The Startup Checklist: 25 Steps to a Scalable, High-Growth Business Quotes
Quotes from "The Startup Checklist: 25 Steps to a Scalable, High-Growth Business"
All of these are quotes from the book. These are not mine. If you believe that your copyright has been violated, please contact me for immediate removal.
“In their structure, a business model includes nine basic elements:
1. Customer segments. The specific, different groups of customers the business serves—that is, the identified customers for whom it will create value.
2. Value propositions. How the business solves problems and meets the needs of its customers, creating value for them in the process.
3. Channels. How the business reaches its customers and delivers value to them—for example, through direct online sales, retail distribution channels, value-added resellers, company-owned storefronts, or affiliate programs.
4. Customer relationships. The ways in which the business connects with, relates to, and retains customers.
5. Revenue streams. Where the money comes from: how the business generates income from the value propositions it offers to customers.
6. Key resources. The assets required to create and deliver the value propositions to customers—for example, physical assets such as buildings and machinery, and human assets such as employees with particular skill sets.
7. Key activities. What the business does to make its business model work, such as inventing, buying, building, distributing, operating, and so forth.
8. Key partnerships. Outside organizations, such as suppliers and partners, that help the business model work.
9. Cost structure. The costs that the business incurs in operating its business model.”
“In general, there is a simple math equation that estimates basic viability by multiplying four factors:
Number of potential purchasers ×
Percentage of capturable market share ×
Absolute dollar amount of each sale ×
Percentage margin of net profit =
Total potential profit”
“The ideal startup is one that can be bootstrapped from its own early revenues—or at least funded from the founder's personal savings account.”
“Your marginal costs must drop over time so that each additional dollar of revenue costs less than the previous dollar.”
“Your scalability needs to be built into your business model, rather than relying on any special exogenous factors.”
“You need to know your market extremely well to run your business. What you do not have to do, however, is to include everything you know about it in your lean business plan.
Your lean plan is about what's going to happen, and what you are going to do. It's about business strategy, specific milestones, dates, deadlines, forecasts of sales and expenses, and so forth.”
“Running a business effectively requires minding the details but also watching the horizon. It's a matter of keeping your eyes up (looking at what's happening on the field around you) and your eyes down (dealing with the ball), at the same time”
“You should now have a clear focus on the core of your business that will be used as the context as opportunities arise and decisions need to be made.”
“Marketing, in essence, is getting your customers to know, like, and trust you. To do that, you must understand them inside and out. Know how and where to find them, how to help them find you, and how to present your business to them in the way that best matches your strategy and business offering.”
“Product and service tactics are the decisions you make about pricing, packaging, service specifications, new products or services, sourcing, manufacturing, software development, technology procurement, trade secrets, bundling, etc.”
“Tactics often include financial tactics, team building, hiring, recruitment tactics, or the logistic tactics related things such as taking on a new office or manufacturing space.”
“Once you have the strategy and tactics clear, it's the specifics you need to track progress, identify problems, and make changes. These include milestones, measurements, assumptions, and a schedule for regular review and revisions.”
“Coding, design, production, sales, finance, operations, marketing, and the like are all execution skills—and without great execution, success will be hard to come by.”
“A powerful step in the marketplace experimentation process is to watch customers using the product. How you accomplish this will vary depending on the nature of the product. The key is to pay close attention to how the product is used, to make detailed notes, and, in particular, to notice anything that is unexpected or surprising.”
“Sole Proprietorship
(The company is an entity with its own existence, but you are personally liable for everything from debts to taxes.)
General Partnership
(Similar to a sole proprietorship, except that several people share ownership and liability.)
Limited Liability Company (LLC)
(An independent entity with limited liability, but with no easy way to divide or sell ownership and no way to give options to employees or advisors.)
S Corporation
(A corporation with an independent legal life and limited liability, and with stock, but with all the stock owned by you, and the company treated as invisible when it comes time to file your taxes. This can actually be a good thing, IF the company is losing money and you have no investors and you have other income that you would like to shelter. An S corporation can also be easily turned into a C corporation by filing one form.)
C Corporation
(Bingo! A corporation, with limited liability and divisible stock. What more could a startup want?)
B Corporation
(This is a variant of a C corporation, but designed for businesses that plan to have a social impact by generating public benefits. At this point, the B corporation concept is primarily a marketing ploy, so my suggestion is to avoid it for now. If, ultimately, you feel the need to be a B corporation, to switch is pretty straightforward.)”
“but the most important thing a lawyer brings to the startup table is their knowledge of the law surrounding everything to do with founding, financing, and operating a startup!”
“The third thing I look for in a startup attorney (the first is integrity and the second is professional skill and experience in startup law) is that he or she is a deal maker, not a deal breaker.”
“If you are negotiating anything, from an investment round to a strategic contract, you want to be absolutely sure that your counsel understands that you want to do the deal, and his or her job is to make that happen”
“You should choose your counsel on the basis of professional competence, the quality of the working relationship you believe you can create with them, and their billing rate”
“Your Corporate/Business Law and Securities Lawyer”
Your Employment Lawyer
Suite of employment agreements (proprietary information agreement and job offer/employment agreement)
Severance agreements
Case-by-case advice on special situations involving employment agreements, disputed exits and possible lawsuits, founder entries and departures, and independent contractors
Human resources forms (antiharassment policies, employee handbooks, etc.)
Your Intellectual Property (IP) Lawyer
Contractor agreements (ongoing, timebased, and special purpose)
Nondisclosure agreement
IP assignment agreement
Patents
Copyrights/trademarks; advice on names and name conflicts for company, website, application, product or service
Trade secrets”
“Any information or data that is generated or controlled by your business is part of your company's IP, which means it needs to be protected and managed. Customer lists, contracts with suppliers, software code, plans for future products—these and other forms of information can all qualify as IP with a definite financial value that your lawyers can help you protect.”
“Don't put any of your management team on the board (except for a cofounder); don't put someone you don't trust absolutely on the board; and don't put your mother or your best friend on it. Instead, think about someone with business experience who has been advising or mentoring you along the way.”
“When you create your budget, try to project your income and expenses for the coming year as accurately as possible. Identify specific categories of income and expenses as precisely as possible. Then, break down the budget according to monthly increments.”
“Beware of relying on a one-person internal accounting department without carefully defined and consistent checks and balances”
“One of the more powerful, yet easy-to-use, cloud-based solutions—and my recommendation for most startups—is the suite of online tools from Xero”
“Website
For businesses that do not require large, custom-coded Internet applications that are deployed on cloud-hosted platforms, there are many vendors that provide powerful, easy-to-use tools for quickly and inexpensively designing and deploying custom websites.”
“Best options: SquareSpace*, WordPress, Weebly, Wufoo, Wix”
“Surveys
Whether you need to create a simple poll of existing customers, conduct an in-depth market research survey, plan an event, or collect data from employees, these services give you the tools to design a survey, send it out to targets, collect answers, and analyze and report on results”
“Best options: SurveyMonkey*, Google Forms, SurveyGizmo, Zoomerang”
“Customer Relationship Management (CRM)
The first pioneer of Software as a Service (SaaS) was Salesforce.com, which revolutionized the world of business sales teams and the industry of software distribution. Following in its footsteps, customer relationship management systems organize the entire sales process and keep track of past, current, and prospective customers. With comprehensive reporting, sales pipeline generation, and a nearly infinite variety of add-ons and additional features, CRM systems serve as the backbone of a company's revenue generation activities.”
“Human Resources
For a newly minted startup that consists of just you—or you and a cofounder—you will likely be able to handle by yourself the paperwork related to your employment with the company”
“Best options: Zenefits*, Justworks, Insperity, Workday, TriNet”
“File Storage
While it used to cost thousands of dollars to purchase physical disk drives to hold all of your data, today, data storage in the cloud is virtually free, and competition has moved to the areas of features, interconnectivity, and ease of use.”
“The major ecosystem players incorporate full cloud-based file storage into their offerings (Google Drive, Microsoft OneDrive, Apple iCloud)”
“Best options: Dropbox*, Box, IDrive”
“Team Communications
As your team grows, it is increasingly important to have effective communications systems in place so that nothing gets lost between the cracks. This is important if your team works side by side in a single office. It is critical if your team is virtual, dispersed, or often on the move.”
“Best options: Slack*, Sococo*, Yammer”
Project management
“To manage development and projects in this changing environment— especially when many people are working together—it is essential to use a system to keep track of what is happening, and to manage the company's priorities.
Best options: Trello*, Basecamp, Asana, Pivotal Tracker”
Teleconference
“Best options for audio calls: UberConference*, FreeConference
Best options for video calls: join.me*, Skype*, Google Hangouts*, FaceTime, GoToMeeting, WebEx”
“Customer Support
As your business grows, so too will your customer base—and no matter how easy to use or self-service your product or service is, you will invariably have customers who require support, report bugs, or have questions.”
“Best options: Zendesk*, Get Satisfaction, Freshdesk”
E signature
“you will want to establish an account with an e-signature provider to make your life easier as you negotiate and execute documents.
Best options: EchoSign*, DocuSign*, HelloSign, CudaSign”
Marketing
“Once you have your first customers, you will want to maximize their lifetime value to the company by keeping in touch with them and delivering sales messaging on a regular basis.”
“Best options: MailChimp*, HubSpot, SendGrid”
Social media management
“Best options for social media: Twitter*, Facebook*, LinkedIn*, Google+, Quora
Best options for social media management: Hootsuite*, Buffer, SocialFlow, Sprout Social”
“Among the most popular and important metrics that startup managers find valuable to track across all business categories are customer counts, number of repeat purchases, and sales revenues. But more granular data related to a particular business model may be equally important.”
“Finally, as you develop your metrics, define the growth milestones you hope to achieve and the metrics for achieving them in advance rather than after the fact.”
Tools for analytics
“Google Analytics is a free service for small businesses that has become the standard way of tracking website interactions with users
Chartbeat is a business dashboard that shows you a summary of success. You can track concurrent visitor counts, compare web traffic against Twitter chatter, analyze how people find your site—say, by searching Google or clicking a link on Facebook—and see a history of web traffic at a glance. To use Chartbeat, simply insert a small code snippet into the header and footer of each web page
Kissmetrics is a comprehensive and easy-to-use analytics platform designed to optimize your marketing and conversion rates
Mixpanel gives you tools for tracking user engagement across your product and following individual users and their specific actions, as well as doing detailed conversion analyses of your sales funnel
Indicative is a newer analytics platform specializing in the customer journey”
“This framework provides a strong foundation as you consider who's on your team now and whom you want on your team in the future.
You need a strong core of team leaders who are extremely talented at what they do, are a great fit for your system, share the desired vision and values, and will work at a fair price relative to market rates.
You need a deep bench of team players who aren't yet as talented as the starters (or lack the same level of job fit), but buy into the desired organizational culture, and do so at fair market price.
You want to avoid using specialists who, if placed in a leadership position, can quickly turn the organizational culture toxic or tip the payroll balance by demanding exorbitant fees to be part of the core team.
You must avoid hiring and retaining waivers, who don't have the skills, aren't a fit, don't buy into the vision and values, or make it too expensive in time, energy, and/or money to keep around.”
“As you build your team, it is important that everyone sign an employment agreement on his or her way in the door. This goes for you and your cofounder(s) as well. The specifics can be tweaked (although in general they are pretty standard), but the basic points should include salary and benefits details, confidentiality, intellectual property assignments, and employment at will.”
“The ideal lead investor will have the following characteristics:
“Smart money,” which means they know the startup business and the particular domain of the company, and can be helpful in many ways going forward
A strong commitment to the company, so they will devote time and effort to the company during and after the fund-raising round
A significant amount of money they are willing to invest (typically, at least 25–50 percent of the target raise)
Deep pockets (that is, more cash reserved for follow-on rounds)
A network of other investors to whom they can introduce the company
Good personal chemistry with the entrepreneur”
“The Startup Checklist
Develop and iterate your Business Model Canvas
Craft and maintain your lean business plan
Find and monitor your competitors
Find and collaborate with your founding team
Establish and maintain your founder accord
Track and monitor your lean startup experiments
Establish your online profiles
Network within the entrepreneurial ecosystem
Incorporate your venture as a Delaware corporation
Work with your startup lawyer for incorporation and financings
Recruit and communicate with your board and advisors
Manage your financial accounts and accountant
Establish and manage your credit profile
Establish your bank, credit card, and merchant accounts
Integrate your key online platforms and vendors
Measure your business with data analytics
Hire your team for best fit and work with freelancers
Establish and maintain your stock option plan
Assess your funding readiness and develop your fund-raising pitch
Reach out to investors and manage your investor pipeline
Raise funds online from the crowd, angel investors, and VCs
Execute your investment term sheet and manage all due diligence
Manage your investor relations
Keep your 409(a) valuations current
Plan for a strategic merger or acquisitions or an IPO”