Founders' Lessons

DESelect has been going for four years, but many people don't realize that my co-founder (Jonathan) and I had three startups before. Even though we're still in our early 30s, we've always wanted to build something from scratch. We got to know one another at our first job, working for a Big Four consulting firm while creating a CRM project. After work, we'd visit the gym together. We'd talk about books, how to become an entrepreneur, the lessons, and the various opportunities in the world of technology. DESelect is our fourth enterprise, so what went wrong with the previous three? Looking back now, there are a few lessons I can confidently share that aren't new, which is somewhat ironic given this article.

Empty your cup

But first, a short tale of a young man's visit with a Zen Master.

Scholar Tokusan, full of knowledge and opinions, came to Ryutan and asked about Zen. Ryutan refilled Tokusan's teacup as he spoke, continuing to pour even after the cup was full. The tea overflowed from the cup and over the table.?

"Stop! The cup is full!" said Tokusan.

"Exactly," said Master Ryutan.?

"You are like this cup; you are full of ideas. You come and ask for teaching, but your cup is full; I cannot add to it. Before I can teach you, you must empty your cup."

So how can we empty our cups? This is an exercise in making room, so you must be brutal. Cut out people who drag you down. Cut out TV, social media and any other unhealthy habits. Find a way to reduce your workload, even if that means going part-time. Work weekends and late nights. Reduce commutes or optimize all that commuting time with podcasts and audiobooks about your subject matter or entrepreneurship in general. Do less, better.

Default to action

I read many texts from founders in my earlier years. And maybe the first lesson is that you must learn from experience. Ignoring this crucial point means you stand a chance of starting a business but actually knowing whether you have the right expertise. It's just not the same as reading theory from a book. You will also better understand theory if you're in a position to apply it. Hence, Nike's slogan 'Just do it' works very well.?

My variation is 'Default to action,' which, without doubt, means just do, and by doing something, you'll figure it out. So when you have multiple options and are unsure what to do, you should just start experimenting, or you may likely procrastinate. The best way for me to break through procrastination in creating this piece was to say, "I'll just record a few notes and then see." Once the first sentences were spoken and written, the rest flowed. So this is the first option. It might take me a few tries, but ultimately it will display signs of success. Eventually, I was glad I put myself through previous experiences because I'm not sure I would have otherwise learned the following lessons.?

Trust your gut

When I was an aspiring founder in the early years, I would consume all kinds of books and knowledge. I'd learn about frameworks etc., which are all useful, of course. In the meantime, you must still follow your gut and learn to trust it, even if it sometimes seems your gut is wrong.?

Try to remain humble; remember, we are always learning. Your intuition is the collection of conditioning, knowledge, experience, and emotions, and it will develop as you mature in life. You have to learn to rely more on it gradually. It's something that even I'm still working on because intuition, for instance, plays a huge role in hiring. But that's maybe a story for another time. So learn to follow that. And this is actually the advice I once received from a successful entrepreneur. I met her after her talk at a Salesforce conference. I asked about Steve Blanks' book, The Startup Owner's Manual (a great book, by the way). I also wondered what she thought of Eric Ries', The Lean Startup , and her response was one of the best pieces of advice I ever received. She said, "All of that is great. Learn it, study it, but in the end, you have to follow your own instinct." It's advice I still live by today, yet it's hard because sometimes your instincts will tell you to do something you know will be difficult, letting go of someone, not hiring someone, and realizing that maybe a new product or startup idea you had is not great after all. Acknowledging that people were giving advice that you choose to go against—it's a minefield. Trusting your gut is, therefore, the best route. And it will get better over time.?

Choosing your co-founder

If you’re in the market for a co-founder, ensure they’re smart. Education, competencies, etc., are crucial in selecting your co-founder. Also, perhaps stating the obvious, it's essential to get along well, that there are no hesitations.

Choose your founder wisely. I've worked with people who were very enthusiastic about ideas and wanted to start a company, but there are multiple reasons why they were not promising founders. What you're looking for in a founder is someone you know well enough. Now, this is extremely difficult, especially for younger founders. They may not have an extensive network yet. And so the key is to network. But when I say "network," I don't mean you should attend networking events, sip wine, and chitchat idly. While that might be a good start, realistically, you want to find yourself working with smart people.?

Find an environment, join a community of startups, nonprofits, after-work activities, or just one project. Work together on assignments and pursue something that interests you collectively. That's the best place to find good colleagues because if you've never worked together, it's hard to know who they are and how they will act. I think it's okay to work with family members or friends, but they also must meet these criteria. You all need to know what it's like to work together, as the dynamic will be completely different. Having that foundational relationship allows you to be more brutally honest with one another, which may not necessarily be the case with someone you don't know personally.?

Check out The Founder’s Dilemma - one of my top five titles for startups. It's a great book that helped us a lot. And amongst other things, it suggests that you make cast-iron agreements on paper with your co-founder, which ensures the whole venture is more grownup while making people more accountable to one another. I followed this advice, and I suspect it's helped us more than we realize.?

Beware the brilliant idea

My next lesson is hands-on, which is especially challenging for technical founders. Be mindful of 'the brilliant idea. I would often come up with what I thought were brilliant ideas. People would tell me they were brilliant ideas. I would even have potential customers confirm the brilliance of said ideas. They would even help me formulate my inspired concepts. But in the end, there was no business, so what went wrong??

Well, another resource I invite you to check out is The Mom Test , a short, simple, elegant book that gives one of the most important lessons: The people around you are probably being nice when you're pitching your idea. But they're not telling you the truth: The idea will never make money. Let's just say that when you conceive an idea, try to increase downloads and get actual people to pay you to build it, whether a company or consumers, because therein lies the real proof.?

Years ago, after having had a few ‘brilliant ideas’ that failed, I felt in turmoil. I was on a consulting job and sat behind my desk at the client’s office. I sighed, wondering what startup project I should try next. Then it deemed upon me. “Okay, rather than looking for an idea, what problem can I fix?” I - literally - looked around me and saw these marketers struggling with managing their data, especially segmentation. “Maybe I should find a solution for that problem,” I thought to myself. That solution became the company known as DESelect .

It comes down to this, it's better to look for a good problem rather than get an ivory tower idea. The best ideas solve problems faced by an existing market.?

Sell before you build

And this is what we did in the early days. Before coding, we would first make slides and mock-ups of our idea. We would pitch it to customers. Of course, we had the background and credibility in the market. Given our work experience and relationships, we would still try to sell this product essentially before it was finished and only once people started asking for legitimate quotes. At that point, we said, "Okay, this is an open-for-buying site. Let's start to program some of it."?

This is a strategy that we still hold true today. It's an open secret of all SaaS companies as it helps them develop and clarify the idea through iteration and testing. Ultimately, it benefits the customer because they're in a world where great developers are scarce. The customer isn't helped by suppliers casually working on some piece of code that ultimately no one wants. And unfortunately, that happened very often in large companies in the early days when more projects were created in what's known as a ‘waterfall development,’ where reaching out to customers for ideas was tricky.?

So if you follow this advice as a founder, you will ridiculously increase your chances of success.?

Take the leap

Quit your job as soon as you can. This isn't easy, especially if you have an excellent, safe package, which was the case for us. You'll likely be comfortable making good money with fewer responsibilities or stress. Saying goodbye to that and replacing it with a new company making little to no money is a massive challenge and takes guts as you've never known. It also requires that you have 100% faith in your abilities.?

Put aside some savings to cover a lack of revenue in the early days. As soon as you find that you've enough funds for a couple of months, quit your job and have all founders do so as soon as they can. Maybe one by one, maybe part-time, initially. But just do it. The moment you take the leap, you realize this is happening, that it's a real company. And also, knowing that you're now responsible for your own income will force and motivate you to work much harder and stay focused on the stuff that matters. It's no longer just some fantasy or mental exercise during the weekend where you come up with exciting ideas and features. Now it's about making money fast. It's about making something financially sustainable. Newsflash: No company can survive without money. There's no pretending otherwise; if you're unclear on this, do yourself a favor and stick to your day job. Read that again. A few companies have existed without revenue for a very long time, but these are exceptional companies that rely heavily on funding, with precise reasons why it was possible.

So if you want something manageable, make sure your company makes money. Be sure you can pay yourself, at least for a couple of months. Be willing to take a pay cut, but don't over-invest in luxuries, and be ready at any time to offload anything that's not the bare necessities. Always have your eye on the main prize, i.e., keeping the business in a cash-stable position.?

The final lesson

And finally: Once you've started to sell the product you're no longer working on, get extra people as soon as possible, even if they're interns. Yes, they need training, but we found a natural flow with interns that still suits our business even today. Early on, we had one fill a commercial role and one a developer role. They were graduates with a lot to learn but were hyper-motivated and eager to grow. The logic was that we then had to learn to manage resources while they forced us to think about processes and how to better articulate our vision. We also saw that the more autonomy and responsibility we gave them, as long as they could scale with it, they could grow, taking ownership. Sure enough, they would come up with their own ideas for improvements. And if you take this far enough, respecting people despite their age and experience, they’ll hold you accountable, too.?

Sourcing a few interns initially profoundly improved our productivity. Also, once you know you have employees in the office, you will show up more, stay longer, and be better. This is equally true, by the way, for having a co-founder. I think it must be tough to be a solo founder; thus, they have my utmost respect. But for most of us, it really helps to have one or even two founders because you keep each other accountable. Plus, you bring different tradecraft to the table, all complementary by design. The same goes for employees. Their presence will help build your skills as a manager and leader, which you must obtain as soon as humanly possible. Why? Well, assuming you've been able to sell before you build and are in a position to deliver, you have a product worth selling. And you will want to grow as quickly as possible, especially if you're in tech, where you have 'winner takes all' dynamics.?

Developing these skills is crucial for your success. You'll need to hire, scale, manage, and coach your team to win. At the same time, it'll start to feel like a real company. So assuming you’re all set, congratulations, you've taken the first step toward being an entrepreneur.?

Good luck; we're all counting on you.??

;)