Reinvent the mousetrap - Brilliant move.

Sometimes being different is so easy. Just like the fresh made Pizza business I wrote about some long time ago this project has achieved to build a better mousetrap and to create a decent buzz!

Paintyourpizza.com offers customized pizzas. The difference:You doodle your pizza using the standard ingredients and paint-app on  the website....easy idea, beautiful execution and buzz around it. Watch the video and think about it.

Next time you order pizza take a second to imagine the little extra you could have ordered.

There are so many businesses that wait to be reinvented or simply marketed differently...beautiful and simple. That is what ultimately matters for a startup!


Paint Your Pizza from JONAS LUND on Vimeo.

3 Basics on Startups

I walk into this conversation all the time. Quite funny to see the number of startups that do not get these basic and in some cases neck-braking factors sorted out.

Just for you to know: Be careful with these here:

1. The Team:

• Homogeneous Team: Try to cover certain basic areas of your team with specialists, or at least all-rounders who can handle Sales, Marketing, IT, Logistics, Networking or (most importantly) financials. ITs the mix that makes a startup worth to invest in. Only good teams add value to a good idea.
• Check the girlfriends or brides to be: Never start a biz without knowing the women behind the heads. Turns out that many investors (at least in the US) hear alarm bells ringing when it comes to that topic. Imagine a wife sitting on the couch at 1900 claiming time for cuddling and your biz is going down the tubes....its a matter of time they can invest in odd situations. Dont get me wrong here: Everybody needs some work-life balance, but not every type of business can handle 3 weeks of vacation during the first 6 months of business.

2. The Market:

• You cant explain your target market or did not make sufficient research to fully understand what drives the target.
• You believe there is no competition doing what you are doing. Chances are 100% that you are wrong with this assumption.
• You did not talk to your market and the people who are supposed to buy your stuff. Do not talk to friends. I hate talking with people I know about projects. The reason being that the feedback you get is always biased and too favorable. Talk with strangers or people who have the balls to tell you that you are dead wrong. Stress test assumptions! You need people to play the devils advocate...

3. It´s a Business, not so much a Startup.

• Act like a professional and do not nurture the startup-image too much. Good startups play it as if it was the most normal thing on earth to be around. So if somebody asks you what you do for living say: "I am in the business of selling....". Sounds better like "I am starting up this cool idea".

I barely forgot. There is one exception when you should not act like a true business. Imagine you are a staartup of 3: Do not doll up yourselfes with fancy titles like CFO, CTO, CEO, etc...you are still a bunch of kids trying to sell something as professional as possible. There is no fancy titles until you are a 30 people business. There is a guy who buys stuff, one who advertises it and another who takes care of the rest....its simple. Keep contact with mother earth. I appreciate that.

Cheers.

M

How to: Raise Seed Capital

Easy steps I try to follow when raisng some bucks:

1. Do / develop your numbers for the next 3 years. Make it a monthly simulation so you can benchmark yourself each month and (if necessary) break it down to daily average numbers so you can put some pressure on you....

1.1. Base it on your sales simulation, revenue stream and expenses model
   1.1.1 Sales-Simulation base on some industry assumtions and averages
   1.1.2. Marketing Expenses (to generate your sales objectives)
   1.1.3 Fixed costs, office, etc. Expenses
   1.1.4 HR Expenses (dont forget to calculate your cost of living....)
   1.1.5 Logistics Expenses (based on what you sell)

1.2. Cash Flow Simulation based on the capital you need
1.3. Balance sheet for the next 3 years.

2. Know your numbers

2.1. Don´t oversell, creat milestones and be aware that investors will nail you down on your numbers.
2.2. Benchmark and make common sense assumptions (they will challenge you on that one)
2.3. Know your market & Biz Plan

3. Know your potential  investors

3.1. Don´t be afraid of investors, be afraid of them because they are humans and worried about their money. Report well to them and act pro-active
3.2. The less the better, Angels preferred, keep few interest groups
3.3. Don´t fight too much about the initial valuation and the share. Better having 20% of 1Million than 90% of crap. Ok, make it reasonable! Come on..dont nail me on this one.
   3.3.1 Letter of intent, Shareholder agreement whatever. Get a lawyer who looks at it.
   3.3.2 Be aware that their risk is higher. Worst case: 100% loss, you still have the free ride!
   3.4. Give them a clear idea of how to exit. Remember, they have a timeline....

THe lst thought on it: Keep your numbers uipdated. More that than the damn business plan. It changes all the time anyways....and gives a much better idea of how you tick than any 20 page exercise.

Cheers and have fun. M

The Crowd is wrong

You know what I think is absolutely wrong about the existing crowdsourcing place on the net?

Look at the infograph and you will realize that the social component not really contributes what is could potentiall contribute....simple making contacts and spreading the word. What a nice little dream.

I realize more and more that the crowd is going to be a breakshoe for further development of an idea and for sure for a startup that is planning an exit strategy some day in the future. Crowdsourcing is a great tool for raising some money in the first place. However,a big chunk of the value it could provide is being neglected.

The easiest thing a crowd can provide is money and contacts. The quality of the contacts or network is never being questioned. I believe that the model will prove to be wrong from a professional standpoint within some years. I am talking about adding value as a crowd, not a bunch of kids spending 5 bucks based on some gut feeling... do they actually understand a biz halfway? What about valueing a startup? 2.Million valuations all over the place. Where is the reason for that amount? Call me arrogant, but there is no selection process involved and this attracts stupid money. Very stupid money. That drives me nuts. I want smart money and now I know how to manage that.....Think about  it.

I believe crowdfunding has gone into the wrong direction. Simply because it is crowd driven....what the masses want, the masses get. Its not about the startup any more, its about the platforms trying to raise money. Thats why many pigs are being dressed up like little ladies.

I will test an idea i had some hours ago and let you know when time is right.

Cheers M

How to: Facebook Pages

Here some good stuff! I will start an army of Like Pages on Facebook. Here is how I do it:

First of all: Establish one corporate page "Yourbiz". Be a nice host and post what is going on in your corporate life and what you "as a biz" like or do.

Now that you are done you can start to talk marketing strategy:

1. Build an army of FB Pages, each with a different topic. Important: The topic has to match your businesses target market in some way. If you are an expert for selling pink television sets make sure to set up a FB Page for discussing my girlfriends favorite telenovelas.

2. Position each page and establish a posting-history....post for some weeks, before publishing...who will like a naked page or cause? You need something going on on your timeline.

3. Build up credibility. Use your network and invite the first bunch of kids via your contacts. If absolutely necesary: buy likes....you need 100 people to like your stuff, underneath that you will fail to gain "like-me-trust".

4. Relevance is king: Keep on posting and use or invent events that matter to your community. "Today is international womens day - have a good day chicas...". That is all that matters - be relavant and don´t bore people with stupid chitchat. Build on that. Invent things that are fun if necessary, but stick to your topic. Funny and targeted things are the best. Read a lot about your target, find out what matters most and use the most actual information to spread the word and to become a trendsetter.

5. Avoid commercial posts on your like pages to gain trust. Don´t sell that trust of your fans. When you have enough moment start introducing small little doses of commercial content....sutile please.

6. Encourage Likes and shares. People need clear directions of how to use a post: Interactive votes are a good example: "Like it if you think this is cool, comment if you think its nonsense (if you fancy a shistorm on your wall...)". Encourage interaction, this is what makes people spread the word.

These are the basics....if the thing is big enough and works: Buy the domain name and set up a blog for your FB Posts to give it more momentum. Add Pinterest....grow an army of links and sites. That is key to become the 1% of top viral sites.

How long it takes: You never know. Some fun pages go viral within hours or days. I guesses that 99% of all pages take some time to grow and never go viral. If you have a look at the stat down there that was quite a good guess. If you are so fortunate to hit a viral jackpot: Tell me how you did it!

Here are the stats ....hope you get into the 100k soon...only 6% make it.

One last thing: This is for free, so dont even think about it twice, when your budget is tight! If nothing happens after 4 weeks: Ditch it, try something else!

Cheers M

Spare time for Business

I am a big fan of gap-marketing. Whenever you have a couple of spare seconds or minutes waiting in line or just sittting there in the metro staring at the wall.....what a waste of marketing potential.

A great example for using this wasted time ist Wash & Coffee in Munich.They dolled up the washing saloon and converted it into a coffee shop. Yet another revenue stream that bridges the nasty waiting time converting waiting customers in paying customers. They even have events in there.

Just like Splash did in Barcelona I believe there is a trend to convert stupid time you waste into productivity for shopping. Think about the potential....combining business models is key for profitability.

Imagine a Pizzeria, which shares the wood oven with a bakery in the morning.....nice.

Interview questions

Good people ask good questions. 

What would I ask someone in an interview? I am being asked a lot recently what I would ask in an onterview.....I conducted lots of interviews in corporate days and these would have been great ones for me to ask a candidate:

1. Imagine we would hire you. If we would be celebrating something in one year from now: What would it be? - Great one to determine whether the applicant is a perosn that knows how to blend in, where they focus on, if they undestand what the company is all about....

2. If I would hire you right from the spot. The job and the salary would be exactly how you expect them to be. What would another company have to offer you to ditch me? - A great one for playing the devils advocate. Love it in order to determine if they can be bought....I read it some time ago and it stuck to my head.

3. What was the thing you did not like to do or about your last company? - That is a difficult one, because you are asking directly to ditch someone else. I love it, its such a nasty thing to ask, but tells you if the person is straightforward or not. Additionally to this you get to see how the person deals with stress and ambiguity.

4. Tell me a situation in which you tried to achieve something you badly wanted and explain why you failed. A great one in order to determine if the applicant is able to admit and to deal with failure. We fail all the time. Few people take this as a lesson in life and deal with it....

5. How would you react if I told you that I am actually not the guy who was supposed to interview you. I sneaked in and wanted to chat a little. I never did that befor, but it was fun. Thanks! - To see how the candidate switches between serious and casual behavior. Getting upset or changing the behaviour towards me would be a clear indicator for some serious ass-licking genes....

Cheers M

Avoid writing a Business Plan

Recently I have been talking to a couple of people about the sense of writing business plans.

I have come to the conculsion that under certain circumstances it does not make sense at all to write one. Why? Imagine yoursef in a very competitive environment like Germany or the US for example. Time to market is crucial.

Nowadays it is easy for barely everybody with the right set of knowhow to become serious competition within weeks. At least if you live in a copycat environment like Germany. What a shame it is... Whatever....Time to market and the proof of concept is (in some cases) more important than having a perfect plan.

Can you afford wasting 2-3 weeks for writing something down you already have planned out in your brain? The answer is: No, not necessarily if time and money is -as usual- a factor. Just calculate the cost of it! 2 weeks of work....imagine the money you could earn with something else. I have seen people lose opportunities because they wrote a plan....omg.

What you need in order to skip the annoying task (at least if you don´t need investors) of writing a biz-plan:

1. Opportunity & vision: An awesome idea, team and concept. AAA everything. Then go for it. Asap.
2. Awesome financial planning and revenue stream flexibility.
3. Insider information from a trustworthy source.
4. You are extremely talented and hands on the job and you are not a perfectionist.
5. Pocket money, so you dont have to really care.

If you miss one of the above: Write your damn plan, but dont be a prefectionnist nless you have to be. Halfway down the road you will either have convinced yourself that the thing will fly for sure or you will have realized that its utter bullshit.

Bottom line if you want to source some money or you are a perfectionist nut-job: Write a plan for gods sake and risk losing the market. In all other cases: Good results are the best plan.


Cheers.M

P.S.:

Do not have it written by a third person. Outsourcing is good, but outsourcing your brain is plain stupid.
Keep it short and think what the reader wants to hear/values most. No fuss.
Never say you assume a 1% share of the market. Its bullshit. Every investor reading it will think you are a nut-job. i completely understand that.

Dare to disagree and lead!

I actually believe very strongly in this....a talk every entrepreneur shoud watch:


The other day I say a presentation about an inhouse project of a big company that failed big time. Waste of time for the most of it, but they learned a big chunk of lesson out of it.... It was a classic copycat of Google Wave, which was abandoned by Google some years ago. Wave was pretty much built about the assumption that dicussing a topic to death is a good ting to do when organizing a workflow or even for planning leisure activities. Total crowd-democracy.

I got a little updet during the presentation because I could not understand how some guys, who obviously had some skills going on there, could fall into an obvious trap. They were lacking the common sense of understanding the most basic mecanics of leadership and organizational behaviour.

I wont bore you with that, but the bottom line for me is: When starting a project you need to appoint a devils advocate, who asks the right questions beforehand or during the project...Does it make sense to start this? Is there a real problem we are solving here or do we just try to fix our own lack of leadership skills?

Most startups/projects fail by committing one of the following failures when starting a project:

1. Appointing a team to a problem that exceeeeds a headcount of 5
2. Assembling a team that does not involve all involved / partially touched departments
3. Not analyzing the problem well enough...not knowing where the real problem is. The root of the issue that has to be solved. Where is the biz?
4. "Nerd-Pooling" - creating a task force that consists of a homogeneous bunch of kids....that means skills, soft skills, and age/experience. You need a leader wo guides the discussion. Democracy is good for brainstorming, but for getting things done it is nonsense (most of the time)
5. Did somebody else already solve the problem for you and failed (Google in our particular case). Check if a problem was solved by somebody else already. These guys could have avoided wasting time by researching the stuff that is out there. Do your damn market research:

Bottomline: You need a plan and someone who thells the people the truth about that plan. Dont be polite when people are going the wrong way and you know it...! Help them to avoid a mistake. If they go for it anyways, screw it, theyll learn by their own means... Cheers. M