Rising StartUps - A new podcast series about Startups, for Startups, byStartups on ..... (you guessed it) Starting Up

I live & love startups. Like the small of a new car, every new startup has their own unique appeal. A (hopefully) needed possible answer to a real-world problem, or a new market not yet identified. Each founder like a wide-eyed child with their vision of the future, and their startup a part of changing their part of the world.

And every new founder, whether first time out, 'up-at-bat' again, rookie, or experienced professional, is going to have some challenges; actually, lots of them. More than they can yet imagine.

When I broke free from a corporate career in 2004, there wasn't even a startup eco-system in Australia. Now, we have one that is burgeoning, but the stories that I hear are from overseas imports or from long-time-ago successes, most of whom that are way past the early days of their first hires, the challenges of early-stage funding, finding great mentors, and trusted advice, of connecting with co-founders, and mistakes, and bootstrapping and........, ok, you ge the picture.

So way past, that the stories might not yet (and might never) be of much help to the many people who are about to, thinking about, or have just started. (Though they are often inspirational, which is why I continue to go to select meetups to hear them.)

But mostly, I wanted to hear the stories of my peers; their challenges and successes, their gains and pains, their learnings and yearnings. But these stories didn't seem to exist. 

Which is why I started 'Rising STARTupS'.

At Tim Reid's suggestion (yes, Small  Business - Big Marketing -thanks Tim), and inspired by Nathan Chan of Foundr, I decided to try my hand at interviewing. After all, how hard could it be for some-one whose done a few startups already?

And what I found out is, that apart from having 'a good head for radio' (and a reasonable voice for it), it was a natural fit for my style of conversation. 

Before cutting the first of them, we agonised long and hard about the questions, trying to determine just what could draw out the greatest of responses. And I wanted to use a consistant format & questions, so that you, the audience, can compare the answers of each person, and take from each, just what you need.

We've already taped 14- (and have a another 36 planned for this year) which we will be publishing next week.

The first four so far (each with links to twitter) are:-

• Justin & Andre of Vinomofo 
• Troy & Martin of Care Monkey
• Barry Nguyen of SolarX Car Company
• Julie-Anne Black of Be Brilliant Now

And I have to say, they are each unique, all brilliant, packed full of tips, gems & advice; timely, relevant, and helpful.
As well as the 25 min interviews with each founder, we've added a special topic, relevant to the content of each interview, and a review of some of the key points. As well, there will be links to some bonus downloads, cheatsheets, upcoming events and other startup news and views.

So subscribe (above) to this blog and we'll give you advance notice of the podcasts as soon as they are ready to go to air.

And one special request - if you like the interview series, tell your friends (whether by social or word). 

And if you have ideas about how we can improve, or know of a great Rising STARtup whose story is just begging to be told, tell us (there should be links on the right for both).

Getting clear about why startups fail - the real truths behind failure(not for the faint-hearted)

I recently read a post about startups & why they fail. Given my background in startups, (15 personally, and hundreds in conversation), I couldn't help but address this mis-information.

The key reasons early stage businesses and startups fail is often a lack of 3 things: 

1. Clarity - about ‘who’ they are and what problem they solve in the market. 
2. Financial Mastery – knowing what to measure and what it all means (including how well their current marketing efforts are working) 
3. An Action Plan - that includes specific targets and strategies to ensure they stay focused.

However, Our team of 27 Mentors & advisors (who between them have helped thousands of startups) all agree

THESE 3 reasons ARE WRONG

Worse, taking this advice will cause you to focus on solving the wrong problems.

Not all advice is equal. Let me be frank. There are a lot of people out there giving advice on startups, that have never done one themselves, or worse, have never 'failed'.

But don't just take my word for it (which is the point of the article). Here's what a few 'failures' had to say on the topic.

The great NFL football coach, Tommy Lasorda famously said "About the only problem with success is that it does not teach you how to deal with failure". 

"Many of life's failures are people who did not realize how close they were to success when they gave up." -Thomas Alva Edison

"Develop success from failures. Discouragement and failure are two of the surest stepping stones to success." -Dale Carnegie

"I learned more from the one restaurant that didn't work than from all the ones that were successes." -Wolfgang Puck

"My imperfections and failures are as much a blessing from God as my successes and my talents and I lay them both at his feet." -Mahatma Gandhi

"Anyone who has never made a mistake has never tried anything new." -Albert Einstein

So let's get to it. 

There are 8 real reasons why startups fail,  and they boil down to 2 indesputable truths as to why entrepreneurs fail.

The 8 Reasons. 

1. You have the wrong, poor or mis-aligned guidance, or you don't heed it. 

(Note:, the rest all follow from this first one)

2. Your business model is flawed.

3. Your personal life sucks

4. Your team is weak, or non-existant.

5. Your strategy is mis-aligned with your vision. 

6. Your message is incongruent with your offering, or poorly crafted or delivered.

7. Your execution is 'sub-optimal'.

8. Your Resourcing skills  (finding customers, partners, suppliers, supporters, JVs, funders, fans, advocates) are not aligned with your capabilities. 

And the the great news is, because these things is these are all your responsibility, they are also within your control. 

There-in lies your opportunity. (And my own, for that matter).

And the 2 indisputable truths?

1. Your reason 'why' is not strong enough, or

2. Your compelling 'vision' is not big enough or powerful enough. 

Here's the best part. If you address the 2 first, you are halfway to fixing the 8 reasons. 

Again, don't take my word for it. Find out for yourself. Ask your own mentor/ advisors -show them this email. The clever ones might even manage a wry smile. 

If you'd like to learn more, we are about to launch 3 new weekly podcast series, the 1st of which is called 'Rising STARtupS' for startups, by startups, about (you guessed it)....starting up. 

We'll be promoting the podcasts through our meetup & LinkedIn groups, so join that & you'll get the updates. 

And please share this with that person you know that has been talking for ages about starting 'one-day', and with your 'tribe'. 

Have a great day

Daniel Mumby

CEO & Founder

StartUp Foundation

- The Startup Accelerator for Professionals

- Presenter - Rising STARtupS Podcasts

- Events Co-Ordinator - Startling StartUp Ideas

What is Startup Success really?

Why 15 startups? Can't you succeed at anything?

Great insight often comes from great guidance. One of my newer mentors (who didn't know much of my history) asked this question of me yesterday. 

Not because he was trying to be rude or critical, but because he recognised that anyone from outside of the startup space would genuinely ask that question. And it's a valid one. 

What do you call a success?

Is it a startup that went on to make it's founders millionaires? 

And what is failure?

Is it a failure to properly execute a strategy? To launch prematurely?

Or is it an idea that has inherenent weakness (as most do) that cant easily be overcome?

Or perhaps its an interesting idea, that you successfully launched but later ran out of resources (team/money/ execution) for? 

Or hits a unanswerable questions or barriers (such as scalability/ licencing/ politics/ market) ?

Or a launched business that you later closed because there was substantial risk (eg of itself of being disrupted)?  

Or perhaps you didn't know/ learn/ do / listen enough?

Or one of a hundred other reasons.

These are interesting questions, at least to me, and perhaps to a few other entrepreneurs. 

What I do know, is that the average number of projects that an entrepreneur has attempted before reaching substantial success (what ever that is) as a Founder (as opposed to an investor) appears to be between 8-14, according to the wise advice of 2 of my great mentors. 

Why is that important?

Because for every 1000 entrepreneurs who start the race, only a few will ever make it to this mythical finishing line (or perhaps its just a new starting line). 

Let me expand. A recent report by PWC, analysed the dropout rates of failed startups in Australia as being about 60%, which means that founder retry rates are 40%.

For example, in any one year if you had a cohort of 1000 aspiring entrepreneurs that had failed on their 1st attempt, 600 would leave, and 400 would retry. 

(In the absence of any data about the return rates of subsequent founders, we can only use that continuing ratio). 

So of the 400 that retry, (and because most of these will fail), only about 160 of these will go on to try a third time, and 64 a fourth, 25 a fifth. 

By the end of the time series that marks the 6th attempt, from the original cohort of 1000, we would have a very interesting statistic.

Only a handful of entrepreneurs will have successes, and an equivalent handful number will have achieved failure, both over approximately the same time scale. 

Both will have learned similar things, such as how to build & resource teams, overcome adversity, build connections, obtain great guidance, craft and deliver a compelling story, and engage an audience. 

Some will say that the main difference will likely only be the size of their wallets. 

However, one group will be disproportionately stronger in another area.

You can't buy it, borrow it, or lease it (though some might try to fake it). 

And once you have it, it can't be take from you. 

Character. 

Character comes not from money - it comes from facing & overcoming adversity. 

It is what defines, and refines you. It says what you will, or won't stand for. 

Character forces you to search your soul for who you really are. 

Character comes from standing against the small voice in your mind that tells you to take the 'easy' shortcut. 

Character comes from pushing on, when all about you have fallen, or given up, or taken the easy path.  

Character tells you get up again after you fall down. 

Character will cause others to rally around you when you fall, and reach out to you, to help you to your feet again

Character, is the compelling and endearing qualities of your integrity, values and standards, all wrapped up. 

Success is Character.

The smartest startup decison that I never made

Back in late 2010, immediately following the collapse of 2 concurrent startups, I started the discovery process on a startup idea in the Financial Services industry, which was built around the impending FOFA reforms.

It was an interesting arbitrage process in financial services, that we could bootstrap through to substantial growth, before expanding to include additional services, or sell to one of the dealer channels that would've been our customers. It  (the idea) had all the hallmarks of a successful idea; a scalable business with a compelling need, accessible market, viable value proposition, a low investment trajectory, an immediate path to customer revenue, deep-domain knowledge and market expertise, with a market willing to pay. In short, a 'unicorn'.

The compelling need was caused by a change to Financial Services legislation by the-then (Labour) Federal government, with an original start date of July 2013. It centred on whether Financial planners were authorised to give advice to clients (which they are), on matters pertaining to tax advice related to the FP advice (which they are generally not).

My co-founder, who apart from being a Chartered Accountant, had a long & successful entrepreneurial track record. He had recently gotten married, and had started working together with his new wife in the Financial Services industry as Financial Planners & Tax Advisors, which was how we had identified the opportunity.

After 6 months of customer discussions, problem identification, and solution design, things looked good to start scoping out the platform & service.

And then something weird happened; the spouse of the business co-founder suddenly started making demands on my co-founder, around our involvement together, which seemed completely at odds with the process of 2 people starting a venture. Without having a clue why (and I'm not considered to be socially inept), we had gone from having dinner parties at each others homes, to my co-founder telling me that I couldn't call  outside of business hours, lest his wife hear that we were talking together.

By this time, I had my own personal family challenges, so I made the critical decision to shelve the project, and put it down to a learning experience.Though to this day, i still have no understanding of the cause of the  'disappearing act' of my friend and co-founder. And perhaps I never will, but the process taught me some valuable lessons.

As it turns out, due to this week's announcement that the (now Liberal) Federal government has permanently shed the FOFA reforms, it would seem that I saved myself 3 years of hard work and effort in developing a startup through to being enterprise-ready. As I had previously developed a startup that turned out to be on the wrong side of government legislative changes before (which was around the National BroadBand Network), this meant I could apply an important valuable lesson, that I previously learnt.

So for a range of reasons, deciding to build that startup, was probably the smartest decisions that I never made.
However, as we get closer to our first seminar to support experienced professionals, - part of the first stage intake of our  new venture accelerator program  (StartUpFoundation.com.au) -  my take-aways from it, and the value and that I can pass on to other prospective entrepreneurs far outweighed the price I paid for the learning.

I make the observation specifically around these key areas, because as entrepreneurs (me included), so often when we have 'the solution', we just want to get into motion, and 'get it done'.  Doing so might cost you and your co-founders years and many hundreds of thousands of dollars in losses and opportunity costs, without getting some things clear first.  I am proud to say that I have never lost a dollar of investors’ money, perhaps because ideas, resourcing, team-building and execution have never been a problem for me.

Before you get to your ‘Go/No-Go’ decision point, here are some things that you must address.

• Get your life in order - which includes making sure that the life partners of any participants in the venture understand where you are going, and how long & what it will take to get there.
• Have a plan for when the life of your co-founder (or you) goes 'pear-shaped'. It will likely happen, so having those open discussions early, will help set the tone for open and considerate conversations in more difficult times.
• Not doing so is probably the biggest unsung 'killer' of most early stage ventures.
• Know what your 'stop-loss' strategy is at every point. Just as you do with your share portfolio, know what your entry & exit points are, especially if you aren't hitting all your milestones.
• Getting the right types of mentoring & accountability guidance & is especially critical here, as is continuing the the conversation & involvement with life partners.
•  Make sure that your exit or contingency strategies address the challenges of governmental or legislative risk. If you are building a model contingent on the economy, or governments doing "the logical thing", you could be in for a nasty surprise.

o    There are many things that stay the same when governments change, but ideologies or political philosophies aren't amongst them. Just because the government-of-the-day thinks 'A' or 'B' is a good idea, doesn't means their successors will.

And finally, you might need to grow up (occasionally)- unicorns don't really exist, except perhaps in our dreams. ;-)

Winning isnt really winning- it's failing to fail.

When most people think of winning, they think of the skill of the sportsman, or team, in competition against their peers.
That level of skill is often physically matched, so the difference is shown in the mental preparation, or determination, a willingness to beat the other team, by doing those '1%-ers' required to gain an edge.
So often the success, or failure is measured in centimeters, or milliseconds, or some other very small margin of difference between the combatants.
However, in the startup game, it's something else entirely.

Here, your competition isn't really your competition. Your ability to do things 1% better may not be ever be recognised, valued or even make a difference. A coder who is 1% better than his peers, may not be as politically savvy, or as good at extolling his virtues. I'm not suggesting that the aggregate results of doing things better isn't required -it's just that it not the difference between failure and success in our world.
For example, from my experience in startups so far, a brilliant idea, a 'perfect pitch', a well-oiled team, a valid proof of concept, early market traction, or even that successful elusive 'series A' funding round, are no guarantees to ultimate market success.
Here, its something much less well defined; its more akin to the solo yatchsmen that circumnavigate the globe; they keep trying, again & again, despite weather, equipment failure, adversity, fatigue, capsizing etc., until they acheive their goal. You often hear hear of them succeeding after many attempts.

This type of winning could be more aptly described as 'failing to fail', and is much closer to what you & I do perhaps every day.
Leni Mayo (of 99 Designs fame) described it best when he recently floated the concept to me that that the normal entrepreneur (I avoid the word average here) has attempted 8 startups before they get something to fly. (He also joked to me that he lucked out on his 2nd.)
Unfortunately, too many give up before that stage.

So if the game isn't you against the world, what is it really? I believe that the real game is 'you against yourself'.

• How big is your vision?
• What lengths are you prepared to go to, in order to make it a reality? 
• How many stones are you prepared to turn over? 
• How uncomfortable are you willing to get? 
• How much more are prepared to stretch, to strive, to reach? 
• How hard will you push yourself? 
• What pain are you willing to endure in the pursuit of your vision?
• How many times will you get up after you get knocked-down?

Did you notice that none of these mention or even consider competition? No, the real game is 'you'.  If you doubt me still, let me ask you three final questions.

If not 'this', then what? 
If not 'now', then when? 
If not 'you', then who? 
So stay in the game, keep striving, keep reaching, keep failing, and most importantly, keep getting back up, until you fail at failing.  
Then everyone can call you an 'overnight success'.