ExperimentFirst
We are constantly listening, testing hypotheses, failing fast and iterating our internal innovation cocreator model. A running commentary of our collective failures (a.k.a learning).
CEO as designer?
"1. It’s relationships which underpin the impact of any programme. Therefore, you need to 'design' relationships into your solution, as an integral part of your solution.
2. To build empathy, don't sit behind a desk. Ask for a tour or go for a walking-meeting. You'll see and hear many more nuanced insights aka Design Thinking
3. Integrate your solution into the daily/weekly habits of your users/customers. Creating new habits is so hard."
Multiple stories?
“Differentiate your value proposition narrative depending on whether the person is a customer, a user, investor or partner. Each one cares for and reports about different things.
Fail-fast?
“Learn to recognise failure, then the hard-part of accepting it, and then react to it FAST"
Intra/Entrepreneurs don't want mentors, they want co-founders?
Vinod Khosla, founder of Sun MIcrosystems, said "90% of venture capitalists don't add value to the startups they advise. Knowing whose advice to take and on what topic may be the single most difficult decision an entrepreneur will have to make." What's worse, he said, most of the advice available to founders from VC on their boards is bad. "I would guess up to 85% of VCs add negative value to a startup in advising them." Instead, he said, he prefers to meet with entrepreneurs one-on-one.
The motivations from mentors vary from mentor to another. Whilst there is a significant benefit of mentors for startups at growth-stage, there is more-often-than-not a mismatch of needs for early stage innovators:
- Mentors wanting to “give back”: For (intra)entrepreneurs, this then becomes a one-sided power relationship. It's wrong to assume just because a mentor has been successful, their advice is "worth it" (read five signs your mentor is giving you bad advice) . For sure, there is a lot to learn from a mentor's failures, than his/her success, for there is no one replicable recipe for success.
- Mentors giving their time: Typically mentors give when they have time. What entrepreneurs typically want is on-demand time. Early stage (intra)entrepreneurs want to share hypotheses on a daily basis not on a weekly or monthly intervals.
- Networks: What entrepreneurs are looking for most are handpicked and personalised 'introductions' which help to advance highly specific hypotheses they have. They are not looking for a 'network'. Therefore the quality and willingness of a mentor to provide introductions is very important.
- Priorities: Investor mentors who are mentoring as a deal source, to be able to select the cream of the crop. Most early stage (intra)entrapreneurs want to be chasing customers, not investors. Most investor advice is very good for optimizing and scaling a working business. Listen to it. Most investor advice isn’t very good for building a magical product. Nobody can help you build a magical product — that’s your job.
- Idea v Mindset: Most industry mentors are in the space of mentoring on ideas, rather than entrepreneurs mindset. The latter is critical to success of the former, but mentors typically don't have the context or energy to invest in the mental side of a entrepreneur.
- Mentor vs Sponsor: "Unlike mentors, who act as sympathetic sounding boards, sponsors are people in positions of power who work on their protégé’s behalf to clear obstacles, foster connections, assign higher-profile work to ease the move up the ranks, and provide aircover and support in case of stumbles"
Incubator model open to innovation?
A new incubator is launched pretty much every week in some part of the world. We look at the some of the shortcomings of the external incubator model for organisations:
- conventional incubator model typically support around only 10-20 high potential ideas and people ever year, from the thousands trying, but typically only open to entrepreneurs, not intrapreneurs.
- in-person program involves relocation or transition for an employee from their current role. This visibility then subsequently limits the iteration and failing-fast that is fundamentaly important to any internal or external startup.
- Company incubators are standalone units inside organisations. We feel this formalises an idea (problem or solution) too quickly, getting caught up in organisational processes.
- mentor support: Please read our blog below why we feel the mentor support can be problematic.
- Lifestage: There are a lot of incubators who provide great support for existing startups to help them scale, However, most won't touch people at the simple idea stage (pre-revenue or customer validation). So many high potential employees leave their organisations due the frustrations of seeing a problem but not being able to close the execution gap.
Economist article: Most incubators use funding as a success metric, which is a somewhat flawed criterion. Over 99% of companies should operate as organically grown, self-sustaining businesses — bootstrapped, without external financing. For them the goal is to achieve customer validation, not financing. Yet if the incubator uses financing as its success metric, it will try to force inexperienced entrepreneurs into an unnecessary financing round. And more often than not, they will fail.
What other problems to you see with the external incubator model when applied to organisational context? Please mail us.
Chicken or egg?
The answer is always, egg.
i.e. Chase customers, not investors
Sell before you develop your product