I was talking to an old friend yesterday. He’s a CTO with a large payments company. At heart, he’s truly an entrepreneur. I forgot to say: He’s on his 3rd startup, 2 of them he founded, this one he got hired to ramp up.
We were talking and since we’re both naturally born ideas people we started talking shop.
I’ve previously written about my rules for a future startup; the principles I would want in place and follow if I did it again. I’m revising them slightly. Please find them below.
The fundamentals I’d want to have in place:
- BIG market: Minimum a billion dollar total market. Anything less I’d call a side project.
- Fulfill demand vs create demand. It is much easier to ride a wave than try to create a market.
- Timing. Ride a wave or time to jump on a market that is accelerating. This one is hard. There is a bit of a trade off between a big market and jumping on a soon to be an enormous wave. Being risk averse I’d likely opt for jumping in on an existing, proven, big market.
- Tied to making more money: It aligns to selling more or making more money. I much prefer something tied to revenue increase or profit acceleration over saving money. Why? I’ve found that I have a much easier time selling such solutions and that they resonate better with people.
- Personal experience with the pain I’m solving for.
- Validation that this is a problem worth solving before building ANY technology.
- 10 engaged and paying customers/users of the solution before thinking about scale and pouring too much money into technology. This implies doing things that do not scale. Doing it this way also forces me to engage heavily with customers and as such perfect the product market fit.
- Don’t overbuild, instead build MVP and focus on revenue growth over feature build.
- Do more of what matters. #1 thing: Engage and talk to potential customers. No Matter What!! Instead of worrying about the how I’d take more action and learn as I go. This is the 1 rule to rule them all.
Did I miss anything? What would be your rules if you were to do another startup?