This is a translation of an article posted in Fortune (Arabia) – October 2011
Taking on entrepreneurship is one of the most life changing events any person can embark on; it not only impacts the individual, but impacts the community and even the world. An entrepreneur is someone who just does not accept the status quo, but has a vision for the future and makes the impossible happen to arrive at this vision.
Entrepreneurship is not easy anywhere in the world. Each region has its unique challenges, and in the same ways has its unique opportunities. The Middle East and North Africa (MENA) is in transition. All market indicators whether it is around consumer usage patterns, infrastructure availability, business demand or overall business and political disruptions indicate the MENA is ripe with opportunity. Things are moving quickly and it is clear that it is a major and growing world market.
What does this growth mean for MENA entrepreneurs? We are about to enter the age of MENA entrepreneurship. MENA Entrepreneurs are going to be the life blood of all MENA economies. If you have what it takes, now is the time to act and take that idea you have always wanted to do and just make it happen. Only good will follow!
In my journey as an entrepreneur, I too started with a desire and an idea. This idea took me to unexpected places and taught me plenty of lifelong lessons that I will share with you in a list of 10 confessions:
1. Be your #1 customer
I have always found that the greatest products service the needs of those that create them. Solving a real personal pain point makes you passionate about the space, and solution. Being your #1 customer makes you use your own product everyday and forces you to keep improving it before the rest of the world asks you to. Your problems are potentially business opportunities.
2. Beauty though real things, not business plans
I always tell entrepreneurs when starting out not to focus too much on the business plan. That is a poor use of time. Spend your time building a prototype and make it look beautiful. Many early stage detailed business plans I have seen are not worth the paper they are written on. A beautiful user experience that solves a real problem get most users and investors excited. It also proves that the team behind the idea can actually deliver, which is usually the biggest wild card with early stage entrepreneurs. So ask yourself, would you invest in a business plan or a real working service that looks great?
3. People like to do business with people they like
One of the best pieces of advice I got when I was starting out was to not be so serious or take myself seriously. When working with customers, investors, and partners, it shouldn’t all be about business or technology. Human nature gets people to gravitate towards people they like. I have seen it time and time again, and all over the world, people like to do business with people they like, plain and simple. Do not forget that. There is no harm exposing your cool personality during these important business meetings and presentations.
4. Fail fast
Failure in the MENA is a huge taboo, sometimes the kiss of the death. If you read the research, second time failed entrepreneurs double their chances for success. At a more tactical level, I have found that it is far more important to get to a working prototype as fast as possible, so you can identify what is not working and fix it. In most of the products I have worked on, the first prototypes validated that the initial ideas needed evolution to work for the market. This is especially the case with new products, new markets, or new ideas. Ideas need time to bake, and it is best to bake them by allowing the bad ideas to fail as quickly as possible so the good ones fourish. So, don’t be afraid to have failed ideas under your belt, just make sure you do it quickly. In fact, the more bad ideas you have under your belt, the closer you are to having a good solution.
5. Build a lean mean machine
One common mistake I have seen in many startups is scaling and hiring a lot of people quickly. I think that it is a bad idea when you do not know that you have a product market fit. The less money you spend at the beginning, the longer your runway to figure out if you have a business. Start to scale only once you see traction, otherwise it is a poor use of money. Find the cheapest path, time and money, to test the solution.
6. Put everyone, including yourself on a vesting schedule
One of the most challenging problems with most startups is figuring out who owns what. I have a simple rule, all employees and founders must be on a vesting schedule from the start. Vesting is when people get their equity in increments over an allocated period of time. For example, if you own 40% and are on a 4 year vesting schedule, you get 10% every year for 4 years. If you leave early, then you get what is vested. There are many schools of thought, but I generally like to pick a vesting schedule of 4 to 5 years. This is such a critical concept because it protects everyone. If anyone wants to part ways early on, then it does not destroy the business. Further, it also tests if everyone has the resolve to stick with the business. A business is a multi-year affair and those that stick with it should be rewarded more than those who do not. This topic has a lot of other subtleties that I will not go into, but the principal should be set forth from the start.
7. Great teams rule
When starting a business it is important to find people to work with you that complement you. It also allows you to scale as a person and creates an environment of healthy dialog. The most important advice I got in the start of my career was when I figured out how to get others to help me. I have a better chance of moving faster and having broader impact. Further, innovation is a process and not an event. Working with others helps put that process into hyper drive. When picking people, make sure they are rock stars at what they do. The first group of people you work with will define your corporate culture and be role models for everyone else. Never compromise on people because one bad apple will bring the whole team down.
8. Plan in small measurable increments
I am a strong believer that attacking problems should be done in small increments. It makes things manageable and achievable. I generally like to set my goals once per quarter and then every week set a weekly plan to support my quarterly goals. Especially in technology, planning beyond a couple of quarters is the equivalent of looking in a crystal ball. This does not mean that there shouldn’t be a strategy; a strategy is a direction, not an execution plan. Execution should be focused on measurable deliverables. If you do not measure what you do, then how do you know when you are done or if you have succeeded.
9. Always get out of your comfort zone
I have a personal rule, if I am in my comfort zone I am doing something wrong. When you are in your comfort zone, then you are not learning. Getting out of your comfort zone, means you are learning new skills to close a gap. I ask myself always, am I doing something new? If the answer is no, then I need to change things so I am uncomfortable again.
10. When starting out, sell to anything that moves
A common thing I hear from many entrepreneurs, especially in the MENA, is their fear to share their ideas with others. The logic just shocks me. First, if an idea can be easily copied by just a conversation then it is an indefensible idea. Second, actually executing on an idea is really hard work. The likelihood of someone doing this is very low. On the plus side, when you share your ideas with others, then questions they will ask you will help it grow and flourish. The more people who talk about what you are doing the more you are likely to get visibility in the community and industry.
In closing, entrepreneurship is the most exciting thing I have ever done. It has helped me grow as a person because of the things I had to do and all the great people I met in the process. I am sure you will too. The hardest part is always taking that first step, so what are you waiting for?