Tag Archives: risk

Your Big Advantage over the Big Boys.

business difference

How StartUps can make the most of the blank canvas.

It’s easy for a StartUp to feel intimidated. To think you are not worthy. To look at the big boys with awe, with all their resources, their profile, their confidence, their relationships. You might assume that if they chose to confront you, you’d stand no chance.

But I’ve worked with them all my professional life and guess what? You’d be wrong.

The truth is that their disadvantages might just outweigh their advantages. Corporations are a complex battle of interests, laden with conservatism. They are risk averse…in fact, worse; often they are decision averse. Often the mindset is: doing something new creates the potential for risk, whereas doing nothing avoids that potential…so stick with doing nothing. And in that environment, that’s actually smart: because that’s how the corporation is often structured, that is the reward mechanic and behaviour follows.

There’s some talk about corporations beginning to be more like StartUps. But in all but the rarest of situations, this misses the point. Corporations are bureaucratic because they have to be. They have due diligence and institutional investors, they have heavy structure, processes, organograms…but more importantly they have a hive of people and a culture.

Legacy system buries itself deep within an organization. You can’t unpick it. You can’t alter the mechanics and expect a new mindset. That’s the wrong way round. (Personally, I believe that once an entity becomes a corporation, it creates the conditions for its own demise. But more on that some other time.)

StartUps have no legacy. They have a blank canvas. They are free to do what they want. And this can be the biggest advantage in the world.

But you have to focus on the areas where this blank canvas can lead to the greatest advantage. That’s not going to be product, or supply chain, or sales, R&D or talent.

The two areas they will find it impossible to beat you are:

1. They can’t think as small as you.

2. And they can’t think as holistically as you.

To the first. You can target a tiny but perfectly formed audience. In fact, you must. Not just focus better but show them the love. Find – or create – a gang. Not an audience, a gang. A gang is about belonging, about having something you are anti and about feeling special. Prove to them that you were designed for them and only them. You can grow from here, not by compromising but by pulling more and more people into that gang.

To the second. You can aggressively deliver your brand concept through every element of your brand. Corporations find it so hard to control this, on a practical level and on a human level. But it’s easy for a StartUp once they think not as a business but as a brand that does business. Change the experience people have when they connect, buy, use and share your business so it captures the uniqueness of your brand idea.

As I’ve written before, Airbnb does this as well as any StartUp. But using an existing brand makes the point more clearly and I’ll use the most famous brand in history, Coca Cola.

We are told the brand idea of Coca Cola is happiness. But you know what, it’s not really.
It’s brown sweet fizzy drinks. Which they then use to lay claim to happiness.

It’s a critical distinction. The product drives everything, not the brand.

Take the brown drink away and what have they got? Nothing. The brown fizzy drink is their legacy system. But what if Coca Cola was a StartUp? What if they had the same blank canvas you have?

How can you build a business around Happiness so it lasts forever, not matter what trends there are in product use? Here’s my back-of-a-fag-packet thinking.

Coke should have started to build from Happiness Factory and position themselves as an experience brand.
Happiness isn’t simply about taste and mouth feel, it’s about entertainment. Coke should have bought Pixar.
They should own theme parks and days out.
They should have acquired/built the play-centre ecosystem that’s growing so quickly in Asia.
They should own handshakes, smiles and jokes.
But they didn’t and they are becoming less and less culturally relevant.
(To be fair, their bar was very high….and their Christmas play is good, you have to give them credit for that. And they do lots of great tactical work like this in the Philippines…but I’m making a point.)

The StartUp lesson is: use your blank canvas to create a branded business – not just a brand image – that reeks difference. Then you can slap that big bully right back in the face.

What StartUps can learn from our Neanderthal cousins.

Strategy for fears, entrepreneur fears, new business fear
How StartUps need to identify and compensate for their fears.

If you haven’t listened to Seth Godin’s podcast from 2012 on Starting Up, you should. He’s not only a smart man, with some great experience and supporting anecdotes, he’s a really engaging teacher. It still leaves some questions unanswered as far as I’m concerned (and I’ll come back to that in a subsequent post) but he covers much of what you’ll face, from the practical, to the strategic, to the emotional and human.

In episode 12, he talks about fear. He tells us: Be clear and precise on what you fear because it’s that fear that will derail you.

Kennedy was wrong when he declared, like a New Age life guru, that the only thing we have to fear is fear itself. No. Fear is human. We are hard-wired to be fearful when we embrace opportunity…because back on the savannah (or wherever Neanderthals lived…I’m too busy to check that…), when we went out to find our food, there was always a chance we’d get killed. And that fear, over thousands of years, became part of our hard-wiring. Fear goes hand in hand with opportunity, because opportunity involves risk. The hard-wiring still serves a purpose. Which is good because it won’t go away soon.

It seems to me Seth Godin is not saying rise above fear or challenge fear, or anything as dramatic and heroic as that. He’s way too practical and real for that. He’s saying: plan for fear, have worthwhile insight into yours and deal with it strategically.

For me, a lot of my experience is in pitching to win big pieces of business. You need to be right. You need an answer for everything. In short, it needs to be complete and you need to be the one saying what is and what isn’t. If they disagree, that’s fine, it’s just a difference of opinion but you have to show that at least it’s all been thought through. And I’ve been the so-called expert in the room at my discipline so that puts me at an advantage.

So what I fear is not having the answer, of being seen to be still working on it, of making it up as I go along. But Lean StartUp thinking tells me I have to embrace incompleteness, or at least a recognition that things will need to change and I must get the idea in front of people – generally strangers given I’ve just moved here – for them to pull it apart.

Added to that is the simple truth that as an entrepreneur, you don’t know it all but at this stage you are doing it all. You have to get the best answers you can get despite your ignorance. So you know you’re walking into a conversation with ideas outside of your area of expertise.

I fear incompleteness I guess because somewhere in the back of my mind I think it makes me look ‘less’; less proficient, less likely to succeed, to attract belief, support and so on.

The StartUp lesson – from Seth – is to really be honest about what you’re fearful of, and that includes your own – and your partners if you have them – very human, very real personal fears – and then plan for them and find a way to compensate.

Where does that leave my fear? At the moment, I’m going to attempt to pre-empt the failings of the idea, be clear on everything that’s bad about it, what areas will probably change, what is still being worked on. That’s the plan anyway but it might not be that smart a thing to do. In fact, I might be making that up as I go along.

Starting up is hard to do

StartUp worksspace
Why StartUps need a proper desk

I think it was Neil Sedaka who said starting up is hard to do. Or was that breaking up? I’ll assume for the sake of this post he was talking about a tough StartUp he’d been involved with. Because starting up is hard…but in a good way.

After the coziness of salaried employment I’m sat here at my new (temporary) desk. Kind of alone. But then again, no politics, no power plays, no sulking. Other than my own. And being alone teaches you a hell of lot.

I know it’s obvious but because you’re alone you play all the roles. An old friend of mine started his own thing, just him, all alone. But he’d literally play all the roles. He’d answer the phone and say ‘I’ll see if he’s free’…even the client’s joined in: ‘would you like to take that back to the office and talk it through’. I think they liked him so much they wanted to – subconsciously at least – give him the respect of being a ‘proper’ company.

So I’m on my own and doing everything. It’s not like I’ve never done this before. I’ve been involved in three stand alone attempted StartUps and three within an existing business (still counts in a way). But there was always a team from the off. Now I am the team and there’s loads to do, much of which I’ve never done before.

Now, if you’re not familiar with Comfort Zone Theory, there are three stages as I was taught it:
1. Comfort
2. Stretch
3. Break

A few days ago, I was talking to a guy who has a great little StartUp, already operating, already proven. They’ve done a great job but he is pretty much petrified about visible marketing/PR, the stuff where they have to be seen to say something and even perhaps show a face, rather than SEO etc. SO he keeps putting it off.

In a StartUp you’re constantly being pulled out of your comfort zone, having to learn new stuff, both hard & soft skills. We all have to develop new coping mechanisms to make sure we stay in the Stretch Zone and don’t slip into Break Zone. After we got him to drink more beer I think he began to relax.

Hell, I’m even trying to learn some coding…I thought it was going well until I pressed save and nothing happened. That was at midnight. But at least I got my ‘beta’ site up and running, for now just something that I hope proves to the local authorities that I’m serious about this business and I’m not hear to sponge (on what exactly?! It’s costing me an arm & a leg to stay here with no income!). I’ll talk about the website development in a subsequent post.

Also – and this feels symbolically significant – I took on some pay-as-you-go office space at Collective Works. Having a workspace away from the kitchen table at home is good. But perhaps it’s greater value is the network effect. Normally, in an office, it just happens but not now. The stuff I’m confortable with is the product development, the business plans, the website and the content dev etc. etc…as valuable as these are though, I’m beginning to suspect that the network is going to be at least as important. And guess what, I’ve been rubbish at it. (I’m in good company: check this great piece on this from the excellent James Altucher.)

However, in pay-as-you-go space people don’t really talk to each other. What I’ve come to realise is that I need to get out of my comfort zone and force a network, I need to be proactive and make it happen. Now I’m asking pretty much anyone and everyone out for a coffee/drink. So this is going to be interesting…can I carry it off? So far it’s going OK and I’ve realised that:
1. You need people to bounce stuff off. Two brains are better than one. And other StartUp types love to help out, it’s in their blood.
2. Despite not working together, you, effectively, pool your skills. They teach me about SEO, I teach them about brand development.
3. You are energised by all these other StartUps trying to make it happen. That gives you momentum/ a kick when you need it.
4. Someone always knows someone else you should meet. So within a matter of weeks you have a network you can barely keep up with.

So the lesson for any StartUp is to force a network: get some office space, ask people out for a drink, email people you’ve never met, ask Person A if they can introduce you to Person B, sit in the right bar at the right time. Look it might not be the golden key but it’s got to improve your chances.