The Best Way to Start-Up

There are many paths to every destination. For start-ups this is especially true; there is no one right way to success for an untested venture. However, according to entrepreneur Scott Weiss, there are certain steps that a young entrepreneur can take to have a better chance at growing their business. Speaking from his own experience Weiss suggests that rather than going to school or starting your own company right away, actually working at a start-up will give you the most valuable experience. He offers several tips to getting started:

Prepare to Move: Weiss suggests moving to a hub or hotspot for your industry. In the case of tech start-ups, he suggests moving to Silicon Valley. While friends may have a job lined up right out of school, you have to prepare to be unemployed for a while or get a part time job in the mean time.

Research the Options: You want to work at a legitimate start-up, so Weiss suggests looking at venture capital surveys and see which companies have been backed.

Focus: Research and focus on roles you want to play within a start-up. If you are knowledgeable about the differences, it will give you more credibility when you start networking.

Narrow it Down: Narrow your choice down to 20 or 30 companies and make a web of all possible connections. The best way to get an in is to build a referral network, so network with anyone you can think might be of help.

Weiss says that persistence and preparation are the two most important aspects to getting hired by a start-up, and networking with potential referrals is key.

For the full article, see The Path to Starting a Start-Up

How Important is Funding for Start-Ups?

While many start-ups can get off the ground with little to no external financing, sometimes it can make the difference between success and failure. According to entrepreneur Kevin Ready, there are several good reasons to to raise funds through external entities:

Marketing: Even if you make the best product ever, it doesn’t matter if no one ever sees it or knows about it. A marketing budget can get your product or service visible where it otherwise would not be.

Speed to Market: The time window for your product to be viable is a short one- the longer you take, the more time your competitors have to take market share away.

Visibility: A high profile investor brings credibility and can make people take notice of your product, and you will have more access to talent, advisors, money, etc.

Less Personal Risk: You don’t want to have to drain your bank account getting your business off the ground. External funding lessens the hazard for you and will allow you to take risks without risking your personal finances.

Cushion: More money in the bank means more of a cushion in case of hard times or uncontrollable external factors.

There are many types of financing available- a start-up company must weigh the pros and cons of external financing, evaluate the financing options, and then decide which form is best for its needs.

For the original post, see Do Startups Need Funding Anymore?

Small Business “Pre-Nups”

They say people can be married to their business — well, it follows that people can also go through messy business divorces. In a recent article in Crain’s Cleveland Business, U of M entrepreneurship professor James Price discusses how he often advises small business co-founders to sign a prenuptial-like contract in order to avoid conflict if one or more founder should jump ship.

Much like young love, entrepreneurial partners are often enamored with the start-up at first and might think that nothing could go wrong. Price advises that business partners instead think rationally and come up with an agreement that will force them to reason through what should happen in case of a break-up.

The fickle nature of business, with its soaring highs and Mariana Trench lows, can put stress on the best of partners. Sometimes “love” is not enough, and that is where a start-up pre-nup comes into play. Price claims that these contracts are a “clear-eyed way of building flexibility” so that both business and personal relationships can remain intact regardless of how it all plays out. See the full article at Why I Always Tell Co-Founders to Sign a ‘Pre-nup’.