This week marks two years since I dissolved my successful band management company to focus full-time on my startup. I’d just completed my first large fundraising round where 21 individuals had written me personal cheques to invest in the business. These angel investors came from a variety of backgrounds. I found them through speaking at pitch events and by presenting my PowerPoint deck an estimated 700 times over the previous year. Raising the first round of capital was the hardest thing I’d ever done. It required a huge amount of personal energy and growth, and at the end I had a massive sense of achievement from pulling it all together. Now, I thought, the fun could begin!
Unfortunately, that’s not how it works. Yes, raising your first capital round can be hard, but what comes next presents the real challenge. My startup, Posse.com, is still in the early stages of development. We’ve pivoted twice and, recently, launched what feels like a winning model. Professionally, the past two years have been the hardest of my life, but the extent to which I’ve learned and grown as a person has been remarkable. There are way too many lessons for one article, so I’ve picked three of my favourites.
It’s all about the team
The number one driver of success in running a startup is the quality of the team, and how much they enjoy (and are passionate about) what they’re doing. Above all, you must hire the right people. I’ve learned this by trial and error – I had a 100% staff turnover in my first year of running Posse.
At my previous company, I hired people who had experience in particular fields or industry contacts. But the requirements of successful startup personnel differ from those whom are successful in other sectors, especially the entertainment business. I’ve learned to hire people who are smart with the right attitude; I don’t prioritise experience. Startups need “can-do” attitudes and these types of personalities are rare diamonds. In other environments, trying to make something happen may be good enough. In a startup, trying scores zero. Things either happen or they don’t. Something works or it doesn’t, users join or they don’t, people pay to use the product or they don’t, the company is solvent or it isn’t.
I’ve managed to build a team of these rare diamonds to give Posse the very best chance of success. I feel this is my greatest achievement so far.
Communicate frankly and openly with everyone:
If you read my regular blog you’ll notice that I’m very open about our challenges, mistakes and victories. In my previous life as a band manager, I used to hate admitting I was wrong and kept my cards close to my chest. To start with, I did the same thing at Posse. Then one day, I walked into my first board meeting, pleased that I’d assembled such an impressive group of people, only to discover that they wanted to know everything. So, that was what a board was for! It was scary – we were months from running out of cash, a lawyer was suing us for a bill I thought outrageous, and our product wasn’t working. But as I unloaded my catalogue of disasters, something strange happened. To my surprise and delight they weren’t angry or disappointed. We just put our heads together as a group and worked through the challenges. It felt like an amazing therapy, and I walked out of the meeting ten times lighter.
From then on I have switched 180-degrees and practiced complete transparency with everyone. With our team, investors, users, and even the public, I strive to be open and forthcoming. The team stays informed of our company’s monthly financial position. They understand the reasoning behind decisions to focus on various aspects of the product, user growth, PR or fundraising. I try to communicate as publicly as possible with users and potential users when we make mistakes, and why we’ve decided to try something new.
Transparency creates a connection with your product and takes people with you on the journey. If nothing else, being candid and open requires a lot less energy than being guarded!
When you think there’s a problem, act fast
I’ve heard this advice many times, but it’s taken the pressure-cooker of a startup for it to really sink in. When you think you’ve built the wrong product, hired the wrong person, or when something just doesn’t feel right – trust yourself and fix it immediately. The outrageous lawyer’s bill I mentioned before illustrates this. Early on, I fell out with someone who was doing some work for us. Then, he sent us a really big bill which we couldn’t pay. At first I ignored it and hoped that the problem would disappear. It didn’t. He took us to court just as I was about to close our first funding round. And I had to come clean with the incoming group and declare the whole bill as a liability. This almost cost us our funding, but fortunately the investors recognised that I’d made a mistake and said they’d help me fix it once they were involved. The messy saga took more than another year to work out, was a huge distraction, and ended up costing us quite a bit in legal bills. I could have resolved it fairly easily if only I’d acted fast.
People and product mistakes are even worse. I’ve often tried to ignore my instincts and hope things will come right. They never do, and I’ve learned to act fast no matter how painful the change will be.
Running Posse is incredibly fun and incredibly challenging. I’ve read every start-up and business book out there: The Art of the Start, The Lean Startup, Good To Great, and Winning are among the best. All of these books catalogue lists of mistakes, and I’ve made pretty much every one. Somehow, reading about other people’s lessons in advance didn’t teach me anything – I had to get out there and learn it for myself. So, for anyone who’s considering starting a company and who hopes to learn from me, the best advice I can give is: get out there and be prepared to fall over a few times!
Rebekah Campbell is an entrepreneur and founder of a new social media platform called Posse.com