The Chinese philosopher Lao Zi once said: “A journey of a thousand miles starts with a single step.” But sometimes we get so caught up planning 50 steps that we skip over the very first one when we want to start some larger-than – life mission, like our own business venture.
That’s why author Guy Kawasaki gives enough tips to take the first move in the book “The Art of the Start”. Among other stuff, even if you do not get it, you can learn how to pitch for funding and survive. You’ll learn how businesses can effectively position themselves and build strong brands.
Many individuals dream of starting their own company, and their inspiration often stems from the desire to get rich quickly. But this is the wrong way to do it: making sense, not making money, should be about entrepreneurship. And when you create a service or good that somehow contributes to making the world a better place, you create value.
And not only does making meaning help the world, it’s also a critical element in your company’s success. It’s far more difficult to be an A-list entrepreneur if you don’t make meaning. Both you and your employees will be far more motivated if money isn’t your primary goal.
So how can you create this meaning? Formulate a short, powerful mantra that reflects it. A mantra is a simple, frequently repeated statement that reminds the employees why the company exists. For example, Nike’s mantra is “Authentic athletic performance” and Disney’s is “Fun family entertainment.”
You may think that a company’s mission statement already performs the same function, but a mantra is different in that it is shorter, more direct and more memorable.
Coca-Cola’s mission statement, for example, is “The Coca-Cola Corporation exists to help and refresh all it affects.” But we could come up with something like “Refresh the universe,” which is far more catchy and easier to hold in mind, if we devise a hypothetical mantra for the same business.
Many start-ups operate in a state of constant chaos: no one really knows where the company is going or how much progress it’s making. Don’t let this happen to your company. Instead, use the MAT framework: define Milestones, Assumptions and Tasks.
First, identify your milestones so that you can see how you’re progressing toward them. These milestones should be the most important events on your planned road to success, i.e., finalizing key deliverables or making a crucial decision.
For example, the first milestone of a start-up could be getting a “proof of concept” for its product or service, which demonstrates that it’s feasible. Then the next milestone might be completing a functioning prototype, and the one after that is raising funding to build the first batch of products. This means every key event is mapped out in advance.
But, of course, the fact that milestones will be met is not a given. With regard to what business-relevant assumptions you make, you need to be rational. You should then build a list of assumptions that might impact whether your goals are met or not, and then monitor them periodically to see whether they still hold. You need to answer if not.
For example, let’s say you’re opening a tailoring shop, and assume that the textiles will cost you $1,000 a month. Then your suppliers tell you that they’re raising their prices, and the textiles will actually cost you $2,000 a month. Clearly you need to either find new suppliers or raise your prices.
Finally, list the tasks that will help you achieve your milestones – tasks that are required to produce, sell, and support your product. These could be something peripheral but nevertheless crucial, like renting office space or paying your employee insurance policies. You need to ensure this is taken care of.
Positioning is one place where start-up companies sometimes falter, which means the way consumers view the business. But it is not important to complicate positioning. The most important thing is that it addresses one question clearly: “What are you doing?” Find a great response to that question and share it with the market, giving the consumer a reason to purchase your product.
So what do you need to do to achieve great positioning? The first stage of positioning is to make sure that your mission is understood and believed by customers. The core of your business should connect to their core needs, so that they see that your company exists precisely in order to fulfill those needs.
Your positioning should also be formulated so that it speaks specifically to your target group of customers. For example, let’s say your company sells security software for banks. Which one of the following two positioning statements would you rather go with: “Increasing the security of websites,” or “Reducing the risk of online-transaction fraud for commercial banks”?
Clearly the latter is much more successful when it comes to talking to the target client. A second element in good positioning is that the individual consumer should feel personally important to that. If you’ve developed an revolutionary new form of sunblock, for example, you shouldn’t say, “May reduce global cancer rates by up to three quarters,” but instead, “Prevents melanoma.”
The latter statement makes it immediately clear to the customer why she needs it.
Everyone knows that no entrepreneur can succeed if she’s the only person excited about her idea. This is why a key part of entrepreneurship is pitching: presenting your business idea so that others get excited about it too.
You have to keep a couple of things in mind to pitch properly. First, always start by clarifying what your organization does. It’s the first thing the viewer will want to hear, because once they’ve found it out, they won’t be able to concentrate on anything else. But keep the presentation brief and timely so as not to overwhelm the audience. For instance: “We sell technology,” or “We teach underprivileged children.”
Second, always clarify to the audience why what you’re saying is important. Remember, the audience lacks your background and expertise, so the significance of what you’re saying may be lost on them.
For example, if you’re an expert in audio technology, you might proudly proclaim: “Our hearing aids use digital signal processing,” but this won’t mean anything to an audience of investors.
To avoid this communication gap, when preparing your pitch always ask yourself “So what?” after everything you want to say. Then prepare to answer that “so what” using a few clarifying, vivid examples.
So again, if you want to say: “Our hearing aids use digital signal processing,” ask yourself “So what?” Your response could be: “Because our hearing aids make sounds clearer.”
Then use a real life example to really make the matter crystal clear: “So if you’re at a party with a lot of ambient noise, you’ll still be able to hear your conversation partner perfectly.”
This is a benefit anyone can understand.
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