Stay focused on the goal, Stupid!

All startups have a reason to exist – and no, it is not just about how cool the idea is, how solid a team is behind the venture, how passionate the founding team is etc. All these are good attributes but really, it is all about what value the startup claims to provide, and specifically to which target customer. And while it might seem obvious that fulfilling this value needs to be the core focus of the startup in the early days, reality seems to be rather different. I recently met the founder of a new startup who was taking a fair bit of pride in explaining that his startup had seven different things they offered to customers – yes, seven. And it was very hard to try and correlate what was common to the seven offerings, or how they all related to the core value he was claiming. Now if he pulls this off and succeeds in doing any of the seven well, then thats obviously very commendable, but I am reasonably certain thats not going to happen.

In any case, the topic of core value is what this post is about – and what follows is completely based on our experience and what we learned from it. So any resemblance to anything else is completely coincidental and obviously unintended. Our startup began out of a core idea. The core idea, in our case, either addressed an existing problem, or made something better, or enabled some new possibility, depending on which customer’s perspective you were viewing it from. [Note that there are at least two problems here. The core idea better address only one of these aspects, not all three of them. Its hard enough doing justice to one, let alone three objectives. Secondly, you should really only have one target customer segment, and the solution you are building should be consistenly the same from that customer segment's perspective - having a matrix of possible customer segments, customer perspectives etc is a short-cut to nowhere. So attribute those mistakes to our inexperience and read on...]

In any case, keeping that solution and the target customer in context, an initial plan of the How gets defined, with some initial goals and milestones for your team to target during the early stage. With that plan, you simply start executing. Great! Now, somewhere along the way, things aren’t taking off as well as you had anticipated, revenues aren’t coming in as strongly etc and you start to get a little anxious. Its time for some readjustments, you tell yourself. Probably the right thing to do…but at the same time, you have to ask yourself a very fundamental question – do these adjustments support our core value prop? does this truly help what we set out to do? And if the answer is a No, then its probably not the right adjustment. Of course, you will have situations where the adjustments are indeed right and they warrant a refinement (or even a major change) of the core value prop, but to me, that requires going back to the drawing board, questioning your fundamental assumptions and making any necessary changes to the core idea before you go too far with the adjustments themselves. What is absolutely not a good idea is to continue to believe that your core vision has not changed and your adjustment doesn’t really support that vision, but yet, with some short-term interests in mind, you push yourself into going forward with the wrong adjustments. It might even be possible to justify these “initiatives” as minor or that they won’t distract your team’s true focus, but wake up and stop pretending. You know that’s not true. If you have customers at the receiving end, then no initiative is minor. Even if its minor today, it will become major at some point, at least in their eyes. Thats why they are paying you!

If you’d like a simple example to illustrate my point, I’ll use one from our own history – our core mission is to make it easier for small businesses to go online and enable customers to easily find these businesses. At some point, we convinced ourselves to mange small events for a couple of our customers because there were requests for us to do it. It really had nothing to do with our core goal but it was an opportunity to earn some revenue, get some reach to a bigger customer base, didn’t require a great deal of investment etc. While we ideally should have politely turned those opportunities down and focused on our true objectives, we concluded that accepting these commitments would help the bottomline and went ahead and did them for a while. Bad idea! What wasn’t so obvious at the beginning was that these things have a cost – if you only have a small core team (and you better only have a small team if you are a startup), then every minor distraction is taking valuable cycles away from meeting an already challenging objective you’ve set out for yourself. And your team will slowly start getting confused about what our real day-to-day objectives are – the goals we set for ourselves, or these adjustments that cropped up along the way. How do you keep them focused on the right goals? In the long run, would that additional revenue truly seem worth that cost? With the benefit of hindsight, I strongly feel that it does not.

As a side note, there are the examples of consulting gigs that fund startup products but thats a very, very different scenario – you are not under time or revenue pressure for the startup, your core revenue is coming from the consulting assignment and therefore the startup or its mission is probably not your primary focus etc., so lets not get apples and oranges mixed up.

So, in closing, should you just keep going after the core idea that was originally defined without making adjustments? No, absolutely not. As I stated in my earlier post on The Business Plan, I think its good to constantly review your milestones, progress towards your stated goals, validation of the assumptions, targets etc you had defined and thereby ensuring that your core idea is either still intact, or that you are able to refine it as appropriate. You obviously don’t want to do this as a daily exercise, that will absoutely not help – but a periodic review, preferably with your Advisory team, based on your idea, your goals, your time horizons, your team situation etc is a well-advised move. Note that all ideas need time to germinate and take some time to come of age, so try not to be too impatient about expecting results from the ideas that you start implementing. More on that topic in another post, its time to sign off on this one.