Most of us enjoy spending our time one way or the other: photography, cooking, painting, archery, solving puzzle games, etc. Only some of us have what it takes to turn their hobbies into successful startups.
Let me give you a few examples and then I will ask you if you think you’ve got what it takes to turn your hobby into a flowering business. Is it guts, money, ambition or determination? We’ll see in a moment.
Terry Finley is one man that saw that his passion for horse racing could bring him money, satisfaction and the possibility of quitting his dull job of selling life insurance. As Jane Porter writes for the Entrepreneur.com, Terry Finley turned his passion into a thriving business.( Read more…).
His first horse, Sunbelt, won a few races and attracted an investor who paid $5000 for partial ownership. Within two months, Terry had 2 horses and he continued to invest in his business. So, he quit his job and founded West Point Thoroughbreds, a race horse syndication management company. In 2011 they had a revenue of $6.5 million, which has grown from $2 mill. in 2005. Now, the purses they’ve won up to the present rise up to almost $22 mill.
Another hobby mentioned by Jane Porter is sewing. Megan Duckett worked with an event-planning company, as she wanted to work in the entertainment industry. In her free time she was sewing, making bedding, drapes and costumes. In 1996 she was earning more money from her sewing than from her full-time job. So, she quit and started working at a successful startup, with only 3 hired seamstresses. In the first year she generated $80.000 in revenue. She is the founder of 2 thriving business: Sew What? and Rent What?. Now she has over 32 employees and Sew What? had a revenue of $5.2 million last year, while Rent What? another $1.5 million.
Though there can be no book of rules you should follow in order to achieve success, there are some questions you should answer if you want to know if you have what it takes. Asheesh Advani offers you “5 questions to answer before you make the leap from hobbyist to full-time entrepreneur” in her post for Entrepreneur. I believe her explanations and questions provide useful insight into what being an entrepreneur means. She shows that in order to be a business person you must be “committed to excel” and “not waver when the going gets tough”.
Another suggestion is that being a successful entrepreneur needs “confident optimism”. If you think about it, how could you push your employees further if you didn’t believe in any of your business plans and your every failure would seem the end of the world, not that which it is: a mere failure.
Asheesh Advani also highlights the importance in building a successful startup from hobbies of being a decision-making person and having enough money to encourage your business to thrive. You also need to know how to sell your product, so if persuasion and charisma are what defines you, you’re heading in the right direction.
What’s your hobby and could it bring you money? Do you think you have what it takes to transform it into a successful startup? Write me in the comments below.
You can learn a lot in a very short amount of time.
During Startup Weekend you are surrounded by people who have their best being brought out of them.
Apart from being stimulated by the energy of other participants, mentors continuously push your boundaries through their questions, insights and experiences.
I’ve participated in two Startup Weekends. The second time, me and my team won.
The way I approached the second Startup Weekend was really different to how I approached the first one. In my second one, I had a much better idea of how the system worked.
The fact that I was part of the winning team had a lot to do with these 7 surprising lessons:
The way Startup Weekend works, people first pitch their ideas, then teams are formed around the more popular ideas. Important: Don’t focus on joining the team with the best idea but join the team made up of the best participants.
A great team can get a crappy idea, turn it around, develop it and end up with Gold.
A mediocre team with a great idea will probably not develop their idea enough and end up with nothing.
On the first day, there is a lot of time to get to know other participants. Make friends. At the start, many people like talking about their idea or their skill sets or just about being at Startup Weekend.
When making friends, people will ask you what you do. Make sure you communicate a skill that’ll be helpful during the weekend.
In my second Startup Weekend, half of the teams asked me to join their team whilst a few individuals were asking around to join teams. I joined what ended up being the winning team. I’m not saying this to boast, but to outline how important networking can be.
From the get-go, you want to have a winning mentality. Working in the startup space is a competitive business. Personally, I don’t love working with people who are in it just for the ride. I look out for people who are driven, motivated and ready to really push themselves.
Finishing second means you’re first from the losers. Bring out the best of yourself.
Ultimately, Startup Weekend is not about winning, but it’s a much more interesting experience when participants push themselves to win and succeed.
“Winning is not everything, but wanting to win is” – Vince Lombardi
There’s a misconception that Startup Weekend is about building an innovative prototype product to impress people. It’s not!
Startup Weekend is about getting an idea, validating it, building a business case for it, and selling it to a panel of judges.
You don’t have to build anything.
That’s why it’s important to have business-focused people in your team. If your team is just made up of developers, that’s a red-flag.
Ultimately, everything depends on your presentation.
A business case, that is poorly presented will leave people uninspired, unexcited, and with little faith in you and your team.
A stand out business case, that is impressively presented will capture the judges’ attention and they might just give you the benefit of the doubt you need to win.
The first time I participated in Startup Weekend, I joined a team of Italians whose energy was infectious. Everybody loved them.
During my second startup weekend, one of the teams stood out because of their amazing enthusiasm and energy.
Both teams lost. Enthusiasm and passion are great. But alone, they’re not enough to win. Look out for teams with the right skill sets, a promising idea and the right attitude.
Although learning, winning, and working hard are all great, make sure you have fun throughout the weekend. For energy, having a laugh is better than having a red bull. Besides, Startup Weekend is a great opportunity to make friends beyond the weekend itself.
The lessons I mentioned above apply beyond Startup Weekend. They apply to the startup world in general.
Startup Weekend is a great learning experience and an introduction to startups. After my first Startup Weekend, I co-founded a startup project, an online accounting software called Clever Accounting.
After your first Startup Weekend, you’re going to be full of energy to start your own special startup.
If you’ve read this far, I really encourage you to take part in an upcoming Startup Weekend. Click here for a list of upcoming Startup Weekends. Push your boundaries and try this unforgettable experience.
Check out the Startup Weekend Trailer
It had it all. Exciting startups, inspiring speakers, a unique venue, and a charismatic Marco Montemagno at his best. TechCrunch Italy 2013 was a success.
The event was attended by entrepreneurs, investors and media mostly from Italy, though there were participants from over ten countries including the USA, UK, Germany and Spain. Among the speakers featured Matthew Prince, CEO of CloudFlare, Renaud Visage, co-founder of Eventbrite, and Micheal Widenius, founder of MySQL. So, pretty big stuff.
The conference took place over two jam-packed days and I couldn’t stop taking notes throughout. These are 10 startup lessons learned from TechCrunch Italy 2013!
1. “Persistance breaks resistance”. I loved this quote by Zaryn Dentzel of Tuenti. The importance of combining utter hard work with strong self-belief in your startup cannot be overstated in the world of ambitious startups. Efe Cakarel, founder of MUBI, similarly reminded us of Winston Churchill’s famous quote, “If you’re going through hell, keep going”.
2. Massimo Ciociola, founder of MusixMatch, emphasised the importance of design. In itself design is a form of social proof and particularly at the early stages of a startup it is a great way to build trust in your brand new brand (pun intended). Also contemplating on design was John Underkoffler from Oblong, who pointed out that “design is what takes us from the past into the future”. Wise words from the man who worked on the futuristic interfaces in Minority Report.
3. “Too much money in the beginning is toxic. You create a burning plate”, so said Yossi Vardi, established entrepreneur and investor. The same sentiment was shared by Mike Butcher, Editor at large at TechCrunch, who pointed out that startups should raise money once they achieve traction. In his own words, “raise money as late as you can”. The reasoning behind this is that you might spend too much money early on, putting you in serious debt once you actually get going.
4. Have a vision and believe in that. Matthew Prince’s (Cloudflare) vision was “to build a better web”. Matthew had to repeat that vision in front of the mirror for several months before he could say it convincingly. It was ambitious, yet today over 350,000 websites use Cloudflare.
5. Following trends is great. Anticipating them is even better. Perhaps the best way to do this is to focus on what will not change. Also, keep in mind that trends are exponential. So if your startup is banking its success on a number of trends, make sure you consider their exponential development.
6. Be bold. So said Mauro del Rio co-founder of Buongiorno. Today, the entrepreneurs are the rockstars, not the media or the investors. If you are changing the world, don’t ask for very little funding. Half a million will only get you so far. Think big and don’t shy away from what you need to achieve your goals.
7. Focus. Again, this is another of those points that cannot be repeated too many times. Its importance was mentioned by a host of speakers, but perhaps most noticeably by the VC panel when commenting on the most important characteristics they look for in entrepreneurs.
8. When it comes to A/B Testing, conventional wisdom is often wrong. Amelia Showalter, former director of digital analytics for the Obama re-election campaign, emphasized the importance of being humble. Coming from an expert who helped raise over $500 million online for Obama’s campaign, that is quite something. Amelia outlined that when testing, it was very hard to correctly guess which version would perform best and this is why it was important to be humble and admit when you’re wrong. Most of the time, despite being an expert, she would not be able to guess what would perform best and that is why they tested everything.
9. Business Plans are bullshit. Four investors said this. One of them even said he hasn’t looked at a business plan in years. Apparently what is important is the 20 slide presentation you give them and the qualities of the founder/s.
10. Martin Varsavsky from Fon, pointed out that Apple, Google, and Facebook all have a particular and different character. Yet they are all very successful. It follows then, that there’s more than one good way to build and run, a great company.
I could keep on going as so much was shared. However, to really get the best out of a TechCrunch conference is to attend it. If you have an opportunity to attend the upcoming TechCrunch Disrupt in Berlin or any of their future events, I would highly recommend it.
In the meantime, what are your thoughts on the above? Which point struck you the most and why?
Setting up a business is not for sissies. According to research by the University of Tennessee, 44% of new businesses do not make it past the 3rd year, with 55% not making it past the 5th year.
The rate of failure for technology startups is actually much higher with more than 90% of tech startups ultimately failing.
The bottom-line is that most entrepreneurs trying to build a successful company will not succeed.
What does this have to do with Accounting?
According to the University of Tennessee research, it turns out that many of the reasons why companies fail are related to the mismanagement of the financial side of the company. Some of the most common causes for failure include the nonpayment of taxes, no knowledge of financing, over-spending, and poor credit granting practices.
From my experience with meeting with several new businesses over the years, it is often the case that the founders of businesses are either technical people/specialists, business developers, or a combination of the two. These do not necessarily have knowledge about managing money in a company and as a consequence, things like accounting many times end up not being attributed their due attention.
From the qualitative research we’ve done here at Clever Solutions Ltd., both with accountants and small business owners, we have found that accounting is often perceived as a necessary chore and expense. These are both negative ways to perceive a business function that is crucial to achieve commercial success.
Where does Accounting Software come in?
Making the step to using accounting software to organize the accounting function of your business is a great start to improving how you use your company’s money. Many startups still do their accounting in Excel. Although Excel is a great application, it is not made for accounting. Once the business begins growing and more data needs to be entered, Excel becomes quite cumbersome. Accounting software don’t have this problem, and with the easy to use and low-cost options available, there is little reason not to explore existing solutions.
Working with an accountant who can ensure your books are in order, your taxes paid, and who can provide you with advisory services is also very much recommended. If you don’t have the know-how, don’t try to go it alone. Accounting is not data entry (as some perceive it to be) and requires an experienced professional to get right.
Even though your accountant will be seeing to your accounting needs, you still need to be conversant with how to use your accounting software and with accessing your accounting data.
The trend with accounting software is that it is all moving online, making the accounting function more accessible to management. Suddenly the CEO can now easily view his company’s latest accounts at home or during a business trip. This important development brings accounting closer to the people in charge, and with the help of an accountant, proper financial management becomes more do-able, improving the chances of success for you and your team.
What are your views on the importance of accounting in new businesses and startups?