barclays Business Marketing) spoke about whether banks are lending to start-ups and SME’s.

That was really interesting is that I thought my “Soft side of business plans” topic would possibly be too controversial because it deals with feelings, passion and story telling before the harder topics of numbers and facts. In fact the opposite happened… So much so that I was so pleasantly surprised that both Duncan and Travers referred to the element of the “story” the “passion” and the ability to engage your audience.

After the session it struck me that there is a perceived discord between how we really operate in business and how we say we do. On the past weekend working with Darren Shirlaw and Daniel Priestley we were building on frameworks that connect with people on a Thinking, Feeling, Knowing basis. Today we were talking about the energy in a team, the passion that people buy into as commercial partners or investors and in today’s session, the ability to lose the momentum in your team if you have a rotten apple in that team… None of these are “business” language and yet all around me I am seeing so much more reference to business in emotive language.

In realising this I came to think about our perceptions of business. Do we expect it to be formal, strict, conservative, boring, structured, process-driven and all that? Do we expect to leave our emotions at the door when we hang our winter coats? I think there is an element of discord in business reality and how we perceive it.

Thinking about where I have worked – at Vinci Park UK, Monster.com, Yahoo.com and now Ariadne, the times I and our team were most successful was when we worked as a team and had fun… Of course this is obvious but digging deeper and there is something interesting. When we put aside the expected barriers of rigid work formality and were able to come together in a deeply personal way, we became highly motivated to work and succeed as a team – there was more at steak than not succeeding at work – there was letting ourselves down.

I think there is something fundamental in the shift at work these days. I don’t know quite what it all is yet but when you combine the trends of massive social adoption online, the X and Y generations starting to get into working environments, the growth of SME and entrepreneurial ventures (and the decline of the corporate) then at that intersection are we at the place where in business/work terms we are shifting as we did in western culture – from ‘boys don’t cry’ to recognising EQ as value?

If there is an increasing use of emotional language and descriptors in business terms from banking to investment, then surely there is a deeper groundswell at the core of the businesses that are operating at an EQ level too? Does that mean that when they fail to engage investors and banks for funding they are still thinking they need to engage those conversations in the rigid and old-world stoic business models? Are they miscommunicating their passion and drive based on an old assumption of how to talk business – Businesses don’t cry, do they?

This leads me to think about the role of the story and story telling in building business success…

I have been asked to give a presentation about tailoring business plans for investors at the Entrepreneur Country Building Your Business Summer Workshop tomorrow (30th June 2011) in partnership with Smith & Williamson. As this is a core topic for the book I am working on I am rather excited about the opportunity.

Googling “Writing Business Plans” returns 154m results so clearly there is more than enough information out there and yet on a daily basis I receive and read business plans that leave me bored, confused or simply disinterested. I think the problem lies in the process…

I believe that too many people see the process as a must do rather than a want to do and so as a result they lose so much of the flair and passion that they have for their business. As a potential investor, I want to feel what the proposition is about, how the entrepreneur will inspire his/her target market and how I can imagine myself using their product.

For me, one of the key ingredients missing in most business plans is the passion. The passion for what the business is about. Not in the form of the technology but in the form of what the technology can enable for the consumer of the service. This is the magic!

Including the passion and the story of the vision into a business plan is like making a tapestry. A tapestry has a specific underlying structure of the weave but it is the colours and combinations that make it unique. In presenting a business plan the same applies. Tomorrow I will be presenting what I consider the things not taught when learning to write a business plan – the soft side of bringing the weave to a level of passion and differentiation.

The first part of the process is to think about the structure much like Mike Harris’ Perfect Pitch architecture: What do you do? How are you different? What is your credibility? What is the market problem / solution you bring?

In preparing the structure of the business plan I always suggest the entrepreneur focuses on the questions of Why, What, When, Who and How so that at every stage of the plan you are answering the investor’s questions of Why this, why now and why you?

If the business plan focuses on the technology you are probably only going to inspire the technologists in the room while if you talk about the implications to the people who use your service all of a sudden it can appeal to a larger audience. You need to think about who it is who is reading the plan. If the investor does not invest, would you not still want them to buy your product, subscribe to your service or at least talk about you as a thought leader?

My 5 Do’s and 5 Don’ts I am sure will get some interesting responses:

Do:
Map out the sections before writing them
Define your perfect user/customer/client
Always ask yourself if each section answers the Why, When, What, Who and How
Keep the plan to under 30 pages
Use external examples and data only when relevant

Dont:
Start with the big market opportunity before the proposition
Make it bigger than it is just to please an investors 20x
Assume the investor knows your market
Say if we can get only a small percentage of a big market we can be huge
Say you have no competitors

For the presentation, follow this link or view it below: