Startup Lesson Learned 3: Be Honest and Open about your Strengths and Weaknesses

10_Tech_Startup_Lessons_Learned-1_thAbout the Series “10 Tech Startup Lessons Learned”
PADT is a company focused on helping companies bring their physical products to market. As “We Make Innovation Work” for our customers, we learn a lot about what does and does not work in technology startup companies. In addition, we were once a startup ourselves and we now participate in Angel investing.  All of this has taught us a lot of valuable lessons.
In this series we will share some of those lessons learned and explore the basic concepts and ideas that will help startups overcome the odds and become successful.

This posting is the second installment for our series. The previous postings were: “If You Build It, They Will Not Come” and “Stay Focused, Be Flexible, Set and Use Goals.”

We hope that you find it useful and we look forward to sharing our thoughts on this topic with you.

If you spend time around startups you have seen it before.  Someone comes up with a great idea and they have the technical understanding, the connections, the money, or the drive that allows them to start a business around the idea.  But then the business fails because some important skill or capability was missing and the founders could not, or would not, recognize and deal with the need. On the other side of things, we have all seen a company stumble because they spent a large amount of time and money trying to accomplish something using expensive outside resources that the founders could have easily done themselves.

Both of these situations stem from the inability of people who start a technical company to be honest and open about their own strengths and weaknesses.  They end up not doing what they can do, and doing what they should not be doing.  Both can waste time and money and even bring the company down.

The Technologist Trap

BearTrap_Active_TexturedSpotlightThe most common manifestation of this problem, so much so that it is has become a stereotype, is the technologist that tries and fails to start a company because they did not understand business, sales, marketing, or manufacturing.  It is an unfortunate reality that the capabilities that make a person a great innovator are not the same capabilities that make someone a great CEO or even a good manager.  There are exceptions to this, but more often then not if you look at successful technology startups there is usually the “the technology person” and “the business person” Only rarely are they the same person.

What does this mean, because this certainly does not apply to you? It is your idea, your understanding of the science behind the idea, your intimate knowledge of the market that created the company.  Doing that other stuff required to get things off the ground is simple by comparison.  But the hard reality is that a technically capable person usually does not have the skills, experience, knowledge, or desire to do that other stuff. And even if they do, they usually do not have the bandwidth to get it done. And that other stuff is required to build a company.

To deal with this trap, the best place to begin is with the assumption that the you, the technical innovator, should start in the founder and chief technologist role. Just plan for that when you start a company.  It is much easier on everyone involved for you to add roles then for you to have to give them up.  Stepping forward is much more pleasant than stepping back.  And it is much easier to be honest about what you are good at when you are looking at it as adding responsibility, rather than giving it up. Human nature, no matter how hard you try, will always tint your self-view when you have to admit to others that you can not do something.

Even if you retain control of your company, delegate as much decision making responsibility as possible to those who are best suited to make the decisions. 

Taking Advice

adviceSo far I have been focusing on skills and capabilities. But another area where the founders of a startup have to be brutally honest with themselves is in taking advice from others.  This is not the same thing as just doing what others tell you. It is about being able to put your preconceived ideas aside, leave your pride at home, and really listen to what other people are advising you. 

If you have ever spent time around a great leader you will notice that they are masters at soliciting input from others, reviewing it, and turning it into the right decisions.  As a leader in a technology startup, you have to also grow this ability to first actually listen, then make honest and accurate assessments of the advice.  The first step in doing so is letting go of ownership on ideas. 

When you internally claim ownership of an idea it is hard to accept that someone else’s ideas might be better, because that implies that yours is wrong. So start off by letting go of the ownership and evaluate each idea on its own merit and not based on who it came from. Learn to be honest with yourself about the fact that your ideas may not always be the best and that in most cases, a combination of multiple ideas from multiple sources is the best solution.

Confidence, Not Arrogance

self-confidence-300x300To be successful in a small business you must be confident. Without significant confidence you can never survive all of the obstacles that face you.  But if you are not honest in your view of yourself, that confidence can turn to arrogance, and arrogance leads to making bad decisions that can ruin your company.  Confidence is telling yourself “yes, I can make this happen.”  Arrogance is telling yourself “yes, I am always right.”  A confident leader in a technology startup knows that they can make the journey to success regardless of where the path leads, the arrogant leader thinks that they already know the path to success.

The way to avoid slipping into an arrogant stance is to really be honest and look at how you make decisions.  Are your decisions based on the facts you have in hand and maybe some intuition, or are you making decisions based upon what you want the answer to be, or how the decisions make you look?  You should be using facts and intuition.

We have actually had situations where we have told customers that their idea has a significant problem that needs to be dealt with. And their response was “I don’t want to hear negative information.”  That is taking confidence into arrogance if not just plane crazy.  A confident leader will take in the information and say “what do we need to solve this problem, I know we can overcome this obstacle.”

Being Honest is also about Strengths

strengthAnecdotes about startups that failed because the owners just did not listen to others, or tried to do things they were not qualified to do only show part of the story. Being honest about your abilities is a two edged sword.  Not leveraging your strengths can be just as deadly for a startup, especially if a founder considers themselves too much of a nerd or a “techie” to do non-technical things.  Or if they lack the confidence to assert their point of view when they should.

Many innovators are multi-talented and they may have chosen a technical path for their education or career.  This does not automatically disqualify them from being a successful business person, it just requires that they follow the advice above and work to have an honest understanding of what their skills and abilities are, and work to make the right choices in filling in the missing pieces. 

Look in the Mirror

dog-mirror1Let’s be honest, it is very hard to be honest with yourself.  Your thought process on which accounting package to use probably has more to do with the way your mother responded to the finger-painting you brought home from kindergarten then any of us want to admit.  We are complex creatures with conflicting emotions, memories, and desires. And they are very hard to see from inside, and even harder to adapt to.  Most of the time this does not matter, but when you are trying to do something as hard as start a technology company, it is a big deal.

The best way to deal with this honesty stuff is to learn to really look at yourself in the mirror, make it part of your normal process. When you are making a big decision, ask yourself why you decided to go a certain way. When you take on a task, look at yourself in that mirror and ask if you are the right person for the job.  When you are looking to bring in an outside expert, make sure you really need them.

Just be honest with yourself, and success will be a lot easier to find. 

 

[A Note on the cheesy images: 
Sorry. I know they kind of suck but I’ve taken it as a mission to find the most stereotypical business images to highlight the message of each paragraph. Hopefully you will find them somewhat funny… or at least not too annoying…]

Serious Integrated: Modular Touch Screen Panels

image_thumb1PADT Angel Investment Profiles
Giving back to the community you come from is something that PADT strongly believes in. We extend this belief not just to charities, but also to the technology business community that helped to create the company we are today.  One way in which we do that is through strategic Angel investments in local technology startup companies.
In this series, we will take a look at the companies that PADT has invested in, where they are in the startup process, and why PADT invested in them.  Hopefully we will cover two a month.  To learn more about PADT’s investment program, visit our Technology Investing page.  You can also read about the first investment we covered, Veebow.com.

 

imageSerious Integrated, Inc. is a company focused on one simple mission: doing away with buttons on machines.  Most mechanical systems need some sort of human-machine interface, and in the past this has consisted of buttons in some sort of control panel with a small monochrome screen that is hard to read and does not give enough information.  The current trend is to replace this interface with a color touch screen that can be programed to have whatever interface the equipment manufacturer want.  The problem that the manufacturer faces is that they have to design the screen and all the electronic hardware behind it, source it, program it, and integrate it with their system. Serious Integrated has solved this problem with a family of modular interfaces and a GUI development environment.  A six month development process to just get a prototype can now be done in a few weeks.

The Company

Serious Integrated was founded by Terry West and Gregg Lahti because they saw a need in the market.  With experience from RIM, Intel, Microchip and Sun Microsystems, along with a few startups, they knew how to take this need and build a product and services around it.  They are currently growing at the Chandler Innovations Incubator in Chandler, AZ by adding other seasoned professionals to their staff.

Serious Integrated Inc.
Terry and Gregg Show off two Modules

It is truly rare to sit in a room at a startup and be surrounded by people with as much experience as Serious Integrated brings to the table, and not just on the technical side, but also in operations, legal, and finance.  One of the ways that this has manifested itself is in establishing partnerships with a suppliers like Renasas and Microchip.  This also showed in the quick selection of the Serious modules as listed products by heavyweight distributors Arrow Electronics and Digi-key along with a host of well respected electronics manufacturers’ representatives.

The management team has been able to grow quickly and efficiently through many obstacles and are already generating revenue, delivering multiple product options, releasing software, and finding time to do custom design work.  Such a strong start is a good indicator of a very successful future.

The Technology

imageThe technology that Serious Integrated offers is an off-the-shelf solution that consists of already assembled components on a custom board with a standard operating system already installed.  This is combined with a GUI development environment created by the company to offer a complete modular solution that eliminates the lengthy development process required if you decide to roll your own interface.

If you want to know more specifics about the hardware technology, you need to contact Serious Integrated. Because I am a mechanical engineer, much of what they do in these modules is black magic to me. I do know it works, and if I want to use it on one of our projects, I do not have to budget for an electrical engineer to spend 3 months designing it for me.  Modules cost between $120 and $200 depending on size and features in small quantities, which is such an affordable price point it makes sense to just try one out.

imageI can speak to the software, which was just put out in beta release.  Ship is a complete rapid GUI development system that uses a WYSIWYG interface (SHIPTide) that allows you to design your interface in a virtual space by dragging-and-dropping components.  You can layout your GUI, define events or actions, build your resource library, and create a package that you can upload to your hardware with ease.  Something even a mechanical engineer can use.

SHIPEngine is the runtime engine that sits on the board. It can be loaded on a Serious Integrated module, or on your own hardware.  It takes the package you make with SHIPTide and runs your GUI.  No need to write for a specific microcontroller and/or RTOS.  Serious Integrated also offers services to help with the GUI design or to help with custom content for your GUI.

So you can go with their modules, or your own hardware, and use the SHIP environment to drastically reduce your development time. Many companies consider the use of a Serious Integrated module for their product development phase, and then going to their own hardware for mass production. With Serious Integrated, you have the option to do it whatever way is best for your needs.

SBX200PADT’s Interest

The current trend in product development is smart products. Everything has some sort of controller and a way to interface with it far  beyond on-off switches and simple buttons or dials.  New products must not only have more sophisticated controls, they must have human-machine interfaces that are robust, easy-to-use, and easily configured.  Serious Integrated has created a hardware and software solution that has huge advantages over developing your own interface. This is a product we recommend to our customers.

We also really like the team. They are smart, experienced, and very knowledgeable.  They also have contacts in the world of machine interface and control that we find very useful.  Our involvement with them has already been beneficial and we learn things every time we interact.  As Serious Integrated grows we hope to be able to offer PADT’s services to some of their customers, and we will continue to introduce our customers and vendors to their technology and services.

All and all, this has been one of the more beneficial partnering relationships that PADT has done through an angel investment.

imageStatus

Serious Integrated is currently in a great place for a new startup – they have orders with revenue coming in the door, product shipping, new products in the pipeline, and are building a positive reputation in the market.  Their focus right now is on raising the funds needed to meet the demands of their growing market and on executing their plan efficiently.  So far things have gone well and they have been able to verify their initial assumptions about the market and the features/functions of a product that will meet those needs.

If you have a need for a human-machine interface, you can help yourself and PADT out by taking a look at Serious Integrated and trying one of their modules and the GUI development environment.  Let us know what you think.

Startup Lesson Learned 2: Stay Focused, Be Flexible, Set and Use Goals

10_Tech_Startup_Lessons_Learned-1_thAbout the Series “10 Tech Startup Lessons Learned”PADT is a company focused on helping companies bring their physical products to market. As “We Make Innovation Work” for our customers, we learn a lot about what does and does not work in technology startup companies. In addition, we were once a startup ourselves and we now participate in Angel investing.  All of this has taught us a lot of valuable lessons.
In this series we will share some of those lessons learned and explore the basic concepts and ideas that will help startups overcome the odds and become successful.

This posting is the second installment for our series. The first posting was “If You Build It, They Will Not Come.”

We hope that you find it useful and we look forward to sharing our thoughts on this topic with you.

image_thumb1
There is a reason why so many business books and presentations use a picture of a guy on a tightrope.  Business is all about balancing.  But if you dig deeper, you find that in order to balance you have to do two things that are often in conflict – you must stay very focused on what you are doing while being flexible in how you react to things.  Getting the right balance between these two approaches is critical to success in any business, but especially for a technology startup.

To understand why focus and flexibility are so important it is a good idea to remember that doing a startup is a process that involves many steps, often executed at the same time.  The execution of each step costs time and money, and a startup has a limited amount of both. Therefore it is critical that you only execute the steps that will lead you to your goals. Doing anything else will lead to a squandering of precious resources and will result in your startup running out of funding or not getting to market in time.

The path seems obvious: come up with a plan, then follow the plan.  Easy.

The problem is that no one knows what steps are needed when they start, and even if you have a good idea, everything changes all the time. There are a host of external factors that impact what you are trying to achieve. Things like the economy, competition, changes in laws, shifting consumer trends, and new technologies.  You can plan for some of this, but not all of it. When circumstances change, successful startups react in a controlled but effective manner.  This requires focus, flexibility, and the effective setting of goals.

Focusing on Focus

image_thumb3Being focused is not the same thing as making a plan and sticking to it.  Focus is all about making sure you are paying attention to what is important, thinking about why it is important, and prioritizing your actions.  It is about having an inner dialog with yourself and within your organization that directs your actions, allowing you to keep moving towards your goals as things change.

Sometimes it is easier to understand the importance of a concept by looking at its opposite.  The opposite of focus, in this context, is distraction.  In the world of startups distractions are often deadly.  They sap resources and move your team away from what they should be doing.  They can also lead to making the wrong decisions because you loose site of priorities.

By concentrating on your companies goals and relating decisions back to those goals, you can stay focused and avoid distractions.  To do so we recommend the following steps:

  1. Any time you need to make a decision on if you should do an activity stop and assess it.
  2. Look at the activity in relation to your startup’s goals and decide if it moves you towards those goals and use that decision to label the activity as something to focus on, or as a distraction.
  3. Track the distractions for review in the future, they may become aligned with your goals as other things change.
  4. If it is worth focusing on, prioritize the effort required to complete the activity with respect to meeting your goals.  Not just what the impact is, but the impact relative to the effort required.
  5. Continue to monitor actives with respect to your goals and their progress. Make sure that you lower the priority on activities that are not moving you towards your goals or that no longer address shifting goals.

In the end, you just need to have the discipline to keep your whole team focused on what needs to be done, why it needs to be done, and how you are going to do it.

Stretching for Flexibility

image_thumb5Way back around 500 BCE, a Greek guy name Heraclitus said “Nothing endures but change.”  It was true then, it is true now.  When creating a startup there is only one thing that is a sure thing – that things will change.  The unexpected will happen and things you predicted will not. Worst of all, there is no way to avoid change.  You have to accept that it will happen, and when it does happen you have several choices on how to deal with it.

You can resist it, push back, fight the change.. But in doing so you can often loose your focus and create resource sapping resistance.  Another option is to ignore it, which is often the easiest response.  The problem with ignoring change is that your startup’s goals may actually change and you do not even know it.  Lastly, you can meet change proactively, embrace change, and adjust your activities to make the best of it. The issue with this approach is that you may make the wrong adjustments and stop doing what you should be doing.

As with most things, the best answer is a combination of all three of these responses, controlled by each unique circumstance.  That is why a startup needs to be flexible.  When change happens you need to stretch your perceptions and maybe your knowledge till you truly understand the change and how it effects your startup.  Once you understand it in the context of your business, you can devices a plan for dealing with the change, or decide you can ignore it.

The most important part of flexibility is being able to honestly look at your product and your organization and change your views, your activities, and maybe even your organization itself.  Being flexible is all about using change to deal with change.  It is about being open minded.

Having an open mind and being able to listen to other peoples ideas is a critical step towards being flexible.  This is often difficult for those with the drive and passion to create a startup. The self-confidence and determination that keeps them moving forward makes it difficult for them to except that change needs to happen or to let others decide what that change needs to be.  Entrepreneurs need to be open to the ideas of others and step up as leaders to modify their plans based on outside input.

For an organization to be flexible, it must constantly stretch and push its flexibility, just like with muscles in the body.  If a company is rigid and then tries to make a big change out of the blue, pain will result.  A startup that has flexibility as part of its standard way of doing things can bend and twist as needed, when needed, without stretching things beyond limits.

Goals

image_thumb7The key to staying flexible and focused at the same time is setting usable goals and effectively using them. Goals are the tool that a startup can use to find that balance between focus and flexibility.  They give everyone in the organization a shared set of guidelines to evaluate decisions with.  If you have clear goals, your team can look at change, assess its impact on goals, and make intelligent changes.

Easy to say, hard to do.  Setting up a concise set of goals and objectives is hard enough, but sticking with them and adapting them as the world around you changes is even more difficult.   Whole books have been written on the subject of business goals and objectives.  If you have not done so, it is probably a good idea to read one or two or read some articles on the web.  Inc. Magazine has a good article from 2010 on the subject.

Some of the rules we use for establishing goals are:

  1. Goals must be real and achievable
  2. Chose goals that can be measured
  3. You should be able to explain why each goal is important to your company in one simple sentence
  4. Keep goals as simple and practical as possible
  5. Do not word your goals for outside consumption, they are tool for you and your team.

Whatever method you use, identify real world long-term and short-term goals that everyone in your organization can understand.  Once established, make sure you review them and change your goals as you learn more and as things change. Then use your goals as a tool to help make decisions and guide your company through its growth towards success.

Thoughtful Controlled Adaptation

image_thumb9A common term in the world of startups these days is “pivot.”  Do a search online for “business pivot” and you will be shocked at how many articles and blog entries are written on the topic.  It is an idea that has come out of the observation many of today’s very successful software startups ended up being successful in areas they did not expect or initially go after.  Fast Company has a good article on the whole “pivot” thing and where it came from.

Doing a pivot in a business is being flexible and making changes to address changing goals. That is good.  However, what we see again and again is people justifying lack of focus or chasing after wild geese as a “pivot.”   We know, YouTube started as a video dating site.  Great for them.  That does not excuse your shift from bio-contaminant detection to making custom dog collars.

If you pivot without control, without looking at what is going on around you, you will fall over.  If you pivot away from your goals, then you will miss your target. The answer is to think and adapt to changing situations with control.  Assess the change you are looking at, compare it to your goals, and if it make sense, plan the proper effort to implement the needed change.  Make a conscious effort to thoughtfully work out your decisions.

The journey to success is a long one, with many distractions along the way.  You can complete that journey if you stay focused, be flexible, and set and use goals.

Veebow.com: Smart Phone Coupons

imagePADT Angel Investment Profiles
Giving back to the community you come from is something that PADT strongly believes in. We extend this belief not just to charities, but also to the technology business community that helped to create the company we are today.  One way in which we do that is through strategic Angel investments in local technology startup companies.
In this series, we will take a look at the companies that PADT has invested in, where they are in the startup process, and why PADT invested in them.  Hopefully we will cover two a month.  To learn more about PADT’s investment program, visit our Technology Investing page.

 

imageVeebow.com is not a typical technology investment for PADT.  The company “was founded by Tom Vitale and Edward Loew to connect buyers with savvy companies through local, regional and national special deals using a free application on smart phones and mobile devices.”  Why does PADT have an interest in a mobile phone coupon application? We will get to that below, but first a little bit about the company.

The Company

Based in the Phoenix area, with offices in Los Angeles, Veebow.com is a startup that was born out of a missing capability in the market place.  No one provides a method for consumers and merchants to easily and affordably  use coupons on a smart phone. There are plenty of discount applications out there, but non of them are free AND mobile oriented.  They usually cost money for the consumer, or are web based systems moved to mobile.  Veebow is mobile from the ground up, and costs the consumer nothing. In fact, you actually make some money when you use a coupon through the application, because users earn points that can be redeemed for gift cards.

Veebow Couponing app developed by Amadeus ConsultingThe merchant side is also different.  Instead of having to pay for deals to get published, or instead of using the deal company as a middleman to pre-sell things, Veebow only charges the merchant when a coupon is used.  The merchant only pays when they get a customer.  That is very attractive to merchants that are unhappy with most of the deal sites out there.

One other thing that makes Veebow different is where the idea for the company came from.  Tom Vitale, one of the founders, is married to the actress Valarie Bertinelli.  A life long coupon clipper, she was complaining about what a pain it is to use coupons, and that all of the online and mobile options are difficult to use or cost money.  From that complaint came the idea and the name for Veebow – Tom’s nickname for his wife.  Her involvement is a significant marketing advantage for the company.

veebow-managementThe Veebow Management Team

The Technology

The technology on for this startup is not bleeding edge. The mobile apps are written in native IOS and Android and use standard location services and communication to work.  There is a backend tool that sits in the cloud which houses the database and does all of the heavy lifting as far as finding what the user is looking for.  Nothing too special, but a lot of work to implement and something that needs to be done right.  So the technology focus is really on executing correctly

Because of this, the real technology challenge for this product was taking the desired user experience and making it a reality.  It is one thing to sit in a room and talk about how an application should work, and another to make it happen in the real world.  Veebow just released their first major revision of the user application and you can tell they have really thought things out and put a lot of effort into making the experience special.  As the product matures and they modify and improve the user experience, look for more sophistication and ease of use in the application.

PADT’s Interest

Eric_and_VB1We are interested in this company for three reasons. And no, one of them was not meeting Valarie Bertinelli. (although, that was pretty cool, and she is as nice and funny in person as you imagined. We did get a picture with yours truly during an event in Phoenix).  As PADT grows our services and works with a wider range of companies, we have to continually learn more about other spaces and other processes used to get products to market and sold.  Sometimes we make investments in companies because their products or services are directly related to what we do, and sometimes it is because they offer us the opportunity to learn about areas we want to understand better.  The latter is why we invested in Veebow.

The first area of interest for us is the mobile application aspect.  As products get smarter they are going to be moving towards monitoring and control through mobile applications. This is already showing itself to be true in medical devices, and we are seeing it with more customers in other industries every day.  Our involvement with Veebow has already taught us a lot about mobile app development, connections to cloud based backend database applications, and user experience issues.

A unique challenge that Veebow faces is that they need to market to consumers and vendors at the same time.  PADT has no direct experience with marketing to retail merchants or consumers, but many of our customers deal with this on a daily basis.  We feel that by being involved with Veebow we will get an up close look at this very important dynamic, and give us insight that we can use when working with our customers.

The most important reason for our investment in Veebow is that we think it is a great idea, with a good team, and a workable plan. In short, we think it is a good investment that will make a nice return on our investment while growing jobs and the technology ecosystem in Arizona.  This is the type of win-win situation we strive for.

Status

The team at Veebow is very busy with a local test launch in the Phoenix area, closing out this round of funding, and finishing up some very nice tools for their merchants.  They are starting to see some traction with consumers, as they get more merchants signed up.  This is an effort where they need growth on both sides at the same time to be successful.

They are also adding to their team, making some great hires for key positions that will allow them to grow and be successful. We have already seen a positive impact on the software side and are seeing some very serious momentum on the customer acquisition side of things.  Local restaurant company Fox Restaurant Concepts is an early participant as is the national hat chain Lids.  Many others are in negotiations.

Best of all, the users seem to like it.  The droid version has 4.5 stars out of 5 and the iPhone version has 4 out of 4.  We feel that is pretty good considering how picky consumers are.

You can help PADT help our local tech startup community by downloading the application for your iPhone or Android device and using it.  It works all around the country.  What is the worst thing that will happen? You might save some money.

I know, this is bordering on advertising, but at the same time we would really like people to use it and spread the word.  Growth of this company will provide PADT with experience and capital that we can use to provide you with better products and services..  Also, when this is the next big thing, you can tell your friends that you know someone who invested in the idea early.

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Startup Lesson Learned 1: If you Build it, They Will NOT Come

10_Tech_Startup_Lessons_Learned-1About the Series “10 Tech Startup Lessons Learned”

PADT is a company focused on helping companies bring their physical products to market. As “We Make Innovation Work” for our customers, we learn a lot about what does and does not work in technology startup companies. In addition, we were once a startup ourselves and we now participate in Angel investing.  All of this has taught us a lot of valuable lessons.
In this series we will share some of those lessons learned and explore the basic concepts and ideas that will help startups overcome the odds and become successful.

This posting is the first installment for our series.  We hope that you find it useful and we look forward to sharing the the other nine articles.

We see it over and over again. Someone has a great idea. They borrow money from their friends and family, they max out their credit card, they get angel funding.  They then build their product, putting every ounce of enthusiasm and drive they have into making the product perfect. All along they show it to people and get fantastic feedback like “I would buy that is a second” and “I wish I would have thought of that, it is a great idea.”  They are dripping with passion.  As soon as they can, they put their product out there…

And the product fails.

And they wonder why. They get frustrated and sometimes angry.  What the majority of startups fail to recognize is that no mater how good an idea is, no matter how real and tangible the market need is, products do not sell themselves.  This failure mode is different from failure caused by mistakes in execution, pricing, growth, or missing the market. What we are talking about here are perfectly good viable products that do not make it off the ground because the startup that created it felt that just building it was good enough.

product_in_desert

“Building it” is just one step of many in getting a startup to success.  You must also plan and implement everything that is required to build a business and launch a product. Those things do not come automatically. If you have a great idea with demand, then the implementation will be easier, but it is very rare for the idea or need alone to make a product a success.

There are many different areas that a startup must focus on beyond the product itself.  Many a book and even a few text books have been written to talk in detail about how to plan and implement a entrepreneurial business plan.  However, in our experience, there three critical parts of the business that every startup must carry out well to be successful.

Marketing

The first is marketing – because if no one knows you have a product and what it does, you do not have the opportunity to acquire them as customers.   You have to do it, and you have to do all of it: branding, messaging, social media, website, advertising, networking, trade shows, press, etc…. You do not have to do it big, and you can scale as you grow, but you must make sure that customers know your product exists and what it does.

We see many of our customers go to market with a name and maybe a basic website. When nothing happens they do not understand why the orders are not rolling in.  A consistent and properly scaled marketing strategy with a concise message that conveys the products value is what is missing. Coming up with this is not easy and time and thought needs to be put into it.  The good news is that this is one area where outside consultants can really help.

Sales

The critical partner to marketing is sales.  The ease of direct to customer transactions through the internet gives many startups the false impression that they can simply put their product on the web and they will get orders.  Even if no human interaction is involved, there is a sales cycle and you need to plan for it, manage it, and maximize the return on investment from the sales effort.

Sales is something that everyone in a company needs to be involved in to some extent. Success in this area usually comes when a sales process is developed that fits the product, and everyone sticks to it from the receptionist in the lobby to the CEO at the top.  It is also a skill that most people do not have, or can not do over the long term. It is important to hire real sales professionals and if needed, managers, to head up the effort.

Complete the Product

There is one more major step that needs to be taken for success, to get people to come and buy a product.  You need an actual product, and not just an idea.  This seems obvious, and not even worth noting. Many times we have been involved in projects or mentoring where, when you dig deep enough, you find out that the “product” is just an idea, or a half formed prototype, and all of the details have not been worked out.  To them they have built something great, so money and customers should be coming.  But money and customers need something real and finished before they will engage.

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Build It [finish it, market it, sell it], And they WILL Come

If you are thinking of doing a startup, or if you are in a startup now, take some time to look at your strategy and decide if you are counting too much on the power of your product’s appeal to make your successful. You probably are because most people make that mistake.  Be honest about what you need to do, plan and execute, and you can defy the odds and be that technology startup that makes it.

Thoughts from the 2012 CleanTech Open

The CleanTech Open (CTO) is a unique organization in the world of technology startup competitions. As PADT grows our involvement with the CTO, we become more and more enthusiastic about their efforts. I just finished attending our first global awards competition as a sponsor, and wanted to share my thoughts on what makes it so special

The most unique aspect of this competition is the fact that it is more than a competition. When a company applies they immediately enter into a mentoring process that is comprehensive and in depth. Whereas most competitions offer up the ability to chat with a few retired guys, the volunteers that make the CTO so strong are active business, finance, and technology domain experts. Applicants are put through a rigorous training and mentoring process that addresses all aspects of starting and growing a business. So when they get to the actual competition they are much more mature and prepared than we have seen almost any other applicants in other competitions. It is not about winning the pitch, it is about learning.

The other characteristic of the CTO that we find special is that they are focused on companies that are using technology to address real environment problems. Clean water, more efficient energy production, dealing with waste and pollution. Sitting there watching the presentations I realized that the problems we face as a planet are not going to be solved by politicians, laws, treaties, or activism. Like most serious problems that we have faced in history, they will be solved by smart people being creative who apply knowledge and technology. They are working on it.

What a great experience. Thank you to all the volunteers that make it happen and the leadership behind the whole effort. I can’t wait to get involved in the 2013 competition.

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SBIR Awards at PADT

In 1999 PADT started looking for ways to leverage our various skills to further develop some intellectual property.  We had been doing projects for a variety of customers who were participating in the Small Business Innovative Research program through the federal government (SBIR), and we thought it might not be a bad idea to try going for a few SBIR’s of our own to help us get from that “startup” stage to the “established” phase.  It worked, over the following ten years PADT was successfully awarded 13 SBIR grants.

While we were in the thick of it we really did not keep track of things from a marketing perspective.  But as we prepare to launch the new Product Development portion of the PADT Blog, we thought it would be a good time to look back and summarize what we did and share it with our readers.

One thing that sets PADT apart in the world of SBIR’s is our high level of commercialization.  Although not all of the awards PADT received turned into commercial products, many did.  And bits and pieces from each project help PADT increase our experience and tool set.

Here is a list of the SBIR’s we have been awarded over the years:

Miniature Air Handling System for Portable Fuel Cell Power Supplies
US Army 1999 Phase I
VaneAlpha1This was our first SBIR and it was also our first project that involved pumping or blowing for fuel cells.  We learned a lot on this project and many of the follow on SBIR and commercial products we developed in this area are based on the technology developed here.
Ultra Low Weight Turbomolecular Pump
NASA 1999 Phase I
psys5JPL was interested in developing a very low weight vacuum pump (TMP) that they could use on their interplanetary explorers so they could run their experiments in a vacuum.  This project had a lot of issues to overcome, not the least of which was how to manufacture the thing.
Ultra Low Weight Turbomolecular Pump
NASA 2000 Phase II
TMP_050701_fOur proof of concept in Phase I was good enough to win PADT a Phase II contract for the ULWTMP design.  Now our ideas had to be put to work. We did solve a lot of the problems, especially the manufacturing issues. At the end of the project the only issue left undone was the rotordynamics problem that is encountered at the speeds of a TMP with a magnetic bearing.
Miniature Air Handling System for Portable Fuel Cell Power Supplies
US Army 2000 Phase II
vane-familly2PADT took what we learned in Phase I of this project and developed a family of vane compressors that met the unique needs of the US Army.  We developed an entire family of pumping solutions and tested them to develop a good understanding of their capabilities, strengths, and weaknesses.
Fuel Cell Based Portable Hybrid Power Supply
US Army 2000 Phase I
Hybrid-aThis phase I project involved the design of a portable hybrid power supply that combined batteries and a hydrogen fuel cell.  The end product was a conceptual design for a light way power solution for US soldiers.  PADT built a working demonstrator model that highlighted the control system, the custom fuel cell, and the pumping solution.
Fuel Cell Based Portable Hybrid Power Supply
US Army 2001 Phase II
hybridThis follow on project focused on the detailed design of a light weight portable power supply that used hydrogen to drive a fuel cell.  We produced a working demonstration product at the conclusion if of the effort. PADT was able to use all aspects of our company: simulation, design, test, prototyping, system integration, and manufacturing. The technology developed was used successfully to develop a complete hybrid system for a methanol fuel cell manufacturer who applied it to commercial applications.
Aerosol Collection Technology
US Army 2001 Phase I
impactor_bAfter the events of 9/11 the US Army had an interest in being able to detect air born biological weapons. Although they had good detectors, they needed a device that would use aerodynamics to collect air and separate out particles of a certain size. In Phase I of this project PADT used our CFD capability and rotating machinery design experience to develop a conceptual device for this application.
Aerosol Collection Technology
US Army 2003 Phase II
91010046For Phase II of this project PADT produced a working prototype and tested it with the help of Arizona State University. The testing showed that the technology was viable.  Fortunately, as time passed so did the potential threat and no market really opened up looking for such a device.
Low Cost Hot Anode Recycle Blower for SOFC Systems
DOE 2005 Phase I
invis_start_02_a32500_pic13PADT applied our fuel cell pumping knowledge to develop a pumping system that could work with the very high temperature Solid Oxide Fuel Cell systems that the government was looking at using for aircraft applications.
Miniature Disposable Drug Infusion Pump
DOD 2005 Phase I
clip_image002The department of defense is always focused on improving their ability to treat wounded soldiers in the field. One area that needed improvement in 2005 was the ability to deliver drugs in the battlefield with a portable lightweight design that had many special features which would allow a non-expert to administer the drugs. PADT investigated several different solutions and produced a conceptual design.
Low Cost Hot Anode Recycle Blower for SOFC Systems
DOE 2006 Phase II
clip_image002For the follow-up on this project PADT built a working system for pumping very high temperature fuel in a solid oxide fuel cell loop.  We also tested the system, at temperature, under a variety of operating conditions.
High Temperature Blower Development For SOFC Applications
DOE 2006 Phase I
clip_image002[5]PADT received an additional Phase I grant in this area to explore other options and to improve on the system developed as part of the low cost program.
Instruments and Devices To Preserve Molecular Profiles In Tumors
NIH 2009 Phase I
IMG_1448PADT first NIH project looked at developing a device that would freeze tissue biopsy samples during their extraction from a patient, or just after.  PADT developed a working prototype, the ReadyFreeze, that was very successful at allowing the user to freeze biopsy samples very shortly after extraction.