The Time-Tested, Battle-Hardened Guide For Anyone Starting Anything – Written By Guy Kawasaki Starting a business that scales is no easy feat. In this book, Guy gives us a guideline to follow that is very useful. I have not introduced investors in our software company because we have been financing our R&D through profits and cash flow. Regardless, we have two other ideas that may require funding, I was intrigued to read this book. It is much more than pitching for money. This guide will help you keep track of the ball and make sure you don’t end up as part of the 50% stat. The 50% statistic says that all companies that start fail in the first 5 years. I’m sure no one knows this better than Guy Kawasaki, as he invests in startups.
Why is this important to me? I always want to ask this question as if he were sitting in his shoes. I do not want to waste your time. One thing is for sure. Most Americans today need to earn more money. Therefore, this book is a must read for you if you are building the next Facebook or just starting a part time business. If you look back in history, families could survive on one income. Then both parents went to work and really did well. As usual, expenses always increase to cover income, so both parents had to work. Today, 44 million Americans receive food stamps. This is almost 15% of the population. A guide like The Art of the Beginning will help you create your own wealth and not become a casualty of war. We are living through the greatest transfer of wealth in history. The dollar has lost value since President Nixon took us off the gold standard and people who thought they could retire have been taken to the dry cleaners by Wall Street bankers betting on derivatives. It is up to us to dictate our own destiny and Guy’s book will help in that quest.
The Art of the Beginning consists of 5 sections. In the interest of time, I will touch on one area in each section.
1. Causation: Guy coined the term GIST to refer to Great Ideas to Start Things. This, in essence, is his compelling WHY for what he does. The Three Stooges made their last television series with Curly in 1945. This was over 66 years ago. That’s longevity when you’re doing something you love. In our business we sell to public safety organizations. Our compelling vision is “Seconds Save Lives”. We create great software to help dispatch centers save lives. Sure we make money doing it, but that is secondary to the “Cause”. Doing something you love that has meaning is the essence of GIST.
2. Articulation: the art of throwing is essential for the survival of any organism. Show and tell don’t work. Business owners have to pitch at all levels. They need to sell their ideas internally, they need to introduce new clients, and they need to introduce the best talent. I have to confess that I always thought I was a pretty good salesperson because my mission was to ask prospects questions and have a 70/30 relationship with them. This means that they speak 70% of the time and I speak 30%. This allowed me to understand their needs. One thing he needed to work on was the pitching part. Guy touches on this in detail in the book and a book that really solidifies the method was written by Carmine Gallo. It’s called Presentation Secrets of Steve Jobs. Following this new method has allowed my team to increase their sales by 100%. Some of the techniques include the 10/20/30 rule. Basically, this means 10 PowerPoint slides, 20 minutes, and a 30 point font. The KISS principle is critical (Keep it simple, stupid). Have you ever sat in PowerPoint hell? Think about it for a moment: You have slides with tiny fonts and buzzwords that just make the presenter feel smart while the audience feels stupid. That’s not the way to go.
3. Activation – This is the “do” section. There will be times when you have to watch the money and count the pencils and there will be other times when you have to pay to recruit the best talent. This may be a paradox, but depending on where your business is located will determine what you need to do and how to invest your capital. Raising capital is an art form that I personally need to work on. Guy outlines what to do and it’s so logical that he amazes me people miss it. One thing that stands out here is being realistic in your numbers. Don’t say there are three billion people in China and if we can get 1% of them to spend $50, then we’ll be a $1.5 billion company. This is not realistic because getting 1% is very difficult. The best way to do this is to allocate the capital you ask for in terms of sales and marketing. Are you going to sell directly or indirectly? How many sales calls can each salesperson make? What is the close ratio? What is the average transaction size? What is the expected lifetime value of each new customer? Understanding these questions will allow you to scale effectively, and more importantly, your investors will believe you. Giving short, realistic pitches will put you ahead of 80% of the deals VCs are looking at.
4. Proliferation – In this section, Guy talks about branding, partnering, and creating rain. If you’re selling in the B2B (Business to Business) marketplace, then they only buy for three reasons: increase revenue, reduce cost, and mitigate risk. That’s it. Therefore, if you partner with other organizations, those partnerships should amount to doing one of three things. but
then it’s marketing people wasting their time creating useless press releases that talk about partnerships. In reality, most partnerships during the dot-com craze were mere PR ploys that never made any money.
5. Obligation – Emerson summed up that if you want more than give more. Giving back to society pays dividends. A great quote in Samuel Johnson’s book sums this up: “The measure of a man is how he treats someone who can do him no good.”
The Art of the Start is an excellent business book. If you are interested in building a business full or part time, I suggest you give it a read. I can tell you that the presentation scheme discussed in this book works and has increased our business significantly.
I hope you found this short summary video helpful. The key to any new idea is to work it into your daily routine until it becomes a habit. Habits are formed in as little as 21 days. One thing you can take away from this book is “Say No to PowerPoint Hell.” Evaluate your presentations and if you are reading the slides while presenting then you are doing it wrong. Evaluate your sales team too. Good trial lawyers don’t read their closing statements. In order for them to win, they have to help the jury find out that they are right. It’s more about being prepared than improvising and just reading slides.