When will Founders Learn?
It’s the oldest story in the modern world - bright-eyed, tech savvy founders build an idea up and spend 20 hours a day on it. Day in, day out, they keep improving it and eventually end up making the best app/tool/SAAS you have ever seen.
The only qualm is, it’s built for no one.
The biggest mistake I made when I worked on my ventures was being so deep in my own idea I forgot what it means to run a business. A business is essentially “someone will pay you because to them, your product is more valuable than the price you’re asking for”. But while I was good at the first half of the sentence, I forgot what it meant to have the second. And by the time the adrenaline of starting my 6736472349th company wore off, I was greeted with the harsh reality of having no customers to buy anything I was making.
Why am I writing about this now?
If you’re a startup advisor, you probably tell your founders this about 3000 times a day. But it wasn’t until I was asked to join a company as a co-founder that I realized how big this problem is. As I did my due-diligence on the project I kept asking how they plan on selling the product and WHO they plan on selling it to, but the original founding team kept getting stuck in this … loop where they were relying on funding. Everything they wanted to figure out, was after they had raised. And although I saw this problem less in the West and East Asia, Pakistani founders are far too fixated on the details and milestones that in a genuine business sense, don’t really matter.
Strong statement. I know. But let’s go a bit back to 2020 when Pakistani founders started catching international investors’ eyes. Linkedin was flooding with celebrations. I2I, Fatima Gobi, Zayn, Indus Valley - everyone was talking about how they invested xyz million dollars into founders, and all anyone every cared about was how much money a company raised. Any kind of a funding round meant good PR which lead to some kind of traction, and eventually lot’s and lot’s of media coverage for the company.
But as the global economy slowed down, and Pakistani politics started politicising again (iykyk), investor confidence went down and VCs returned to investing in businesses which would guarantee a good return. But the founders did not. The founders kept focusing on how much money they raised, were raising, or wanted to raise. And then we ended up with several examples of companies that were 85% diluted before they even raised series C. Yum. I know.
So what is the solution?
Truly teach yourself to distinguish the media buzz from genuine success (aka profit). This one is a lesson I learnt about a year ago when I found out how much of media placement of a founder is actually done by their PR/marketing teams. So any awards, sponsorships, honors or public glam you’re looking for, put it on the back burner for a while and focus on ensuring your company is making money, and has the happiest customers ever.
Your customers are the most important stakeholders!!! Don’t build for your investors, or the idea of an investor. Don’t get me wrong, VCs are a critical part of helping your company scale, but funding isn’t the most important aspect of your business. And your business isn’t real if it doesn’t have customers. Whether you’re on the idea stage, or are scaling from a city to 50 cities, or are scaling globally - secure the customers first! How? Well. Great question! Next!
Go where your customers are! If you’re building for SMEs in Pakistan, but exhibiting at large retail conferences, or glamorous corporate events where you meet your buddies that have been in the same industry for 15 years, and take some nice photos before you have some snacks, you’re not going where your customers are. Starting something is HARD. And part of that difficulty is putting your ego, career, accomplishments aside, and starting from ground zero. In this case, find out who is running SMEs in Pakistan. Where are they hanging out? In big corporate events or co working spaces or in a facebook group or an instagram influencer’s follower list? Once you find out, then
Talk to your customers. Again, and again, and again, and again, and again, and again forever and ever and ever (until you want to exit and sell your company to some rich dude or girl ;))
If no one wants to buy your product, it’s okay! Build what they want. Or better, build what they need.
These are some of the lessons I learnt over the last 6 years after many failures and some successes in business and a corporate experience that I will always remember. To read more, browse around this site. I write here sometimes and I NEVER spam :)
(no picture for this one because it’s a serious matter and I am shooketh every time I see the same thing happening in a different font).