The Art of the StartThe Time-Tested, Battle-Hardened Guide for Anyone Starting Anything

AUTHOR: Guy Kawasaki PUBLISHER: Portfolio DATE OF PUBLICATION: 2004NUMBER OF PAGES: 215 pages

THE BIG IDEA

You have the idea of a lifetime and yet you do not know where and how to begin. It is a dilemma shared by entrepreneurs everywhere - what does it take to turn a great idea into action?Author Guy Kawasaki brings two decades of business experience to offer a definitive guide for anyone who dreams of starting anything. Whether you are thinking of starting a start-up Internet operation or a church group, The Art of the Start will provide you with everything you need to know from raising money to fostering a community.

Chapter 1: The Art of Starting

Make Meaning. The best reason to start an organization is to make meaning. Meaning is not about money, fame or power. Instead, meaning is about making the world a better place, increasing the quality of life, righting a wrong and preventing good from ending.Make Mantra. Instead of a mission statement, take your meaning and make your own mantra. A mantra is defined as a sacred verbal formula repeated in prayer, meditation, or incantations such as an invocation of god or a magic spell. Get Going. Start creating your product or service and commence delivering to your customers. Define Your Business Model. Define your customers and their needs. Weave a Mat (Milestones, Assumptions, and Tasks). Compile a list of the milestones you need to meet, assumptions that are built into your business model, and the tasks you need to accomplish to create your organization.

Chapter 2: The Art of Positioning

With the right positioning, you should be able to see clearly why the organization was started, why it should be patronized by customers, and why good people should choose to work for the organization.Good positioning must have the following qualities:

Positive.Customer-centric.Empowering to your employees.Self-explanatory.Targets the intended customer.Must show the core competencies of your organization.Relevant to your core competencies and to the core needs of your customers.Long-lasting.Different from your competitors.

Chapter 2: The Art of Positioning

Other Positioning Tips:Position your product or service in the most personal manner you can. You must choose a remarkable name for your organization, product or service. Use plain words that are easy to understand when describing what your company can do for your customers. Avoid technical or insider jargon.Offer concrete points instead of mere overused adjectives when distinguishing your products to competitors. Instead of calling your system safe, say that your system has never been hacked. Ensure that each member of your organization understands your company’s positioning.

Explain Yourself in the First Minute. Every single time you make your pitch, take in mind that your audience is waiting for you to answer one question: “What does your organization do?” Answer the Little Man. Picture a little man sitting on your shoulder the next time you are giving a presentation. Imagine the little man whispering, “So what?” in your ear every time you make a point. Always answer the little man’s question. Know Your Audience. Do your research before any meeting starts. Find out who you would be pitching to and learn what’s important to your audience. Observe the 10/20/30 Rule. Use the following the next time you are giving a presentation: ten slides, 20 minutes, 30-point font text. The 10 slides that are necessary for a pitch to investors are:

Title slideProblem

Chapter 3: The Art of Pitching

Chapter 3: The Art of Pitching

SolutionBusiness modelUnderlying magicMarketing and salesCompetitionManagement teamFinancial projections and key metricsCurrent status, accomplishments, timeline and use of fundsSet the Stage. Remember that everything and anything that goes wrong would be your fault. Therefore, you must be prepared. Make sure you bring your own projector and your own written materials. Let One Person do the Talking. In a pitch, it would be advisable for the CEO to do 80% of the talking. As for the rest of the team, one or two slides that pertain to their expertise are more than enough. Pitch Constantly. The best way to achieve familiarity is to keep doing your pitch over and over again.

Focus on the Executive SummaryWhen writing a business plan, use the ten slides that are necessary for a pitch to investors (previous chapter) and use them as your framework. An executive summary is a concise and clear description of the problem you wish to solve.

Keep It CleanDo not exceed twenty pages. The shorter your plan is, the more likely it is to be read.Only one person should write the entire business plan. Use staples to bind the plan. Forget about leather, embossed portfolios.Simplify financial projections to two pages. After all, it is simply impossible to know how much you’ll spend on office items in your fourth year of operations.Include key metrics. Remember, the number of customers you have, locations and resellers are important to your investors.Provide the right numbers. Your cash flow statement for the first five years is very important.

Chapter 4: The Art of Writing a Business Plan

Here are other things to consider when you are on a bootstrapper’s model:

Forget the “Proven” Team. When you’re bootstrapping you must almost always go for what’s affordable. Focus on Function, Not Form. Do not focus on form when it comes to spending money. Go Direct. Take the opportunity to sell directly to your customers. Position against the Leader. As a bootstrapper, positioning against the market leader or going against accepted ways of doing things might be the smartest thing to do. Understaff and Outsource. Overstaffing can cause you a multitude of problems. It is better to understaff and outsource. Build a Board. A board of directors is always a source of good guidance and superb direction. Sweat the Big stuff. Save on office space, furniture, computers, and office equipment.

Chapter 5: The Art of Bootstrapping

Chapter 5: The Art of Bootstrapping

Execute. The failure to execute can be disastrous to a bootstrapper. To be able to execute, you must be able to:

Set and communicate goals.Measure progress.Establish a single point of accountability.Reward the achievers.Follow through until an issue is done or irrelevant.Heed reality.Establish a culture of execution.

Chapter 6: The Art of Recruiting

Recruiting good people is one of the most enjoyable and yet most critical tasks that you must face as an entrepreneur.

Recruitment Tips:Hire people better than you.Remember that there are very few A players out there. Don’t make the mistake of disqualifying A prospects because of gender, race, sexual orientation or age. Ignore the following factors: experience in a big, successful organization, experience in a failed organization, educational background, experience in the same industry, experience in the same function, and functional weakness. They are unimportant.It is best to hire candidates who possess major strengths even if they have major weaknesses.

Build a Business. The best way to get investors is to build a business immediately. Get an Intro. Have current investors, lawyers, accountants, other entrepreneurs and professors introduce you to investors. Clean Up Your Act. Get rid of obvious flaws in your system. Disclose Everything. Don’t attempt to hide problems that can not be cleaned up immediately. Acknowledge, or Create, an Enemy. Believe it or not, investors do not want to hear that your organization has no existing competitors.

Don’t Use Old Lies. Refrain from using them and be prepared to come up with new ones:

“Our projection is conservative.”“All we have to do is get 1 percent of the market.”“P&G is too old to be a threat.”“Several investors are already in due diligence.”“Key employees will join as soon as we get funded.”

Chapter 7: The Art of Raising Capital

Partner for “Spreadsheet” Reasons. Partnering can accelerate your entry into a new area, open up new distribution channels, speed up product development and reduce your costs. Define Deliverables and Objectives. These include additional revenues, reduced costs, new products and services, new customers, new markets, etc. Ensure that the Middles and Bottoms Like the Deal. It is not enough that upper management believe that the partnership is a good idea. Find Internal Champions. Choose one person from each organization to become an internal champion. Cut Win-Win Deals. Both partners have to win. Do not enter into win-lose partnerships. Wait to Legislate. Don’t ask for legal advice too early. Legal experts will always give you more reasons not to go through the deal. Put an “Out” Clause in the Deal. The assurance that both parties won’t be trapped into a partnership that is not working actually promotes longevity.

Chapter 8: The Art of Partnering

Lower the Barriers to Adoption. You have to make your product or service simple and yet effective. Recruit Evangelists. Evangelists are people who believe in your company and what you do. Foster a Community. Identify and recruit customers who are enthusiastic about what you do. Hire someone whose sole task is to foster a community. Achieve Humanness. Target the young and don’t be afraid to make fun of yourself. Feature your customers and help the underprivileged.Focus on Publicity. To attract publicity, create something grand and get them into the hands of people. Make friends even with reporters from publications you have never heard of.

Chapter 9: The Art of Branding

Chapter 10: The Art of Rainmaking

A rainmaker is a person who generates large quantities of business. The second step of rainmaking is to be able to sell the product or service well. Here are some tips you can use to master the art of rainmaking:

Pick the right lead generation method. Find the key influencer. Ignore titles. They really don’t mean much.Be nice to secretaries and administrative aids. Make your prospect talks. This way, they’ll be able to tell you what you need to do to close the deal.Ask customers to test drive your products and services.Give your customers a slow and easy adoption curve.Do not be fazed when you are rejected.

Chapter 11: The Art of Being a Mensch

Mensch is a Yiddish term for an ethical and admirable person. In some cultures, it is considered the highest form of praise. To be a mensh, you must help people, do what’s right and contribute to society.Here are some tips on becoming a mensch:

Help people who can not help you back.Observe the spirit of agreements, pay for what you get and focus on what is important.Help society by giving money, time, expertise and emotional support.

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