scaling Archives - Serious Startups

Every morning when an entrepreneur wakes up, he or she must embrace the fact that as their startup ramps up, each day will be fraught with bigger decisions than the day before. Part of the job description is the ability to quickly process tough decisions as they could swiftly make or break a fledgling business. Many in the tech sector thrive in this type of environment as risk taking is embedded in their DNA.

And while part of the appeal of being an entrepreneur is autonomy, there are times when the most important tool a founder can utilize is a mentor who has already navigated the road of ramping up a startup.

As an entrepreneur and executive recruiter in the tech startup ecosystem, the best piece of advice I’ve heard repeated time and time again is to “lead, follow, or get out of the way.” The onus of leadership is always on a company’s chief executive.

However, part of a savvy leadership strategy is to lead with the counsel of a trusted advisor to flatten the learning curve for ramping up. The shortest route to success is to find influencers who are willing to give you truthful advice. A capable mentor will guide you past “founderitis” (an oft-dreaded, though inevitable condition among nascent leaders) and help you scale to the next level.

Well-Known Founders Who Have Faltered

There have been many high profile cases where a founder’s ego has increased to the point where they are convinced they are infallible. Steve Jobs is an example. His conflict with then-Apple CEO John Sculley over the Apple 2 and advertising strategy led to his demotion and eventual departure from Apple. This highly public time-out allowed Jobs to reflect upon his hubris and prepared him well for his return as a humbled, but much more effective leader. He made an excellent mentor after this experience.

Next, consider Yahoo’s co-founder and former-CEO Jerry Yang. Yang over-exaggerated the value of Yahoo and snubbed Microsoft’s $44.6 billion offer. As a result, he was shown the door. The Marissa Mayer era of Yahoo is in full swing now.

These founders were rock stars in getting their respective companies to a certain point, but they were removed for a reason. They couldn’t meet their businesses needs at critical junctures of development.

If a leader allows their ego to reign supreme, they run the risk of having a false sense of ability and security. It’s the rare executive who can go from the clubhouse to the penthouse without a detailed playbook. Seeking out a mentor that has your back and will call you out for shortsighted or self-absorbed behavior is crucial for staying level headed and humble.

Learn from the Best

The hottest tech leaders have the best mentors:

• Mark Zuckerberg had Steve Jobs, Sean Parker and Don Graham, among others, for advice. Their collaborative guidance and counsel put Facebook on the map and transformed the social media landscape.

• Square’s CEO and co-founder Jack Dorsey tapped philanthropist Ray Chambers for mentorship.

• Salesforce.com CEO, Mark Benioff also looked to Steve Jobs as a mentor and has spoken fondly of their business and personal relationship.

The takeaway from these successful founders is that no man/woman is an island.

Outside influence and feedback are required for successful ramp up.

Finding a Mentor

The case has been made for the value of a mentor but it begs the question – How do you find the right people?

• Take an honest look at where your startup is now and where you want it to be.

• Seek out the key influencers and decision makers who scaled a similar path

• Directly approach each influencer and candidly ask for guidance

• Once a mentor is in place, actively engage them in key decisions only – don’t inundate them for minor details or they will disengage

• Keep the relationship strong – follow the advice and give updates or candidly explain why you are going a different direction

• Accept the tough criticism; if your skill set is no longer a fit for the enterprise, consider your next move

• Add to your mentors as the enterprise scales and enters each new phase of growth

• Give back. If you are approached to act as a mentor, graciously accept the challenge and guide the next generation of leadership

The tech ecosystem evolves at an incredible rate and can be very chaotic, therefore the best strategy for smoother navigation in uncharted waters is to tap into the seasoned traveler for clear, unbiased, and effective direction.

Charley Polachi, managing partner at Polachi Access Executive Search, can provide a expert insight ion the importance of mentors, particularly for entrepreneurs in the tech industry. As an executive recruiter, he knows the importance of a mentor and their role in shaping the best executives and leaders.

My startup experience began in college at what ended up becoming a very successful company. After graduating, I moved on to a corporate role at IBM. As I learned the ropes at an established company, I continued investing and advising startups on the side. Finally, two years ago, I founded my latest company, SimpleRelevance.

Through each career move, I’ve learned the value of practicing an intentional business strategy. Putting short and long-term goals against decisions and challenging my own choices has been the best way for each of my companies to pivot and evolve. Here are few of the lessons I’ve learned in my latest endeavor and over the years:

Fast Cash Doesn’t Sell

Telling a prospect that you’ll earn them $20 dollars for every $1 dollar they spend on your solution seldom works. It seems too good to be true. While your promise might still stand, it can’t be the sole selling point of your product or service. In the customer’s experience, there probably was someone who couldn’t deliver on such a bold statement before you.

To beat a potential customer’s skepticism, it’s important to offer proof of credibility. This can be done using case studies or testimonials from past and current clients, through trial period offers or product guarantees. For SimpleRelevance, we know there is a certain amount of noise in the marketing services space, but we’ve found continuous success for each client on each campaign, and have the proof to back it up.

Find the Right Target

Make sure the person you’re talking to has a stake in the conversation. In the past, I spent time and energy explaining the importance of using my solution to the wrong person because I was looking to get my foot in the door. It never worked out well. If the person isn’t directly impacted by your value proposition, they’re not likely to make the purchase or even hand you off to the right person.

Find the person responsible for showing results in the specific part of the business your product affects. For us, it’s often a CMO, director of marketing, or person in charge of email marketing. These are the folks who feel support and recognition for increased sales directly correlated with email personalization. They’re the people who are actively seeking new, better technology to make their lives easier. Find someone who would get the pat on the back for choosing you, and you have potential for a real conversation.

Find Your Differentiator

There are a lot of industries that seem crowded, including marketing services. Recognizing the amount of noise in your space is key to fighting it. For SimpleRelevance, there is often a misconception about who our competition actually is because of the plethora of buzzwords that describe the industry: email marketing, email service provider, email optimization, digital marketing, etc. There are thousands of companies who fit in each of these buckets, but very few who are direct competitors offering the same outcome.

Going through the TechStars process taught our team the importance of being thoughtful about how we position ourselves against our competition. It’s absolutely mandatory to be crisp, concise and to the point about what we do. This eliminates confusion from jargon and shows our prospects how we can truly help them. We’ve actually got ours down to about 10 words: SimpleRelevance plugs into existing tools to optimize an email at the individual level. Spend time refining your real message and differentiating factor so when a prospect compares you to your competitors, you’re able to explain exactly why you’re the better choice.

Scale Thoughtfully

Finally, when founding a startup, the inability to scale properly is an often overlooked internal issue. There is no shortcut leading a company from under 10 employees to 40-plus. Instead, each department must mature at the same rate, or at least close to it. Product, sales, marketing, operations and customer service all require equal attention to detail and support. When things get out of sync, the business loses equilibrium, which causes unnecessary internal hurdles.

Some startups take growth where they can get it and expect things to even out on their own. That works sometimes, but more often than not, these issues can cause even a five-year old company to implode. Remember, happy employees make a company successful, and instability threatens that.

There are many more lessons I’ve learned from founding SimpleRelevance, but all of these suggestions have one principle in common – be thoughtful. Successful businesses aren’t built in a year and they don’t materialize out of thin air. But with deliberate choices, the right message and the right team, yours will come together with time.

Erik Severinghaus is the founder & CEO of SimpleRelevance, a Chicago-based company focused on digital marketing personalization. Prior to that he received a patent while in IBM‘s IT Optimization organization, and helped co-found iContact – a leading Email Service Provider.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

How a Mentor Can Help You Scale, Not Just Start