4 weeks ago I met with this young entrepreneur in Surrey. He contacted me seeking some business advice and mentoring. Let’s call him ‘Dave’. “How do I increase sales, become more profitable and minimise the dependency on me, I'm also working 24/7, whilst also holding down a part time job working for one of the major supermarket chains?”
Dave’s enthusiastic, has a strong drive and a clear personal ambition to own his own company, not to mention, build a better future for his ageing parents.
What’s not to like…
It’s an eCommerce business, less than 3 months old, which by the way was already trading and making some very important early sales. Not enough yet to cover all the costs and pay a wage mind you. So spending time together with Dave provided me with the perfect opportunity to identify how much of Dave’s recent theory gathered from studying business and graduating college with distinction would help going forward.
We used the Business Model Canvas methodology to breakdown and gather a clear understanding of Dave’s business model and value proposition. We then looked at mapping the customer journey and supply chain end-to-end.
This threw up lots of interesting insights, and very few considered before we met. “Your saying Ron, that I can work with national and local partners to handle the fulfilment and last mile delivery 24/7 365 as well as secure up to 90 day payment terms from wholesalers to ease cashflow. I can also leverage existing local business partners to create awareness and generate high quality inbound leads to also reduce my cost of customer acquisition?”.
I continued to share that also amongst other things, the 30 items/skews currently being sold on the site, only 6 of them are responsible for generating 80% of the online sales, not to mention at the biggest gross margin. This means, Dave can use this insight to reduce waste, complexity and increase profitability at scale sounded like a no brainer.
Our first session together felt like a success. I left the meeting, but before I did, I checked in to ensure ‘Transfer of Ownership’ had taken place. This is where I got Dave to play back his understanding of what we discussed, what we had agreed as well as what he needed to accomplish before we spoke again. Now It's totally understandable between calls, one might need help re clarifying the actions or tasks or even a quick injection of positive reinforcement from time to time.
It's not so good however, when I started receiving emails and questions asking for help on lots of others matters, some as big as how to raise investment or do you know anyone who would invest quickly, with no reference to any of the original tasks agreed. This is a real red flag!
There is a common trait amongst young startup founders, and that’s to run for investment as if It's the answer to all their problems. For one, raising investment It's not that simple, and two, it also consumes very precious time away from selling.
So why was it a red flag… Well, when I reconvened to check in on how Dave had faired against the actions he signed up for. Dave’s lack of focus had significantly diluted his execution and quality of work produced.
Here on the one hand Dave left the first meeting clear about his next steps and actions, however, the execution and quality of Dave’s work was well below the standard I believe is required, but more importantly, below the standard he set for himself.
When we explored the situation, I gave Dave the chance to rate himself out of 10 against the tasks set. Dave scored himself a 7, which I felt was generous to say the least. Second red flag!
I stated to Dave…. “Here I am personally giving you my 10 out 10 for your business and all you can muster is a 7 for your own, why am I working harder than you for your business…? If this is the level and standard by which you work and even worse still expect will be enough to succeed in business, then I think you have some serious thinking to do”
Dave to his credit, took the stark feedback and radical candour with exceptional maturity and continued to apologise whilst also committing to do better, correction! what’s required to get the job done.
That’s a bit harsh Ron, some might cry… well for those that do, you are entitled to your opinion. However, in my experience, It's the ones who have or develop the highest sense of self awareness, an unwavering faith they will succeed, whilst also being prepared to face the brutal facts, deliver an execution unmatched by others even with greater resources.
Personally, I’ll even go so far as, I’m not looking to work with anyone who’s not as determined or prepared to work as hard as me on one of their objectives as I am. I explained to Dave, don’t come back to me ever again if this represents yours best! Find a way or It's GAME OVER!
This is not exclusive to Dave, but too many young startup founders I meet and work with, In fact It's indicative of a mindset that permeates humans as a whole. Fixed vs Growth.
Do you think Martin Luther King accepted the status quo, or the NASA space scientist that were told, It's impossible you can’t get to the moon… All things are created twice, first in our mind and then in our actions.
You think you can’t, you won’t, GAME OVER! If you think you will, you might just surprise yourself. Either way, stop blaming the bloody environment, events and circumstances and start taking responsibility for your own thinking. And just maybe you can tie yourself to your potential and not just your history or someone else's for that matter.