Pivot Labs: bootstrapping a side hustle

Pivot labs has been going for a year. It's an incubator / venture studio I co-founded and run with my friend Mark Adams . We both have almost-full-time roles elsewhere and it has been interesting getting something going during a half-day per week, while we keep other things spinning. For Mark, other commitments include interim CTO for a startup and consulting and I'm with BMNT, Ltd. with a small, part-time volunteer role with the NCSC . I thought I'd share some notes from our first year of Pivot Labs, what we've learned, and how it has been juggling roles.

What’s pivot labs? We support people looking to pivot careers from public / civil / military service to entrepreneurship (much like how my co-founder Mark left government service to do a startup - what's the support we would've liked looking back, what do we wish people told us).?

How do you do that? We help first time founders plan to do a startup long before they quit their day job. When everyone’s ready we help them raise enough cash to allow them to quit the day job and become their own boss, hire the founding team, and get after the opportunity we helped them identify/de-risk. On a practical note: we book in 30-minute meetings weekly/fortnightly and provide some template spreadsheets (zzz, I know) for them to track their progress and make best use of us and our networks in between check-ins. We have a private slack channel for each candidate to sync and support.

You’re targeting public servants? Yes, should people in government want to do something different with their career we’d encourage them to get in touch. (Although we’ll try to persuade them not to quit the day job, as often they’re doing something very worthwhile and might just need a change of scene. Failing that, we’ll suggest some private sector options and they’ll have to persuade us they’d like to do a startup as it’s a bonkers thing to do.)

Why help people do startups? While we were mentoring on programmes for first time founders (e.g. cyberASAP) we thought we’d like a way to do this full time, on our terms and timelines. But as we’re not VCs, we felt that to create an inbound flow of candidates and to be valuable we'd have to be helping people pre-incorporation, right from the blank sheet of paper stage. We, of course, also direct candidates to all the good startup programmes that are out there. Really we’re here for a small number of candidates, typically mid-career who need time to get things in place for their career move and who are open to some coaching. We don’t have any deadlines which we've found powerful for people who juggle lots of responsibilities.

Why help civil servants do startups; aren’t they the least commercial people possible? Maybe. But we’ve noticed that people can learn all the commercial stuff. We found working in government a lot of hard-working, persistent, high integrity people who’d make fantastic entrepreneurs with a bit of support. (I may write another time about what we call the 'accidental portfolio', the set of companies formed by government leavers. I say accidental as, should government have given a little cash to help these teams get started in return for a small stake, they would have enough money to evergreen a fund already.)

What kinds of business do you help people do? While we coach / mentor all kinds of people and businesses, the type we’re really looking to focus on are product businesses, i.e. not services businesses. We are happy to advise those, but we’re not going to get seriously involved as often they’re not VC-backable. We are interested in 'deep tech', where a founder might want to look for an opportunity in an area that might be research heavy, but we'll help them find the research and expertise. We're not looking for people who want to commercialise the work from their day job as it'll involve IP conversations and there are other non-Pivot Labs routes that can help there.

How many have you done so far? None. We've worked with a heap of different size and shape of people. Pre-incorporation and post. Lots of different backgrounds and life stages. We're learning lots about what we're looking for, who we're a good fit for, we have some candidates in the pipeline that I expect to go 'all the way with' but on their terms, in their own time.

What’s the business’s model? Between us and the angels, we take a small % of the new company. We're planning for 7.5% all-in. So that's 5% for our angel syndicate and 2.5% between Mark and I with some room for splitting this up should we grow a team. But we've yet to go all the way with a candidate so far, so we have the flexibility to try different deals with different candidates and networks to permute until we find a good fit. But yes, Mark and I generate no cash through this, hence having income from other means while we prove the concept.

What's the long term plan? Assuming we can do a few deals and show this works, we'd look to learn about building funds, eventually building one for ourselves and factor in whether we'd want to pay ourselves a salary or keep bootstrapping. Assuming we can get a fund together, we'd then want to start looking at allied countries to the UK where we can build similar pipelines of talent. Mark and I are open to the backgrounds of the candidates and the markets they want to go after, but we lean towards defence and security, so I would be looking cross-NATO for future opportunities.

How do you manage community comms? We've been experimenting with keeping in contact with our close allies. We run a slack for circa 80 people. We're about to open up a discord for the entrepreneurially curious. Still learning how to manage this / experimenting.

Why not make this a not-for-profit? We've had this suggested a few times. We think we can do good things while also making money. Making this an NFP wouldn't set the right tone for what we want to do. Even though it is about helping people develop skills, and in a few circumstances helping them make a business that we take a stake in.

What have we learned? Not working to a schedule / fixed timeline is a strength for us. When we think about raising a fund we have to be mindful this could easily be compromised by seeking to hit a certain number each year. We've discovered that different sorts of people are encouraged to consider entrepreneurship in different ways. We've found no end to the list of people who like the idea of supporting new ventures and will go out of their way to hear about product ideas, and discuss markets. Above all else we've found a great way to learn about something is to try and do a startup in that area. We wanted to spend more time with startups, and that is where we are one year in.

What do you need? Send candidates our way. We're happy to meet anyone. They don't need to have their own idea, we'll help them develop one. And if you're curious and have some time to spare, we can help find things for volunteers to do.

Thanks to everyone on our vibrant Slack group for all the support and I'm excited to help launch our first venture likely in 2024

Amber Wright Andy Smith Ben S. Charlotte Smith Adam Palser Ollie Whitehouse Alex van Someren Sabra Horne Ben Brabyn Chirag M. Chris Heath Chris Magazzeni Chris Meah Daniel S. Dave Palmer David Balson David Sully Eddie Alleyn Ellen M. Chang Dr. Emma E Burke MBA Eric Slesinger Ferdinand Reynolds Glenn Richardson Grant Hume FBCS CITP James Chiswell James Cowley James Vickery Dr Jane W Jason Knudson Jens Holzapfel Jo Miller John Yeo Jonathan Benton Jonathan Luff Jonathan Scudder Jordan Giddings Joshua Burch Joshua Walter Katie Saddleton Kristen Shannon Lucy Mason Maren Cattonar Nathaniel Hartley Neil Thompson CB Nicholas Melgaard Nick Morris Oz Alashe MBE Patrick Schneider-Sikorsky Paul Boardman Paul G. Pearse Coyle Peter W. Phil Sheriff Rebecca Floyd Reid D. Richard Yorke Richard Bach Richard Porter Rizwan Noor Rob Leworthy Rob Stemp Robin Vann Rupert Shute ?? Ryan Heartfield Sara Boltman Stephen West FIET Stuart Murdoch Dr. Thane Campbell William McManners