"We invest in people." "It's a people game." "The founder is the key to startup success."
You've heard all those pronouncements. How true are they? Can a startup win solely because of the abilities of the founder? If you are the next (name an icon) are you sure to succeed with your startup idea?
LESSONS FROM Adkeeper (renamed Keep)
A quick read from this stinging commentary today in Advertising Age about startup Adkeeper reveals how the founder -- a proven, charismatic serial entrepreneur -- delivered a painful startup failure. Here are some takeaways for you to ponder:
- Customer acceptance rules. Customers and end users must eagerly respond to the startup's offering. All else leads to the death of the business model. In the case of Adkeeper, it failed to win over media agencies and consumers.
- Cash is dreadfully neutral. It fuels either failure (most often) or success. It contributes no more or less.
- Skin in the game is no extra supercharger. Founders' money joins the other investors to whatever transpires with the startup.
- Investors do not walk on water. Only one person in recorded history has done that. Revered angels and venture capitalists are humans with finite limitations regardless of their icon status. They fail, often.
- Boldness is not sufficient. Being bold about a bad idea for customers leads to bold termination of a new enterprise.
- Changing an industry is rare. More likely a new industry (category) is formed by a handful of startups in a new market that out-maneuvers the existing industry, condemning the dinosaur to a slow death.
- Confidence can lead over the cliff. Following confidently a plan for an exciting startup that customers yawn about will deliver you over the cliff with confidence.
In the case of Adkeeper, learned wisdom of the founder did not translate to success. The company's pivot attempt is underway. I wish them success. You can learn from its errors.
BOTTOM LINE: Customers and end users have to "get it," "buy in," "go bonkers" about what your startup is offering. That goes for industrial as well as consumer new enterprises. You've got to have WOW! in what you are offering, that special something that gets humans to reach instantly for their credit cards. Serial entrepreneurs know that. Do so and move on to build an unfair competitive advantage that propels your startup to the winner's podium. You can do that, even if you are not a startup icon (yet).
I wish you The Best on your Adventure!