Tag Archives: lean start-up

What young people have taught me about starting a business #2 – the entrepreneurs

Communication skills are essential

I had a privileged upbringing – surrounded by books and a loving family that were articulate in spoken and written word – particularly around political and social change. That’s probably why I chose marketing and communications as a career in the not-for-private-profit sector.

A worrying large number of the young people I work with have poor communication skills when it comes to answering and talking on the phone, taking notes when listening to people giving advice, shaping and presenting ideas within their peer group, and a reluctance to read anything more than a couple of sentences. This is not about learning disabilities (which are also common), it’s about (not) learning basic skills in schools, or losing what they learnt in school – like writing by hand.

Some have coping mechanism for hiding areas of weakness (don’t we all?) but, when starting a business, the inability to communicate with a certain level of competence is a massive barrier. The sooner issues are identified and addressed the better; not always easy when the young people themselves don’t acknowledge there’s a problem.

Some young people think they can run an online business from their back bedrooms without ever having to leave the house. They look at me with horror when I tell them they’ll need to go and talk to people face-to-face to get their businesses started.

 ‘Quick and dirty’ may be the best way to start

The idea of the MVP (Minimal Viable Product) and phrases like ‘fail fast’ are familiar in the world of business start-ups, particularly when they are of the techy variety. I’m talking about something different here… ‘try to strike while the iron’s hot’ might be a more appropriate cliché.

Sustaining interest and motivation is young people with ‘complicated lives’ is not easy. We know that the longer the time lapse between a young person applying for business support and that support actually materialising is critical for determining how much energy they bring to the process. When real life gets in the way, the dream can fade surprisingly quickly. The ideal scenario is enquiry one week and support the next, but this is not always possible and a 4 – 6 weeks delay is more likely between first contact and hands-on support.

In a similar vein, delays while writing a business plan can result in a rapid decline in commitment to the finished product; so ‘good enough’ may be the watchword here. An idea being explored is to fill the immediate time after first contact with an involvement activity – around market research maybe, or even the early stages of drafting a business plan. Watch this space.

The delay in ‘getting started’ might be self-imposed as well. We all know that sometimes we procrastinate – putting off doing something through lack of confidence or whatever, making it bigger in our imagination that it is. This happens quite a lot with young people who find reasons for not starting a business; the search for ‘the right premises’ in one case. My reaction is to query the delay and suggest ways to get ‘test trading’ as soon as possible.

The role of the side hustle

Objectively, and procrastination notwithstanding, the ability to devote a full working week to business development is likely to get a new enterprise up and running the quicker than doing so alongside a part time job. The advice is always ‘don’t give up the day job too soon’ – test the viability of your new business idea while having a steady income to help pay the bills.

Not everyone has the luxury of having regular income while starting their businesses and, as mentioned in a previous blog, many young people are setting up businesses precisely because they can’t get someone to employ them. That said, I am increasingly attracted to the idea of the ‘side hustle’ which seems to have a raised profile in recent years. And it’s not just my imagination – the Henley Business School reported on the rise of the side hustle as recently as July 2018. Doing a ‘bit of business on the side’ sounds dodgy, but it needn’t be; having a way to test an idea without undue financial risk is a responsible route to take and, depending on the nature of the full-time job and the very part-time start-up, could be a sustainable combination.

Businesses are getting more social

I have a personal passion for a business model described as ‘social enterprise’ – it’s been a part of my professional and personal life for almost two decades. I see it as mixing the best of the charity world with the best of the business world to create an income-generating enterprise with financial, social and, often, environmental objectives.

I’ve consciously not pushed the social enterprise model to young people, not least because it’s a difficult route to go down with built-in business disadvantages before you get to the starting line. Despite this, I’m quietly pleased that an increasing number of people with whom I work come to me with business ideas that I would broadly define as social enterprises.

On the plus side, their commitment is likely be a given – they are often motivated to set up a business to meet a need they have personally identified – as someone with mental ill health or as a struggling young mum. That passion however can also be a negative – personal involvement can often blur the line between the heart and the head. Early on, agreeing the primary purpose of the enterprise is important – is it about furthering a cause or making money – often requiring some difficult decisions, with some compromise at least in the early stages.

And on a broader point, and in praise of the young people I advise, all the would-be entrepreneurs have been sensitive, sociable and considerate to each other – a million miles from the monsters we see on TV in The Apprentice!

Previously – https://enterpriseessentials.wordpress.com/2017/08/28/what-young-people-have-taught-me-about-starting-a-business

Next – what have I learnt about the support needed

Eight tips for business start-ups    

Share your start-up ideas

You may be tempted to think your business idea is so clever that others will steal your idea as soon as they hear about it. Chances are your idea isn’t so unique, and you have more to gain from telling everyone who is prepared to listen than keeping your cards close to your chest. Unless you have a potentially patentable product, don’t waste time and money on protection – even with a patent you probably can’t afford to defend it. https://youngfoundation.org/social-innovation-investment/social-enterprise-mistakes-worrying-that-someone-will-steal-your-idea/

Consider a lean start-up

We talk about finishing a business plan before launching a business to lay solid foundations to give the business the best chance of success. In reality, a business plan is never finished – it’s a promise not proof and sometimes waiting to ‘get it right’ is an excuse for doing nothing. Sometimes it’s good to jump in before all the details are worked out. At that ‘test trading/ piloting’ stage you’re doing real life market research and you’ll probably be more willing to make changes because the plan is less fixed and you’ve committed less time to it. https://enterpriseessentials.wordpress.com/2014/03/06/running-on-fumes-a-case-for-lean-business-start-up

Things always take longer than you want/ expect

When you’re fired up about your business idea, you don’t want to be told that it won’t develop as quickly as you’d like; that things won’t follow the time-line in your well-worked business plan. You’ll want to keep the momentum going but remember – your timetable is no one else’s. If you’re collaborating with others and depending on the support of partners who have less interest in your success than you do, you may have to be patient – they have their own timetables.

Passion is rarely enough

People are too eager to say that passion is all you need for starting a business (it certainly helps) and if you want it badly enough you’ll succeed. The latter is not true and sets up people to fail. Some business ideas and the people behind them have no chance of success and ‘managing expectations’, if not actually damping down their enthusiasm, is often kinder in the long run. That said, being proved wrong is always a delight! https://enterpriseessentials.wordpress.com/2013/10/27/lesson-1-roots-wings-and-balance

Be prepared to stop making products you want to sell and start making products that people want to buy.

The paying customers is (almost) always right – if they want it, make it. Business is business – don’t let your personal views stop a sale (unless it’s a commission that simply won’t work).

If you’re making products, you’ll probably take pride in your creation having spent a lot of time and effort in the process. But you have to let go – in business you must be prepared to sell your favourite pieces, even to people who don’t appreciated your talent. You may also have to compromise your standards and at times; accept ‘good enough’ to operate competitively. https://enterpriseessentials.wordpress.com/2015/11/25/the-paying-customer-is-always-right

Keep it simple and limit choice

Whether it’s pricing and discounts / membership processes and application forms / product and service ranges, keep it simple. You shouldn’t need a degree to work out the price of an item after taking off the discount, adding delivery and VAT etc. It’s also proven that limiting choice will result in higher overall sales. So, don’t display 15 different ‘bespoke’ mirrors – put 5 in the spotlight and keep 10 under the counter.

The ‘right way’ is rarely clear cut

‘Getting it right’ is usually a question of balancing different options. Whether it’s balancing social and financial objectives, pricing for affordability vs pricing for viability, and balancing quality against cost-effective production, there’s usually a judgement to be made. Making 150 bird boxes is good for business but not for the wellbeing of workers who want to be creative.

You can’t run a business on fresh air and goodwill

You can go a long way by appealing to your friends and family and tapping into the time and expertise of volunteers – there’s a lot of free support and advice around, particularly for start-ups. But sustaining a functioning business in the longer term, is likely to need at least some paid staff input. A contract of employment is important for underpinning commitment and reliability.

For more start-up lessons go to https://enterpriseessentials.wordpress.com/category/learning-about-earning


What makes a great business idea?

As readers of this blog will know, I work with young people to help them launch their own businesses. Business start-up success is, of course, as much to do with the capabilities of the would-be entrepreneur as the quality of their business idea, but invariably I judge the latter before I know the former.


When I first hear a business idea, I subconsciously and unfairly assess it by whether the idea personally appeals to me. My passion for social enterprise, for example, tends to make me more positive about business ambitions that are more than just ‘making money’.

Over the past 20 months I’ve been told about over 100 possible businesses. Beyond my personal interests, what can I conclude about the elements of a potentially good business idea?

Is it a novel idea? If you take the ‘five f’s’ – fashion, food, facial treatments, photography and fitness – out of the frame, there are probably less than 50 other ideas. Of these, few have been particularly different, but two stand out.

The first is a shoe-selling service for people with different sized feet and amputees with only one leg. A young entrepreneur with mild cerebral palsy has feet that are two sizes different meaning she needs to buy two pairs of shoes to get ones that fit properly. She knows how costly this is and wants to solve the problem for herself and others by selling odd size pairs and single shoes.

The second business involves selling pearls in oysters that are then set in jewelry pieces of the customer’s choice. Each oyster (scanned at source to ensure it actually contains a pearl) is opened live on social media, with the owner looking on, creating an excitement which builds as the jewelry piece is created in the following weeks (for supply in the oyster shell?)

What are the start-up costs? Cost is as much about the time as the money it will need upfront. Even techy start-ups – with the right in-house expertise – can launch a MVP (Minimum Viable Product) to test the market without a major financial investment. I’ve written elsewhere about the value of not investing too much time and money in a new venture, making it relatively easier to ‘recover’ if/when the enterprise doesn’t take off. Some argue that a high personal investment makes the entrepreneur work harder to make the business succeed (but it can also make them blind to the dead horse they’re flogging).

What’s the competition? Novelty adds interest and ‘instant appeal’, but the most unusual business ideas may be novel for a very good reason; that others have tried unsuccessfully to make them work. This may be down to timing or location, but the rate with which some restaurants continue to change hands on the same site after successive failures makes me think that many restaurant owners believe they alone can buck the trend.

That said, there is something to be said in favour of starting a business in a crowded marketplace – a coffee shop for example. The number of people already selling coffee confirms there’s widespread demand for the product and/or service. And, to some degree, publicity for just one coffee shop benefits all coffee outlets in the locality. When competition is fierce it’s then ‘just’ a matter of doing better than the others. Like the barbershop in my home town which opened on Sundays when the other four barbers didn’t (now three of them do).

One way to tackle the competition is to go for a niche within the particular business sector – something that, with the advent of cost-effective communication through social media, is now more possible than ever. One young photographer is specialising in photoshoots with new born babies aged 5 to 10 days. The beauty of catching ’em so young is the scope for repeat business with milestone photos.

Is the idea simple to grasp? Business start-up ideas tend to be over-complicated. This is partly a reflection on the muddled thinking of the would-be entrepreneur – buzzing with too many ideas and thinking they have to be firing on all cylinders from day one. But if the product and/or service is not clearly communicated, the business tends to suffer because it expects too much of potential customers to understand the offer – they lose interest and look elsewhere.

It’s almost as if young people think a simple idea makes them sound, er, simple. But in a room full of business ideas of varying complexity, the best idea (on a particular day I’m recalling) was described quite simply in three words – cleaning people’s houses. A great business idea – easily explained, low start-up costs, repeat business practically guaranteed for an affordable quality service, and potential customers almost literally on the doorstep. The same goes for the would-be gardener, dog-walker and ‘man with van’ who knows what s/he is doing.

Does it meet a real need? The clichéd definition of marketing ‘selling things that people don’t need at prices they can’t afford’ is, happily, less common now than when the phrase was first coined. If there’s a genuine need for a product or service – rather than one which is somewhat contrived (for examples, look in one of those problem-solving household gadget catalogues that drop through the letterbox) – so much the better. I also like business ideas that try to meet more than one need (without getting over-complicated). One young entrepreneur came up with an interesting idea to provide pamper sessions for young mums at playgroup locations – so both generations could benefit from some play at the same time.

Sad to report that business hasn’t taken off… yet. Business success is never guaranteed and even the best ideas in competent hands can fail for very good reasons. ‘Back to the drawing board’ is not just for would-be architects.

Further reading:

Business ideas to launch in weeks https://startups.co.uk/10-great-start-up-business-ideas-to-launch-in-weeks/

How to turn an idea into your dream job  https://www.theguardian.com/lifeandstyle/2017/aug/14/how-to-turn-an-idea-into-a-dream-job-by-people-who-have-done-it   

Business ideas for 2018 https://startups.co.uk/business-ideas-2018

Trade secrets – you can start a business without money or time

What they don’t tell you about starting a business…

Tradition says that you need money to start a business and ‘friends, family and fools’ are the most common source of that funding. While some businesses need money to buy equipment, get premises and pay staff, many can get started and test-trade with limited cash.

Nor do you need to spend months getting all the bits of the jigsaw in place before you launch. ‘Fail early, fail fast’’ is sound advice for the bold (some would say irresponsible) risk-taking entrepreneur. The theory is that getting your product/ service out there as soon as possible means your relatively limited investment of time and money will mean you’re more willing to accommodate failure, learn, and change your plan accordingly.

Which leads us to the concepts of the ‘lean start-up’ and ‘minimum viable product’. Both are about saving money until you have evidence to justify expenditure (for short term benefit) and investment (for longer term benefit).

There are other ways to save time and money at the start-up stage. Make the most of an amazing range of free business support. For a selection of free support and advice see https://enterpriseessentials.wordpress.com/free-lunch-business-support

You can also create a minimalist business plan until you have more solid information on which to base your future business development. To quote Michael Fowle from the Newcastle Business School at Northumbria University “Full business plans are a distraction. Use the Business Model Canvas and post-it notes for a near instant plan that is more flexible and valuable than the back of the envelope. [Newcastle Business School] allow 77 days to develop the idea and get “traction”, and then 77 days to turn the proven idea into a properly resourced business.”

Finally, some advice from readers of the Guardian newspaper…

  • A 30-day MVP [Minimum Viable Product] works well for IT [techy] products, but is harder (though still a useful exercise) for bricks and mortar and services start-ups
  • Superniche [a very specialist and targeted product or service] is exactly right. The only person that really matters is the customer who will fund your business (try The Mom Test by Rob Fitzpatrick).
  • Know your customer. Get their commitment before you waste time and money.

Further reading:

Running on fumes https://enterpriseessentials.wordpress.com/2014/03/06/running-on-fumes-a-case-for-lean-business-start-up/

Lean thinking  https://www.squawkpoint.com/2012/07/lean-thinking

Prototyping: https://www.fastcodesign.com/1663968/wanna-create-a-great-product-fail-early-fail-fast-fail-often

The Lean Start-up http://theleanstartup.com

Minimum Viable Product https://blog.leanstack.com/minimum-viable-product-mvp-7e280b0b9418

How to start a business in 30 days www.theguardian.com/small-business-network/2016/aug/19/how-to-start-a-business-in-30-days

The Business Model Canvas https://strategyzer.com/canvas/business-model-canvas

For other Trade Secrets in this series, go to https://enterpriseessentials.wordpress.com/category/trade-secrets

Learning about Earning: lessons 3 and 4 from a social enterprise start-up

Project plan vs business plan

“Never present figures without a story, never tell a story without figures”

What’s the balance of words and figures in your plan (assuming you’re setting up or running a social enterprise)? Despite the pressure from all around to ‘be more business-like’ in my experience, charities are still good with words rather than figures, whereas organisations down the earning end of the ‘asking-earning’ spectrum use figures to tell their story (with the narrative in the background).

In my twelve months as a social enterprise start-up, I’ve had a business plan sitting on a shelf (almost complete, but weak on figures..!) and I revise my project plan every time I bid for grant support (three times – fingers crossed for third time lucky…) In all three cases, the application has been strong on words but, until the third application (when I got help) I’ve been weak on hard evidence in the form of figures (about scale of need, benefit and income) to make the business case.

If you want help to make the mental and physical – it’s as much about thoughts as actions – journey from asking to earning, try this http://bit.ly/1qFGGoJ

Planning vs doing

Cliche alert: ‘Fail to plan and you plan to fail’ andPiss Poor Planning Promotes Piss Poor Performance’ are over-used clichés that are a good excuse for not taking the plunge – talking about doing rather than doing.

Waiting to get all the jigsaw pieces in place and building firm foundations sounds like common sense, but what about (analogy alert) jumping in to test the water without having all your ducks in a row?  A ‘lean start-up’ can…

Motivate:  Having general discomfort can encourage us to go further, faster (you will run faster when chased by someone with a knife…)

Enable real market research: By launching the unfinished article in which you’ve invested relatively less cash and care, you’re more likely to respond to criticisms positively and adapt your product – which is what innovation is all about.

Reduce padding, increase focus: Without the luxury of unlimited resources, the new enterprise is forced to hone in on essential spending with a keen focus on purpose

Attract finance:  A shining business plan with figures to impress is just that – a plan and a promise – whereas hard evidence – of demand for new real products and services – counts for a lot.

More on the case for a lean start-up at http://bit.ly/1kjOsoT

 If you’re interested in exploring ways to turn ideas into action, join Chris Lee for a day-long workshop on December 4 in Chelmsford Details at www.voluntarysectortraining.org.uk/courses/event/70/Ideas-Into-Action

Building a shed – day 300

IMG_4446So what progress with plans to develop a would-be environmental social enterprise – The Repair Shed – to bring older men together to stay healthier for longer by making, mending and learning?

July 27 was 300 days into my 12 months with the School for Social Entrepreneurs (SEEE) in Ipswich on the Lloyds Bank Social Entrepreneurs Start-Up programme.

That particular day – last Sunday – I was busy with the third Royston Repair Cafe, but had time to smile as I recalled our first Community Repair Day at the Hemel Food Garden Open Day on 7 June – our first real ‘public outing’ and lots of fun. If you want to see what we got up to in Hemel, go to our new Facebook page at www.facebook.com/TheRepairShed for photos and a link to a short video clip.

Day 300 was also a good point at which to do some accounting – to update my expenditure records and prepare a third and final claim to the SSE for the final tranche of their £4,000 grant. As I did the sums, I realised with some alarm that when my final £500 comes through it will be pretty well accounted for!

As my wife regularly reminds me, none of the £4,000 has actually paid me. But it’s helped me get around by car and train (lots of learning and development – in Ipswich and London, and regular travel between Royston and Hemel Hempstead and, more recently, Stevenage – see below). It’s also helped me cover office costs and publicity without which I could never have got this far. But it won’t pay the bills much longer and my wife’s patience might also have its limits. So what to do?

Back in March, I wrote about the wisdom or otherwise of trying to start an enterprise with no money – more at http://bit.ly/1kjOsoT – soon I really will be ‘running on fumes’! I’m not yet reduced to hitchhiking around Hertfordshire but it’s time to get real – to be prepared to make the case for working unpaid for a little longer, or…

Earn income: In early July we made our first Repair Shed sale – a pallet pub (see photo above) to a customer in Yorkshire! It’s long story – a unique present for someone who’s got everything… I was thrilled but, as my wife pointed out, the wood may have cost nothing but it took me several hours to make.

What price my time? But I’ve just firmed up an affordable supply of pallets from a local social enterprise in St Albans so I see no reason why our pallet furniture production shouldn’t take off.

Another way to earn income, of course, is to get a job (or a proper job as my wife calls it – by which she means one that pays for my time). While I’d love to have the luxury of devoting 100% of my waking hours to developing The Repair Shed, I realise that I may have to do with just three out of six days a week, if another job that will help pay those bills comes along.

Which explains why, in May and June, I applied for two jobs for which I thought I was eminently well suited and which would have nicely complemented development of The Repair Shed. Unfortunately, the recruiting organisations didn’t agree.

Gifts in kind – Notwithstanding my past interest in timebanking (and plans to set up a time bank at The Repair Shed) I realise that the world cannot survive on bartering alone. But that said, our good friends at Hemel Food Garden – Sunnyside Rural Trust – are happy to help us out with free facilities while we’re getting up and running. In return, we’re repairing and refurbishing donated furniture for them to sell to raise funds for their work.

My ‘pallet pub’ not only generated a little sales income but, through a special deal arranged by the UK Mens Sheds Association,  we’ve been awarded £250 to spend with Triton Tools in exchange for my pallet pub project plan (trying saying that after a few pints!) which will be published on Triton’s website.

Finally on the bartering front, I continue to enjoy free desk space and the support of Wenta’s business incubator in Stevenage (ref my earlier blog at http://bit.ly/1pxVX7I) and I try to help them out in return, including input into a social enterprise workshop.

Fundraising – the other way to get paid for my work is to successfully bid for a grant to develop the Repair Shed to a point where it has the potential to be financially sustainable through selling goods and services. Following four unsuccessful bids, I’m preparing a fifth application to an environmental source. This latest effort may have a greater chance of success, if only because I’m not relying on my fundraising ‘skills’ alone.

The bid and my plans for the months ahead are now being scrutinised by a new steering group (reference my Day 200 blog http://bit.ly/1nAA8Yx) and a fund-raising sub-group. That said, as always I take full responsibility for the ups and down on the Repair Shed journey – including running out of fuel!