Mark Suster just posted a great piece on taking time to THINK as an Entrepreneur.

Here’s the money quote (paraphrased)

 1. I think the best leaders are Thinkers. They often need teams of people to help them Plan how to turn their ideas into realities.

 2. The best managers are Planners. They are really good at creating lists of actions and monitoring performance of those actions. Manager isn’t a bad word. They are the absolute lifeblood of any organization.

 3. And the best individual contributors are Doers. This can be … your star salesperson who doesn’t want to have to manage a team because he simply wants to earn his paycheck and get on with his life.

 But read the whole thing. There’s a lot more where that came from.

And then THINK if you have enough of the right people on your team.

I / We are

Selling / Designing / Making /Thinking about

[use a verb that indicates what stage you’re at]

A Device / App / Consumer Product / Medical instrument

[use a noun that indicates what your product is and don’t say SOLUTION]

That will allow

Sales VPs of Fortune 500 / Women over 40 / Left handed First Basemen

[use a noun that defines your customer]

To

Drive Faster / Clean up their email faster / Kill bugs cheaper / Travel through time

[use a phrase that explains what the customer can DO with your product that they couldn’t do before.]

That’s IT. No Buzzwords, no jargon. If your 8th grader can’t figure out what you do then don’t waste my time with it.

[UPDATE] After reading Brad Feld, I’m willing concede you may need 2 or 3 sentences to do this well, but not more than a paragraph. If it takes longer than that, you haven’t put enough prep time into it. And if you haven’t done that, why should I spend my time listening to you?

See my newest post at Open Forum by American Express.

Learn HOW and more importantly, WHY to measure what happens in your company.

In fact it’s useful for this reason:  companies at any stage need all the functions performed by big companies. But they usually don’t need them full time. Nor can they afford a full time position for many functions. That’s why employees have to wear many hats.

One other characteristic of these companies is they are frugal.

What’s missing is they often don’t have time to plan for the future. They tend to management from crisis to crisis thinking they don’t have time to be strategic. And that often becomes a barrier that prevents growth. That is a bad thing.

What’s the Solution?

The first place to start is The Company Blue Print. My program called 20 questions will help you specify what you want from your company at this time in your life and translate that into a blue print that will help develop your company so it can achieve your personal goals.

After that we usually work on better cash flow management. Why? Because taking time away from the day to day to focus on the future requires cash.

The next step is to document work flows and job expectations. Expectations (rather than descriptions) define what you expect a person to produce. This leads to better management, fewer crises and a more organized company.

Would you like to Learn More?

Call me. 203-775-6676. I’m on eastern time. Or shoot me an email: john@betterceo.com.

Let me know what questions you have and we’ll see if it makes sense for us to work together.

Which instrument do you play best?

Would you like to Learn More?

Call me. 203-775-6676. I’m on eastern time. Or shoot me an email: john@betterceo.com.

Let me know what questions you have and we’ll see if it makes sense for us to work together.

That means you need systems and managers in place to deal with the ongoing operations and keep them up to the standards that have got your company where it is. In other words, the wisdom and experience that you’ve developed can’t just live in people’s heads. It has to be transferred throughout the company.

The way to do that is by having standardized processes for routine tasks. This must be done in a way that doesn’t burden people with needless bureaucracy. You should also allow for new ideas to arise and be incorporated into the systems quickly.

But what about your job? As CEO you’ll now have time to focus on the more strategic aspects of growing the company.

• Looking toward new products and new markets
• Deepening relationships within your industry
• Improving relationships with vendors

Programs I have that help with this include:

• Coaching to focus on building your CEO Skill Set.
• 48 Point systems assessment to determine which systems in your company are functioning well and which need shoring up.

Would you like to Learn More?

Call me. 203-775-6676. I’m on eastern time. Or shoot me an email: john@betterceo.com.

Let me know what questions you have and we’ll see if it makes sense for us to work together.

There are 4 kinds of small companies. What makes them different is the potential scope of the business and this is defined by business model and the owner’s goals.

• Lifestyle & Legacy Business. These are the companies that 50% of Americans work for. They usually have fewer than 100 employees (most have way fewer).  They range from a Mom & Pop storefront or janitorial company started to put food on the table to construction companies or manufacturing plants that become a legacy of wealth for future generations.
• Scalable Startup. These are the companies that founders hope will become the next Google, WalMart, or Ford.
• Large Company Entrepreneur. These are skunk works or other protected enclaves in a large company carved out to protect them from the bureaucracy of the large firm so they can start something fresh.
• Social Entrepreneur. These companies are in it to make money, but are started with a vision to improve the world. They often focus on ecology, social justice, or empowering the poor.

To get over the hump of being a start-up it’s critical to know which kind of company yours is. Then develop a plan to raise money and scale in the most appropriate way.

Programs for Start-ups

• Finding your Business Model Using Customer Development / Hypothesis
• How to Pitch to Investors
• Devil’s Advocate. If this is your first time or you’re starting with only an idea and some passion, this two hour session will tell you what you’re in for. It may keep you from losing your shirt.

Would you like to Learn More?

Call me. 203-775-6676. I’m on eastern time. Or shoot me an email: john@betterceo.com.

Let me know what questions you have and we’ll see if it makes sense for us to work together.

Technology Risk

This is the risk that your product won’t work. This is why drug companies say they need such high prices: because it costs to much to find a new drug that works. This is also why some things can only be accomplished by non-commercial organizations. No sane board of directors in the 1960’s would have let their CEO bet company money on sending a man to the moon. But it was a great thing for government to invest in. For economic as well as other reasons.

Market Risk

This is the risk that enough people won’t want to buy it at the right price. MySpace is currently experiencing this problem right now. The price is FREE and yet they just announced a lay-off of half their employees. Why? Even at FREE not enough people want to buy it. They prefer Facebook.

In some ways these two risks are opposite ends of the same line. The cure for cancer is entirely technology risk with zero market risk. If you can make it work, people will buy it. Making a video game, however is the opposite. There’s no doubt you can get the technology to work. The entire risk is in the market.

The web has reduced technology risk for a lot of new ideas. It’s now cheaper and easier to build things that people could barely conceive of  a few years ago. FourSquare anyone? But that has not eliminated market risk. This is what makes the Customer Development Methodology so powerful. You start early in the process to connect with customers so you don’t waste time building something people don’t want to buy. And you learn quickly how to sell to them.

Management Risk

This is the risk that even with a technology that works and people who will buy it, management won’t find a business model that makes a profit or won’t be able to execute on that model, or scale the company properly. It’s common that inventors often don’t make good CEOs (and vice versa). One is all about technology and one need to focus on running the company.

A key to minimizing this risk is first to understand that being a CEO is a definable skill. And that being a CEO of a start-up is a different skill than being CEO of a growing company. Experience helps here as well. Experience on the team, experience in your board and experienced advisors. Don’t shy away from asking for support.

Even large established companies are not immune to this risk. It’s what led to the need for General Motors to need a bailout to survive. They had a sizeable market, wonderful technology, ample capacity but for decades management just couldn’t put the pieces together properly.

Deal Risk

This risk is to the investors. The risk is that the technology will work, people will buy the product, management will run a profitable company, and you still won’t make a good return on your investment. Maybe there won’t be an exit. Maybe the deal will be structured so that only some of the investors make money.

There are different types of investors and investment vehicles. Be sure to pick the right ones so everyone’s goals are aligned as much as possible.  Of course bootstrapping is one way to go – without investors you don’t need to make deals with them. I’m a big fan of bootstrapping. But there are occasions when not taking on investors slows your growth and that can open up the risk that a competitor will get exploit the market before you do.

We must respect the other fellow’s religion, but only in the sense and to the extent that we respect his theory that his wife is beautiful and his children smart.
— H. L. Mencken

We all love our own ideas. But they are not as valuable as we think. If you try to raise money from investors based on the strength of an idea, you’ll quickly see how little the market values ideas.

Many of us have had the experience depicted in the cartoon. If you read about the history of almost any technology, you’ll find that many breakthrough ideas occurred to several people independently around the same time. I think 5 people lined up behind Alexander Graham Bell to patent the telephone.  Leivnz and Newton are usually both credited with the invention of calculus. Charles Darwin had delayed publishing his “Origin of the Species” because he feared the repercussions, but changed his mind when it looked like someone else had come to the same conclusion and would publish first.

The market values the action, products, sales etc that comes from ideas – but not the ideas themselves. And usually when ideas get loose in the real world, they don’t survive unless they change, adapt, morph, evolve etc. It’s the result of the changed idea that produces value.

Takeaways:

• Make it easy for your ideas to get tested in the real world.
• Be ready for them to change, evolve or even die.
• Don’t worry – there are more where they came from.