Startup Critical Success Points_WREVGEN

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Critical Success Points

David J. Donovan

CEO, WRevGenUpdated September 2010

www.wrevgen.com

08/01/2010 1Copyright © 2008-2010 All Rights ReservedStartup Critical Success Points • David J. Donovan

http://www.wrevgen.com/

http://www.wrevgen.com/



Preface

Working in a startup environment can be an adrenaline packed rewardingexperience, pushing the risk reward envelope to "infinity and beyond". Not withoutchallenges, navigating a startup through the obstacle course of cash burn, riskmitigation, hiring the right employees, staying focused and timely execution are theresponsibility of EVERY member of the team.

All too often in the startup environment there are misaligned expectations, pooraccountability, and inconsistent goals that needlessly add additional layers of risk.Large companies, small companies as well as startups suffer from thesemalignancies.

A toolkit based on first hand learning experiences in this environment is valuableinsight into your current or next engagement. To that end I have compiled a set oftake-a-ways based on what I have learned over the last 10 years working fortechnology startups. I use these critical success points as a filtering mechanism anda check and balance in my daily activities. I hope you find them as useful as I do.

208/01/2010 Copyright © 2008-2010 All Rights ReservedStartup Critical Success Points • David J. Donovan



Clarity of Purpose

• Need to be able to state the company’s

value prop & purpose in one sentence.




Focus, Focus, Focus

• Stay on the course to meet the statedobjectives

– Be wary of distractions such as

• Non target customers taking an interest in yourproduct and diverting resources off the course

• Feature creep- allowing additional productfunctionality or features into your design and

production path.

– Maintain a single clear value proposition




Cash

• Cash is King

– Spend money on execution not on fluff

• Pre revenue focus is to minimize burn rate• Expenses should be commensurate with

industry peers

• Manage to cash flow• Preservation of capital trumps everything




Execution

• Give ownership to department heads, setexpectations and make accountable

• OSTM Process

– Each project/subproject should identify abasic and communicable Objective, Strategy,Tactics and Metrics

– Applies across all functional departments




Communication

• No one group/person isdesigning/producing in a vacuum

– No assumptions, check your interfaces




Customer

• Your customers are internal and externalto the company

– Each group must understand the total solution

that the team is presenting to the marketplaceand their departments role in its success

– The components of a successful total solution

to the market place depend on internaldeliverables first




Personnel

• Hire the best skilled people you can

– Multidimensional skills and advanced degreesare generally greater asset than single point

expert with some exceptions

– Enthusiasm, commitment, ownership,accountability, communications skills are as

important as subject matter experience




Marketing

• Critical to understand customer point ofpain and address in timely and costeffective manner




Product

• The tech road map is full of pot holeswhere companies are buried when they:

– Designed a compelling product in a vacuum

and failed to see the total solution

– Designed a compelling total solution but failedto deliver the product

• Right message, right timing, right valueprops mean nothing if you can’t the get

product to customer on time




Manufacturing

• Critical component lead time can kill alaunch

– Need contingencies

• Adjacent mature market demand cancorner critical components needed forapplications

• Displays, GOBI, flash, duplexer

• Secure supplies




Authority

• If you give me the responsibility then giveme the authority




Startup Lessons Learned(by function)




BOD/VC

• Critical that BOD/VC have industry backgroundcommensurate with the technology funded

– Eg., semiconductor capitalization needs a cost

understanding of masks, engineering tools, multipletape outs, testing, yields, market risks

• Expectations need to be managed by CEO &CxO

• Shoot for tier 1 VC funding. Micro VCs haveshallow pockets for follow-on investments




CEO

• Ensure that CEO goals are aligned withbroader company goals and are not selfserving

– Leads to conflicting allocation of resourcesand inefficient execution




CTO

• Critical that CTO spends 80% of the timeoverseeing all aspects of the design, block toblock & in system to minimizes circuit design time – Must have vested interest and goal of seeing design

through to production/cash generation

– Design is NOT complete until STAC, Apps, BD,customers have vetted and qualified part for massproduction

• No next project until first one is complete – Owns checks & balances process to tape out such that

all risks are minimized towards a saleable product• Doesn’t mean their cant be impairments that are manageable

and not hindering sell-ability1708/01/2010 Copyright © 2008-2010 All Rights Reserved

Startup Critical Success Points • David J. Donovan



Design Engineering

• Critical that chip is designed in context of thesystem it will operate in, including behaviorinfluenced by the implementation in a totalsolution, ie with baseband, RFFE

– Designing for chip bench performance only isnot an option

– Design verification processes must be inplace and adhered to insure design goals are

met before tape out – Need constant reminder that venture is forprofit production company not perpetual R&Dfacility




Sales & Biz Dev

• Critical to have a voice/insight into thedesign process to act as a customeradvocate and insure the end product

substantially meets the MarketRequirements Document

– Selling in a vacuum and consistently resetting

expectations for customers erodes confidenceand credibility

• Sales need to have skin in the game1908/01/2010 Copyright © 2008-2010 All Rights Reserved

Startup Critical Success Points • David J. Donovan



All

• Critical that a stakeholders operate inmanner consistent with a sense ofurgency, problem ownership and

accountability. – VC funded days are finite

• Efficient management of time and task required

– Problems need advocates who can efficiently

and effective create resolution consistent withcompany goals

– Needs to be penalties for failure




Mutual Expectations

• Know the answer to these questions:

– What do I expect from employer?

– What does employer expect from me?


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