Far away the times where you had to quit your job and risk everything to get a startup of the ground. That approach is quite valid if you are a fresh graduate and don’t have anything to loose and maybe cannot find a job in the first place… How about the person that has built up a corporate career, has a good salary and savings, but is maybe too afraid to restart? This is often the case for people in their mid-thirties and becomes even more evident for people in their forties or fifties. You just don’t consider entrepreneurship as an option anymore!
Times have changed… I have been coaching and mentoring startups for the last 3-4 years and nowadays I can see more and more “older” people approaching me for advice on how to get started… many of them have great ideas, a high disposal income and a willingness to put time and money into their dream project. But most of them don’t want to quit their job… yet!
Good news! Today you don’t need to quit your job anymore (at least until you know the company will fly) and you can get quite far without having to completely dedicate yourself to that dream project of yours. So here are some tips for us wannabe entrepreneurs.
You can do it! But are you an entrepreneur at heart?
Now, before reading the rest of this article, take a pause here! The corporate world tends to put us in boxes, limits our beliefs and creates fear of failure. But this is not about failure, it is more about beliefs, passion and commitment. So the first question to ask yourself is: How much do you want this? And how much time are you willing to dedicate to your idea? The capability to execute is the trait of an entrepreneur we are looking for here.
DEFINE YOUR OBJECTIVES, A TIME PLAN AND FIGURE OUT HOW MUCH TIME YOU CAN REALISTICALLY COMMIT. THE NUMBER OF HOURS DOESN’T MATTER BUT IT IS CONSISTENCY AND PERSEVERANCE THAT ARE IMPORTANT!
Nowadays, lack of time can partially be compensated by money! And don’t forget since you have worked a number of years, you have experience that you can leverage on. But check you commitment before going further!
Validate, Validate, Validate…
Whether you are at idea stage or later, validate your idea as early as you can. Quickly define a concept, a paper prototype that you can use to validate your thoughts. Meet potential customers, do surveys, create mock-ups, whatever it takes to get you forward in the validation process. This usually won’t cost a dime or barely. Don’t be afraid to share your idea and concept. If you are afraid the idea could be stolen, then disseminate bits and pieces to different people, so that you can still collect feedback. In terms of ways of working Design thinking as well as lean & agile development approaches are good ways to work in an iterative fashion allowing you to improve your value proposition. Make sure that you stick to the plan you set earlier and quickly move into defining a Minimum Viable Product ( MVP) that you can build. The next question is then: How do you build something quickly?
Digital and as a services business models change everything! Figure out what help you want and need help with.
Digital has changed everything. Software production and distribution costs have gone down drastically. Also there are more on more software houses providing prototyping services at very reasonable costs. So you can now build a quick prototype for a few thousand dollars. Depending on what you are trying to achieve, the cost may vary, but a responsive web page design can be done for 10KUSD or less. Prototype mobile applications can be developed for 20-50KUSD per OS depending on the complexity of the application. So for around 100KUSD you can probably get a web site and matching mobile applications developed. The cost and time needed will depend on how well you have specified your MVP! This is when you might realise that you need a technical co-founder or maybe you see that you can still wait with getting that person on board. Waiting to get a co-founder on board can help you get more control, but do you have enough time, and can handle that extra risk by yourself?
The as a service business model, is also evolving from software only models to include also other services, like CTO-as-a-Service, digital marketing as a service and growth hacking as a service. In some cases the service provider might even be willing to take equity instead of hard cash. This is when you need to start to think about what you can do, what you need help with, what to outsource and what not!
Building a team (at the right time) is crucial!
A lot of first time entrepreneurs are struggling with this part, but you need to quickly realise that you cannot do everything yourself. Whether you need a technical co-founder, marketing or sales partner, you need to think when and how to look for these skills. On-boarding too many person too early, could create greater sense of ownership, but could also lead to power struggles if the co-founders are not completely aligned. If you can, get an initial MVP by outsourcing some development and maybe getting only one co-founder on board. If you do this while already sponsoring the prototype that would give you more control, but would also allow you to make the ideas clearer to co-founder and other potential partners.
BEWARE ALSO THAT IT DOESN’T MAKE SENSE TO LOOK FOR EXTERNAL INVESTMENTS BEFORE YOU HAVE A STRONG TEAM CAPABLE OF EXECUTING ON YOUR PLAN
Setup a company and run pilots
Another key question is often what type of company setup is best and what is the best time to setup the company? Mostly I would say that you need a company to be considered seriously by any prospective customers, but try to control your costs. A BVI (British Virign Island) setup is often a good way to start as it gives a formal company setup and allows you to define the initial shareholder agreement, it also gets around the grey area or starting a company in the country where you are currently employed. In UAE, for instance you would need an non-objection letter from your local visa sponsor/employer. You don’t need more than a BVI license at this stage. You have your company and can now start approaching potential customers for pilots. If you are selling something, as for instance through an e-commerce marketplace you might need a specific license, so check that out as well. In any case try to quickly pilot your application or website and use selected geographical area or customer segment for the initial trials. The most important here is to show that you can get market traction, test price points and get indications on customer acquisition costs. These are all elements potential investors will be looking for later on.
What support structures can you leverage on?
One question that you might ask yourself is what type of structures are best suited for this type of venture? What I notice is that many of these entrepreneurs will not approach incubators and accelerators as they find the services and support they provide too generic, considering that the founder already has a number of years of corporate background behind him. This in my opinion is particularly true for accelerators, which tend to have uniform approach to all startups while the more senior founder might need more specific support in certain areas. Still you need to be part of the startup community, become visible to potential investors and learn from other founders. Joining an incubator is hence still a good option to expand your network and share experiences with other founders. In the future I would expect more boutique incubators and accelerators coming up with a palette of services that can help you develop and grow your business at your pace.
Im summary, today, even at 40 or plus, there is no real excuse for not giving it a try. You can do it! And as said you don’t even need to quit your job…yet!