We all have heard phrases like “Customer is King”, “Customer Delight”, “Customer Experience Management” etc. and we rightly value (paying) customers above everything else for our startup. Especially in the early stages of the startup, the “customer acquisition strategy” is one of the first things that we focus on.
While you focus on critical things like targeted customer segments and customer acquisition cost for your business plan of your beloved startup, we invite you to consider “customer dissatisfaction cost” as well. The below useful infographic from Vision Critical demonstrates the importance and impact of the cost of unhappy customers with some surprising numbers that startup teams (even big corporate firms) often overlook.
To continue our series of weekend videos, here is a nice one from Y Combinator in which Mark Zuckerberg talks about early days in Facebook. Highly recommended to watch. For those who don’t have time for a 36-min. piece, here are our favorite lessons-to-learn from the video:
– On motivation: Stay inspired by what you are doing. There will always be skeptics saying that your thing can’t be a business. Just care about what you are doing, and that’ll drive you forward.
– On hiring great people: The only way to determine whether a person you are hiring is really good is to realize if you would want to work for that person.
– On making decisions: Out of a hundred things that you can potentially go do, pick up the one that actually matters.
– More on motivation: In the early days Facebook had a serious competitor called “College Facebook”. Every time the competitor would launch at a new school, the whole Facebook team would literally not leave the house and work until they address the problem. They still have this concept of “lock-down” at the company and many teams do it themselves.
– On founder equity (we couldn’t miss this one!): All founders must be on vesting schedule. Mark heard nothing about vesting at the time when they started the company. They just divided equity, and then his co-founder Eduardo left. “That mistake probably costed me billions of dollars” – says Mark. But even when things like this happen, it’s important to move forward.
Here founders of Zenlike are sharing their story of how they came to a decision to split unequally and why it felt as a right thing to do.
For a short resume: they agreed on a 55/45 split. Founder 1 got 55% for two reasons: first, he had been working already for 2 months on the project and secondly he had made a significant investment into the project. No premium was given for the idea. As for other factors, the two founders seemed to have a comparable level of experience, expertise and network value.
Recommended reading for those who are in the process of negotiating equity division with their co-founders. It clearly shows that in truly successful ventures even equity talks are more about fairness and cooperation than about “splitting” or getting into a more advantageous position in comparison to your co-founders.
We were also happy to see that the logic of Zenlike founders can be absolutely replicated in our FES model. While our model by default assigns some equity premium for an idea, this can be easily overridden by indicating that all founders are the “idea persons”. And FES helps founders consider even a wider range of their strengths and competencies which can be vital for the startup and which should therefore influence their equity splits.
Are you working on a new business idea with a small group of friends or colleagues? Is this the first time that you start a startup? Then you absolutely need to check out this entertaining infographics below from an infinitely creative FundersandFounders team.
Do any of these issues sound familiar to you? Beware of these founder conflicts, as they can easily sink any promising venture.
And yes, we would recommend any of those solutions – except just one. When answering the question “Who gets what” you should never jump to a 50/50 equity split. This is the only wrong answer, as Dan Shapiro put it in his widely cited and much discussed blog post.
Use Founder Solutions model instead and find out immediately what’s a fair equity share for each and every member of your startup team.
The FounderSolutions got into its first ever pitch competition – and WON it!
Thanks go to Pankaj Saharan, our co-founder, who outcompeted around 10 other excellent pitch makers in a contest “Pitch and Beer” held in Helsinki.
Pankaj’s presentation of the idea and vision behind FounderSolutions won appreciation of a panel of strict judges, including a serial entrepreneur Ilkka Lavas (w3.fi, ilmainensanakirja.fi, http://deitti.net).