Neil Senturia on Top Lessons Learned as an Entrepreneur
“Let your hopes, not your hurts, shape your future.” — Robert H. Schuller
Editor’s note: This is a guest post from Neil Senturia on his lessons learned as an entrepreneur. Neil is the current CEO of Blackbird Ventures and the author of I’m There For You, Baby; The Entrepreneur s Guide to the Galaxy . As an entrepreneur with more than 25 years of diverse entrepreneurial experience, Neil has re-invented himself several times in his relentless pursuit of entrepreneurial success. Without further ado, here’s Neil …
To be successful at your start-up, you need to get the first 10 things right. In other words, you need to bat .1000 on the first 10 decisions. After that, you can bat .400, and in the aggregate, you can still make a strong company and a lot of money.
So, when I teach this concept to students at UC San Diego and San Diego State, they always raise their hands and ask politely, “OK, so what are they?”
My answer infuriates them: “They are different every time. But you still need to bat .1000. The first 10 are the most important, they cannot be finessed or nuanced, they need to be dead on, rock solid, concrete and correct.”
So here is one rule that is constant. The entrepreneur must not only tolerate ambiguity but in fact they should embrace it. The willingness to not know what you need to know informs the decision- making effort—for example, the effort to define the business model and the product.
You would think that product and business model are what you have before you start the company but in fact, what you have is a quarter-baked idea, based on some half-baked assumptions that rely on some raw opinions.
Step One is Taking the Effort to Find Out What You Don’t Know
The concept of ambiguity implies that you are not sure what the business really looks like. Only 20% of companies actually end up doing what they think they set out to do on day one– the day they finished writing the business plan or the infamous 13 slide power point with its attendant hockey stick and the verb “we will.”
“Will” is a powerful word. You think the venture capitalist wants you to make a presentation with answers, and what I now strongly believe is that presentation should mostly have questions. I am not being cute. What I am suggesting is that step one of the start-up is the effort to find out what you don’t know.
This is the embrace of ambiguity. This is the willingness to change your mind, your plan, and yes, your underwear.
Changing Your Mind and Your Plan is a Good Thing
Currently, I am the CEO of a start-up in the alternative energy space (www.oberonfuels.com), and I recently was speaking with one of our key investors. I told him that we were going to make DME instead of gasoline. The various twists and spins and reasons are not relevant.
What is interesting is that one of our key investors was happy with the switch. Another one said, “You have changed your plan. You told us one thing, and now you are telling us another.”
Now I viewed changing my mind and our plan as a good thing. It might save you guys $25 million while some of our investors thought that changing your mind indicated weakness, vacillation, uncertainty, confusion.
The entrepreneurial spirit demands that you be willing to tack and jibe and then tack back (I race sailboats) because things change, and you are always looking for the right wind on the right side of the course with the right pressure. If you fear reprisal when you change your mind or your course, then you will not get one of the first 10 things right and you will not bat .1000.
When You Make a Big Mistake, Fix It
Here is another example. Recently I built a new house, and the day before they were going to pour the footings for the house, I realized that I had made a mistake– a big one. I had miscalculated the dimensions. I had two choices– pour anyway since the concrete trucks were in front of the house or stop the presses and send everyone home and fix it.
I picked the second option. It cost me seven months and some serious money. But I have been living in this house for five years, and immodestly I would say it is quite lovely. The proportions are now correct.
Wade Through the Ambiguity
It is mandatory to seek the correct answer and to be willing to wade through the ambiguity of indecision and the fog of revenue calculations and the mist of customer adoption.
Because once the footings are poured, the damn thing is cast in concrete.
Ambiguity is your friend. Love it and embrace it.