How to Use Bridge Capital to Accelerate Your Business

How to Use Bridge Capital to Accelerate Your Business

What was formerly a last resort is now a means of achieving independence and profitability.

It was cold and slightly misty outside my hotel in Dublin, Ireland when I got the call. As an entrepreneur and investor, I have seen my fair share of ideas run down to zero. The founder on the other end of the line had informed me a week earlier that he was raising a bridge round. Usually, this means doom and gloom, so naturally, I expected the worst.

“Are you in? You investing can send a really positive signal to everyone,” said the founder.

“Well, how bad is the business?” I asked. “Is there a chance of saving the intellectual property, the product, repositioning; something, anything, that will make this work?”

“Actually no, that’s the thing,” replied the Founder. “We are raising a bridge round to accelerate the business to profitability and command a higher valuation at the next round.”

“Wait, so you don’t need to save the business?” I responded, puzzled.

“No, we’re doing great,” he assured. “But this bridge injection will be able to ensure independence.”

Standing there, alone in my hotel room, I dropped the phone on the floor, speechless. The founder’s response was one I have never heard before. That’s because for the past half century, essentially since the dawn of modern-day venture investment, bridge capital was often viewed as an option of last resort. Entrepreneurs would take lower valuations, more dilution and even onerous repayment terms for a crucial injection of capital that would save their business and allow them to keep the lights on as they proceeded to enact a recovery plan. Dreaded by entrepreneurs and initial-equity investors, bridge capital was sometimes provided by existing investors or specialized firms that developed to fill this hole in the market. Sometimes companies would receive bridge capital and thrive. Other times, founders’s control and power would become greatly reduced.

And yet over the past few years, something different entirely has started to emerge. Entrepreneurs are increasingly turning to bridge “micro-rounds” as a means to reach profitability, gain independence and accelerate business metrics. These rounds are often opportunistic and exactingly timed. If a business’s metrics are performing beyond expectations, entrepreneurs will use bridge capital to get the company in a better position so that they may not need to take capital, external assistance or even customers that they do not want at a later stage.

If you are a founder and thinking of availing yourself of this strategy, there are some key things to keep in mind. Namely, you must raise bridge capital on a concrete plan based on current business metrics. Specifically, these metrics can encompass profitability, customer retention or some other verifiable data that all existing stakeholders will view as a strong path forward for the company. Second, entrepreneurs must be wary of the risks associated with this strategy, such as over-dilution and poor market signalling.

A Bridge to Profitability

Remember that call I took in Ireland? To my absolute surprise, the founder informed me that his company was mere months away from profitability and had two choices: Raise a smaller bridge round now to achieve profitability, thus putting the company in the driver’s seat, or he could raise a large Series A according to his previous timeline and accept less control and more dilution. For the founder, the solution was obvious: Raise a smaller bridge round now and get to profitability.

This founder was not alone in using profitability as a metric for bridge rounds. Investors often look to metrics that are easily attainable in a short time period in order to ensure more capital can be raised. Profitability is a unique metric that is easily understandable, achievable and provides options to the company. Once a company is profitable, the founders are in the driver’s seat.

When raising a bridge round, profitability is one of the easier metrics to highlight because it can be achieved in a short time span necessitated by smaller bridge rounds; gives the company a multitude of options, including plowing profits back into growth or remaining independent and not raising; and proves that, at the very least, a core group of loyal customers wants the company’s product.

Building Bridges With Other Metrics 

And yet, you may be asking about the founders who may not be able to achieve profitability but still require a bridge round. What should they do? Instead, these founders should focus on other quantifiable and verifiable business metrics with clear and unambiguous goals that can be achieved in a short period of time. These can include customer-acquisition costs, customer retention, overall product sales, marketplace volume and other customer data. The key here is to use data points, achievable in a relatively short period of time, to create options for the company and its key stakeholders.

Over-Dilution. A Bridge Too Far?

Just two months ago, I was speaking with another founder at a coffee shop when he bemoaned the valuation of a previous bridge round and how he gave up too much of the company. I asked for the valuation and his immediate comment was, “We were desperate, and they could tell. We went all in, and they took 20 percent more than they should have. We did not really need the money.”

As the above story indicates, one of the most important things to keep in mind when raising bridge capital is the risk of over-dilution. Roughly defined as giving up more of your company to investors than is necessary during any financing, over-dilution is an acute risk in bridge rounds because of the position that investors believe a company is in, which has historically been mere weeks or months away from going to zero. And yet, if founders present quantifiable metrics like profitability and a timeline in which to achieve them, investors are more likely to treat the company as a market-oriented investment rather than a soon-to-be -asset. It’s all about positioning, and it’s up to the founders to make it happen.

Bridge rounds were once the exclusive province of companies on the precipice that needed a crucial capital injection in order to survive. Increasingly, founders are using bridge rounds not to survive, but to thrive and maintain their independence by achieving specific business objectives with quantifiable metrics like profitability in a short period of time.

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How to Use Bridge Capital to Accelerate Your Business

What was formerly a last resort is now a means of achieving independence and profitability.
Source: By Alex Gold

The Importance of Getting Advisors to Invest in Your Business

The Importance of Getting Advisors to Invest in Your Business

Outside consultants can show true conviction with their capital.

I was sitting outside at Samovar Tea Lounge in the heart of San Francisco’s Yerba Buena Center. It was the middle of July, but the 55-degree temperatures and brisk coastal winds made it feel more like late November. “I thought this one advisor would be great with connections to multiple customers, but after signing the advisory agreement, I have not heard back from her in six months,” said an entrepreneur I knew who was starting a company for remote product shipping in Europe.

“I’ve seen this before,” I replied. “Did she invest capital in the company as well?”

“No,” said my entrepreneur friend. “She said that she did not have available dry powder, but wanted to help out.”

After much prodding by my friend over the ensuing weeks, nothing changed. Unfortunately, they wound up terminating the advisory agreement for non-performance and wasted six months of gestation time.

Advisors are undoubtedly critical for any startup to succeed, especially in the earliest stages where mentorship and coaching are as important, if not more so, than capital. They provide a crucial knowledge base of skills, sector-specific expertise, connections and recruiting ability, and are often critical to closing key commercial transactions, important personnel or trajectory-changing publicity. Yet all too often, entrepreneurs complain about advisors who are non-responsive or too slow to provide help or feedback. Naturally, I have experienced this myself. In nearly all cases when I have confronted the advisor about their performance, they have been apologetic but eventually shifted back into old habits.

The core root of this tendency is a misalignment of incentives. Although all advisors care about the companies they are engaged with, the question is how much? Advisors often have full-time jobs and other commitments that eat into their time and limit their contributions. This time-management challenge becomes especially acute when compounded by the extraordinary over-commitment of the founders and management team.

There needs to be an element that shifts the equation. The easiest way to do this is to mandate that all advisors be financial investors in the company as well. Even if just a small amount, this will ensure that important KPIs are met on time, provide proximate investment and recruiting value and even serve to filter out anyone who may just be looking to collect advisory shares.

Investment = Meeting KPIs

Coming out of an accelerator program a few years ago, I was shocked to see my friend’s software platform acquiring enterprise-level customers like Salesforce and Nvidia with only five employees. How did he do this? He ensured that every advisor also invested capital into the business.

“Not all advisors can invest $25,000 or $50,000, so we lowered this amount, even to just $3,000, and our results fundamentally changed,” said the founder. “They feel like real partners in the business and are motivated to help us hit our KPIs.”

For a startup, hitting KPIs, or Key Performance Indicators, is crucial to enabling the company to raise more capital or be profitable. Defined as the steps a company strategically lays out in order to hit a certain goal or performance framework, hitting KPIs is a team effort. In a startup, where resources are scarce, entrepreneurs often rely on advisors to help out and get them “over the finish line.”

But there’s a very important difference here. If a company cannot hit its KPIs, it can be fatal. And yet, advisors can just go back to their day job or pursue another opportunity. To even the playing field, have all advisors invest even a small token amount into the company. If the advisor cannot afford the minimum investment of $25,000 or even $10,000, allot them a smaller amount. Although it may seem trivial, the mental value to the advisor of having capital at stake cannot be underestimated.

Providing Better Investor and Recruiting Referral  

One of the most important facets of raising capital is that investors like to join other investors who are “already in” with regards to a specific company. Not only does this lessen risk in their mind, but it creates mutual shared value and an opportunity to collaborate with like-minded people. When your advisors also invest, they become the most valuable referral network for other possible investors because now they’re “all in.”

This concept also extends to recruiting new employees. Often, key new hires like sales leaders, developers, designers, product managers and other associates care about the conviction of those they trust when making a decision as to whether to join a company. The mere act of investment — and the communication of that decision to potential hires — sends a message of strong conviction rather than mere advisor-level commitment.

Weeding Out Advisors “Along for the Ride”

Ensuring that advisors also invest will allow founders to filter out those who may provide less value or just be interested in extracting value while providing very little in return. Somewhat unwritten about, but still quite common, are business leaders, professionals and others who are interested in getting involved in the “hottest company.” Often, the long-term utility value of these advisors is minimal to low. Yet, they still vest stock ownership that could be allotted to those providing more value. By tying their engagement to an investment, smart entrepreneurs can filter out advisory candidates who have true conviction from those who are merely looking for a resume buffer.

Choose Advisors Wisely

In all early stage companies, advice and coaching are often as critical as capital. Advisors provide expertise, guidance and connections that can make or break a young company. Conversely, advisors may also underperform over the long term due to misaligned incentives. The best means to address this is to make all advisors investors as well. This ensures a better opportunity to meet KPIs, better investor- and employee-recruiting success, and it filters out advisors who may lack true conviction.

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The Importance of Getting Advisors to Invest in Your Business

Outside consultants can show true conviction with their capital.
Source: By Alex Gold

What Entrepreneurs Can Learn from the Backlash to Hotel and Resort Fees

What Entrepreneurs Can Learn from the Backlash to Hotel and Resort Fees

Being upfront with customers about pricing will create a customer for life.

Every January, I go to the Consumer Electronics Show (CES) in Las Vegas. CES is a cavalcade of “what’s next” in consumer electronics, from televisions to smart refrigerators. And robots. Lots of robots. Some of which are really creepy.

With how expensive hotels tend to be during this event, I book months in advance to secure a still unreasonable but not eyeball-gouging rate. But this year was different. To my surprise, a $54 resort fee was added to my bill upon checkout, thus adding a total of about 20 percent to the cost of my stay. Inquiring to the hotel, I was told that the fee was “mandatory” and that it covered such generous amenities as water bottles, a chocolate bar and an airport shuttle that is “currently down because we are short staffed. So sorry.” Fed up, I vowed to never stay at that hotel again.

I am not alone in feeling cheated. According to a survey conducted by Atmosphere Research, 91 percent of customers think resort fees are egregious, and many customers feel that they are not disclosed adequately during the booking process. In Las Vegas, where some hotels average $25 a night during low season, a resort fee of $50 can double the cost of the room. Naturally, the Attorney Generals of both Nebraska and the District of Columbia are suing Marriott and Hilton for unfair and deceptive practices.

And yet, it doesn’t need to be this way. Transparency in product pricing and offerings can make or break a business. According to the Journal of the Academy of Marketing Science, customers are more likely to purchase an expensive product and even repeatedly patronize a business if they feel the complete price of a product has been adequately and fully disclosed. In order to ensure a loyal customer and not have pricing issues get in the way of success, entrepreneurs should seek to disclose pricing as clearly as possible (even if it means losing possible business), justify any price increases with a concise fact base and even introduce dynamic pricing options. Let’s break that down step by step.

Disclose Pricing Transparently and Clearly

At my hotel stay during CES, the resort fee was not clearly and transparently disclosed during the booking process. In fact, it was hidden. This contributed to sticker shock, or the feeling a customer gets when the price for a product is radically different than as earlier quoted or expected. Sticker shock can be extraordinarily damaging to a business, so you’re better off disclosing the entire value and price of the product before purchase. Make sure a customer clearly understands what that price encompasses, including any ancillary or secondary fees that may occur. And while some entrepreneurs may shy away from full disclosure out of fear of losing business, an angry customer with a complaint always costs more time and money in the long run. The opportunity cost is not worth it.

Justify Price Increases

A few years ago, I was dining at Union Square Cafe in New York when, again, I was shocked at my bill. Instead of arriving with the opportunity to tip my waitress, the pricing of each item was higher in order to pay employees a living wage. And yet, the bill also came with a message from the founder and owner of Union Square Café, Danny Meyer, stating why gratuity was automatically included, where the money will go, when it was enacted and how any customer can contact the restaurant to discuss their opinion on the matter. Contrast this with my experience at another restaurant in Los Angeles that just added the tip automatically and justified it by effectively saying, “It’s good for everyone.”

If you are going to materially increase the price of your product, follow in the footsteps of Danny Meyer and state, in detail, why you are increasing the price, where the proceeds will go, when it comes (or came) into effect and how the customer can reach out if they have any comments or concerns. A good example of a company that does this is TargetCW, which provides contingent workforce solutions but breaks down pricing by line item so it is more transparent before customers make a purchase decision.

The overwhelming majority of customers want to see businesses they love be successful, and by offering clear and concise facts on pricing, you are making them ostensible partners in your business and future success.

Introduce Dynamic Pricing Options

Earlier this year, Disney World introduced dynamic ticket pricing options for admission to its theme parks. Dynamic pricing is a consumer cost model that adjusts to the supply and demand curves of the market at any given time without having a set flat rate. So for example, if you visit Disney World on Christmas Eve, expect to pay more than if you visit on a rainy day in October during the off-season. Disney justified the change by saying that the increased demand in busy seasons, coupled with resource strains, meant that they needed to put a premium on pricing.

Disney is not alone in introducing dynamic product pricing, the most notable, and controversial, being Uber. But if entrepreneurs are to introduce a dynamic pricing model, they must ensure that the terms of the price, the reason behind any increases and the time it lasts are clearly and legibly disclosed to consumers before the purchase is made. Consumers must be given the option of paying more for a product they want at a specific time period or waiting for the price to drop when demand may be lower. The goal is to shift the decision on price to the consumer rather than having the business arbitrarily set or increase prices themselves.

If there is anything that the resort-fee debacle teaches us, it’s that honesty and transparency in customer service is one of the most important assets to building a successful business. And when it comes to price, entrepreneurs should aim for transparent and clear disclosure, provide concise facts and introduce dynamic pricing to shift the responsibility for making a decision over to the customer. Hopefully, they’ll become customers for life.

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What Entrepreneurs Can Learn from the Backlash to Hotel and Resort Fees

Being upfront with customers about pricing will create a customer for life.
Source: By Alex Gold

Why 'Now' May Well Be the Right Time to Start a Blockchain Company

Why 'Now' May Well Be the Right Time to Start a Blockchain Company

With the crypto market growing again, here are the three main factors to watch out for if you're starting, or investing, in a company in the space.

A little over two years ago, I was at my company’s holiday dinner, and the only topic of conversation was the stratospheric rise of cryptocurrencies like Bitcoin, Ethereum and those others that were lesser known but certainly more amusingly named (like Putincoin).

With Bitcoin at that time topping $20,000 and Crypto Kitties also hitting the world by storm, something momentous was afoot; and we all wanted in. Yet, my company’s CTO called a halt to our excitement, cautioning that a deep decline was coming. The reason he gave: The potential of the blockchain — the platform through which cryptocurrencies are built — to create real-world applications with strong customer use cases had yet to be realized.

“Raising $10 million from retail investors on a two-page paper is not enough,” our CTO said.

Boy, was he ever right. What came next was that massive slump, in which Bitcoin lost over 80 percent of its value, and the swiftness with which the SEC put an end to initial coin offering scams.

Yet, a few weeks ago, as I was attending a demo day for Binance Labs — a kind of accelerator program but for blockchain startups — I saw that some of our initial energy had returned.

In particular, I was struck at the focus and discipline of these entrepreneurs from Binance Labs, the venture arm of Binance. Rather than releasing a white paper and trying to raise money on ideas and theory alone, these people had already fully built their product, conceived of applicable real-world use cases and secured strong early customer traction.

More important: They were focusing, as has startup fund-raising has traditionally done, on getting skilled investors on board, the kind of investors who contribute so much more than just capital.

This got me thinking: Is now the time to invest in or start a blockchain-focused company?  What are the factors that entrepreneurs and investors should be looking for in this space?

To quote the words of Wired founding editor Kevin Kelly, now (yes, right now) is the best time to start something (never mind that he wrote those words in 2014). This mindset, in my opintion, is extraordinarily applicable to the blockchain which, as it matures, presents more and more opportunities to create new solutions. To take advantage of this trend, entrepreneurs and investors should seek opportunities that present an immediate real-world application as well as customer traction.

And these investors should be ones whose value-add is more than just capital; the colleagues they bring in, meanwhile, should be the type interested in the long-term impact of the technology.

Real-world traction matters.

At Binance’s demo day, nearly all presenting companies had some early customer buy-in and traction.  Whether it was a brand signing up for a test run on a new decentralized loyalty platform or a marketplace touting the growth of its supply-side volume, customer-use cases won the day. Many entrepreneurs commented that with blockchain solutions slowly gaining acceptance among everyday consumers, it was only appropriate to demonstrate real-world adoption

A case in point: Cerebellum Network, a decentralized version of Salesforce’s famed CRM.  Rather than publish a white paper, the founders built a product and tested it, to positive feedback, with early customers like Benefit Cosmetics. Because of this, Cerebellum’s founders were able to secure significant early investment from the likes of Arrington XRP Capital and others.

Are you starting or investing in a blockchain company? If so, the first question to ask yourself is: What real-world problem are you solving for consumers? For instance, an entrepreneur friend of mine is planning to start a next-generation nomadic home-sharing platform that will allow members to hop from house to house at exciting locations around the world.

While the entirety of the database, billing and identity components of the product will be built on the blockchain, that’s not what the founder is excited about. Rather, he’s psyched about bringing to market a product  that people have expressed a desire for. In this instance, blockchain technology is just acting as the enabler.

Seek investors who add more than just capital.

During the height of “Crypto Mania,” it was not uncommon to see new ICOs floated to retail investors, and see coin prices shoot skywards in a matter of hours, if not minutes. These cryptocurrencies were an incredibly efficient way to acquire capital to scale a business.

Yet, this process misses the most important point: Advice and help from investors is often more important than money in early-stage companies. Yes, this includes blockchain companies, as well.

Early-stage investors offer so much more than just capital.  They offer connections to talent, first-mover customers and additional investors.  Some, like co-founder Will Bunker, use help as a form of due diligence.  Even if he does not invest in a prospective company, Bunker goes out of his way to offer help and guidance because he knows that that’s what matters to early-stage companies.

So, if you’re launching a business, seek investors who offer resources help and guidance, even if this route it costs you a bit more than other fund-raising channels do. While you may be paying a little more now, you will be able to maximize your valuation down the road.

Seek out long-term colleagues who “get it.”

Sitting down on my friend’s couch one night, talking crypto with others, I was struck by how short-term many of those attendeess’ thinking seemed. Rather than building a sustainable, real-world application, my friends were more interested in releasing a hot new coin and pumping value out of it, rather than in the long-term transformative nature of their product.

Of course I understand that any new field will generate a lot of buzz, excitement and FOMO, or fear of missing out. Like moths to a flame, people often flock to what’s “hot” rather than what’s sustainable.

Yet this instinct of theirs misses the foundational point of cryptocurrencies and blockchain: their long-term revolution and transformation. The potential of cryptocurrencies to fundamentally alter our global economy, trade pathways, financial system and supply networks cannot be understated.  According to investor Lou Kerner, blockchain is “the biggest thing to happen in the history of humanity.” Okay, maybe that’s over the top, but Kerner follows up that phrase by cautioning that this revolution will be a long time in the making.

Naturally, founders should seek out colleagues, partners and even investors that understand the long-term nature of the space and are willing to invest the time, capital and, yes, the patience needed in order to make something happen.

Right now is the best time to start something.

With crypto prices recovering, albeit slightly, and the market opening up to new entrants and applications, now may be the best time to start a blockchain-powered company.  While the technology offers unlimited opportunities, when starting a new business, founders should not ignore the key points. Namely: Build a product that people want; seek out investors who are true advisors and partners; and hire colleagues who are in it for long-term gain.

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Why ‘Now’ May Well Be the Right Time to Start a Blockchain Company

With the crypto market growing again, here are the three main factors to watch out for if you’re starting, or investing, in a company in the space.
Source: By Alex Gold

3 Counter-intuitive Customer Service Lessons Entrepreneurs Should Learn

3 Counter-intuitive Customer Service Lessons Entrepreneurs Should Learn

How a bad experience at a self-styled "luxury" Sydney hotel reminded me of the most important customer service lessons for small business owners and entrepreneurs.

At about 1 a.m. during a memorable trip I took to Australia, I awoke suddenly in a hot sweat in my hotel room at the Intercontinental Sydney Double Bay. Supposedly among that country’s leading hotels, the Intercontinental bills itself as “Sydney’s Exclusive Bayside retreat,” where guests stay in luxury.

According to the hotel’s website, air-conditioning is one of these luxuries.

But not on that particular night. In fact, the thermostat in my room was stuck at a stuffy 24 C. (75 F.) degrees. So, I turned the temperature down, but to no avail. When I called the front desk, I was informed that the air-conditioning in the hotel was “functionally off for the season.” Yikes.

Still, I was okay with that, assuming that I’d receive some form of compensation for my discomfort. After all, I was a loyal customer: I had spent over 30 nights in the hotel, in just the previous year alone. Boy, was I wrong.

Not only was I not offered compensation, but I was told I was “lucky” I wasn’t penalized for leaving the hotel early.

The lesson here? Whether you’re talking about your local post office, a rental car agency, hotel or of course an airline, you’re bound to have a customer service horror story. Don’t we all? So pervasive is poor customer service that an entire startup’s business model is devoted to getting even with airlines.

For entrepreneurs and business owners, a reputation for poor customer service can cause not only reputational damage, it can actually be fatal. According to NewVoiceMedia, U.S. companies lose $62 billion in revenue every year for customer service missteps and mistakes. And yet, most of these issues are avoidable if handled properly by management at the point of infraction.

Here’s how, as a business owner, you can turn customer service blunders into success stories.

Address the root issue immediately. Don’t make it about something else.

At the Sydney hotel, I was looking for compensation for a non-functional room. Instead of compensating, management doubled down and made the issue about how it had handled things rather than going after the root cause.

Poor reactions like that to customer complaints abound. When that happens, management’s reaction to a product or service deficiency becomes more the issue than the root cause itself. Look no further than the United Airlines passenger-dragging incident of Dr. David Dao in April 2017 to get just a taste of this.

As a business owner, you must immediately address the root problem involved and seek to avoid larger systemic implications of management style and discretion. A good way to do this is to follow the process outlined in Training magazine which suggests the following steps: 1. Stay calm; 2. Listen and communicate to the customer that you are doing so; 3. Acknowledge that a problem exists; 4. Clarify the facts of the matter; and most importantly, 5. Immediately offer a solution.

Know the long-term value (LTV) of your customers, and reward accordingly.

As already mentioned, I had stayed at that Sydney hotel more than 30 nights in the previous year without incident. As a customer, my long-term value (LTV), therefore, was extremely high, as I was more than likely to visit the hotel again.

Defined as the estimated revenue a customer may generate over his or her lifetime at any one business, long-term value (LTV) should play a significant role in how customer service missteps are corrected. If a loyal customer complains, smart entrepreneurs and business owners will pay particular attention to making it right; they know that whatever the cost to correct the situation right now, they will be paid off over the long term by a happy returning customer.

So, if you’re the business owner, when a complaint arises, attempt to immediately understand the customer’s LTV through previous or projected business, and craft a response and resolution accordingly.

A good example of this in practice is to examine how casinos owners treat their highest value customers or so-called “whales.” Casino management goes out of its way to satisfy the whims of these customers and correct the smallest of imperfections for them if something goes awry. This is because the casinos know their investment will be paid off many times over with a customer who is not only bound to come back, but also to refer others who similarly are big spenders.

Nearly every other business category should follow this logic.

The customer is not always right. But offer to make it right anyway.

A time-tested and oft-cited adage of customer service is: “the customer is always right.” Well, I hate to break it to everyone, but this is not always the case.

In fact, the customer may often be wrong, as no one person can be expected to understand the nuances and specifics of any business where he or she is merely a patron. And, for business owners and entrepreneurs, this presents a conundrum: How do you handle a customer who may be incorrect in their complaint?

For guidance, we might turn to Southwest Airlines, a legend in its industry for customer service and loyalty. Southwest’s policy is that the customer may not always be right but front-line employees should always be in a position to make it right. For example, when a customer was late to the airport and just barely missed a flight to meet his daughter, Southwest chartered a plane to ensure the customer made it to his final destination. Although the issue was not its fault, Southwest went above and beyond to make things right.

Similarly, as the founder of an advertising technology company, I used to offer free extras all the time to customers who, because they did not specify targeting or budgeting at the start of a project, were unhappy with their results. Even though the problems that resulted were not my fault, it was my responsibility to make it right.

For a lot of small business owners and entrepreneurs, making something right that was not your fault may sting, both ethically and financially. Yet, making it right can pay enormous dividends down the road, as customers will recognize the lengths you went to do the right thing and will reward you with their never-ending loyalty.

Saving time and money

Ultimately, by quickly focusing on and solving customer service missteps, small business owners and entrepreneurs can come out on the positive side of the opportunity-cost equation and focus their valuable time on scaling their business rather than becoming embroiled in side issues. The easiest ways to do this are: addressing root issues and not making it about management, understanding a customer’s LTV and offering to make things right regardless of who was at fault.

Although I probably won’t be going back to that Sydney hotel any time soon, the above points demonstrate how as a business owner you can keep and engage your own loyal customers for a very long time.

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3 Counter-intuitive Customer Service Lessons Entrepreneurs Should Learn

How a bad experience at a self-styled “luxury” Sydney hotel reminded me of the most important customer service lessons for small business owners and entrepreneurs.
Source: By Alex Gold

How to Raise Money Even When You Don't Have 'Traction'

How to Raise Money Even When You Don't Have 'Traction'

Early-stage entrepreneurs need marketplace traction to raise capital. And capital to generate traction. Here’s how to get out of this frustrating cycle.

It was an unusually sunny early spring afternoon in San Francisco’s SOMA neighborhood. I was meeting with the founders of a new company, fresh out of Y Combinator’s latest cohort, and they were pitching me on investing in and advising their business. They were excited and pumped for the future.

“We are creating a marketplace for mineral rights and options,” they told me. This marketplace they envisioned? It would enable landowners to sell the rights to mine for minerals or even oil on their property to prospectors and others.

“Stuck in a pen and paper dynamic, this market is worth at least $50 billion,” one of the eager young founders said. “The standard to get to traction — at scale — is extremely low.”

Sitting on the other side of the table and seeking to provide some advice to these entrepreneurs, I was struck by one fact: Their business had no traction or growth. And I responded accordingly: “You don’t have any real traction yet do you?” I commented.

“No, not really,” the founder replied. “But we do have a massive market opportunity, incredibly strong tailwinds and the team to execute.”

He had a point: These founders may have fallen into the “traction trap” in investor pitches, yet they had not only survived but thrived.

Unfortunately, the same cannot be said for many other founders.

One of the most common reasons why investors say “no” to early-stage entrepreneurs is that they lack traction or growth as evidence that consumers want their product. This is often  frustrating for entrepreneurs as it presents them with a “Catch 22” situation.

Obviously, they need traction to raise capital. In turn, they also need capital to generate growth. For an early-stage company that’s resource-starved, this kind of squeeze can quickly precipitate a death spiral as a founder’s time and attention gets directed toward investor meetings that are not yielding results: What the founder really should be doing is working on growing the product.

Still, there’s a silver lining here in the form of two strategic tactics that can massively shift the conversation more in the entrepreneurs’ direction. First, entrepreneurs can focus on the total addressable market (TAM) to set the stage for the growth of their business.

Second, entrepreneurs can focus on storytelling methodologies and tools to tell their unique story better, tug on investor heartstrings and close the deal — at least at this very early stage.

Third, entrepreneurs can draw analogies to other successful startups

Focus on the total addressable market (TAM).

Entrepreneurs raising capital without traction, need to tell a story that illustrates how their total addressable market (TAM) is so attractive and ripe for disruption that future consumer adoption will be readily achieved.

In short, we can define TAM as the total revenue opportunity that is available to your company and/or product in the market today. This is often a critical component of many pitch decks, and investors look to it as a key determinant as to whether the potential to create a massively scalable business exists in an entrepreneur’s category or vertical.

For venture capitalists, the ideal TAM should be sizable enough to grow a $100 million revenue business but not so big that the space is too crowded and any given entrepreneur may get “lost” in a “red ocean” of competitiveness.

Where TAM is particularly challenging to consider are trillion dollar markets like health care or markets in the hundreds of billions of dollars, like advertising.

Where the overall TAM of their space is very large, founders should emphasize and estimate the TAM for their specific sub-vertical or sub-category.

For example, building a marketing technology company in the United States presents the opportunity to take part in the $129 billion a year digital advertising market. On first glance, this kind of size seems too big for a newcomer to make a difference What’s more, it’s crowded with thousands of new entrants every year, and looks extremely challenging to pitch.

Yet, founders can estimate the TAM for their sub-category or sub-vertical (i.e. the TAM for CRM or the TAM for display advertising) rather than the overall market size to bring the size down to a more ideal TAM and significantly cut down the number of competitors.

Focus on your most powerful sales tool: storytelling.

Yet another tactic is for founders to focus on storytelling tactics to make their startup even more attractive. This can be particularly fruitful since humans are predisposed to focus on the power and possibilities of great stories.

This is good news for early-stage startups without traction since story is usually the only thing left to focus on. By focusing on the origins and eventual destination of their startup, founders can actually make their business more attractive than if they had achieved traction, since investors’ imaginations about the potential for growth can sometimes seem limitless. To do this:

First lay a strong groundwork and historical narrative for why your startup is necessary or is solving a particularly acute problem for customers.

The pitch of Airhelp, a service that helps consumers get compensation from airlines for delays, provides a great example of the power of storytelling. By focusing on the nearly universal pain of airline delays, poor customer service and bad inflight experiences, the founders of Airhelp empathized with their audience (face it, most investors fly a lot) and raised capital despite little traction.

Second, craft a story of what the world looks like at scale for your company and the effect on your target customer.

One of the best recent examples of this involved Boom Supersonic, the supersonic jet company. Boom’s pitch focused on the future results and effects of its technology, like trans-oceanic transit times cut in half and day-long business meetings in London. These tactics had the effect of making the company look more attractive because it focused investors on seemingly limitless potential whereby they could “imagine” the future in their own minds. This is exactly what startup founders should want: investor buy-in to their vision.

Draw comparisons to leaders’ companies in your space.

One of the most important tools in the entrepreneural “pitch arsenal,” if you will, is the ability to draw analogies between yours and previously successful businesses. If you do not have the metrics to raise at such an early stage, analogy is a useful tool to illustrate similar market conditions, customer dynamics and the potential for growth that other companies have already demonstrated.

Still, you must be careful when employing analogies. You must avoid your pitch being derivative (i.e. similar to another product but perhaps in a different geographical market) or too obscure or narrow to be obviously exciting.

Solving the “Catch-22” dynamic

For early-stage founders, the “Catch-22” of not being able to raise capital without traction and, in turn, not being able to generate traction without capital can be vexing and even fatal.

Fortunately, by focusing on your prodouct’s total addressable market (TAM), the power of storytelling and other previously successful businesses, founders can address some of the issues investors will likely bring up, and get back to building their company.

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How to Raise Money Even When You Don’t Have ‘Traction’

Early-stage entrepreneurs need marketplace traction to raise capital. And capital to generate traction. Here’s how to get out of this frustrating cycle.
Source: By Alex Gold

How to Raise Money Without Lying

How to Raise Money Without Lying

Entrepreneurs often overstate their early "success" in order to get investors to buy in. Here's how to avoid this fatal strategy.

“We have grown 2,600 percent in three schools over the past four months,” a breathless and incredibly young founder boasted to me as he was pitching his new company: a mobile app for school scheduling.

Though this entrepreneur wannabee was so confident about his app that he was ready to drop out of the prestigious Wharton School of Business, what he didn’t count on was what a quick search of his app’s history would reveal.

In fact, I conducted such a search — on the App Store, no less. And what a few clicks on my part yielded was a simple fact: This young man was just combining many mobile apps, launched three years prior, into one brand. And, yikes, he was passing it off as something completely new.

“Love this concept and the business,” I told him. “And yet, I see on the App Store that you have a number of outstanding apps that are similar to this concept, and in fact contain the same UI/UX — but only with different colors.”

With only silence emanating from the other end of the phone, our conversation came to a quick end.

You would think that after the thriller-esque story of Elizabeth Holmes and Theranos or even after this young founder’s notable indiscretion, that every entrepreneur would learn one simple lesson: Don’t lie.

And, more than that: Don’t overstate what isn’t there. Don’t ever do this to investors. And especially don’t do this when pitching your business.

Yet, time and time again, I’ve been confronted by investors who complain about being patently lied to about everything from founders’ full-time commitment and product traction to the make -up of their financing rounds.

Shooting themselves in the foot

Aside from the obvious legal implications of this behavior, many founders don’t realize that in stretching the truth, they are often shooting themselves in the foot. They don’t realize that the fine line between being passionate about selling their business and outright fiction often results in their holding unrealistic expectations about whom they can recruit, or growth that they can’t achieve.

If you yourself are a founder, here’s how to avoid this type of behavior when you deal with two topics that are both critical to and common in fund-raising: product traction and the presence of certain investors in your round.

Telling the truth about traction and user growth

One of the most prominent ways in which entrepreneurs creatively “position” the truth relates to user traction and growth. With an investor reviewing on average close to 3,000 opportunities a year, he or she is going to pay particular attention to traction and growth. No one sums up this maxim better than Y Combinator co-founder Paul Graham, who said: “Startups equal growth.”

Yet in reality, startups often don’t equal growth. For one reason or another, founders may not immediately capture consumer attention, may have issues with marketing and acquisition or may have to pivot before finding their groove.

But that doesn’t stop the most enterprising and daringly ambitious founders from overstating their traction in order to raise money. From disguising “bookings” as realized revenue, to pooling users from a number of different apps into one, founders will try anything.

Yet if your particular startup doesn’t have enough traction to capture investors’ attention, the best strategy, aside from telling the truth, should be to focus on the story you tell and how your concept will capture and own its respective market.

And the best way to do this is to focus on the scale of your Total Addressable Market, or TAM. In fact, by focusing on the potential TAM of their startups, founders can shift the conversation to more of what’s possible, which is often limitless, rather than actual early results.

Another strategy is to focus on future growth strategy and projections rather than actuals. Resources like the Entrepreneurs Organization or the Young Entrepreneurs’ Council provide founders with the easiest means to do this. The point of these suggestions? To provide a concrete framework of predictability around what is often the wild west of the startup universe.

Investors call one another for references.

When raising capital, eager founders may state that certain investors are “in” a particular round, when in fact the latter may just still be considering an investment.

In this respect, founders in many ways are responding to investor “herd dynamics” in that the presence of one investor or fund becomes an immediate incentive for another to invest. Founders think they can make up the difference and close as many investors as possible so that what may have started out as a slight misstatement is eventually obviated in a short period of time.

There’s a warning here, however: Founders may not realize that the investor community, in Silicon Valley and beyond, is extremely small. Investors often call and reference check one other on deals both to assess value and claim bragging rights. After all, the best deals are often competitive.

So, rather than employing definitive language saying an investor is “in” a round, founders should communicate that a particular investor has a clear and principled commitment to funding a startup but has not made a firm commitment yet.

Terms like “soft circled” and “committed in principle” indicate that particular investors are very close to a commitment, yet have not formally written a check. Even better, some founders might offer to connect prospective investors together in order to fast-track due diligence.

Yet another strategy is to pivot the question right back to the investor: Ask why he or she cares who else is committed. Investors should be willing to capitalize a business because they believe in the team, the product and the market potential. Not what other “name brand” investors may be in the round.

When founders pivot the conversation in this direction, investors will usually focus once again on the business rather than name recognition.

Doing well by doing the right thing

If you’re a founder: Pushing the limits when you’re raising capital, especially when it comes to traction and investor participation, only establishes a foundation for failure. By setting unrealistic expectations, often in the most desperate hours of fund-raising, founders are only hurting themselves.

Conversely, by being more strategic and tactful in their pitch, founders can achieve the same effect and close the investors they want.

Read the full article on
How to Raise Money Without Lying

Entrepreneurs often overstate their early “success” in order to get investors to buy in. Here’s how to avoid this fatal strategy.
Source: By Alex Gold

How to Introduce Investors to Your Team the Right Way

How to Introduce Investors to Your Team the Right Way

Eager to introduce investors to the rest of your "rockstar team"? That meeting could be to your detriment. Here's how to turn your dilemma into a win and close the deal.

“We love you and your co-founder,but we want to meet the rest of the team.” The speaker was a partner at an investment firm thinking about sinking money into the startup my co-founder and I ran.

“Specifically, we want to meet the engineers on board and understand how they think about the product,” the partner told us. And, without even thinking twice, my co-founder and I promptly set up the meeting for the next afternoon.

The meeting happened. The partner and his associate met with our entire engineering and product teams.  We came out of the meeting in high spirits.

Which is why were shocked to find out the next day that the firm had decided not to invest in us. “We think you have a great thesis but the team is not really up to par to deliver on what the space needs,” the investment company partner told us.  “We saw some serious deficiencies that would have to be filled later on, at significant cost. Let’s talk at the next round once you have de-risked the company more.”

What investors expect

Often, as part of due diligence, investors will ask for a variety of materials ranging from product plans and customer contracts to even user testimonials. And, as a founder, you can control how all of these materials are presented. But the one factor you cannot exercise complete control over is the most important one: human capital.

By interviewing your colleagues, employees and collaborators, investors often attempt to understand whether the team has the knowledge, willpower and grit to pursue the opportunity.

Often these team interviews and meetings fall short of investors’ expectations. Those individuals may believe that the team is not experienced enough to build out a complicated technical product and incapable of pivoting at the right moment to build the product the market needs. Additionally, investors may believe that the team just doesn’t “gel” or isn’t “all in” on the startup’s mission. These conclusions can come from things as simple as body language.

Want to prevent this from occurring at your startup? Here’s how to position your team a different way — the right way.

Let investors “fill in the blanks” as you describe your team to investors.

Envision this scenario: You are in an investor meeting and the discussion starts to move toward your team. As founder, rather than offer to have the investor meet your team in person, you take another tack: You offer detailed descriptions of their skills and capabilities that clearly communicate your excitement.

You accompany these descriptions with visualizations. Using your naturally infectious descriptions as a foundation, you prompt the investor to take what you’ve said about your team and “fill in the blanks” with details that his or her own experiences and imagination conjure.

This tactic is nothing new. In fact, you are borrowing a popular filmmaking strategy. Lacking funds to build a mechanical shark while making Jaws, director Steven Spielberg used music and creative camera angles to create the feeling of a carnivorous creature on the hunt. Knowing that the audience’s imagination would “fill in the blanks,” Spielberg purposely set up the film to be that much more terrifying — and successful.

In a similar way, if you describe your colleagues, especially those in technical roles, as extraordinarily talented and qualified, investors will “fill in the blanks” in their own minds and equate those colleagues to analogous rockstar people they’ve worked with in the past.

In this way, you will successfully convince investors what you knew of all along: that your team is qualified.

Pre-empt the ask: Bring your best colleague to the meeting.

Again, let’s go back to that investor meeting. It’s smooth sailing as the meeting progresses toward the end and the investor seems copacetic. Yet, something is amiss. The investor didn’t ask a single question about the team or its qualifications. Why? You’ve brought along one of your most valuable colleagues to participate and answer the investor’s questions.

In doing this, you are not alone. Many founders look to bring one colleague, usually a technical leader, who has a strong grasp of business fundamentals, can easily explain the solutions for complex technical challenges, and can convey a sense of commitment to the long-term success of the company. Remember, though: Bringing too many colleagues to the meeting could overpower the investor and make him or her feel ambushed. So, be judicious.

Know that, ultimately, it’s about getting to “yes” faster.

The above tactics are about enabling you to close your round with less “last-minute” questions that could derail the entire process. Because what really matters to the long-term success of your business is not investor and team introduction strategy but rather working with your team to create a great product that customers love.

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How to Introduce Investors to Your Team the Right Way

Eager to introduce investors to the rest of your “rockstar team”? That meeting could be to your detriment. Here’s how to turn your dilemma into a win and close the deal.
Source: By Alex Gold

How Rapid 'Testing and Learning' During Product Development Saves Time and Money

How Rapid 'Testing and Learning' During Product Development Saves Time and Money

Investing money and design work is all very well. But what do your (potential) customers think? That's what really counts.

A few weeks ago, I met with an extremely frustrated founder. “I just spent all of my capital building and designing a great product,” he fretted to me. “We hired the best branding and design team, and we paid top dollar for ‘first in class’ market research. Now, I can’t get anyone to use my product.”

“But did you know if anyone wanted it?” I immediately asked.

“Of course they do!” he said. “I know they want it because we’ve invested so much. How could anyone not like this?”

“But you haven’t really tested it!” I responded. “You haven’t gotten customers to sign up and pay, which is really easy with white label tools available on the market.” I’m not sure my words got through, however. The guy walked away, determined to keep “plugging away” — which, sadly, will probably yield him the exact same results next time.

Customers first.

All too often — both as a growth marketer and aninvestor — I’ve heard from entrepreneurs struggling to attract a customer base, even after they’ve invested millions into product development and engineering. Those things are important, of course, but not as important as what really matters: a customer base.

Yes, there have been notable failures that have occurred despite there being a solid customer base, as occurred in the case of Color — and the infamous Galaxy Note 7. But, overall, this failure by entrepreneurs to attend to the customer issue has been all too common. Failures may happen often, but the reasons behind them needn’t be hard to understand.

Digital products also have some real advantages: For instance, they have no red tape, like real estate development, for instance, where developers are often delayed from putting their building on the market as they wait for zoning approvals, design changes and construction permits. By contrast, a digital product, like a new SaaS tool or mobile application, can be built within days or weeks, and adjusted on the fly as customer feedback is received.

Unfortunately, many first-time entrepreneurstreat a digital product like a real estate development! They try to sell “the house” before they even understand whether customers want to buy it.

There is a better way. Rather than building a product full stop, you can learn as you go by testing and using tools to do this that are as simple as “interns and a spreadsheet.” Your goal? To understand exactly what your customers want and how to develop the product they need.

What an “interns and a spreadsheet” approach entails.

For many digital products, especially those that are direct to consumer, entrepreneurs can employ an easy three-step process for testing and understanding their market.

This process, titled “interns and a spreadsheet,” technically involves manually accomplishing many of the tasks you’ve set for yourself. First, Build out what the “MVP” would be. Second, use media and customer acquisition tactics to test whether your customer base will actually “buy in.” Finally, re-group around the value focus that your customers are responding to and build that. Here is more detail on these three steps:

Build the “MVP.”

First, set up a sign-up a landing page to start getting feedback. Companies that have been successful at this approach provide a clear picture of what they plan on offering. Good examples include the Muzzle app, which includes animation to illustrate how it works, and Transferwise, which also provides a visual means for immediately understanding the tool.

These companies’ landing-page descriptions include the value being offered and a call to action to encourage sign-up. In return, the company can better assess the level of interest in what it is developing by how many people respond to the call to action.

After following these steps, have “interns” or internal staff accomplish the bulk of the actual product work manually. This can include studying the overall environment and trends, and the competition’s offering; and conducting direct customer surveys and interviews.

Test user acquisition.

Testing user acquisition provides good evidence for whether or not you should further develop your product. There are a number of ways to test: First, create a variety of different sign-up pages that can be tested with different demographics. Using a tool like ClickFunnels is an effective way to match a specific goal or item you want to sell (a product, service, B2B application, etc.) with the most appropriate sales funnel template.

This is particularly valuable for any company that doesn’t have designers and developers to create those different funnels.

Next, spread your acquisition dollars across social platforms like Facebook, Twitter and Instagram, focusing on different targeted groups to understand how each responds to what you’re offering. You can test various social ad campaigns for each group on these platforms to determine product viability.

Use content marketing to create articles that drive attention to the product in development.  Focus on one component of a value proposition within each article to attract a specific target audience-segment.

Review data and build into what customers want.

Review the data from your acquisition and then, as YCombinator’s tagline says, “make something people want.” With so much information available from audience members willing to share their preferences, opinions, challenges, desires and lifestyles, there emeges a much more detailed picture of what your potentials customers really want.

This data then becomes the blueprint you can use to build your product and be confident that your target audience will want it.

Adjust and deliver.

Often, entrepreneurs’ initial inclinations are proven wrong as they work through the testing and learning experience. It’s better to learn this bad news prior to full development so that you can talk about how to adjust people’s expectations and deliver a product that they actually want. Over the longer term, this process can save you money and time, minimize frustration and maximize audience engagement.

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How Rapid ‘Testing and Learning’ During Product Development Saves Time and Money

Investing money and design work is all very well. But what do your (potential) customers think? That’s what really counts.
Source: By Alex Gold

Perseverance: Why It Was Southwest Airlines' Herb Kelleher's Most Important Lesson for Entrepreneurs

Perseverance: Why It Was Southwest Airlines' Herb Kelleher's Most Important Lesson for Entrepreneurs

Sadly, Kelleher died last month. But his legacy lives on: Ever hear of how he and his airline became Texas's largest bourbon distributor?

I was actually on a Southwest Airlines flight when I found out that the company’s legendary co-founder and chairman, Herb Kelleher, had passed away. Kelleher died on Jan. 3, but over the five decades before that, his vision revolutionized air travel. His creation, Southwest — arguably the world’s first low-cost airline — democratized flying for millions.

The company’s differential was that by competing more with bus services than legacy airlines, it could disrupt the market. This strategy was so successful that in 1993, the U.S. Department of Transportation coined the term “The Southwest Effect” to denote an increase in origination air travel and a corresponding drop in prices, in any market the company entered.

This achievement alone is sufficient fodder for any successful entrepreneur’s legacy. But the fact that Kelleher achieved all of that in a company that was, and still is, ranked as the best place to work in America, with employees who would go without pay to work there, says even more.

And there’s yet another lesson stemming from Kelleher’s and Southwest’s story: perseverance. Kelleher’s life offers a unique guide as to how entrepreneurs can and should persevere through even some of the most daunting obstacles they encounter and still come out on top.

What, exactly, does “perseverance” mean?

The importance of perseverance in entrepreneurship cannot be overstated. Starting a new business may initially seem exciting but often, after a short time, the shock of reality sets in. Product, customer and regulatory problems hamper business growth, and many entrepreneurs end up playing an inevitable game of “whack-a-mole” just to solve their problems.

Perseverance is the ability of entrepreneurs to see through these obstacles and still win them, regardless of how daunting any specific challenge may be. Perseverance, in fact, is often the “secret sauce” that sets the most successful entrepreneurs apart from mere entrants in their field.

Stand for something more.

When Southwest Airlines was founded in 1967, the airline had no employees and no jets; it had to gain an operating certificate just to fly. Given the company’s innovative business model, incumbents like Braniff and Texas International (both of which no longer exist) attempted to block Southwest’s operating certificate through a series of historic court challenges.

Though his airline was effectively grounded for  four years, Kelleher hung in there; his persistence ensured Southwest would, and did, eventually fly.

To accomplish this feat, Kelleher first offered his time as a practicing lawyer for free. More importantly, when Southwest’s board of directors wanted to abandon the fight three years in, Kelleher shouldered all court costs himself to get the job done. It would take two Texas Supreme Court rulings and one U.S. Supreme Court ruling before the airline could actually fly.

Before he passed away, Kelleher remembered that during that tough time, he was fighting for something more: the right of free enterprise and the ability to open the skies to consumers who couldn’t afford to fly.

Of course there have been other entrepreneurs with the same kind of tenacity, founders who have carried out some mission of their own with the same motivational force Kelleher showed. Patrick Grove, the founder of iFlix, is an example: He persevered through multiple roadblocks to democratize access to media and information in Southeast Asia.

In the process, Grove created Netflix’s biggest competitor in the video-streaming market. Belief in something more powerful than just a new business or the profits it may bring — meaning a belief in the business’s mission itself — will motivate you, your employees, stakeholders and customers. By turning your business into a cause, you will be able to persevere through some of the darkest days as an entrepreneur.

Think differently.

Shortly after Southwest launched, Braniff thought that by launching a fare class at half of what Southwest was offering, it could undercut the airline and put it out of business. Other airline executives and the consumer press promptly wrote Southwest’s obituary.

But not Kelleher. He understood that to persevere through this crisis, the airline had to think differently. Examining revenue streams, he discovered that most passengers were business travelers on expense accounts who cared little for cost savings and more for time and convenience. So, he made a unique proposition: Pay the full fare and get a free bottle of Wild Turkey bourbon!

This promotion was so successful that over the course of just over six months, Southwest became the largest liquor distributor in Texas.

Stories abound of entrepreneurs thinking “around corners” and not giving up; This category includes people like the founders of Airbnb and GoodRX for example. The real lesson here is to look at the challenge and the situation before you and improviseuntil you win.

Like Kelleher, you should assess the real drivers of your business and the levers or incentives needed to change course in your direction — not to just react to the imminent threat. Often, creative solutions will materialize because by looking at a problem differently, you will come up with a divergent solution.

Perseverance matters.

Kelleher sits among a long line of great, and often colorful, entrepreneurs who disrupted and revolutionized their respective fields. The one thread nearly all of these leaders have and had in common, and which Keller possessed in spades, was the ability to persevere through the most challenging of circumstances.

Kelleher’s legacy not only shows us the power of “thinking around” the corners of a problem, it shows us the extraordinarily motivating power of believing in something — a mission — greater than oneself. That’s advice every entrepreneur should heed.

Read the full article on
Perseverance: Why It Was Southwest Airlines’ Herb Kelleher’s Most Important Lesson for Entrepreneurs

Sadly, Kelleher died last month. But his legacy lives on: Ever hear of how he and his airline became Texas’s largest bourbon distributor?
Source: By Alex Gold