I like to ask founders where they see their company in terms of Startup lifecycle terminology used in the Genome report: Discovery, Validation, Efficiency and Scale. With the result being that in the early stages a lot of companies don’t neatly fit into one of these boxes.
Sometimes they straddle two boxes, having leapt into the next without truly finishing the previous. Or if they are like a lot of founders, they are doing multiple things, some to pay the bills and some to move them forward. Not everyone has the luxury to stop and spend a year in Startup discovery and validation mode before moving forward to having billable customers. And as a result these different threads they are working are often at different phases of Startup readiness, and the company itself is at a different stage entirely.
So why is this a real problem for Startups? To use the word denoting the third phase – it can lead to inefficiencies. And possibly stop the Startup from getting to that phase. There are tangible risks to increased costs and lost opportunities in moving forward with unfinished “stuff” from previous phases. And the whole uncomfortable messaging you send out about your company from this frame of reference can be received poorly by both customers and potential investors alike.
One thing I recommend these founders to do is to think of the company as being a portfolio of projects, and the founder as being the strategic owner of this portfolio. Each specific product or service that the company is offering is a project in the portfolio that sits under the umbrella of the company. Then they can look at the maturity level of each project and the company itself. For example, a company that is offering a service to a customer base and at the same time is thinking of how they can translate that service into a SaaS product offering, may already have a good problem/market fit for the company itself, be in efficiency in terms of delivering the service and be just starting validation for the SaaS service.
One outcome of being able to define the company like this is that the founders can be in a position to make strategic decisions about the various things they do. Keeping with our example, they may recognize the service is helping pay the bills but have an end-of-life plan for how long they will offer it; scaling down services as they scale up the SaaS version. Or they may recognize that some things they are doing are not actually serving the company well, and now have the information needed to drop some things if they aren’t contributing to the full company vision.
Though founders are really busy people, it’s important to take some time out to reflect on how the company is doing and then to integrate in any learnings. I’ve always been an advocate of the philosophy that sometimes you have to go slow in order to go fast. My tennis game went to a whole different level when I learned to not rush at everything, but to plant and then take a strong deliberate shot. Though harder to do alone, the founder can be helped to do this by a good mentor or advisor. Sometimes we can benefit from the perspective of someone outside of the organization to lend objectivity to the exercise.
A great exercise for a founder to do is a portfolio review of the company from the perspective of the company maturity lifecycle. To identify where the company as a whole sits, and where the individual pieces fit. For each project, to identify any gaps in the maturity progress and set out the necessary plans to fill these gaps. Identify any synergies between projects, and develop consistent messaging across the whole.
Adopting the viewpoint of looking at your work as a portfolio is a great learning for anyone who wants to be a serial entrepreneur. Most serial entrepreneurs have some common thread that floats through the various companies they launch – bringing loads from the previous venture into the next one and possibly serving similar markets. For an established company, its good practice to adopt this portfolio approach when moving into new markets or launching new products. It’s make sense to revisit activities in the realm of discovery or validation for these new lines of business, or pleasantly confirm when they do already have at hand information they need.
So I’d like to end this post with posing the questions to you. At what maturity level is your Startup? Does your Startup fit neatly into one of the boxes?
photo credit: Microsoft Clipart