On Yer Bike

One morning about 6 months ago, I remember an agonizing pain in my feet as I was getting out of bed. For the runners amongst you, I am sure you’ll agree – we don’t like to be reminded we’re getting old, and so I tried running through the pain. But the more I tried to grin and bear it, the worse it got.  Doc told me it was a common runner’s (and apparently ballet dancer’s complaint) called planter fasciitis, also known as runner’s heel. The cure was remarkably simple: get some rest, and don’t run for 6 months.  “On yer bike…” I was literally told.

I hear of many entrepreneurs who start something new….and then, text-book style, they wake up one morning with an enormous pain. They try to manage through it. Sometimes, the pain goes, but most often it doesn’t. When it doesn’t go, the only remedy is time itself.

Time stands still for no-one, least of all the entrepreneur who has given it all for the business. Passion gets most entrepreneurs out of bed in the morning, but if you start to feel a constant and recurring pain during your first waking moments, it’s really time to take stock. Better to save yourself the time by moving onto something new and afresh – than to persist on slogging though something that gives increasing pain and injury.

It’s The Experience, Stupid

I have heard on several occasions now that the old fashioned sweet shop (candy store) is making a comeback. I’m not surprised. Globalization may have brought many advantages, but it has also wreaked havoc on the customer experience.  Marketers are great at super-segmenting the product, but as soon as it is on the shelves, well, it’s just another standard product….bland, super-xxl, and with a “buy-one, get one free” tag.

I remember those old-fashioned candy stores well, and so my rather large O’Hara ears have become homing beacons these days….surely word of mouth would point me in the right direction. But no such luck on this occasion. Just silence.

And then, yesterday, as I was dropping my brother off at a major London airport for his return trip to Ireland, I had my Eureka moment. There they were, on the horizon, the familiar sight of those old-fashioned candy jars, stocked 4 shelves high, and 20 jars across, each jar jam-packed to the brim with color… For a second, I didn’t really care whether my brother missed his flight – I knew I was in for a perilous moment, as I succumbed to the temptation of the enchanting call.  I changed my course, and headed for the song of the sirens, not caring whether my sweet tooth would be my fate and have me crashing on the rocks of momentary decadence.

And when my crash came, it came hard! What was that profound instinct that made me break so suddenly and give way to the voice in my head, shouting: “On second thoughts”. It was an easy revelation, as excitement turned quickly to anger and sheer frustration. I was thoroughly and utterly dejected, and this was the reason why:

For me, the whole point of purchasing anything is the sheer sense of anticipation leading up to the purchase, the ease of the purchase itself, and the memory of the purchase experience that counts. In other words, it’s the EXPERIENCE.  It’s the packaging, it’s the customer service, it’s the way the goods are laid out, it’s the opportunity to taste something, maybe a freebie, and a call to action to come back.

On this occasion, this experience was entirely lacking.  As I entered the store and got up close and personal, there was no such experience. Bland, dusty shelves, impatient and impolite staff, jars that were full of, it so transpired, candy that already exists in any supermarket today and had just been pushed into a different plastic container, and packaging that was really nothing special at all. I felt cheated. Here was a brilliant example of how a perfect business idea can quickly turn into “average” very quickly.
Oh well, at least my dentist will be happy.

A Tap On The Head

Everyone remembers his or her first car. Mine was a Renault 18 and I was in love with it. Forget the fact that it had over 100,000 miles when I bought it as a student, and it kept breaking down in the most inopportune moments. For me, that car was freedom and dreams.

Every now and again, a friend or associate will look at me, and with a glint in their eye, they say something like, “Oh Trevor, I would love to do what you do. I’d love to set up my own business”.  That’s the moment they paint freedom and dreams on their faces.

I have heard this sentence so many times now that I have become accustomed to counting the seconds before I hear the qualifying sentence. And it normally comes fast…”The problem is…I’m still waiting for an idea”.

Oh dammit! Here comes my Proustian moment. This is the sentence that makes me remember the love-hate relationship I had with my Renault 18 and the countless moments my dear symbol of freedom and dreams would simply decide to  throw a sparky on the spur of the moment – usually on some highway in the middle of nowhere.

But necessity being the mother of all invention, a short tap with an iron bar and a hammer to the starter motor and we were on our merry way again. You do this a couple of times, and you soon become quite the artist at getting the pistons going again.

I’m not exactly saying that we all need a short tap on the head every now and again to get the creative pistons going, but nothing riles me more than a sorry excuse for not doing something.

Opportunity is everywhere! You are in the thick of it. If you can’t see it, it’s because you are not frustrated enough with the way a good or service is being delivered. Get angry at the world from time to time. Do more than complain. Do it yourself. After all, there is usually nobody who can do it better than you, right? Think this way, the pistons will start firing, and the opportunities will start to flow. D.O.

Crystal Balls

A colleague once made an observation that business plans are akin to lamp-posts. Drunks lean against them, dogs urinate against them, but properly utilised, they can serve as illumination. I laughed, and shrugged it off – besides, I was slightly under the influence, and after all, I was in the height of my strategic planning days.  20 years later, as a battle-hardened entrepreneur, the phrase still haunts me.

I remember the days at Nortel Networks in the late 80s very well. The walls were crashing down all over Eastern Europe, and everything was up for grabs.  I was based out of the satellite office in the top floor of the Hilton Hotel in downtown Vienna, Austria and was covering the new “Eastern Europe” as Head of Business Planning for the region. I remember poring over the long-term political and economic forecasts from the Economist Intelligence Unit, trying to figure out what the market will be like in 10 years in the fledging new democracies of Poland, Hungary and the then Czechoslovakia.  And I recall my youthful naivety – applying what I had just learned in business school about long-range planning and long-term forecasts. Everybody had crystal balls back then.

The problem with possessing the natural arrogance of an MBA grad and a background in strategic and business planning is that you start to think you have a head start. In reality, you don’t, and here’s how the cookie normally crumbles:

First, you do the consumer research. After all you want to impress the investors you’ve done your homework, right? So you make it nice and quantitative, talk about margin of error, 95% confidence level, market size and so on. Then, you take the percentage of people you have proven are interested in your product and say “ah, ok, so let’s be conservative – even if we only take the percentage of the population who are very interested, that will give us a penetration rate of 5%”.  Penetration leads to demand leads to customer numbers, to orders, to revenue and then cash flow. Oh, and by the way, it’s all a “conservative estimate”.

And then finally, you’ve convinced an investor to put money into the business plan.  But what happens then?  She’s going to hold you to the numbers. Guess what? Either you falter, because you’ve just realised you’ve duped yourself, and you’re no longer sure of your own numbers, or even worse, several quarters later, you under-perform and find your shareholding is diluted because your performance plan was tied into the guesswork you produced in the first place.  Tail wags dog – enter stage left, big kick in your veritable crystal balls.

Business is all about making things and selling things. Period! Business planning is all about fooling yourself with a huge amount of guesswork, or at best a lot of procrastination.  Here’s the test: put two savvy investors in a room. Provide one with a pile of beautifully presented documentation with statistics, research and financial forecasts, all backed up with an experienced team, and provide the other with a half-baked product that is already generating cash, but with substantially less documentation and management team members, you can guess on who is going to place their punt.

If you’re in an early stage start-up, forget the planning, and focus on getting your first order. Murphy’s Law: Things are never as good as you plan, and never as bad as they appear to be.