Wednesday, September 27, 2006

Lesson #7 - Shoot First and then Plan

For years we have been trained to follow a certain process before we take action. The classic direction "Ready, Aim, Fire" is how we were all taught how to live life. The problem is that when starting a business, especially a technology startup where you are building products the world has not seen yet - it is almost suicidal to follow the process of ready, aim and fire.

Here are some reasons:

1. One of the classic problems an entrepreneur faces is "analysis paralysis" - where they get stuck in a rut while developing the product (that is, aiming at the target for too long but never pulling the trigger). I have seen more companies stuck in perpetual R&D then I have companies driving revenue and customer innovation. The most critical step in the life of an early startup is building customer relationships. Customers not only drive revenue, but they drive innovation. Stop aiming, and start firing - (if you miss - atleast you learned why, and you can fix it).

2. The second biggest problem with the "Ready, Aim, Fire" mentality is choosing the target. Unfortunately in an early-stage company - the target is not always a large circle painted in red and white. An entrepreneur may have a vision, and may even have a product - but very few have a clear idea on how to go to market (e.g. the target). So if there is no target, what are we aiming at? The more practical approach, is to fire as many bullets as you can, see which ones hit something, and then by deduction choose the optimal target.

3. The third problem - time and money. With any early-stage venture there is never enough time and money - and thus, we should never waste it. Too much planning can kill a company. Too much deliberation can kill a company. Decisions need to be thought through, but need to be made quickly. If a company is raising capital, it is more impressive to an investor to talk about customer experiences and references, then it is about what cool product is in development. Get customers first, and then finish the product.

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