You Think It's All Ducky...

Experienced Stewardship is Essential For Success in Startups -

As Well as in Mid-Stage and Late-Stage Companies

Hmmm.

I spy a rubber ducky on that sunken toilet.

Perhaps the last user of the commode was thinking everything was just ducky in their enterprise, and, well, then it all went south.

Look no further than WeWork which made Adam Neumann rich - at the expense of SoftBank. Fractional-space-Jesus cashed out, while SoftBank bled out. The captain bailed and the ship and the passengers paid the price.

Did you know one of the colossal errors that led to the Titanic's losing bout with an iceberg was not just incompetent leadership, but a lack of binoculars? Apparently they were locked up and the key was misplaced.

Whoops.

I guess the cost of the binoculars was more important to management than the cost of human life and their flagship vessel. Penny wise, pound foolish managerial myopia. So much for cultivating a culture of autonomy and empowerment. Maybe the White Star Line board of directors held onto the key?

Movies and television can teach us lessons about life, and business.? And, startups, established businesses and even late-stage companies.

However, if your startup culture and mindset about business is an amalgamation of Office Space and Shark Tank, you could be setting yourself up to be chum.

Startups are exciting. If they are well funded, it's like a cruise around the world. If they aren't, it's more like Tom Hanks in Castaway floating on his raft made from logs and 2 sides of a portajohn.

While you may be feeling like Leonardo DiCaprio bellowing "I'm the king of the world!" on the bow of the Titanic, it's best to remain grounded, even if solid ground isn't in sight.

In Ang Lee's film Life of Pi, a retrospective interview flashes back and forth illustrating the challenges a teenager encounters as he survives a shipwreck in which his family dies, and is stranded in the Pacific Ocean on a lifeboat with a tiger named Richard Parker. Pi is able to survive by facing fears, mitigating threats and leveraging his creativity, intelligence and resourcefulness. Or, does he?

Similarly, in Robert Redford's virtually silent Lost At Sea, while on a solo voyage in the Indian Ocean, a veteran sailor (Robert Redford) awakes to find his vessel taking on water after being punctured with a floating stray shipping container. With his radio and navigation equipment disabled, he sails unknowingly into a violent storm and barely escapes with his life. He does a pretty impressive job repairing the hole in the sailboat with fiberglass and resin (Gilligan's Island "professor" character take heed).

Lessons in adaptability and survival abound in navigational and nautical tales.

Fail Fast is the dumbest thing I've ever heard in business.? This is like intentionally crashing into the iceberg to see how deep the gash in the hull will be, or how many of your deck chairs will float.? Prefer airplane analogies? It's like crashing the plane to see how the black box works.

Fake It Till You Make It is equally ridiculous.? There is no substitute for experience. If you don't know a sales presentation from a balance sheet, if you can't spell PO or P&L, you are headed for an iceberg.? It's like making believe you know celestial navigation with a sextant. Most of the turnarounds I've done with small companies have been necessary because they have inexperienced captains at the helm of the vessels.

Perfect Storm. Rapid starts and rampups can be a window of opportunity or a funnel of water and it's up to the managers and principals to work hard to steer and sail through rough waters of competition and intellectual property, and battle the elements of commercial launch.

Burn Rate.? If you are using other people's money as tinder, kindling, or firewood, to power your ship forward, it's only a matter of time before you have to burn your deck chairs to stay warm. The business is either going to be profitable, or not, and don't hang on to the wheel of a sinking ship for two long.

Rightsize It.? Sometimes the concept or business plan is far beyond the working capital and cash flow resources of the founders and operators, and the business runs aground. A sandbar isn't the worst thing in the world, and sometimes it gives you pause to re-chart course. There are times when you realize what you're trying to accomplish is overzealous, or the idea is too big for you to tackle, and you need help. To paraphrase Roy Scheider's character in Jaws to Quint, "we're going to need a bigger boat."

Churn Rate.? This is the rate at which a potentially half-baked plan plans to lose customers.? Really? Isn't this the equivalent of throwing people overboard or not having an ample supply of lifeboats? Best to keep and grow customers and not give them a reason to jump ship.

Pitch Deck.? Essential basic document which explains what your company does, why it's viable, and why someone would want to invest in it. If you don't get this right, it will be like sitting in a chair with wheels on the "pitched deck" of the sinking ship. Do it right, and your plan will be buoyant.

Lean Startup.? Don't make this another phrase to describe fast fail. This means launch the enterprise as efficiently as possible. You don't need to fly on a G6 and have caviar.? Don't need lavish offices. Don't need too many "bodies" to look bigger than you are. Not there yet, but hopefully soon. Austerity, humility and confidence are called for here. Don't lose sight of business fundamentals.? All the lean austerity in the world won't offset a bogus product or business plan.

Charting Course. If you don't know where you're going, any road with get you there. Imagine this concept applied to the open sea, sans navigation. Your business needs to have a very concrete course charted, and you need to know as much about the size and location of icebergs as other ships in the night (Andrea Doria and Stockholm).

Maintain Roles.? Even aboard the SS Minnow, the cast members, or castaways, knew their place and their roles. Yes, the professor struggled to patch the boat with a limitless supply of wood and glue, but he could make a dishwasher out of coconuts or a radio from Gilligan's fillings. Everyone knew that Jonas Grumby, aka The Skipper, was in charge and that Gilligan was first mate. Ginger and Mary Ann added polarity, fashion sense and banana cream pie. The billionaire Howells, despite taking six months of wardrobe for a three hour bay tour, had to adapt to survive.? All hands must be on deck and everyone must be clear what their roles and responsibilities are.

All hands must be on deck and everyone must be clear what their roles and responsibilities are. If your crew has no experience, how can they manage the vessel?

Who's The Captain? Your vessel needs experienced leadership. Even if your startup was your idea, you might not be the best person to be CEO. Many startup people are great at ideas and weak on execution. The closest many have come to navigational leadership is a summer job at Old Navy, a breakfast with Captain Crunch or a little too much time spent with Captain Morgan. Hire the right leadership because you might wind up being Captain Edward John Smith of Titanic fame. Can't pay them? They might work for equity.?

Maintain Watch. In June of 1945, the USS Indianapolis CA-35, after successfully completing it's critical mission of delivering the world's first atomic bomb to the island of Tinian, was fired on by a Japanese submarine and 2 out of six torpedoes hit the ship. In minutes, more than 900 of the 1100+ aboard went into the sea amidst a feeding frenzy of sharks. Miraculously, 317 survived after five days in the water.? Even when you think the work's done and the mission's complete, you need to watch for both the torpedoes and the sharks.

Rearranging the Deck Chairs.? Yes, we've all heard this one, while the iceberg is dead ahead and the management team is rearranging the deck chairs, or the band is playing on, but my concept on this is the sunken costs of engaging people in activities which not only waste time, but divert focus and other precious resources, so, don't paint the Titanic's stern with water-based paint.

Lost At Sea exercise.? Want a great exercise to do with your management group? Take the "Lost at Sea" exercise, here is a link to an example:

https://www.airman.af.mil/Portals/17/002%20All%20Products/003%20PACEsetters/Teambuilder_LOST_AT_SEA.pdf?ver=2016-11-02-111101-433

You will learn much about yourself and your team. It's a great retreat exercise and what becomes readily apparent is the value of experience and common sense, two elements your startup will need to stay afloat, and sail into the sunset.

And to quote Qorval founder Jim Malone, "In a crisis, time isn't your friend."

Better to act fast than fail fast.

Copyright, 2023, Paul Fioravanti, MBA, MPA, CTP and/or Qorval Partners, LLC, all rights reserved.??We can help. We’ve been transforming organizations for more than 27 years and have a proven team of subject matter experts.

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Paul Fioravanti, MBA, MPA, CTP,?is the CEO & Managing Partner of QORVAL Partners, LLC, a FL-based advisory firm (founded 1996 by Jim Malone, six-time Fortune 100/500 CEO) Qorval is a US-based turnaround, restructuring, business optimization and interim management firm. Fioravanti is a proven turnaround CEO with experience in more than 37 industries and 87 situational challenges. He earned his MBA and MPA from the University of Rhode Island, and completed advanced post-masters research in finance and marketing at Bryant University. He is a Certified Turnaround Professional and member of the Turnaround Management Association, a founding member of the Tampa Bay, Florida chapter of the Private Directors Association, Association for Corporate Growth (ACG), Association of Merger & Acquisition Advisors (AM&MA), the American Bankruptcy Institute, and IMCUSA.