This is going to be intensely personal. You should switch off now if this isn’t your thing.
Anthill asked me to blog for them, and I really struggled to decide what to write about. Most functional areas are covered on their site. Let’s not kid ourselves, entrepreneurship is ultimately meant to make us money (if you want to spout off about social goods and making the world a better place, we are not going to get on) and although I have certain areas of expertise, I have yet to make a cent.
I needed to get that out of the way. I am not here to preach. I don’t want to come across as the voice of authority on anything. People who are a lot more stupid than I am will probably make heaps more coin than I will ever see, and people who are a lot smarter than me can give you all the intellectual fluff that makes me fall asleep.
So why should you read me? How is this particular blog going to be any different to any other? Perhaps now the 10 second CV is in order. The intention here is to make me sound interesting. Keep in mind that I am broke.
Sahil Merchant. Age 35. Three kids. Law/Comm degree. Four years at McKinsey & Company. MBA from Insead in France. One year at the World Economic Forum in Switzerland. Got to sit in a room with the top 30 CEOs in the world and act as the note taker for their private conversations three years in a row. Me and Gates are tight! Left McKinsey without being pushed (somewhat rare). Decided to sell magazines! Started up mag nation.
This is where the entrepreneurial cred comes in. I have raised over $7M across multiple funding rounds from sophisticated private and professional investors for a business that retails a boring and saturated product and has yet to turn a profit (we are getting there). I have built a consumer brand that has a cult following among the growing urban savvy demographic. And I have jointly overseen (I have a partner) every success and screw up that mag nation has lived through.
I know marketing, management, the detailed ins and out of a multitude of capital raising structures and issues, branding, social networking, investor management, corporate governance and a host of other useful things. Every one of these with perhaps the exception of capital raising is already amply covered on Anthill’s site. (I digress for a second – capital raising is well covered on Anthill, but very few Australian entrepreneurs actually have experience of a multitude of VC/PE-type funding mechanisms and legal structures, despite many claims to the contrary). Unless you want me to put you to sleep by talking about tag and drag, cumulative convertible prefs and anti-dilution formulae, I have nothing new to blog about.
Instead, what I am going to write about is my ongoing journey as an entrepreneur. Not the mag nation company line. You can read about that on the mag nation blog. This will be story behind the business.
Who is out there telling us about the intense personal sacrifices that starting up your own business can entail? Sure, lots of people warn us, but does anyone really share the ups and downs of it all?
Most of the stories we hear are from the glamorous successes – oh how wonderful and smart they all are and what a great job they did. Hasn’t anyone ever heard of the success bias? How many of the 99 percent of people who start a business only for it to fail within a year write their memoirs around their experiences? Imagine what lessons we could all learn from those stories.
As I said at the start, this is going to be intensely personal….
- How do you feel when nominated for Young Entrepreneur of the Year? Pretty good perhaps, but is it worth anything when all your friends are earning a steady living, going on holidays, putting money aside for their kids’ education, and working half the hours you are?
- Is it better to jump head first into a business, putting in all your heart and soul, or do you take small conservative steps and protect your downside by maintaining your existing income until success is more likely?
- How do you balance giving away more of your company to investors upfront vs taking less money and keeping a greater share?
- How important is your husband, wife, lover, mother or pet hamster when it comes to starting a business?
- Do you need to love the area your business focuses on for it to be a success? Does starting a business mean you lose your friends?
- When presenting your financial projections, do you put down realistic numbers to establish credibility, knowing that funders will automatically dumb them down and then find them unattractive, or do you show the optimistic case so that the dumbed down numbers become realistic but you risk your believability?
- What is the difference between knowing when to cut your losses and stop flogging a dead horse versus persistence and strategic renewal?
Lots of questions, and I have no answers.
What I do have is my experiences and personal perspectives as I have tried to deal with all of these questions and more. And given that they are my experiences, they are unquestionable. They can’t be viewed through the lenses of right and wrong. They are simply my entrepreneurial truths.
I promise to give you a hand-on-heart, blow-by-blow, personal account of a continuing struggle to build a successful company. This won’t be an attempted “look how smart I am”; I will give equal coverage to the personal highs, lows and genuine dilemmas. And when I don’t know, I will say so.
Consider this an entrepreneurial “Dear Diary”. Your candid thoughts, contributions and experiences will only make this richer. Perhaps we can all learn something.
Sahil Merchant is founder of mag nation. Follow him on twitter: @sahilmerchant