Entrepreneurs all typically have the same dream. Build a billion dollar company or what we like to refer to as a "Unicorn". Sure founders and entrepreneurs will say they are trying to change the world or make life easier for people by solving a specific problem but let's be real in the end it is about building a Unicorn. So while entrepreneurs and founders say all the right things and take all the politically correct actions in the end, they want the same thing. The reality is investors don't necessarily care about changing the world or making life easier unless it means that there will be a billion dollar valuation tied to it.
How many investors have sunk money into something because it was good for the planet without a potential return? Not many.Click to tweet
The most important pieces to building a Unicorn:
Great Idea - You must first and foremost have a great idea that will make people stop and say wow I wish I had thought of that. Or the ability to take a great idea and improve upon it. Uber is one of these. While maybe they were not the first they have made the on-demand space what it is. There is no question that hundreds of very solid businesses today owe Uber thanks for their very existence. You know you have made it when a company goes to pitch an idea, and they begin by saying we are the Uber of. We have developed a platform that focused on Investor Relations and while that is still a viable market we realized that what we had was a platform that could solve communication problems Early Stage Investors have with their portfolio CEO's.
Solve a problem - There are a lot of great ideas, but are they solutions to problems? In orde to build a Unicorn, you need to have a solution to a problem. While it may not be a problem that is recognized like Uber in the end, it needs to solve something. Uber helps people get a ride without having to wait.
TrueFinancial helps Founders and their Early Stage Investors communicate better and help keep startup CEO's on task and compliant with their investor information rights agreement.Click to tweet
Worldwide adoption - You need to have a product or service that can be scaled on a global level. We have found that very opportunity as Early Stage Investors don't change from one country to another. It is one thing to have a great business in a local market but to have a unicorn on the rise you need to be able to show that this is a global proposition.
Great tech - This seems obvious, right? Well, it should be but sometimes founder cut corners in order to save time and money. To many companies try to nickel and dime their way through a build. Outsourcing to save money is not the answer. In order to control the tech, you need to build the tech in house.
Solid founding team - A great idea can only take you so far. This is proven every day with companies going out of business because there founding team cannot take their idea to the next level. Great founding teams can take an average idea and make great. A great idea led by a founding team that lacks experience and vision will always fail no matter how good. The key word here is team. A founder can be a weak link if they surround themselves with solid people. Founders fail miserably because they think they deserve to keep all their company and refuse to hire solid people. Giving up equity to the right people will help gain the traction needed to become that billion dollar company. 100% of nothing is nothing
Funding - Well this is not a shock. It takes money to make money and even with non-tech products and services it takes money to get your brand out there. Without money, you cannot brand your company. This like building a founding team is a sticking point as founders want to keep control and not have to give up equity. They don't want to part with shares of their company and, therefore, flounder trying to make a go. Another issue is not raising enough money. Founders sometimes think they can do a smaller raise giving up less of their company only to find out they needed 2-3 times the amount.
Support - Having a great founding team is part one of success. Building a great support system with advisors is the icing on the cake. It is critical that founding teams can have a fresh set of eyes to help them through some of the tougher times and critical decisions.
Killer instinct - Winner takes all approach. Be prepared to take this approach and not let feelings and relationships stand in the way. You need to be able to get rid of dead weight and put the right people in the right places. Keeping people because they were there in the beginning, or they are your friend will do more harm that you can imagine. It stagnates the growth regardless of who you hire beyond them.
Work Ethic - If you can't work 18 hours a day seven days a week there is a chance you are in the wrong place. Above anything, work ethic is critical to the success of any company and to become a unicorn this is essential. Work ethic also comes with working smart. Putting in the hours is one thing but being smart about your time is another. Great founders that have built unicorns are smart with their time above everything else.