Serial entrepreneur, Speaker and author
The role of CEO / founder in a startup is probably one of the most diverse jobs it is possible to have. You do everything from buying the printer paper to paying the bills to develop the strategy. But diversity is also the reward as you see your whole business grow and appreciate what went into that success. In this series, I will consider some of the things I have learned over 35 years in and around startups and share some advice for new CEOs.
This month, we look at some of the issues relating to product development, marketing, and protecting yourself legally.
Cook Up
Prototyping is a key part of the design and implementation process. Many development models – design thinking, Lean Startup, MVPs (minimum viable product), living labs, etc. – promote the need for prototypes to test with potential customers to fine-tune the features and functionality of your product. It is an iterative process, and many prototypes may be developed on the road to a final product design. It may seem time-consuming but do it anyway. The more customer testing before committing the design will ensure a better fit with the market and more sales in the long run.
Knock Up
So knocking up a quick and dirty prototype will help you rapidly gauge interest in your product or service. The classic MVP. Something that can be presented to potential customers or investors that shows the possibility of what the full product might do but doesn’t require the full resources of the company to build. Knocking up an MVP can save you huge amounts of time and money in the early stages of development by ensuring that you are building something that customers actually want. If they don’t, you can pivot early into something they do.
Mock Up
With product development, be it hardware or software, making mock-ups is the best way to test ideas with customers or investors. Dummy screens, 3D-printed prototypes, even PowerPoint slides, can all be used with minimal investment for maximum impact. There are plenty of online design services available now to help you show what your product or service might look like once it’s created. Use them to full effect.
Run Up
The run up to the launch of a new product needs careful planning. When is the right moment to launch this product into the target market? Are there particular (annual) events that gather potential customers? Are you going for a big splash or a viral campaign? Do you need physical marketing materials? There is a lot to plan and execute. I have found that only a real deadline – such as an annual exhibition – will galvanize the product teams into finishing. Soft deadlines come and go. As Douglas Adams famously said, “I love deadlines. I like the whooshing sound they make as they fly by.”
The run up to the launch of a new product needs careful planning. When is the right moment to launch this product into the target market?
Draw Up
Drawing up legal documents is a blessing and a curse. You need a shareholder/partnership agreement right away – before you invest your initial capital and well before you launch your business! All other documents can wait. If you have a lawyer in, or close to your team, they will pressure you to create a raft of documentation to ‘protect’ yourself.
At my first startup, we were convinced to develop a sales contract to get customers to sign when they bought our products. It was 20 pages long and cost a few thousand pounds. We never used it. Customers refused to sign it and made us sign their procurement agreements instead. And they paid us anyway.
Protecting your intellectual property, however, can be useful. Certainly, trademark your company name, logo, tag line, etc. Copyright your marketing materials. But think very carefully before going down the road of patenting your inventions.
Do the patent search to make sure you are not infringing upon anyone else. Perhaps start developing the materials you will need to execute a patent, but don’t engage a patent attorney until your (potential) investor insists and get them to pay for it.
Patents will cost you tens of thousands if you want to be covered across Europe, the US, and some other key markets. Patents basically put into the public domain your ideas and IP; anyone can then see what you are doing. If a large foreign company then decides to just take your idea and develop a product, it is up to you to sue them for infringement.
If you thought the cost of getting the patent was high, you will be shocked at the legal cost of defending it. I’m not saying never, but do it with eyes wide open and with the support of investors.
David Tee has over 35 years of experience in technology development, entrepreneurship, and international consulting. He has founded and worked in Cambridge IT startups, consulted for a Silicon Valley-based advisory firm, and supported the development of innovation-focused incubation services across the world. He is currently on assignment in Turkey, and lives between Europe and India.
There are many more ‘Ups’ (Heads up, Free up, Light up, Make up, etc.) in his book Upstart Ninja: So, you want to be a startup CEO?
David can be reached at [email protected]