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Posts Tagged ‘Jim McHugh’

Mentors and Vintage Oar

Wednesday Oct 22, 2014 by Jim McHugh – Experienced Executive & CEO Coach and member of Gerbsman Partners Board of Intellectual Capital

            

This is a picture of my 55+ year-old wooden oars after I opened up our boat this past spring. They looked pretty beat up: chipped and peeled paint…cracks in the wood…and they were graying at the edges.

Were they past their useful life? Would I need to replace them with a brand new pair?

Before trashing them, consider this –> these oars have a rich history that you could never imagine by catching a glimpse of them lying on a dock or in the bottom of a boat.

These oars have done their job quietly and well in rowboats, dinghies, motorboats and sailboats. The type of boat didn’t matter to my oars.

They were always there when I really needed them.

Doesn’t that sum up a good mentor, senior advisor, or board member? Versatile and at the ready when you need their capabilities.

I’ve been mingling with a large number of established company directors and startup mentors over the last few months. The director crowd was at the 2014 Private Company Governance Summit and the mentor crowd was at the MassChallenge Accelerator Program. MassChallenge runs a ‘mentor matching’ series of events to connect mentors and entrepreneurs who have been selected to be in the startup program.

Hello Founder, Hello Mr. Oar!

The MassChallenge matching events are quick. Founders pitch their company and describe their needs and the mentors rattle off their curriculum vitae in about 5 minutes. Imagine the scene…the founders are staring at the oars pictured above (aka ‘yours truly’). I can quickly tell the ones who look at the oars with disinterest or indifference. Translation: “I want oars that are slick and shiny.” Others, who may be a bit more intuitive, can sense what is underneath the oars’ rich patina, and their reaction might be: “I wonder if the experiences or history that created the chipping or wear and tear could be helpful to me.”

My oars have had 5 major roles over their 55 year life:

  1. Providing Propulsion
  2. Enabling Exploration
  3. Creating Fun
  4. Fixing Mistakes
  5. Being At The Ready

Providing Propulsion: My parents started boating with a wooden homemade rowboat and these oars when I was a young boy. The oars were new and had a fresh coat of marine varnish. Want to go from point A to Point B? It was either get out and swim or use the oars! Rowing took practice, but I learned to get it right.

Enabling Exploration: I loved to poke around the inlet on Cape Cod where our cottage was located. It was a fairly expansive body of water so I had many places to scout out and investigate. After a while, my parents invested in a small outboard engine so boating became much easier; however, the oars allowed me to reach down and check the water depth, navigate the shallows, get around sandbars and push through eelgrass when the tide was uncooperative. The oars extended my reach.

Creating Fun: Ever used oars to whack at crabs (I was just a kid…don’t call PETA) or do some serious splashing? I used to splash my girlfriend (“…don’t do that again!” “OK… splash!”) Note: she still married me…and I splashed her again this summer.

Fixing Mistakes: The oars have helped me recover from boating mistakes (also known as ‘running aground’) and set off on a new, better course. Luckily for me, the Cape Cod waters I frequented were forgiving…sandbars and muck, no piles of rocks like Coastal Maine or Lake Winnipesaukee.

Being At The Ready: Our boat now has a 150HP Evinrude ETEC engine and the oars quietly and patiently wait in the boat to ‘be at the ready’. They are there as backup power, a safety net, to fend off another boat or to help to a water skier who needs a steady object to grab.

Advice to founders and CEOs: Quality, reliable mentors provide startup propulsion, help management teams explore new directions and uncharted waters, inject fun into occasional tough days, offer turnaround advice to fix navigational mistakes, and are there when the founding team needs a steady hand to grab. As a bonus, they are chock full of stories!

P.S. I thought the oars needed a bit of TLC this summer. Here is the new look!

Jim McHugh is an experienced executive and a CEO coach.  You can find this post, as well as additional content on his blog called 9Stucks.  You can also follow Jim on Twitter (@9Stucks) by clicking here.

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By Jim McHugh.

Where Start-ups Get Stuck – and How to Avoid Going There

Between us, my long-time friend (and fellow blogger) Andy Palmer and I have started a lot of companies. We also advise many other companies and look at even more pitches from start-ups.  A shared observation is that while a few start-ups shine (or at least glimmer) and go on to some success, other start-ups seem stuck before they start.  Why?

Here are our observations on where start-up founders get stuck and our advice on how to prevent Stuck situations, presented Q&A style. This post also appears on Andy’s blog, The Fundable.

Q.  Andy, where are the most common places you see founders getting stuck, and why?

Andy Palmer, Start-Up Specialist
I see a lot of founders get stuck at the very earliest stages – by being distracted by fundraising.  I’ve said before – over and over again – founders should focus on developing their business first and not worry about fundraising nearly as much as they would probably like.  It’s natural to be nervous when you don’t have any money in the bank.  But it’s a healthy discipline to figure out how you are going to create value for customers who will pay you instead of spending time thinking about how to extract money from venture capitalists or seed investors.  As an angel investor, I’m always looking for people who are mission-driven and focused on their customers, as Jim says below, instead of worrying about what potential investors might think.

 Q.  So how can entrepreneurs avoid getting distracted by fundraising?

Just focus on your business and your customers.  Wake up every morning thinking about how you are going to create value for your customers. Go to sleep at night considering which of your customers you helped that day and how.  Be maniacally focused on your customers’ needs.  It sounds simple – and it is – but executing this when you are starting from scratch – with no product, no credibility, and no people –  is really hard. It requires all your energy and your concentration.

Q.  Any other tips on how to avoid getting stuck?

Be driven by your mission. The money will follow.

Q.  Jim, where are the most common places you see founders getting stuck – and why?

In my experience, the two most common causes of becoming stuck are 1) an incomplete or muddled business model (see Stuck in the Fog) and 2) directly related to that, not clearly understanding the specific needs of their customers (see Stuck in a Rut).
What do I mean by an incomplete business model?  A well-defined business model (i.e., the “guts of the business”) states how the company is organized, what products and services it sells to whom, and how the company “goes to market.” In addition, the whole company clearly understands the associated operational policies, processes and needs (both for the supplier and the customer).

Start-up and early-stage teams become obsessed (as they should) with the product/prototype, the team, and the market potential. However, they sometimes fall short in three important areas:

  • They are naive about all aspects of the business model.
  • They don’t understand – or they have chosen to ignore – the specific linkages of their product to their customer’s product.
  • They have not solved or put in place key components of the business model and assume it will be easy to “finish those later.”

The business model can be pretty straightforward if it is a simple B2C or B2B connection – that is, “we make it, you consume it.” The linkages become more difficult to sort out if the start-up’s product becomes embedded in their customer’s product offerings – for example, as a component.
One striking example I have seen of an incomplete business model was a food ingredient technology company that had considerable success raising seed money from a group of angels. This company had traction:

  • the technically elegant prototype demonstrated product effectiveness and potential significant benefits to consumers
  • the company had received approval from a key regulatory agency
  • the product was going to revolutionize one segment of the food industry
  • there were positive (but limited) real-world test applications
  • the expected market was huge

Then the company’s traction stalled; they became stuck. How could that happen?

This revolutionary product was not sold directly to end-user consumers. It was an ingredient that became part of other companies’ product formulations. The industrial and consumer target customers who evaluated the start-up’s product realized they would have to change their end-use product specs, add equipment and processes to their production line, and change their quality control testing procedures. They would also have to change their existing descriptive product information and packaging.

For some customers that would mean altering (for the better?) very successful, stable products that were established with consumers. Were the customers prepared to take the market and product risk (with a start-up) and incur the costs and aggravation associated with adopting this new technology?

Having a great product was a prerequisite for the big food ingredient companies, but it quickly became apparent to the start-up that many other factors influenced the prospective customers’ decision making process.

Q.  So, what’s your advice for avoiding getting Stuck before you Start?

To be sure, the business model for early-stage companies evolves over time. It gets fine-tuned, even changed.  But fine-tuning is a lot different from having a naive view of the customers’ needs out of the gate. It’s a cliché, but how many times does “knowing the customer’s needs” have to be said to founders?

Q.  Any general tips about how to avoid getting stuck?

Yes, it really helps to have the right people on the team who understand and have experience in the industry they are selling into.
Have you seen early stage companies that were stuck? What caused them to be stuck, and what did they do about it?

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