1.Entrepreneurship and new venture formation as the primary driver of

economic growth.

2.Why entrepreneurship should be considered as a career path

3.Aspects of a successful new venture

4.Success factors for entrepreneurs and their teams

5.The value of community

Let’s talk about …

The size of this box

represents the total # of US

Companies …

Small Companies:

Represent ~99% of all employer firms

Company Size

# of US Companies …

Small Business “Drives the

Economy !!!!”

Where do we all work?

# of current jobs in the US …

~ ½ of all jobs are with a small company

~ ½ of all jobs are with a large company

But … What matters is whether the company is growing or shrinking …

# of US Companies …

Small Companies:

Represent ~99% of all employer firms

Growth Companies Matter

# of US High-

Growth Companies

Growth Companies Matter

Net New Jobs Created by High-

growth companies !!!

They start small, but are designed to

get big!

Net New Jobs, Big

company

Net New Jobs,

Small company

• Kaufmann Foundation: “… it is clear that new and young companies, and the entrepreneurs that create them, are the engines of job creation and eventual economic recovery.“

 “… 1980-2005, nearly all net job creation in the United States occurred in firms less than five

years old.” • Kaufmann makes a clear case that it is a firm’s age,

not its size, that is the driver of job creation – this has many implications, particularly for policymakers who are focusing on small business as the answer to a dire employment situation.

 

“New” beats small and large every time …

Small Business “Drives the

Economy!!!!”

NEW Businesses “Drive the

Economy!!!!”

SOME REASONS TO START UP A STARTUP …

You will have the time of your life

• Starting anything new is difficult, but if it was easy everyone would do it!

• It’s something you will remember for the rest of your life whether things go very well or things go poorly.

• “Everyone should try to be a rockstar at least once in their lifetime.”

• It will test your abilities and teach you more about yourself than anything else you’ll ever do.

You will make friends and connections that will last a

lifetime.

• There is no substitute for being with people with whom you’ve accomplished great things (or failed miserably at something worth trying …)

It is a rare chance to create something from nothing

• Very few professions put you in position to create something of value where nothing was before.

• Your idea probably isn’t unique ...

But by applying your time,

passion, and energy to the

venture you have a chance to do

something no one has ever done

…

It is easier than it used

to be …• Clouds,

frameworks, apps, Oh My!

In the olden days … product development

took years, required large teams and

massive investments in equipment and

infrastructure.

You can do it from (almost) anywhere!

Silly-con Valley is no longer the be-all-and-end-

all location. If you have skill and passion, you

can make your location into whatever you want

it to be.

It’s easier to find customers than it used to

be …• Google changed the world

forever …

• Big data and deep analytics are

changing it again …

• And social media gets

customers engaged in ways we

old guys could only dream of ...

A traditional job isn’t as secure as it used to be …

• Big, global companies are

vulnerable in ways they’ve

never been.

• Global competition affects

every industry.

• You control your career and

“personal brand” in ways

previous generations couldn’t.

The “worst that could happen” ain’t so bad

I can accept failure, everyone fails at something. But I

can't accept not trying.” 

-- Michael Jordan 

SO YOU DECIDED TO START SOMETHING

… NOW WHAT?

We (mostly) know what works.*

• Stick with something you know. 

• 96% of founders ranked prior work experience or hobbies as an extremely important or important success factor.

• It’s the learning; not success or failure, that makes the difference. 

• Successful founders try and try again. 88% attributed their success to prior successes; 78% attributed success to prior failures.

• The management team is critical. 

• 82% of the founders attributed their success to strength of the management team (not the idea, business plan, or money).

• A little luck never hurts. 

• 73% said that good fortune was an important factor in their success

• 22% even ranked this as extremely important.

• There is nothing like being in the right place at the right time.

*Ewing Marion Kauffman Foundation for Entrepreneurship, titled “Making of a Successful Entrepreneur.”

We (mostly) know what works.*

• Use your network. 

• Professional networks were deemed important in the success of 73% of the founders.

• 62% of the respondents felt the same way about their personal networks.

• Dropping out of school is not recommended. 

• 95% of these founders had earned Bachelor’s degrees and 47% had more advanced degrees.

• 70% said their university education was important

• College helps with knowledge, discipline, and networks

• First-timers usually fund their own venture. 

• Venture capital and private/angel investments play a small role in the startups of first-time entrepreneurs.

• 70% said they had to use personal savings as a main source for their first business.

*Ewing Marion Kauffman Foundation for Entrepreneurship, titled “Making of a Successful Entrepreneur.”

We (mostly) know what works.*

• Willingness to take a big risk. 

• When asked what may prevent others from starting their own business, the highest ranked factor by 98% was lack of willingness or ability to take risks.

• Founders clearly found entrepreneurship to be a risky endeavor.

• Huge time and effort commitment. 

• 93% felt that the work and time challenges were a major barrier

*Ewing Marion Kauffman Foundation for Entrepreneurship, titled “Making of a Successful Entrepreneur.”

We also (mostly) know what fails.

• Hero myth: Believing in your product is important … to a point.

• Founders too-often fall in love with their products or technology, ignore negative feedback from customers, and spend years building a product based on a vision that no one else shares.

• Process myth: There is no direct path to success …

• Conventional wisdom is: have a great idea, raise money, build a product, then go sell the product…

• This doesn’t work when attacking unknown problems with untested solutions.

• Money myth: Too much money is (almost) as bad as too little! 

• Too much money, too soon, allows a flawed business model to hide behind the perception of progress.

• Better to stay lean, focused on the market, and adapt as necessary.

Money will ultimately be necessary …

The Valley of Death

Money is not always the problem

The single biggest risk any new venture

faces is …

… trying to grow

the venture

before the model

is fully proven.

One way to think about it(from “Nail It then Scale It: The Entrepreneur's Guide to Creating and Managing

Breakthrough Innovation,” Nathan Furr and Paul Ahlstrom)

• Nail the pain: Begin with a real problem that has a big and monetizable pain points.• Pick a big problem to solve!• Pick something with a lot of

potential customers.

• Nail the solution. Neither breakthrough technology nor maximum features will assure that “if we build it, they will come.” • Start with a minimal focused

set of features that someone will pay for

• Test the solution early and quickly in the market, and iterate to get it right.

• Nail the go-to-market strategy:  There’s no substitute for a deep understanding of the target customer:• What’s their buying process?• What are they trying to

accomplish?• What are they really willing to

pay?.

• Nail the business model: All aspects of operating the business!• Distribution channels• Revenue streams• “Relationship” with the

customer• Cost of materials and

customer acquisition• Partnerships, suppliers, etc.• Key activities.

One way to think about it(from “Nail It then Scale It: The Entrepreneur's Guide to Creating and Managing

Breakthrough Innovation,” Nathan Furr and Paul Ahlstrom)

• Scale it. Don’t attempt to scale it until you have a proven repeatable business model that predictably generates revenue.

• Conserve cash

• Build the team

• Repeat the customer acquisition, product delivery & support processes until they are bullet-proof.

Building the team starts at the top

"Observe all men; thyself most.“

— Benjamin Franklin

“No man is the worse for knowing the worst of himself.“

— Thomas Fuller

20 Core Functions/Skills that need to be considered

1. Team Building

2. Ability/Willingness to Delegate

3. Articulating a Coherent Vision

4. Build and Maintain Momentum

5. Perceptions

6. Using the Tools

7. Managing the People

8. Building the Organization

9. Working the Numbers

10.Making the Deals

11.The Core Technology

12.Keeping it Safe

13.Technology Assessments

14.Managing the Techies

15.Priming the Pump

16.The Overall Market

17.Marketing Channels

18.Market Assessments

19.Sales

20.Managing the Brand

Management

TechnologyLeadership

Marketing

What happens in the garage stays in the garage unless

…… there’s a complementary “ecosystem” outside the garage

In a healthy ecosystem, every participating species benefits from the presence of every other participating

species.

Things to remember

New beats small and large every time!

No reason not to start something.

Nail it, then scale it.

Get out of the garage!

Questions?