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Contrarian Thinking
I’m not sure when it happened, but at some point in the startup world, many ways of thinking became pretty rigid. The team you need, the way to build, and the type of funding you took all became almost set in stone.
This is strange because, by nature, building or working in a startup tends to be the least rigid workplace on earth.
The recent VC bubble burst and other events have shifted certain fixed mindsets (VC as the only route, for example) but I’m still a huge advocate for contrarian thinking.
It can be easy to want to find patterns in building a startup as a way to derisk, but we often we misguided by “the way things are supposed to be done” or hype that leads us down the wrong path.
Viewing things from a different angle every once in a while is key ! It has been for me.
PRODUCT ADVICE
C-TO Be Or Not C-TO Be?
When I’m chatting to a Founder who has a post-MVP product but with limited traction, they often say…
“That’s because I haven’t pushed our product very hard yet.”
It’s often because they are scared of failing and they’re scared of feedback and it’s an easy excuse.
“I don’t have customers because we haven’t pushed it out very hard yet.”
But you cannot be scared of feedback, absolutely essential and you need it as quickly as possible - importantly well before you launch.
A second-time founder thrives off of feedback, not because they revel in bad news, but because they know it’s absolutely essential to success.
If you’ve said/thought the above before, you need to get your product in front of people. There’s no other way around it.
It’s that, or not getting feedback and building something no one wants.
THE FUTURE OF BUSINESS
We need the RICH
It’s not always the most popular thing to say, but it’s really important that we create the right environment for people to get rich !
With a new government almost definitely coming in, who are saying all the right things and pitching themselves as the party of wealth creation let’s see if they back it up ! There’s been some worrying rumours on capital gains tax which seems to go directly against that mantra.
The startup world needs wealthy people.
Because realistically, most solo investors/angel investors/syndicates that I see are wealthy people in their 40’s-60’s+...
They have the most disposable income, and they’ve had a long successful career.
We need to be creating the next generation of angel investors now who are in their 20’s and 30’s.
Because wealthy people, with money they can lose (90% startup failure rate), are the only ones who can really afford to invest in startups.
So over the next 10 years, we need to ensure we know where future wealth is coming from and that it is going to be generated.
Otherwise, there’s no money left to back future founders.
INVESTMENT
Say maybe? to building a Unicorns
Founders do not need to build a unicorn to have a life-changing exit !
If founders need funding, they can raise a small amount from angels, family and friends, or a smaller fund.
It’s important instead that they focus on revenue and getting to profitability as quickly as possible to prove they are solving a problem that people will pay for.
The key is: make something people want, make people’s lives easier, make your customers feel special. Build slowly but sustainably and make a life-changing amount of money.
The vast majority of UK exits are in the tens of millions. If founders manage their cap table and investment rounds well, founding founding teams can make life-changing sums of money.
Plus:
Less dilution
So, can exit for tens of millions, not hundreds (and likely make the same amount on exit)
Higher chance of success, as no growth at all costs mentality
Win-win in my opinion !
INVESTMENT
Our thesis
Contrarian thinking is at the heart of what we’re doing at Founder + Lightning.
We’re looking for offline businesses that we can digitise, or early “scrappy” MVP’s that we can industrialise with our tech and product teams.
We don’t want businesses that need to exit for £100m for anyone to make money from the deal. We’re not hunting for unicorns, instead we’re very happy with horses (businesses with the ability to be a champion, but bringing in steady returns otherwise).
The more niche and “unsexy” the business, the better. We get really excited about these opportunities, and feel there’s enormous value in the economy waiting to be unlocked.
We are very much fishing from a different pond than most VCs and that’s what excites us the most.
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All the best,
Matt Jonns