Young Successful Entrepreneur

Photo by Zara

Though I have been an entrepreneur for less than 2 years, I have seen my fair share of battle scars and wounds that I will carry with me for the rest of my life.  In a way, I wear these scars like a badge of honor, proudly demonstrating them to experienced entrepreneurs as a way to prove that I am worthy of standing next to them.

Yesterday I met two very ambitious undergraduates on their quest to change the professional world.  It made me very happy to speak with them because I saw in them the same kind of passion that runs through my veins; at the same time, I see in them the same kind of naivity that I had when I was their age.

I spent about 45 minutes on the phone with them, listening to their idea, asking questions, and ultimately telling them that I would NOT use their product if they launched with their current concept.  If you’re looking for advice from me, I’m going to give it to you straight because that’s exactly what every young entrepreneur needs to hear.

It then hit me - all the advice and theory in this world does not even come close to comparing to the actual knowledge you receive from first-hand battle scars.  Sure they’ll listen to my advice, but will they actually implement my experience into their business plan and hopefully have a better chance at success?

During my early days as a young entrepreneur, I read tons and tons of literature about how to become a successful entrepreneur. Though helpful, I quickly realized that I could not relate to the Guy Kawasaki’s and the Seth Godin’s of the world.  Sure they’re very successful, but at the same time, they are way out of my league and way out of my age range.  I have learned much more from sitting down with Neil Patel for an hour or chatting with Derek Halpern on Gchat than I have from reading countless articles from Entrepreneur.com.

It’s the personal touch.  It’s the fact that I can directly ask Neil or Ramit questions and get their honest feedback.  It’s the fact that they’re my age, so they know exactly what I’m going through.

Realizing this, I have decided to make a greater impact in the young entrepreneurial world:

I am starting Startup Saturdays, where Yu-kai and I will do a LIVE webcast from 11am - 12pm PST on Saturdays

The topics for Startup Saturday will vary each week, ranging from funding, how to build traffic, how to find teammates, and even how to write a business plan. Any young entrepreneur who wants to join us, ask us questions, and listen in to the topic of the week is encourage to join us.  If you would like to send me questions ahead of time, Yu-kai and I will make sure to answer them during the live video and perhaps center the topic of the week around your question. Send me your questions to questions [at] viralogy.com with the Subject Header as “Startup Saturdays Question.”

Furthermore, I am looking to sit on the Board of Advisors of a couple more early-stage startups.  I am currenlty on the board of one, and feel that I have the time and capability to advice two more early-stage internet startups.  I am looking to use Startup Saturdays as the vehicle to find the right company.

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I will definitely keep writing posts centered around my startup life so that you can all benefit and hopefully become successful young entrepreneurs.  Here are the three tips I gave to my two young friends about the perils of the young entrepreneurial life:

1. You cannot find funding as a 1st time entrepreneur

“Can’t” is such a strong word, but unfortunately in this case, it is proper that I use it.  As a 1st time entrepreneur, I pitched to several investors, each one telling me the same exact thing: “Great idea.  Build the site, gain some traction, generate revenue, and then come back to me so that we can talk about potential funding.” Even incubators like Y Combinator or Tech Stars are very difficult to get into when you have no proven trackrecord.

Yes, I definitely encourage you to apply to Y Combinator and Tech Stars, but DO NOT make this your primary form of funding.  DO NOT depend on this initial seed investment to get your company rolling in the right direction.  Do you know how Andrew Warner funded his company?  He returned all of his J Crew clothing and was able to get enough money to start his company that reached $38 million in revenue.  Did you know that Neil Patel raised over $1 million from friends and family, and lost it all!

We at Future Delivery have focused on funding our startup ourselves, without raising money from investors or friends and family, by doing consulting work.  Though we may not have that huge initial influx of cash like Andrew and Neil had, we are steadily driving towards each milestone every month and slowly accomplishing our goals.  In a year when all you need to focus on is surviving, playing the role of the tortoise may be the best business strategy that we have developed as a team.

2. Launching a site, getting users, and then finding a way to make money is not a legit business model

I have heard this at least 4 times in the past two weeks from young entrepreneurs looking to start an internet company.  We are influenced by amazing companies such as Twitter who have millions and millions of users without generating a single dime yet.  This is an extreme case and DO NOT base your startups business model after it.

Humans survive on blood; startups surive on cashflow.  If you’re not generating revenue with your startup company, then there will come a time when the strain and pressure of your startup are too much for you to handle and your company will die.  The point here is that you need to constantly be thinking about how your company will generate money.  It should be number 1 on your list of priorities. Go ahead and talk about company branding, how to attract more users, and how to leverage the hardcore users, but always remember, without money, none of these plans will ever be able to take effect.

Staying alive trumps everything else.

3. One of your founders needs to be a developer (if you’re an internet or tech company)

We had the right mindset when we first founded Future Delivery.  There were three of us: the CEO, the CMO, and the CTO.  But, there was one flaw - our CTO was part-time.  Never, ever have a part-time founder!

Once our CTO dropped out, we found ourselves an amazing group of developers who were employed by the company.  Looking back, we should have offered the best developer we had the CTO position.  Furthermore, had he taken the offer, we should have given him a bigger stake of equity in our company, allowing us to lower the monthly payments we were giving him and hopefully have him stay on board with our company for much longer.

If you’re building an internet company, one of the founders MUST be a developer.  There is just no way that you’re going to survive paying a salary to a developer or working with part-time developers.

The next question is: “How do I find a good CTO?”

Leverage the contacts you’ve made at your alma mater, use Twitter to try and find out of work developers, and make it widely known that you’re on the search for a CTO.  All you can do is work hard and hopefully you’ll get lucky.

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I look forward to chatting with you on Startup Saturdays!