First of all, I would just like to apologize to all my fans (er Mom and Dad) for being MIA the past month and a half. Between moving, my computer crashing, starting a new job, and preparing for a board meeting, let’s just say that things got a tad bit hectic! But now that the dust has settled I promise that I will do my best to follow-through on my original 3-4 post a month commitment.
So if it’s alright with you, let’s get started!
Last weekend, while catching up on the 300+ blog posts that I had missed since the move, I stumbled upon a provocative entry by one of my favorite bloggers, Eric Reis, that I just had to share.
Having been a part of 4 smallish companies/start-ups, I can tell you unequivocally that until I read “Cash is not king,” I had neither seen nor heard those four words together, in that order – ever. For, if there is one philosophy that professors, entrepreneurs, executives, and VCs alike have repeatedly bludgeoned me with over the last 4-5 years, it is that aside from customer and employee satisfaction the only thing that matters to an emerging venture is cash on-hand.
It has been the one truism that all businessmen and women have subscribed to for decades – from the revered former CEO of GE, Jack Welsh to queen of financial literacy, Dr. Karen Berman.
Not Reis though. He takes a slightly different approach, opining that while cash is indeed a key component to the long-term sustainability of a business, the number of iterations a company has left is much more indicative of how successful it will be.
What matters most is the number of iterations the company has left. While some cost-cutting measures reduce that number, others increase it. In lean times, it’s most important to focus on cutting costs in ways that speed you up, not slow you down. Otherwise, cutting costs just leads to going out of business a little slower.
The full formula works like this:
runway = cash on hand / burn rate
# iterations = runway / speed of each iteration
Very few successful companies ended up in the same exact business that the founders thought they’d be in..successful startups [manage] to have enough tries to get it right.
If that is indeed the case, and I would argue that is, then the obvious question becomes: how do we (irrespective of our personal and/or professional aspirations) ensure that we give ourselves as many chances to succeed as possible?
If you ask me, though there are, as my old English professor used to say, “many ways to skin a cat” (i.e. many ways to execute), there is only one philosophical approach that leads to results.
1) Internalize your strengths/passions: It took me years to understand this about myself, but I am just not good at faking it. I am without question, at my best when I pursue endeavors that are in line with my core competencies.
Consequently, if you are anything like me I highly suggest that you take a few moments at some point to reflect upon and jot down some of your professional, personal, and interpersonal strengths/passions; if you’re honest with yourself you should be able to list three to four for each, complete with concrete examples from your past.
2) Create a list of short-term objectives: Once you are acutely aware of your strengths, the next logical step is to come up with a prioritized list of short-term objectives that leverage as many as possible.
Even if you have yet to fully grasp your niche, the idea is that by immersing yourself in that which is consistent with who you are and what you’re good at, you will achieve self-realization and fulfillment sooner rather than later.
3) Create a list of long-term objectives: If possible, think about where you want to be 10-15 years from now (be it in terms of your company, your career, or your personal life) next.
Though your answer may be vague (e.g. I want to make a social impact through business by motivating young people to take interest in issues that they’re passionate about), trust me when I say: the more you use that ultimate vision – whatever it may be – as a guide post, the more productive your life and business choices will be.
4) Assess your needs: Having come up with a prioritized list of objectives, the next step is to understand, “what it will take to get there.” The more honest you are about how much capital you’ll need, what sorts of skills you’ll need to acquire, the kind of resources you’ll need to have, and what types of people you’ll need to know, the more effectively you will be able bridge the gap between your desires and your reality.
5) Create a milestone plan: Once you have a keen sense of your “needs,” it follows that you should devise a milestone plan designed to address each in order of their significance.
Case in point, if you’re goal is to achieve something on a grand scale, your best bet will likely be to form an army of mentors who have a vested interest in what you’re trying to accomplish first. Everything else is tertiary.
6) Execute: Enough said.
7) Document: Finally, regardless of what path you decide to take, make sure that you document every step along the way. Simply put, when you know what you’ve done (i.e. what has worked and what hasn’t) you will know exactly what you must do.
Like it or not, freedom derives from constraint. The sooner we accept that fact, the closer we’ll be to meeting our vast potential.
I am. Therefore I dream. 