business strategy

[ZEE]

this is the greatest thrade ive read all month on this site, OP for MOD, IMO.

[Blaupanzer]

You do not need a high-powered CEO yet. He can't possibly earn his pay if you already have a VC-ready pitch prepared. You may need a high-powered salesperson if the market you are cracking is that tough. You need someone who comes with a portfolio in that market on day one. Such people are rare, high-priced, and very touchy about product quality and rapid delivery. Good luck.

Don't take VC money unless you expand faster than you can afford to sustain.

[Jon Miller]

I would focus more on getting a good CFO... the good CEO can wait until you have 20+ employees.

Good luck, I like it better when Pekka is manic than when Pekka is depressed.

JM

[Blaupanzer]

Good luck, I like it better when Pekka is manic than when Pekka is depressed.
JM

Hear, hear to that!

[Pekka]

Thanks for your great comments. It's been a miserable day so far, so I came here with an idea that "they've bashed me, I know it!". So thanks for the boost guys.

DanS, About high powered management, we've actually got one that can be regarded as the higher echelon of people. This person is very credible and high powered, and he wants in as he believes in this start up adn the product. According to him, he has been waiting an opportunity like this for quite a long time and sees it is this one. For this, he is given stock, naturally. So it didn't cost us too much. We need the same caliber in pure business sense as well I think, as the first year or two years will determine if we will be successful and we want to avoid the don't do's, and do all the do's.

Yeah, this is a difficult question I'm asking because I'm not giving all the information, and second of all even if I did, it's still a difficult question. DanS captured it. That's exactly the bind I'm in.

OK, some more info. Myself, I don't have enough credibility anyway. I'm the strongest substance provider, but when it comes to business and management, I'm the weakest link so far. I have 3 people confirmed in the management now. One of them is the missing link in the... say CTO part. 2 of them do have credibility. Alas, we still lack a good CEO. If we were running with a more traditional product/service, this management would be sufficient I think. However, this is penetrating a new market for us, and new market globally, as data from it has been collected from 2006. This means we're going against more traditional solutions. That means we need to be able to convince our customers, that we are the future, and the present as well. We have solid grounding on this, we do justify our services in terms of ROI. That is, our competitors won't even offer to show what it is, nor can they actually calculate it. We can, and we do. So this is a big point with us, we can talk to you in terms of how much you pay and what you get, and what was the impact of your investment to adjust them accordingly for the next round.

Now, that's just one thing, we can also show the impact of our product and increase the level of extra benefit it provided. In case it had a negative impact, well, it shows that as well so... These are our strong points in entering this market and competing against traditional manufacturers/consultants. This is also our biggest challenge. This is why we can't go slow, we can't go unless aggressive, and with a risk. We aren't shaking the ecosystem of the infrastructure at all, it is very specific and designed to ... not shake the ecosystem. It requires minimal effort from the customer. But to differentiate from our competition (that is more traditional) is not easy. If we go slow and won't reach our potential in the next 2 years, it's not going to be worth it, it'll die. We offer back end service as well, meaning we have to have maintenance/customer service. Too much work if we go slow.

IN PRACTICE it means that we run fast and take a risk. We will have to try to bluff our way in and make it seem huge until it is or gets that way. With one million there's no way to hire 20 people. The point is, if we get sales going on as we project it will happen, we HAVE to hire 20 people, that is we will have to sell first and then run to catch up with the amount of tasks sold. It's a sad reality, but we're prepared to do it. This is one more risk factor as well. We have to create an image that is big and global, of a big new player coming in aggressively and then run with the image. This is how we can reach our goal. If it goes slow, we die.

For this we really need a good CEO. And as pointed out, VC money would really help, but we'd lose our ownership, which in turn is not an option we would like to take first. If it works, it will be very lucrative, if not, it'll die fast. In this case, it doesn't make sense to take a risk, and not benefit from it if it succeeds. I already take a big risk by giving up my position in my current job. I basically give away a PhD, since I have to take over the IPRs of my work, which effectively terminates my future in this place. But I don't care. This is the dream, this is why I came here. To get connected, to find the angle and then do this and it's now or never.

To recap, our problem is the lack of a very good CEO who can guide us through the problem of penetrating a new market, where we have a very limited window of opportunity to move in. It's one shot and one kill or we don't get it. But if we do, it'll be very successful, and I figure if you ever want it, you'll have to accept the risk. We're running against the clock in terms of people, capital and customers. All which we have to keep juggling in the air at the same time. We have to be aggressive, and yet we don't have a roadmap on entering the market. Everything else is pretty much set up. I believe this is the factor that determines our success or failure. If we screw it up, it has no chance, if it works out and we do the right maneuvers, we have a chance.

I'm bounded by NDAs to lots of directions and so is my management, so at the moment I cannot tell you much about the product/service. We'll be publishing it this Fall though, so then it becomes public.

[Pekka]

Japher, thanks, I've looked into it when you suggested it. It's still in the back of my mind as something for the future if I gain enough credibility. About family, it's a predicament, when your friends and close ones sort of want to come and work for you, and they believe it'll be a big thing, but all you see is the risk. And then, you need to hire the right people and if you build an organization from basically your friends, ... it just won't work now does it?

Az, yeah, simply because I'm not competent enough to be a CEO at the moment and for this particular situation. Even an OK CEO won't do, a one that does the right things. We need a CEO that does the right things, pulls strings, and is just pure awesomeness.

Blau, yep... true. This is the plan. To grow fast, run, run and run, establish ourselves as big as possible. After this, VC money is more than welcome.

It's not just me, it's the whole management that takes a big risk wiht this. They're moving from secured positions that pays well into this one. Of course the reward is good if success comes, everyone owns a bit of it. If not? Well, that's life.

[ZEE]

Thanks for your great comments. It's been a miserable day so far, so I came here with an idea that "they've bashed me, I know it!". So thanks for the boost guys.

DanS, About high powered management, we've actually got one that can be regarded as the higher echelon of people. This person is very credible and high powered, and he wants in as he believes in this start up adn the product. According to him, he has been waiting an opportunity like this for quite a long time and sees it is this one. For this, he is given stock, naturally. So it didn't cost us too much. We need the same caliber in pure business sense as well I think, as the first year or two years will determine if we will be successful and we want to avoid the don't do's, and do all the do's.

Yeah, this is a difficult question I'm asking because I'm not giving all the information, and second of all even if I did, it's still a difficult question. DanS captured it. That's exactly the bind I'm in.

OK, some more info. Myself, I don't have enough credibility anyway. I'm the strongest substance provider, but when it comes to business and management, I'm the weakest link so far. I have 3 people confirmed in the management now. One of them is the missing link in the... say CTO part. 2 of them do have credibility. Alas, we still lack a good CEO. If we were running with a more traditional product/service, this management would be sufficient I think. However, this is penetrating a new market for us, and new market globally, as data from it has been collected from 2006. This means we're going against more traditional solutions. That means we need to be able to convince our customers, that we are the future, and the present as well. We have solid grounding on this, we do justify our services in terms of ROI. That is, our competitors won't even offer to show what it is, nor can they actually calculate it. We can, and we do. So this is a big point with us, we can talk to you in terms of how much you pay and what you get, and what was the impact of your investment to adjust them accordingly for the next round.

Now, that's just one thing, we can also show the impact of our product and increase the level of extra benefit it provided. In case it had a negative impact, well, it shows that as well so... These are our strong points in entering this market and competing against traditional manufacturers/consultants. This is also our biggest challenge. This is why we can't go slow, we can't go unless aggressive, and with a risk. We aren't shaking the ecosystem of the infrastructure at all, it is very specific and designed to ... not shake the ecosystem. It requires minimal effort from the customer. But to differentiate from our competition (that is more traditional) is not easy. If we go slow and won't reach our potential in the next 2 years, it's not going to be worth it, it'll die. We offer back end service as well, meaning we have to have maintenance/customer service. Too much work if we go slow.

IN PRACTICE it means that we run fast and take a risk. We will have to try to bluff our way in and make it seem huge until it is or gets that way. With one million there's no way to hire 20 people. The point is, if we get sales going on as we project it will happen, we HAVE to hire 20 people, that is we will have to sell first and then run to catch up with the amount of tasks sold. It's a sad reality, but we're prepared to do it. This is one more risk factor as well. We have to create an image that is big and global, of a big new player coming in aggressively and then run with the image. This is how we can reach our goal. If it goes slow, we die.

For this we really need a good CEO. And as pointed out, VC money would really help, but we'd lose our ownership, which in turn is not an option we would like to take first. If it works, it will be very lucrative, if not, it'll die fast. In this case, it doesn't make sense to take a risk, and not benefit from it if it succeeds. I already take a big risk by giving up my position in my current job. I basically give away a PhD, since I have to take over the IPRs of my work, which effectively terminates my future in this place. But I don't care. This is the dream, this is why I came here. To get connected, to find the angle and then do this and it's now or never.

To recap, our problem is the lack of a very good CEO who can guide us through the problem of penetrating a new market, where we have a very limited window of opportunity to move in. It's one shot and one kill or we don't get it. But if we do, it'll be very successful, and I figure if you ever want it, you'll have to accept the risk. We're running against the clock in terms of people, capital and customers. All which we have to keep juggling in the air at the same time. We have to be aggressive, and yet we don't have a roadmap on entering the market. Everything else is pretty much set up. I believe this is the factor that determines our success or failure. If we screw it up, it has no chance, if it works out and we do the right maneuvers, we have a chance.

I'm bounded by NDAs to lots of directions and so is my management, so at the moment I cannot tell you much about the product/service. We'll be publishing it this Fall though, so then it becomes public.

Japher, thanks, I've looked into it when you suggested it. It's still in the back of my mind as something for the future if I gain enough credibility. About family, it's a predicament, when your friends and close ones sort of want to come and work for you, and they believe it'll be a big thing, but all you see is the risk. And then, you need to hire the right people and if you build an organization from basically your friends, ... it just won't work now does it?

Az, yeah, simply because I'm not competent enough to be a CEO at the moment and for this particular situation. Even an OK CEO won't do, a one that does the right things. We need a CEO that does the right things, pulls strings, and is just pure awesomeness.

Blau, yep... true. This is the plan. To grow fast, run, run and run, establish ourselves as big as possible. After this, VC money is more than welcome.

It's not just me, it's the whole management that takes a big risk wiht this. They're moving from secured positions that pays well into this one. Of course the reward is good if success comes, everyone owns a bit of it. If not? Well, that's life.

[Japher]

When the tough get goin', the goin' gets tough.

SC

[DanS]

I would worry about getting a sub-par CEO when you want pure awesomeness. We always believe the best of somebody when we first meet, but pure awesomeness isn't as abundant as we might hope. He'll probably be dumber than you, of course. Not everybody has ascended to SC status.

What happens when he has a difference of vision with you? He might start telling you what to do -- he is the CEO, after all. How would you feel about that? Are you going to feel like you are being wronged? Since he probably will be tied into the VCs who gave you the money, your vision might be marginalized. Flat out, ownership gives you control to implement your vision. On the other hand, you might not mind being a drummer rather than the drum major sometimes, so long as you feel like that is the best way to take a shot at ultimate success.

[Pekka]

DanS, This is my nightmare. Exactly the reason why I do not want VC money in yet. Because an investor who would jump into a business like this would invest and outbid ourselves anyway, and that VC might have an idea of bringing in a CEO, even abroad (US CEOs not unusual in here), paying him with tons of points, and this CEO might be good, but he also might direct us into failure not understanding this particular field or being a crazy maverick or something. Who knows, but it would suck to have "an outsider" to come in and screw it all up.

I have never considered myself a sales person, but I can sell my product much better than any hired professional sales person. This is something I have learned in the last couple of months. I had a low opinion of my sales skills, but when I tried to have someone do it for me, I noticed right away this isn't the way to go. I've done all the pitching, all the marketing in this situation as no one else seems to know enough to be interesting about it. When I hear others pitch it or sell it, it sounds kind of stupid you know. Not because they'd be bad sales people, but because I believe this kind of thing has to be sold by the people who are passionate and have developed it and know about it, even if they hate selling and public speaking. Doesn't matter, it's still better than outsider doing it for you in the beginning. Everybody who I've talked to have commented on my gleaming manic eyes, which makes them either believe it's a ****ing great idea or that it's a scary thing. I want a sales person who has gleaming eyes. Alas, haven't found one. This, parallel to the CEO issue, is what has been the focal issue in what-to-do. Sales and CEO stuff is still different. Everybody can do SOME selling, but the same does not apply with CEO stuff.

About being a drummer... yes, this is a problem. We would need to have most of the operational power and not be overpowered by the CEO in this. What I don't mind is creativity in market and business strategy. This is the area where I would rather just sit back and listen and learn. The other stuff we definitely have already, and don't need a new cook to stir the soup. What is your opinion, I'm thinking of remaining the CEO and then getting an adviser to sort of tell me so I can listen, and then make a decision based on what I heard. This adviser might not be an outsider as this person should be rewarded and as it is, that means currently with ownership. Or maybe we should just acquire this "adviser" into our management to begin with.

Problem is also with time, as it does not know any mercy, we're already starting to produce marketing material, and infomercials.

[Pekka]

ALso it seems to me that it's a good idea to become a good CEO. People these days think about incentives, "how do we get a good CEO" and allow them to take big risks that affords them big reward, but at the same time they accept that the risk might not pay off in which case the CEO is free to leave and try something else. To me it seems like a CEO then is able to gamble a bit and see what works, to get the high reward. Of course to get a good track record and thus a noticeable CEO, you need to know your stuff. But still. It seems that it's a good career choice

If the risk is what you pay for the potential reward, it's even better if someone else pays for the risk for your reward.

Or even better, to become an investor seems even a better idea.

[DanS]

It seems to me like you need a mentor rather than a CEO. An entrepreneur who you can pitch ideas to, ask advice, etc. Somebody who can steer you away from the truly big mistakes. The ranks of good CEOs are small, but those good CEOs had to start somewhere. So I'm thinking: Why not you as CEO for now? Do you lack the energy?

A mentor doesn't need to be local, although you might find one working with your local incubator. What with Skype nowadays, the world is your oyster.

[Japher]

Is there anything like SCORE in Finlandland?

[Tear of the Komsomol Girl]

Aaron Nimzowitsch

[Theben]

You should just beat them all with your penis until they comply with your demands.