Category Archives: Entrepreneurship

WHY ENTREPRENEURS NEED TO TALK ABOUT THEIR MENTAL HEALTH

72% of entrepreneurs are directly or indirectly affected by mental health issues compared to just 48% of non entrepreneurs. That’s according to a study by the National Institute of Mental Health. 49% of entrepreneurs deal with mental health issues directly while only 32% of others experienced them. Similarly, 23% of entrepreneurs have family members who face these issues compared to just 16% of others with family members who face these same types of issues. As a category – entrepreneurs are exponentially more likely to suffer from mental health problems, and yet, people don’t talk about that enough – it is fetishized and glamourized, so here’s an attempt to share some data and personal experience to show the other side. While many view entrepreneurship as a dream career full of excitement, it is a real rocky road. According to this study by Michael Freeman, entrepreneurs are 50 percent more likely to report having a mental health condition. And yet, we still struggle to talk about it. In his brilliant book, Lost Connections, the author Johann Hari makes the comment that “humans need tribes, like bees need hives”- and I think this point gets to a major crux of what causes so much of what we, as entrepreneurs, experience as mental health problems. There is the famous quote that “it’s lonely at the top” but it can be very lonely on the way there too, and even worse right back down at the bottom. In COVID times with a mix of quarantines, lockdowns, curfews and too many zoom meetings, this already large problem in our sector has just gotten bigger. Most importantly, whatever you are going through right now, know you are not alone, please do reach out to just one friend, and see what kind of difference it can make. Read More >>

HOW TO RETAIN YOUR FIRST START-UP PRODUCT USERS

At the idea stage, most founders are focused on building a product that customers find interesting enough to try. The truth is, proving that the product can provide consistent value to the customer is as important as attracting the customer. After all, a product that seems useless after the first try clearly lacks validation. This is a common situation where marketing and promise are enticing, but the product doesn’t meet customer expectations. Retention is built around data. You need data to understand where the product falls short and the customer loses interest. If you’re launching a new startup product, you don’t have data. But what you can do is analyze your competitors’ products and speak with their customers to map their journey and understand what keeps them using those products or why they decided to look for another solution. Especially in the early days, personalizing onboarding and product experience, even with as simple as a dedicated account manager or salesperson, can not only boost sales but also, it’s an opportunity to listen to customers’ needs and expectations, which will play a key role in understanding what your solution lacks and how it can be improved. Read More >>

COULD A SMALL CITY BECOME THE NEXT SILICON VALLEY? UNLIKELY.

New research suggests that there’s a population tipping point for supporting a booming tech industry.  “Become the next Silicon Valley.” So many cities have adopted this goal that it has become a cliché.  Many policymakers want to emulate the economic success of the San Francisco Bay Area by drawing tech workers to their own cities—even if they are relatively small.  Growing cities tend to follow a universal pathway, moving from work that relies primarily on manual labor to jobs that rely more heavily on cognitive labor, the researchers report. In a study of U.S. urban areas, the team found that the tipping point tended to occur when the population reached about 1.2 million. Small cities under that threshold may not be able to build a strong tech industry because they don’t have enough people in other industries—from public transit to laundry services—to support software engineers.  As employees become accustomed to working remotely during the COVID-19 crisis, it’s possible that industries suited to remote work, such as tech, will become less tied to particular cities. This shift might alter the universal patterns of urban development.  Because new ideas, by definition, don’t have a defined vocabulary, they usually require some degree of nonverbal communication, which isn’t easily replicated in a Zoom meeting.  How does this finding square with the idea that cities need to pass a certain population threshold to establish strong tech businesses?  Even though these companies are less beholden to population growth than others, a substantial part of their expansion does depend on the number of people in the city.   Read More >>

IN PITCH CONTESTS, GOING FIRST IS A DISADVANTAGE

Research shows that in many types of sequential competitions, the order of competitors can have a significant effect on judges’ evaluations. But what effect does competitor order have for startup pitch contests? We conducted four pitch competitions with business student entrepreneurs as a field experiment to determine whether — and how — the order of pitches affects investor interest. Pitch competitions could be similar to persuasive arguments, where the first contestant enjoys a primacy advantage because evaluators often anchor on the first argument, making them less open to different ideas. Or perhaps we would find no order effects at all. Unfortunately, you don’t often get to choose your place in the pitching order. But if you can, do your best to avoid pitching first. This may feel counter-intuitive for some entrepreneurs, as going first may feel like a move that signals initiative and a go-getting attitude — traits that are generally a positive for startup founders. But the research shows that when it comes to pitch contests, jumping into the shark tank first doesn’t pay off. Investors strive to make rational decisions about where their money goes. Once you become aware of the existence of order effects, you can deliberately counteract them by revisiting your initial judgments after all the pitches are complete. Don’t let something as meaningless as pitch order impact your evaluations and cause you to overlook a good opportunity. Read More >>

THE CENTRAL CONUNDRUM OF COVID-19 ENTREPRENEURSHIP

To get to the top and remain there, businesses must constantly develop new capabilities as they leverage existing ones. Keeping both priorities in play is tricky in the best of times, which is why legacy companies of late have been increasingly outsourcing innovation to tech start-ups via partnerships or outright acquisitions, a trend that has generated tremendous value for start-ups and their investors. However, with economic activity now slowed to a crawl in many sectors, firms have increasingly shifted their focus to short-term survival considerations and longer-term innovation priorities have temporarily fallen by the wayside. One result is that start-ups have been hit especially hard. Interestingly, late-stage start-ups were more pessimistic than early-stage ones, despite experiencing less severe fundraising woes in the pandemic (see below). It may simply be that inexperience breeds an optimism that can survive initial encounters with adversity. Investors, too, do not appear to be thinking beyond the pandemic. Depending on the nature of their business, companies are either busy capitalizing on the market changes produced by the pandemic, or scrambling to adapt. This opportunistic approach may not hold true in other entrepreneurial ecosystems and may also vary as a function of the level of government support.  Read More >>

6 WAYS TO USE STORYTELLING TO ENHANCE YOUR PITCH

As an entrepreneur, one may have passion when one is pitching your solution to investors and customers. But passion alone won’t make one more technology pitch stand out above all the rest. Everyone remembers a good personal story. Thus it behooves one to highlight one’s message with a bit of storytelling. Storytelling in business means personalizing communication here and there with anecdotes to highlight important points, and make the message come alive to peers and constituents. It is not about trying to be a stand-up comic, or weaving theatrical tales. Here are some key ways that personal stories can raise the message above the standard sales pitch. First, it is important to show that one is authentic and deserves another’s trust. Sharing stories is the first step to building a real relationship with other people in business, as well as in one’s personal life. Next, it is imperative to connect to people’s emotion as well as logic. When it comes to the art and science of persuading others, one can never afford to forget the power of emotions. At least one study has shown that 90 percent of decisions are made based on emotion, but that people then go back to logic to justify their position. Third is to relate when and where one’s passion started. In most cases, a new startup idea and plan is driven by a specific personal incident that has instilled a conviction about this opportunity. Next is to explain one’s contribution to a higher purpose. It is popular to highlight how a solution contributes to a higher purpose, such as saving the environment or helping the less advantaged. Additionally, it is unfortunate that most elevator pitches, product descriptions, and marketing messages are abstract, and include no characters at all. People remember people, with associated emotions, whether that main person is you, someone you know, or a customer you lost. Weave a real person throughout your message.  Read More >>

THE PANDEMIC FORCED THIS FOUNDER TO SLOW DOWN SO HE COULD ACCELERATE LONG-TERM GROWTH

I was staring out at a sea—or should I say a grid—of blank faces. It was the town hall portion of our weekly all-company meeting, and an employee asked me directly how long I thought this work-from-home arrangement would last. I gave my unfiltered opinion: I did not see a return to life as we knew it for a couple of years (if ever). I had made a concerted effort to keep spirits high and energy positive in our weekly all-company Zoom calls, but it felt like despite all the positive momentum generated from previous responses to the crisis, with that one revelation, I had just killed the mood of the entire team. As an entrepreneur, working around the clock with the team to save the company was in my blood. Those long days and weeks in March, April, May, and June came naturally to me and to many of my team members who had self-selected to work at a startup. What’s been more challenging is determining how to navigate the transition to this next phase—where working from home is the norm rather than a novelty. In a world where everyday feels like Groundhog Day, and weekends aren’t much different than weekdays, I’m trying my best to provide as much certainty as I can for the team and placing a renewed emphasis on making sure priorities for my direct reports are clear and manageable, and that we expend energy on solving the right problems. We spent a few months building the plane while we were flying it and now it’s time to go back and write the manual. Encouraging employees to work at a more manageable pace (and dismantling the culture of stress and burnout) starts with just talking about it openly. We all have a chance to reset the stage and make work better for our teammates—more flexible, accommodating, and accepting of employees’ full selves and personal lives, including crying babies, screaming kids, and barking dogs. I want to be mindful about preserving the best parts to set us up for future success.  Read More >>

AMID THE PANDEMIC, ENTREPRENEURS CAN STILL FIND OPPORTUNITY

The crisis provides fertile ground for startups in spaces like telehealth and touch-lessRead More >> payment. Other startups will need to get creative.  Business can be divided into two categories: those that have COVID headwinds—think restaurant suppliers whose customers are struggling to survive—and those with COVID tailwinds—think telehealth technology firms that have never seen more demand.  But that doesn’t mean that startups with headwinds are doomed. Instead, entrepreneurs must harness the innovative spirit that drives them and adjust to the moment.  Overall, fewer businesses are started during recessions. And the ones that are start smaller than those formed during boom years.  The good news, however, is that recession-born businesses tend to be more productive, as measured by revenue per employee. And startups during a recession tend to be grouped into industries that rely heavily on innovation.  In the last financial crisis of 2008, society’s growing distrust of financial institutions led to startups like Venmo and Square.  Today, people should expect to see innovations in a wide range of industries. For example, healthcare innovations will likely address both drug development and telehealth delivery. There will likely be new types of automation in manufacturing to allow for social distancing between employees. And, for supply chains, she anticipates more real-time monitoring, so companies can manage customer expectations in the event of disruptions.  Investors are approaching startups and saying, ’I know you’re not planning on raising for 12 months, but I want to preempt that round.’  What they’re really saying is, ‘I have FOMO. I have fear of missing out. I want to get my money into your company because it’s going to grow so fast and I want to get it in now. I’m willing to take the additional risk because I see the future.’  

NETWORKING IN THE NEW REALITY

Curiosity and reciprocity, plus some ingenuity, will help you build relationships in the age of Zoom.  To many people, networking feels a bit like squeezing into trousers one size too small. But networking is essential if you wish to amass the social capital indispensable to a successful career. Its importance has not diminished with the overnight explosion of remote working. If anything, networking has become more critical, as jobs and advancement opportunities are swept away by the coronavirus.  Building connections in times like these will require out-of-the-box thinking as well as the same deliberateness and perspectives that characterised effective networking before the world changed.  If you think you don’t have anything to offer, change your thinking.  In the era of Zoom and reduced face-to-face contact, what could you do to maintain and even expand your network?  Here’s how: First, set aside one to two hours of 15-minute slots every week. Then, announce on LinkedIn or other social media, or your company intranet that you’re hosting 15-minute conversations to exchange ideas and give advice. Be sure to indicate your areas of interest or expertise to invite relevant conversations. Ask interested participants to give you two sentences on why they’re reaching out to you, “so that you’re not just getting random people”.  With the right attitude and framing, networking need not be a pain.  Approach the world as if you always have something to learn. Consider reaching out as a way of learning or giving. It might even feel good.  Read More >>

HOW DIXIE CUPS BECAME THE BREAKOUT START-UP OF THE 1918 PANDEMIC

In 1907, Boston attorney Lawrence Luellen created a cup. It wasn’t made of glass or metal—the norm at the time. Instead, it was made of paper so it could be thrown away after use. While not earth-shattering in our current context, in the early 1900s there were no disposable paper tissues or paper towels. A cup made of paper was a novel idea, one with a noble goal: Luellen hoped his paper cups could help stop the spread of disease. What makes this century-old startup story especially poignant today is that Dixie cups, as they came to be known, achieved only moderate growth for 10 years until the Spanish flu of 1918 made disposable cups a necessity and helped the Dixie cup become a household name. In 2012, Smithsonian Magazine even called the Dixie cup a “life-saving technology” that helped stop the spread of disease. With the success of Dixie cups came other disposable products, such as Kleenex in 1924 and paper towels in 1931. This also led to new and environmentally harmful materials such as polystyrene finding their way into consumer products. As the history of Dixie cups shows, a product that solves one problem can create new ones. Some people are already complaining of “Zoom fatigue,” for example. Products that become popular during the current pandemic will have their own first- and second-order effects. Some of the problematic ones will present opportunities for intrepid new startups.  Read More >>