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The Art Of Embracing Rejection in Building a Startup

Jordan Stephanou

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“Chaotic”, “uncertain”, and “rollercoaster” are three words that would effectively describe almost any entrepreneurial journey. If death and taxes are certainties in life, then failure and taxes are the only two guarantees in business.

If failure is (to some degree at least) inevitable, why should we fear it? In this piece I will try demystify failure, and look into why it should be embraced and not feared.

  1. It’s Part of the Job

We can start by separating failure into two different categories – micro and macro-failure. If a macro-failure can be considered as the overall failure and shutdown of the business, micro-failures can be seen as the day to day events that go wrong – that potential client that hangs up on your cold call; the sales pitch that gets the soft-no response of “we’ll call you”; the product launch that no one pitched up to. As Mark Manson puts it, business (as in life) is just a process of becoming less wrong over time.

So the first thing to address is that to fail in business is not to fail in life, Nobody wants to be “a failure” of a person, but failing in business is where lessons are learnt. Being a failure and failing are two entirely different things. If we learn from our failures, we are not, and will not become “a failure”. Some investors only invest in people who have failed before in previous startup attempts in hope that they won’t repeat the same mistakes.

Everything is a hypothesis that needs to be tested, and the process of business is applying the lessons from each hypothesis – each micro-failure – to be less wrong next time to move the business forward.

As Seth Godin says, “The cost of being wrong is less than the cost of doing nothing”. Embrace being wrong. Rejection and failure are part of the job.

  1. Opportunity to Refine

There is one undoubted truth about every failure – and that is, each failure gives an experience to dissect and learn from. The Roman Emperor Marcus Aurelius had a similar view; that to one person a situation is good, and to another, that same situation is bad – Only perception decides.

As an entrepreneur, it is important to adopt this stoic thinking of managing your perceptions. Look at situations rationally, and perceive rejections as opportunities to refine the product that the market really needs – not the product you are forcing on your market.

  1. With each Failure, Fear it Less

One of the great things about rejection or failure, is that the more often you are exposed to it, the less you fear it. In fact, micro-failures can become such a common part of an entrepreneur’s day, that you stop even noticing them as failures at all.

You may look back on a day with multiple rejections from prospective clients as a normal day on the path to building a business. The goal is to get to that point as quickly as possible.

  1. One Less Avenue

In the beginning, any failure will elicit a strong emotional response, however, when it becomes embraced as part of the journey, as crazy as this sounds, you may even get excited for the next rejection or micro-failure.

Why? Because each micro-failure takes away one possible path you could go down in your business. Entrepreneurs tend to be highly ambitious, highly idealistic people. This may result in wanting to do too many things, take the business in too many directions simultaneously, and run before walking.

The beauty of failure is it re-clarifies the path, stops the entrepreneurial mind from getting carried away, and brings everything back into perspective. What’s better than pursuing 1000 potential clients? Pursuing 999 higher potential clients.

Eliminate avenues that aren’t right for your business as quickly as possible so that you can spend time on providing best possible product or service for the ones that are right.

  1. Practical Tip to Embrace Rejection

So with all this theoretical talk out of the way, how do we get over that fear of failure to see the beauty of it? Start by watching Jia Jang’s TED talk of 100 Days of Rejection. The talk genuinely impacted my life. I have since implemented an annual (and much less impressive) 10 days of proactive rejection in my life. The goal is for 10 days, to do anything in any aspect of life that you would do if you weren’t ruled by fear. Ask yourself today, “what would I do if I wasn’t scared?”

The goal is to actively seek rejection to remove the power of fear from damaging your business’s potential.

Finally, I believe we should get our heads around the idea of celebrating our failures. Go for a drink as a team and give a toast to that failure even more than if it was a success. After all, if life is more about the journey than the destination, surely we should celebrate and cherish every event of the journey along the way?

Every event that happens will be critically important in forming the empire of a business that you are building. Take a step back, see the big picture, and smile whenever it doesn’t go as planned. See the beauty of failure.

 

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Founder of tastePal / Startup Shack / Job Creation Project with African Union & European Union / One Young World

Entrepreneurs

Githurai Maize Roaster Is Now Set to Buy A Posho Mill

Inversk Review

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“Never give up, sit down and grieve so long as you are breathing.” These are the most intriguing words for Mr. Nakpil Suleiman, commonly known as “Mei” by his customers. He dropped out of high school for lack of school fees.

He has however risen above this fact and began a maize-vending business to sustain himself. He deals with roasted maize, a business which commenced early this year in Mwihoko-Githurai area of Kiambu County.

Nakpil explained to Inversk about his “maize-dent” journey as he commonly calls it. He says it began after sleeping on an empty stomach for a couple of days and when he could no longer take it, he began thinking of a business that would put food on his table.

He wanted a business that required minimal capital. That was when he settled on maize roasting. His starting capital was less than Ksh 2,000 because all he needed was maize, charcoal and a stand. He did not need to stress himself over renting a place monthly. He therefore found a strategic place near an M-Pesa shop close to the bus terminus

Nakpil buys one stalk of maize for Ksh.12.50 which he sells at Ksh 25 making a 100% profit. It is even more profitable when he sells his the maize into portions with the cheapest going for Ksh 10. This translates to Ksh 30 per stalk of maize.

It is a business that Nakpil does in the evening from 4:00pm. This is favorable for the business since most people are leaving work and often times need to grab a bite, the roasted maize comes in handy!

Maize roasting is easily manageable for him, because it only requires good communication skills, to get to prospective customers. Favorable weather condition is a must, because it is in the open. It gives him more than just a meal at the end of the day

Hurdles are however not an exception for this type of business. The recent maize crisis in Kenya, greatly affected Nakpil’s business. High cost of production is another issue that trickled down on his business. When farm products like fertilizers are expensive, maize prices become unstable and greatly affects the pricing reducing Nakpil’s profit.

Climatic hazards like prolonged drought or unfavorable weather conditions lead to destruction of the crop leading to low yields and of course this means a season of little or no maize for the Nakpil.

Nakpil is not exempted from competition just like every other business. Besides him are three other maize vendors but he says what keeps him on track is the good communication skills he possesses and the clean environment he works under.

Even if he is only beginning, Nakpil says he has ambitions in life and will not allow his humble beginning become a hindrance for him. “I love farming and want to start my own maize-plantation where I can harvest my own maize instead of buying, which is cheaper because it cuts down on transportation expenses for getting maize from Githurai market.” He says amidst smiles.

Nakpil is currently saving up to own a posho-mill in future where he can grind maize for flour and this will give him increased profits. He is also very eager to go back to school and says he must get knowledge by all means and complete his high education and there-after enroll for a business course.

His closing remarks were directed to the young people and he had this to say, “As long as you have life, and you are in good health, do what you’ve got to do to make a living. Do it honestly and be hard-working. Give your best to what you do and watch yourself dine with kings. Pray and put God above all, this is key.”

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Cynthia Mumbo on #WhatItTakes: Giving Up Is Not Negotiable, That is failure

Kimani Patrick

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With the self-made narrative and multiple stories in the internet, it is normal for one to overestimate the work needed to build a startup or even scale a business. First-timers and novice entrepreneurs often find themselves in a dilemma when things fail to work out as they supposed.

Today on #WhatItTakes, I was able to catch up with Cynthia Mumbo on a few things in building a business. Cynthia is the founder and CEO of sports Connect Africa, a sports consultancy that focuses on connecting and empowering ports stakeholders and managers on the continent through sports consultancy and development programs.

Kim: When did you start out as an entrepreneur? And what drove you to considering entrepreneurship?

Cynthia: Started out in 2012 and was in and out. I decided to go full time in 2016. My drive comes from the idea that sports can change lives and not just socially but commercially too. I also value my independence and being able to chart my own path.

Kim: One aspect of entrepreneurship is sacrifice, what are some of the notable sacrifices you’ve made or you still do for the sake of your business.

Cynthia: The struggle is real. I have sacrificed meals, definitely my social life has been hit hard because I have to choose between hanging out and putting the money in the business. I have sacrificed comfort of having a monthly salary to uncertainty. I use nduthis often these days… I think the sacrifices are worth it.

Kim: What are some of your most difficult moments in business?

Cynthia: When payments don’t come as you planned. I think for me this has been the toughest lesson. Cash is King in business. Having trusted people with your business and they do not reciprocate is hard to handle. The other thing is having people around me who don’t see my vision. I cut those out, very fast…  My lessons have been to stay focused and try not to repeat the same mistakes.

Kim: Why can’t you give up?
Cynthia:
Giving up is not negotiable. That is failure, I don’t believe in starting something I can’t finish. I also believe that there is a solution to all problems. I focus on the outcome and if it that outcome will empower others, I have no reason to give up.

Kim: Greatest lessons so far?
Cynthia:
Stay focused, keep working, nothing good comes easy. And enjoy what you’re doing…

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Complete Guide On How to Build a Tech Startup on a Budget of Zero

Jordan Stephanou

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You may have a terrific idea for a tech startup (an app, website etc), but you don’t have funding and you definitely don’t have hundreds of thousands of spare cash lying around to invest in a project that may or may not bear fruit down the line. What do you do? Most people will let the dream die there and then.

If it’s an app and you’re not technical, many would seek out a technical co-founder that they barely know, pitch this flaky idea with the promise of equity down the line – if, and only if, they commit hundreds of hours to turning the idea into reality now, and if the product becomes a resounding success. That’s not the most appealing pitch for the software engineer, right? I mean, this person could be spending those hours building any product for themselves, or earning good money at a corporate. Also, if they’re good, they probably have 5 phone calls a week from people requesting similar miracles. They’re just not going to be interested.

In my experience, the answer is a simple one:

Get a client.

You may be thinking I’ve lost my head and ask “yes, but, how am I supposed to get a client if I don’t have my product on the market?” I’m glad you asked. I propose the following steps:

Step 1: Ask your Market’s Opinion

In a B2B, this should be at least 10 of your highest value clients. In a B2C, we’re talking hundreds of users. What do they think of the problem? What do they think of the solution you’re proposing? What holes do they see in it? What would they do differently if they were you? What fatal flaws do they see that will prevent your idea from succeeding? What would your product have to be for them to guarantee being your customer?

Important: Do. Not. Sell.

Explore… Learn… Test your hypothesis… Gather info. This is not the time to acquire your first client. Yet. But it is a critical first step.

Step 2: Develop a Prototype

Yeah that sounds terrifying for someone who’s not technical. How am I supposed to do that without any programming knowledge, you might ask. Fear not, the 21st century has gifted us with an amplitude of free online drag-and-drop tools that even your grandmother could use to build your prototype (see Just in Mind and Proto.io as two examples). Still terrified? Have you ever used Paint? What about Microsoft Word? What about a notebook? Your prototype, in its simplest form, is supposed to show off your idea in a way that people can visually understand.

It most definitely does not have to be anything resembling the working version, and it definitely does not have to show off all the features you want in your dream product. This prototype (or wireframes, in its simplest form), is a series of screens that can help get further buy-in and feedback on your idea. They should show a “user journey”, or what would happen if a user clicks this, or what new screen would open if a user clicks that. This is essential for talking to potential clients, and for talking to potential software engineers.

After all, no backend developer could even think of building anything for you if you don’t have a visual representation or process flow of what you want from them. This is the point where most non-technical founders give up. Because the idea of developing a process flow, user journey and wireframe (screens) and prototype for their idea sounds daunting, the dream reaches its premature death. Don’t be that person. It’s quicker and easier than it sounds, and it’s a fundamental step in the process.

Step 3: Take the Prototype Back to your Market

Remember those people you spoke to in step 1? They respect you. They love someone coming to them with innovative ideas asking for their advice for their egos. Because you weren’t looking to sell to them, you made them feel like a thought leader in the space, that you were relying on their wisdom, and they will be happy to be on this journey with you. They say “ask for funding, you’ll get advice. Ask for advice and you’ll get funding”. Well, I believe the same applies for winning clients. Ask advice to build the ideal product for your market, you’ll eventually capture that market because you’re solving the real problem they have.

I digress.

Now that you’ve taken their feedback, comments, criticism and pleasantries on board since Step 1, and you’ve shown that you’re serious about this idea by designing a prototype (no matter how amateur it looks), they respect you infinitely more than any of the hundreds of other people trying to sell them useless things. By taking it beyond an idea to prototype, you are already in the top 1%. Now with this prototype, you repeat Step 1. Once again, no selling. Based on what you’re showing them, have you truly understood their problem? Are they confused by your prototype? Do they understand that they are your target market? Do they understand the user journey? Do they agree?

Once again, pursue fatal flaws in your thinking. Pursue cold hard rejection. Pursue them telling you “it’s not going to work because…” . I need to emphasize this point. Some people call it a pre-mortem. Ie. Before you even have a business, you want to note down all the reasons why your business will fail. This so important, because if you can make it your mission to understand why it will fail, then you can make it your mission to see if it’s possible to remove those failure points. If you can, you may just have a massive business in the making. If not, you may have saved yourself years of psychological trauma.

Step 4: Make Adjustments and Do Pre-sales

Now that you’re armed with knowledge from your market based on something more concrete in the form of your first prototype, you’re ready to iterate on your first prototype. Take every comment that you’ve heard on board, along with your own personal convictions, and refine, improve and deal with all the possible failure points they mentioned. If after that you’re still confident this business is solving a real problem and worth pursuing; then proceed.

Now it’s the fun part. Now you’ll have a prototype version 2 (which can still be amateur-ish as long as it communicates your idea effectively) and you’ll be an expert on your problem and solution. Now you organize a third meeting with all those potentially high value clients and your close advisors. You show them that you’ve taken everything on board and you try get a commitment out of them. Hear me out, if you have truly listened to the needs of your ideal client, and your solution is genuinely going to solve the problem that they have, they will be ready to commit. They won’t be able to pay you anything at the moment because you still don’t have a tangible product, but they will be able to commit in writing. This is the beauty of a pre-sale.

At this moment, you will clearly communicate with them what your Minimum Viable Product will include (version 1), and what could come in iterations thereafter. Make sure that the MVP is the leanest, quickest, simplest, least features version solving only 1 problem that you can think of. This is important in the following 400 ways (well, I’ll only list a few here but you get the point): an MVP is easier to explain what your solution is to your client. An MVP is easier to explain to a software engineer. An MVP is cheaper to build. An MVP is quicker to build. An MVP gives you the opportunity of getting lessons from your market in real time. An MVP gives you the opportunity to excite your clients with a list of other features that will come at a later stage. I could go on and on. The point: Start with an MVP, and not the “Rolls Royce” version despite the temptation.

So now your potential client loves the idea of your MVP. They sign your pre-contract stating the following: If X (insert business/product name here) is built according to the following requirements (all of the requirements of your MVP, along with any service related elements you may include), then the purchase will be completed at a discounted pre-sale price of Y (insert pricing model here).

Of course, there should be an incentive for your client to want to commit to the possibility of the product now, and an attractive pre-sale discount is usually the best way to go. Bear in mind, this is under the assumption that this is a B2B tech startup. In the case of B2C where there is no sign up cost, I recommend getting proof of interest from as many users as possible. Something like a Google Form could work for this, but in a B2C market, you might need thousands of people to complete the form saying that they would use your app in order for it to be of value. Don’t let that put you off, using social media, and getting the right shares from people in your network who believe in your idea can easily lead to getting the volume of completed forms you need. The point of this is to get some of proof of pre-commitment and proof of more than a just mildly interested market. You need to have a compelling case that you have a captive market who are obsessed with your idea and can’t wait for it to be released.

Step 5: Pursue your Technical Co-founder / Development Agency

You’ve made it this far, and now this is the final and one of the most important parts of the jigsaw to take the product to market. If you approached someone to build the app / website when you just had an idea, you would have no leverage and definitely no reason to get anyone excited. However, now, you have options. To have options is to have power. You would much rather any negotiation with power rather than no power, right? Now that you’ve done your research, you’re absolutely confident in the vision of your business, and you have tangible proof from your market that when the product is ready, you will capture that market – you’re in a great position. If you have a B2B, you’re in an even better position, because you’ve got the pre-contract, and proof that once the product is built, you have direct cash-flow coming in.

Now it’s time for you to choose your development option based on your network and preferences. If you know someone who is the right fit, with incredible technical skills (ideally well versed in the full tech stack, a self-teacher, and up to date with the latest technologies) and infallible integrity, pursue that person as a co-founder and use your newly powerful sales pitch and proof to win them over. Offer them equity of a business that you already have some level of proof will get off the ground. Sell them on your vision; sell them on the possibility of being part of something great. If they don’t believe like you do, they’re the wrong person. Keep looking.

In an ideal world you would find the right person as your technical co-founder and you are in it together through it all. This is undeniably your first choice.

If you aren’t able to find a co-founder at this point, that’s no problem. Next best thing is to use an external contractor to do the development work of your MVP. That would probably be a software development company; the top ones in your area can be found through a quick Google search, and by browsing their websites to assess credibility. Find a contractor that is reasonably priced and who agrees with your payment terms – ie. payment on delivery of the MVP, which will then be funded by your first client that signed the pre-contract (you see how that pre-sale becomes a trump card?).

Remember, they’re only building the MVP, so it shouldn’t take more than 3 months. Be sure to find a team that is competent and has a body of work that you can trust, so that the MVP doesn’t have to be rebuilt afterwards. Speak to a few different companies to get the right feel. It’s not worth rushing.

Step 6: Implement at your First Client

This will take on the form of a pilot and proof of concept. Things will go wrong. There will be lessons. Parts of the app will need to be updated and improved based on user feedback. Great, that’s exactly what you want.

Usage. Learning. Improving. Re-releasing. The art of a tech startup. Lean methodology.

At this point when you have one real client with real users, you have a real business. Now you can build a team much easier than with an idea. At this point, if you want to hire an in-house developer (to replace an external software development team), or if you want to take some work of the hands of your technical co-founder, I have a suggestion. I introduce to you, Linkedin.

Search for Computer Sciences students at nearby universities. Scour pages and pages and reach out to people who may appreciate being part of something to supplement their university lessons in the real world. Your goal here is to then meet with as many of them as possible. Try get someone who has technical knowledge to join you for the interviews, so that they can assess the technical side while you assess the human side. Find the right person and sell them on the opportunity to build something that real clients will use. Appeal to the intrinsic motivation of lessons rather than the financial side. What student passionate about tech wouldn’t want to work for an exciting tech startup that has users and a bold vision? At this point you can probably pay them within your means too, based on the revenue from your first client.

Step 7: Duplicate

Now it’s the fun part. At this point it’s all about leveraging your previous success to get more success. You’ve got 1 client? Phenomenal. Do you know how much easier it is to go from 1 to 2, than it was from 0 to 1? Much easier. Then going from 2 to 10. Even easier. Once again, this all relies heavily on how well you implemented Step 1 and Step 3 (the feedback stages) to ensure that your business is solving a real problem. If it is, the sales process will be relatively smooth and painless. Disclaimer: It will always take much longer than expected, so if you’re expecting to get your 10th client by the end of year 1, remember that it’s absolutely okay if you don’t. Build strong foundations. Take your time with development. Listen really really well to your users and clients. Don’t build a house on a broken foundation.

Step 8: Further Leverage your Successes

Form partnerships. It’s crazy how even just one client can open up new partnership opportunities. 100 users, 1000 users and you’ll have many options that could increase your credibility, and give you excellent PR exposure and help you scale faster. Choose your partnerships wisely in correspondence with the brand you’re trying to build, and where the benefit is mutual.

The right partnerships at the right time can be the key to success. Similar to what you did with clients in Step 1 and Step 3, there’s nothing wrong with building relationships with potential partners first to find out what sort of business they would partner with, and if they would see value in partnering with you. But first make sure you have clearly thought through your value proposition and why you’re even talking to them in the first place. Do they need you? Would partnering with your business help them in a significant and obvious way? Remember that partnerships generally lead to brands being interlinked, so a major company has a lot more to lose in this sense than a startup – therefore the partnership sell from the startup has to be compelling.

Step 9: When to Get Funding

You don’t. Well, that’s not entirely true. If you need funding to get your first client then you’ve got problems. If you need funding to go from one client to two clients, you’ve got problems. Not only is it not ideal from an operational perspective, but investors are just very unlikely to invest if there’s not a compelling proof of concept first.

Pursuing funding at the wrong time can distract you from what is most important – building a better product and serving your clients better. If you’re consumed by the idea of receiving investment, take a deep breath, and remember: A good business is run off paying clients that create a sustainable revenue stream, not through external investments that paper over the cracks. No clients equals no business.

However (and this is very important), if you need funding to go from 10 clients to 1000 clients, then get funding. Pursuing investment makes sense when scaling at a rate that you can’t do within your means, or if there is an incredible opportunity to capture a massive market based on the foundation you’ve built. Funding cannot replace a good foundation.

There you have it. You have a product. You have customers. You have a team. You have the ability to build and scale. You had zero budget but through the right steps, you can build lean and grow a successful business. Entrepreneurship is fun, right?

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