My co-founder and I both attended Wharton as undergrads, where we “concentrated” in entrepreneurship (in addition to finance, accounting, legal studies and philosophy). We wrote multiple business plans, negotiated the details of term sheets and collaborated on teams vying for theoretical capital within the confines of a semester.
While the skills learned no doubt gave us perspective and provided a structure for entrepreneurial thinking, after two-plus years of living a startup, it’s become apparent to me that studying entrepreneurship was just as abstract — if not more so! — than my studies in philosophy, especially with respect to starting and building a bootstrapped company.
The lessons outlined below may not be as sexy as term sheet negotiation and capital raising, but they are core to the success of a resource-constrained startup — and make a world of difference between success and failure:
1. Learn how to sell, quickly.
You need to be profitable from day one, and consequently, you need to think about what you’re building as a sustainably profitable venture with a real business model. You do have investors, but they’re your clients, and they’re not giving you money because of an impressive management team, large addressable market, previous accomplishments, or world-scale strategy.
They care only about your ability to address their specific needs in a better way than the current solution. Can you fix their problem? They don’t care about anyone else’s.
2. Learn how to build relationships.
You may be without financial or strategic advisors, but no one understands the problem that you’re trying to solve better than the customers you’re courting. Your first set of customers will effectively become your advisors and most valuable advocates, providing deeper insight into the issues you’re trying to solve and giving you a better grasp of customer needs.
Your first 10, 50 and 100 clients will define your brand and help you shape your business, so make sure you listen to them vs. trying to expand too rapidly. Better insight and understanding of your customers in the beginning is key to setting your business in the right direction.
3. Learn how to engage client referrals and leverage the media.
You may not have the budget for marketing programs, but even if you do, there’s nothing better than a referral from a satisfied customer. Word-of-mouth marketing from current customers creates a trusted network that results in a supportive, invested client ecosystem.
With regards to PR, take the opportunity to engage writers directly with your story. It means a lot to a writer when they receive a custom note from a founder instead of a templated message from a PR firm or marketing rep.
4. Understand the scope of what you’re embarking on — and the significance of determination and perseverance.
This is where our traditional entrepreneurship curriculum failed most fundamentally. Successful entrepreneurship rarely happens within the confines of a year, let alone a single semester, and our half-hearted attempts at starting businesses every semester (only to let them die at winter and summer breaks) reinforced a misleading expectation: that success can be validated quickly.
Building a successful company takes time and patience, two assets that you can’t raise from any venture capitalist. Yes, capital can help you hire and attract resources, but in the early stages of a startup, doing all the work yourself will provide you with perspective on the full scope of what you’re building.
Being in control of your own destiny also uniquely allows you to go at your own pace. While you obviously need to be aware of market pressures, without the pressure from outside investors, you can take the time to better lay the foundation of your business — a foundation that, one day, might support an empire.
Zach Yungst is the Co-founder of Cater2.me, a company founded in late 2010 focused on revamping the corporate catering industry. Zach grew up in Sarasota, Florida and graduated with degrees in Finance and Philosophy from Wharton / The University of Pennsylvania. Post graduation, Zach worked in investment banking at Morgan Stanley in New York and in private equity for TPG in San Francisco.
The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.