100 Insider Rules for Beating the Startup Odds

startup secrets

Lessons for Entrepreneurs

Over the course of their careers, veteran venture capitalist Randy Komisar and finance executive Jantoon Reigersman continue to see startups crash and burn because they forget the timeless lessons of entrepreneurship. But, as Komisar and Reigersman show in their new book, Straight Talk for Startups: 100 Insider Rules for Beating the Odds, you can beat the odds if you quickly learn what insiders know about what it takes to build a healthy foundation for a thriving venture.

 

“Apprentices work furiously to learn the rules; journeymen proudly perfect the rules; but masters forget the rules.” -Randy Komisar

 

Randy Komisar recently shared his perspective:

 

How did this book come about? Have you been compiling these rules for years?

We wrote this book because we were distressed by the growing frequency of missteps by entrepreneurs, many of whom are notoriously splashed across business pages and websites. Jantoon Reigersman brought fresh eyes to the situation as the CFO of a Silicon Valley rocket ship gone awry. We had been having a dialogue for years about what was really going on in the Kabuki Theaters of startup boardrooms and venture capital firms. And we felt that entrepreneurs and investors, professors and students, and frankly anyone curious about the startup game could all benefit from our conversations regarding the time-proven best practices for building successful companies. I have been part of the scene since the mid-1980s, and Tom Perkins, founder of Kleiner Perkins, was one of the original Silicon Valley venture cowboys. I had been compiling and sharing these insights with entrepreneurs since I co-founded my first company. These are the insider rules that the random hero stories heralded by the press conveniently leave out. In Straight Talk for Startups we address the nuts and bolts of choosing investors, raising money, building boards, achieving liquidity, and mastering the fundamentals by distilling decades of frequently forgotten wisdom about how to beat the odds.

 

“Venture Capitalists have one of the greatest jobs in the world. They get to sit across the table from passionate strangers who hallucinate the future for them.” -Randy Komisar

 

Rule 1: Starting a venture has never been easier; succeeding has never been harder. You’ve had an extraordinary vantage point in your career, and I’d like your perspective on the why behind Rule 1. 

It’s all about capital. Privileged places like Silicon Valley are awash is excess capital. The recovery from the Great Recession has left interest rates at record lows. Investors have been looking for ways to juice their returns, and venture capital’s black swans are a siren song. Forget the low odds of winning; the size of the pot is mesmerizing. So investors have been ignoring risk and plowing money into long-shot bets.

This may seem great for entrepreneurs. And on its face it is. But there is a downside. Too much capital means that too many companies are being funded in any single market. With easy capital comes reckless spending on scaling—often times resulting in highly uneconomic growth, that is the acquisition of customers who pay less than the cost of providing the product or service and who have little loyalty to the business. This “all or nothing” mentality leads to wasted dollars, talent and effort. And when one competitor makes the leap to noneconomic growth, the rest are left with little choice but to follow.

The cornucopia of money and startups also affects the job market. Salaries are inflated. People are quick to move from perceived losers to winners. In the Bay Area, for instance, the price of housing, the suffering infrastructure and the breakdown of communities makes building businesses much harder, even if starting them is easier than ever.

 

Startup Rule: Starting a venture has never been easier; succeeding has never been harder.

How Women Entrepreneurs Can Think Bigger

female entrepreneur

Go All-In

 

Are you thinking big enough?

Do you have what it takes?

Are you ready to go ALL-IN?

 

Stephanie Breedlove is the Co-Founder of Care.com HomePay and author of All In: How Women Entrepreneurs Can Think Bigger, Build Sustainable Businesses, and Change the World.

I recently caught up with Stephanie to talk about the lessons she has learned from her experiences as an entrepreneur. These lessons and her advice apply to all entrepreneurs, but her new book includes specific advice for women.

 

Called to Entrepreneurship

How do you know if you’re called to be an entrepreneur?

In choosing entrepreneurship, you are required to take on risk, barriers, financial strain, and uncertainty in virtually every area of life – from the possibility of failure, to the unknown of the size of success if you make it, to what your career will look like as you navigate the journey. In a nutshell, it’s often bring-ya-to-your-knees work and is not sexy, contrary to what the media may lead you to believe. Yes, there is potential upside in entrepreneurship, but who would logically sign on for the guaranteed difficulties if not called?

So how do you know if you are called? One of the beauties of entrepreneurship is that there is no standard or template, so I think most of our callings are as unique as a fingerprint. However, I do believe we have a set of common ideals and a way of seeing the world that builds a foundation common to most entrepreneurs. Entrepreneurship is very hot and trendy today, but it is not a path that will be successful or enjoyable if it is not where your best talents live. I had a thriving corporate career prior to taking the leap into entrepreneurship, with the status and ego that accompany the corporate position. The leap into entrepreneurship was very humbling, yet I couldn’t have been more in my element and comfortable in my own skin – I knew it was where I belonged. Here’s my list to help you know if you are being called, or not.

 

How to Know if You Have the Call

You might be called to entrepreneurship if…

  1. You are going to a new endeavor, not running from your current situation.
  2. You have an idea that will create value.
  3. You have an idea that will grow and potentially create wealth.
  4. You believe your authentic way of working, building or delivering is ahead of its time and of greater value than what is currently available on the market.
  5. You feel being a Jack or Jill of All Trades is a valuable skill, and you enjoy tackling new responsibilities with which you have no experience.
  6. You think broadly and can sew all aspects of a business together to create overarching success.
  7. You have smart but blind optimism in the long-term potential of your idea – enough to thrive in the lean years.
  8. You are excited about working harder than you have ever worked, even if it means being without a paycheck (for a while).

You are not being called to entrepreneurship if…