At the annual Anthemis Hacking Finance Retreat 2014, in spite of a tight workshop and activity schedule, not to mention the networking sessions, some of our most dynamic founders spoke about the building blocks of a sound company – the investors, the co-founders, the team; and left us with some invaluable tips on how to survive if you’re a startup founder. These guys have been there, and have scaled or exited successfully, so take note. For video vignettes with all the founder, scroll down, or click here.
The two things that have stayed with me since our brief interviews in the picturesque Meribel are how staunchly all the founders believed in their vision and the deep sense of responsibility they felt towards their teams and to their customers.
John Prendergast, Founder & CEO of Blueleaf says a good founder has an irrational belief in his or her ability to create something out of nothing, but along with that, the willingness to test those ideas in the market and change on a dime. “The idea is to believe, but not love your idea so much that you can’t hear what the market is telling you”, says Prendergast.
Patience is essential, especially if you work in financial services. Building a good team and a Board, raising capital, testing your product, incorporating market feedback – all this will take ten times as long as you’d expect, according to Josh Reich, Founder & CEO, Simple, but if you’re in financial services, you have the added drag from the regulators and an industry where “people are biased towards saying no to ideas.” The key, inevitably, is to persevere. Arlyn Davich, Founder & CEO of PayPerks simply advises you to trust your gut. (And plough on.)
A “good” founder takes great pride in retaining the founding team as the company scales and it’s something that David Soloff, Founder & CEO, Premise takes very seriously. “These are people who’ve left comfortable positions – jobs at Google or Facebook to come work with me on something that’s pretty untested. So even when I flag, I feel an immense responsibility to make sure that we are successful”, he says. This mutual dedication and loyalty between a founder and the team is crucial in nurturing tensile strength within a team that’ll enable it to weather the ups and downs that building a startup promises.
Then there are the customers. Being devoted to delivering a good product or a service automatically places customer happiness at the core of a company’s success. But Reich steps it up. When the going gets tough, Josh logs into the customer support queue and starts answering questions and engaging with customers. “It’s a way to disconnect from all the bullshit you’re worrying about… just go talk to a customer. It’s a great way to get you out of that head zone and back into the realization that actually the slide in the Board deck is not the important part of this business.” The customer obviously is.
He also likens finding a good co-founder to a successful marriage, complete with a courtship period. He had known Shamir Karkal, co-founder and CTO of Simple for five years before they got together to build Simple. “I knew at business school that if I was ever going to start a business, I was going to do it with Shamir,” says Reich. Mutual trust and honesty is key in a successful partnership and Davich points out the importance of having in a co-founder someone that especially a first time founder can confide in, celebrate the ups and navigate the lows with.
When looking for capital and investors to scale your company successfully, doing your homework while picking your Board will stand you in good stead. Evaluate investors’ history, as you’d expect them to evaluate you and your company. Speak to other startup founders who’ve worked with those investors, advises John Prendergast. A “too busy”, “hard to get hold of” investor; in short, an absent investor is much worse than an over bearing one, he says is his experience.
Next, identify where you need help and target your search for smart money to fill that gap – someone who is immensely knowledgeable and can provide sound advice but also challenge you when needed. When building Simple, Reich wanted people who understood the two main components of the business – consumer web and financial services. At Blueleaf, they had lots of operational experience, but wanted a different kind of global perspective and knowledge on financial services. Simple and Blueleaf both chose Anthemis in order to fill that strategic financial services knowledge gap, while for Suprmasv Founder and CEO Eli Ladopoulos, leveraging Anthemis’ global network of talent and expertise was invaluable. So look for an investor with assets they can deploy to help grow your business and is believes in you and your idea implicitly.
Ladopoulos also appreciated that he and Sean Park, Founder, Anthemis Group were on the same page in understanding that working with a startup is a complex, evolutionary process where the real benefit comes from chasing the big disruptive ideas, exploring the truly alternative models that exist today, “because that’s where the really big wins come from – they come from contrarian thoughts, contrarian ideas and novel approaches.” Soloff echoed the sentiment about Park, “Sean’s been way too early in a lot of things – fortunately for him in the (end), I think things have borne out. He’s extremely persistent. I know he’s been at this a long time and I know he’s built businesses.”
(If you persisted till the end, well done! And watch out for more insights from the AHFR14 workshops)