As a new founder of a startup, you're reinventing the wheel in many ways. You will draw your inspiration and wisdom from those who came before you and do everything in your power to learn quickly. In the words of Ben Horowitz, "you don't know how to be a CEO until you are a CEO."
From some of the best pivots to lessons and best practices you can use to guide your journey today.VC's and successful founders, here are mistakes,
Do not focus on the short-term result at the expense of your long-term vision
Michael Broukhim, Co-Founder and Co-CEO of FabFitFun, a subscription box service told me this is one of the biggest mistakes startups make early on - and we see it all the time as well.
"Startups will often sacrifice the long-term best interests of the business to achieve a short-term result or metric. At FabFitFun, we refer to these as "local maxima." One great example of "local maxima" for a subscription business is making it difficult to cancel. Many of our competitors, for example, force customers to call by phone to cancel their subscription rather than make the option available online. In the long run, customers will get frustrated and even on the way out the door - in fact, especially on the way out the door - the customer will be heard."
Quality is better than quantity. Every. Time.
Rachel Zoe's newest business venture is also a subscription box. Speaking with the Zoe Media Groups E-Commerce Manager Nicole Cutright, she credits their early success to "sourcing the very best product and clearly communicating value."
"Too many companies focus on customer acquisition at the expense of listening--and keeping--their existing customers. Besides offering top notch customer service, we proactively engage with our subscribers on social media and using surveys to constantly improve."
Own your mistakes and pivot accordingly
This is a longer story for a different article but say what you will about the Kardashian/Jenner brood, Kris Jenner is one marketing genius. Kim Kardashian owes her fame to a horrendous (and embarrassing) mistake, but let it teach you that public perception can be managed by social listening.
Do you think they came up with the idea of a reality show first? Probably not - back then it wasn't a "thing" just yet- they saw and listened to the way people reacted and used that learning to their advantage.
Don't pretend you already have all the answers
If you are pitching investors, A dear friend, advisor, entrepreneur and venture capitalist, Dan Lennon has sound advice.
"Investors know you don't [have it all worked out] and don't expect you to. The right early stage investors are willing to take a risk on your ability to figure it out later. Being open to criticism and critique is one of the best indicators of founder adaptability and flexibility. Along with resilience, those are probably the three factors most determinant in founder success."
Don't confuse lessons from successful companies
Saucey, the alcohol delivery app is like Uber in the sense that they have their own drivers, but they are unique in the way that they are in 4 cities. Speaking with Chris Vaughn, the CEO and founder about this he said, "a lot of entrepreneurs take the wrong lessons from successful companies. They try to apply the same model to a different use case or industry, without fully understanding the market size/opportunity or economics.
For example, in the on-demand space, Uber expanded to 100 cities and became a huge success. As a result, many on-demand startups chased "Expansion" and "Gross Sales" as the metrics for potential high valuations.
What they didn't pay attention to was that Uber had raised billions of dollars to fuel this expansion, and even then, the majority of their usage was still only across a very limited number of markets. Failing to see markets as investments that contribute positive revenue back to the business, and instead viewing expansion as the driver of value is what's cause many companies to fail.
Even companies who have raised $60-80MM have gone under (keep in mind that even $60-80MM is very different than $2B). You need to know and understand your market, the economics, the incumbents and competitors, and create an offering that truly addresses the needs or natural behaviors of customers."
People are your most valuable asset
Kent Yu, Founder of T3 Micro, has a 12 year old hair tool company that has not only flourished through recessions but has remained culturally relevant. Coming from a company that has weathered many storms, I think his insight on team building is important, and one that I whole heartedly agree with.
"Many entrepreneurs don't realize that hiring is arguably their most important job. Do it right; life is good. Screw it up; get ready to work.
Entrepreneurs tend to upgrade management too slowly, not pay as well as they could in order to manage costs (people is not where you want to skimp), or don't hire the best due to fear of loss of control.
Invest in talent early and often. Don't fear turnover - it's an opportunity to upgrade.
Your college buddy or brother-in-law is probably not the very best VP of Marketing (or whatever position) that you can find. Attract the best to perform the best."