In the TEDx Helsinki event a few weeks ago Mikael Jungner spoke about control and lack of control. Mikael has a habit of saying things that make sense. If you understand Finnish and have 16 minutes to spare, feel free to judge for yourself:
Jungner wants a world without control. He illustrates an ideal company that is something for everyone to consider:
- The employees would choose the CEO.
- The customers would pay according to what they felt the company has earned.
- The employees would get a salary they felt they earned.
This structure is really something to aim for. The best part is that it works well in a start-up but gets increasingly difficult in the long run. The long run meaning that the company starts spending its resources to control itself, not solving the problems of its customers.
Does control ever make any sense?
Jungner ends his speech with an example of the 1,000,000,000 monthly hours that are spent in Facebook games. Much of these are probably spent by employees in companies that are thinking whether they should limit Facebook usage. A person does his job without any control mechanisms if he wants to do it.
Instead of control we should offer alternatives.
Could these bored people start collecting nearly worthless lost items and start posting them in the Internet instead of playing Facebook games? Could playing a game be both fun and actually have a positive impact on other people’s lives?
Today, we’ve spent most of our time convincing different organizations and stakeholders on the greatness of our service. Our model is good because it has very little to object.
We are not actually selling a product or a service, we’re selling a dream of the future.
The funny thing about doing stuff with any organization or individual is that it almost never goes as planned. You always have two ways to react when that happens:
- Adapt and change your behavior.
- Ignore the feedback and move on like nothing happened.
Both of these alternatives have their sides. The first one is risky because it will cause you to change a strategy you’ve chosen. The second one is risky because following this might cause you to end up ignoring a great majority of your potential customers.
What you should do depends on what you have.
If you have the best solution in the world, you’ll find the second alternative much easier. You don’t want to change your idea but stick with what you know best.
If you have the best team out there, you’ll find the first alternative extremely easy. You can dynamically choose the strategy that you’ll find most lucrative.
That is why you should do exactly the opposite.
I will argue that great start-ups ran into trouble exactly because they follow the path that they find most convenient. Great teams end up doing miscellaneous stuff and great solutions are destroyed because they can’t adapt.
Which way are you handling your feedback?
I attended today an event where four panelists got to present their ideas about growth entrepreneurship. Most of the attendees were likely there to hear the ideas of the big gurus like Risto Siilasmaa and even Marko Parkkinen.
Was it any good?
Well, it was ok. Absolutely nothing spectacular but usual chit-chat about growing your business and making it international etc. However one thing got my attention over the others. Risto Siilasmaa presented his list of four critical factors in a successful start-up.
I disagree with every one of them.
- Great idea. Saying it is about the idea sounds like the words of a cynical business angel who has to hear 300 bad pitches per year. Not a single idea out there is great from the start. Think of Google. Two guys wanting to make a search engine bigger than Altavista by using a slightly different algorithm to rank the pages. Think of the milliondollarhomepage.com. Guy wanting to sell pixels on a random website. Idea is great after it has become reality. Before that it’s absolutely worthless.
- Competence. With competence Siilasmaa refers to competent people. It is obviously utter rubbish that the pure competence of the team would have anything to do with a start-up’s success. Academic degrees and experience have their place but the true success stories are built by semi-competent people. Or better yet the real experts join a new venture team when it’s exciting and compelling enough. Making a company sound exciting requires drive, ambition and passion. These have nothing to do with competence. This is something anyone can have from day one.
- Capital. Saying a company needs capital to be successful is like saying a baby needs diapers to pee. It can protect the outside but will never fix the problems inside, only complicates them. On the other hand, money is the most abundant resource out there. Ask for money and everyone thinks you’re ripping them off. Offer them a good service and eventually someone will give you a generous tip.
- Functional infrastructure/environment. This last point was about the need of an environment where you find the necessary consultants and apparently also about the socioeconomic situation on the market. Whichever it was or even if he meant both of them, I don’t agree. The causality is missing in this argument. Is the environment causing the success or is the environment actually a consequence of the success itself?
What’s the bottom line?
Don’t buy every half-baked comment the gurus tell you. Form your own opinion.
After a month of intensive development we had today an internal kick-off where the team members got to meet each other for the first time. I’m positively stunned by the great atmosphere and enthusiasm these people will bring to the table.
But a company needs to be organized.
We created an organization of six teams according to the needs of the future company. Following teams were created:
- General management team
- Technology and software team
- Business models team
- Product launch and marketing team
- Communications and branding team
- Stakeholder relations team
Every team has a leader who is responsible for achieving the goals set for that team. The best part is that after a while I no longer have to holding all the strings. People get to dedicate their effort to the area they fell most passionate about.
Founding a new company is now closer than ever.
We even got news that after a cancellation are now invited to the Aalto ES boot camp. This is a great opportunity to present our newly created organization in action.
This weekend I’m going to complete one business plan. I’ll be investing a million of my money and take another 500,000 in bank loans. This money is then invested in a factory and the necessary production equipment to produce a basic product almost everyone wants to buy!
Unfortunately this business plan is for a game and my investment will in a virtual currency called the DOM. The upside is that this game is one of the most advanced business simulations available, designed by the famous double Ph.D. Juuso Töyli. I’m really looking forward to seeing how my team of four people makes it in a highly competitive environment of the game. I’ll be spending Thursday and Friday next week playing this and hope to get something out of it even to report to this blog.
What comes to business planning, I’ll throw the following challenge to all my readers:
I promise to help one person each day to sketch a business plan of their own. All you need to do is to contact me and I’ll help in any way I possibly can. Including writing the plan itself. Completely free of charge and without any obligations. Heck, I’ll even write a confidentiality agreement if your idea is too good to share with a stranger!
What do you think might happen if you took you chance and started living your dream now?