The self sufficient
entrepreneur and the power
Kohler Center for
Entrepreneurs start businesses
Change the world.
Solve a big, serious problem.
Create a new solution that’s faster, less
expensive and more intuitive.
The world looks to America for
The power of innovation to improve their
The secret to the uniquely American
Silicon valley founder nationalities
Is now a good time?
Where was Silicon Valley in 1896?
How many recessions between 1902 and
For how long?
How many industry companies were there
between 1896 and 1930?
Who will the winners be?
The ones who:
Focus on big opportunities
Test their concepts and move rapidly to Plan B
Create disruptive solutions to real problems
Employ risk-transferring business models
Have great teams
Have proprietary knowledge
Are great salespeople
Understand bootstrapping, risk and finance
What might your analogs be?
Top ten mistakes startups make
1. No direct customer feedback in the beginning.
1. No real pain
2. A commitment to the Field of Dreams
3. No wisdom from those who’ve gone before
4. A top down forecast
5. …combined with a hockey stick growth curve
6. …and no comparables
7. The “Swiss Army Knife” plan
8. A business model with aggressive timetables for adoption, no acquisition costs
and lots of assumptions
9. No competitive analysis
10. Undefined go to market plans
Said another way: Business concepts
are refined by collisions with reality
Almost what the customer wanted – but
Too much spent on building the first
product without customer feedback
This means slow, expensive testing where
the alternative to being right is bankruptcy
So secretive that while doing this they
never learn from anyone else
We “fit” a forecast.
“If I only get 1% of this market…”
“A growth rate of only 20% per year will result
“These are really conservative numbers…”
Amazingly all revenue and expenses scale
proportionately for the next five years as
A product for every market.
No acquisition costs.
Everyone needs to be a
But certainly 100% of all companies at the
Investor financing limits your choices,
reduces your timelines and often lowers
The #1 Question: Will the dog eat
the dog food?
1. Builds a solid business
2. Having lots of cash only delays starting
3. Few bootstrappers waste much money
or much time
4. You can’t lose what you do not have
5. It’s low risk
6. The founders keep all the ownership
Few businesses need – or should
want – equity investment capital
At very early stages it costs a lot of money.
Most don’t have the explosive growth
required to make the equation work
Bootstrapping early creates more
If growth develops, finance it later
Is This The Right Product or Service?
High margins are better
Underserved customers are better
Customers often know what they want
For your business:
What might your margins be? How will you
Are your customers underserved? Why?
How do you know?
1. Talk to prospective customers – lots of
them – track what they say
2. Where is the biggest underserved
opportunity? – why?
3. Can’t sell? You’re not an entrepreneur.
Nothing really starts until you have a
Become the Expert Yourself
1. Don’t let others interpret the customer for
2. Don’t rely on secondhand knowledge or
3. Do rely on original firsthand sources of
Think in Black and White
1. Keep business decisions simple.
2. The idea is to produce a product or
service for less than someone will pay
you for it.
3. Perfect is the enemy of good.
Plan for rough times ahead
1. Every business runs out of cash.
2. Squeeze yourself first.
3. Too much money makes you stupid.
Consider partnerships carefully
1. Partners can be frustrating
2. Most ships have one captain; define
3. Establish up front how a partner will
leave the business
4. Decide in advance how you will resolve
5. Fewer partners is better
6. Resolve issues quickly
Just Jump In!
1. Find a little niche
2. Use a name that means something to your
3. Provide exceptional customer service
4. Big bucks are made by simplifying a business
5. Get customers to pay up front when possible
6. Get everyone to think like the owner about
7. Maximize experimentation by embedding it in
Will the dog eat the dog food?