Monday, May 11, 2009

Serial Killer or Serial Entrepreneur?

Hi all, it is Raymond To again. I thought the Title would get your attention!
Having worked closely now for 6 months with the PeerFX management team, I am amazed at how much has changed and how much stayed the same. I know it sounds boring but us old guys who have been around the business block a few times have a need to make sure the next generation combine tried and true methods of success with their own ideas. So read on...

Why did I use the title? Serial Killer or Serial Entrepreneur? During the early days of starting my business, there were times when I thought being obsessed was the key to success to any start-up. Well, it is not. A quick recap of my career so far. Got my B.Sc in Biochemistry, then an MBA in 1990 from UBC. Then failed at 3 start-ups from 1989 to 1992. One was an education company I started during my last year of MBA. Another was an advertising agency called Left Brain Right Brain Marketing and the third was a plastic bag distributor importing bags made in Korea and selling them to convenience stores. After these failures, I needed to find a real job so I sent my resume to Corporate Recruiters who at first didn't want to hire me. Understandable given I was only like 24 at the time with no polish or experience. However I convinced the owner to give me a shot. Not much risk on his part actually because I offered to work for free. I ended up staying there for 10 years recruiting for many tech start-ups. Then in 2002 during the last economic downturn, I left to start GO Recruitment. I guess I was never cured of my entrepreneurial bug. Ask me why I did it during a downturn.

Looking back, I am blessed to have failed so early in life. What did I learn?

1. Be mad at something. Does this sound like a serial killer? Well, I don't really know but it sounds provocative and you will remember what I wrote. When I say "mad at something", it means there is something about the status quo which you don't like and chances are you are not alone. If there are at least 100 others feeling the same way and you can solve or reach these 100 people with the a low-cost or high value solution, then you likely have a potential business.
This was one of my drivers when I left my old firm to start GO Recruitment. People were complaining about what they didn't like from traditional recruiters and I ended up creating a business from their pain.
So Lesson # 1: Ask people what pisses them off and if you start to see a pattern, this is the seed for a start-up

2. Carry a weapon. Sheesh! This is all unintentional I am serious. This is your secret sauce. That idea that can solve the problems you heard about in your mission to finding that makes people mad. For me, it was changing the way companies engaged a recruiter. In the past, it was very transactional and brokerage based. I created an ongoing monthly or on-call hourly relationship which tipped the industry on its heads.

3. Find a Customer. Duh! This one is obvious but most start-ups forget to do this in parallel to building a product. Now a customer does not have to pay a lot and some you may have to pay to be your customer. Huh? I know. :-)These are called Beta customers.
The point of having customers or a customer is to validate whether your idea stinks or not. In my case, I was blessed to have 1 client immediately use my new "A la Carte"/Relationship-based model. That was Class Software which is now Active Networks after their founder Ralph Turfus sold it like for gazillions of dollars. Ralph continues to be a big supporter of our company. I just got an email from him today referring us 2 new clients.

4. Be thankful. It is corny but I still have that first invoice which my client paid me. I also still have all of my business cards. This can help you reflect where you have been and to contently smile during those days when things go well and to remind you also during those days when things all go to shit.

5. Build a board or at least a group of trusted advisors. You can't go it alone. When I left to start my own firm in 2002, I was a bit arrogant to think no one could be as good as me. A healthy dose of denial is good but there is always someone smarter. Ask them for advice. Ask them to connect you with their people. People are very willing to help. Be careful though, because smart people may not always make the best entrepreneurs.

What do you think?

2 comments:

vincentkcng said...

It's interesting being in the startup business. Sometimes we expect a lot out of ourselves, and we forget to be grateful for what we have. I didn't keep my first invoice, but I do remember my very first sale and she was willing to pay for the service so willingly. That was something I truly remember.

PeerFX Guest said...

That is so true...us serial entrepreneurs get all wrapped up in our mission that we sometimes forget to listen.

I talked to two companies today. One was a $1M a year company with 11 people and they are ready for a CEO. Another is a 2 person company with patented product and also looking for a CEO. A common theme in both cases is that the founders have recognized a need for an outsider to be CEO...I look at myself and not sure I would be able to let go. I am always prescribing ways for Founders to lose "Founderitis" but I find myself guilty of it too sometimes. Maybe that makes me a better consultant or it makes me a worse one. Dunno.