I recently gave the keynote speech on business development for entrepreneurs at Disrupting London, part of a four-city event highlighting some of America’s most disruptive companies and exposing them to some of Europe’s premiere technology hubs.

Given Huddle’s UK heritage, I did feel like a bit of a fraud, masquerading as a US business. But the event, held in Canary Wharf’s brand new startup space known as Level39, was a great chance to connect with friends both old and new. It was also a great opportunity to explore a part of London that, until recently, felt like a million miles away from Silicon Roundabout and its skinny-jeaned occupants.

Given that Huddle is reasonably well known on the London startup scene, I felt that yet another presentation on the company, our vision, and our product wouldn’t be hugely interesting to the audience. And given that the vast majority of them were early stage founders or entrepreneurs on the cusp of starting their own business, I figured some tips on our own experiences to date might be more useful.

And this got me thinking. What does almost every entrepreneur go through? What are the stages of business development we all face—from idea to reality and eventual success? What would be a clever theme to tie these lessons together?

Startups and Shakespeare

I wasn’t a particularly good student. I liked learning, but I loved building and breaking things. My head was in the clouds, if you will. I guess you could say that in many ways I’ve ended up in the perfect profession. During my pupilage, I was forced to read dozens of books, poems, and sonnets. One that always stuck with me was Shakespeare’s Seven Ages of Man. From mewling infants, unable to care for ourselves, to the second infancy, where old age renders us virtually useless, Shakespeare casts a light on each of us that remains relevant and amusing to this day.

Knowing this poem and knowing what entrepreneurs go through, I wondered: could I illustrate the 7 ages of an entrepreneur as they relate to business development? You know what, I think I can. Here we go.

The 7 ages of the entrepreneur in 7 acts

Act 1. The first age involves choosing your co-founder. Like a marriage, this person should excite you, inspire you, and complement you. At the event, I think I made a bad pun about how they shouldn’t necessarily compliment you, as hard feedback is often necessary for success. In my mind, the perfect founding team (for a technology company anyway) has a commercially-minded product person, a fantastic software engineer, and a great designer. Sales are obviously important, but this can be dealt with later on down the line. There’s also the question of vision: do you all want this to become a billion-dollar global company or a “lifestyle business”? Conflicting goals can rear their ugly heads in years to come, and many friendships have been known to explode when one founder is fixated on raising capital, while the other just wants an easy life. So consider your co-founder carefully, my friends.

Act 2. This is all about launching your product. When should you launch? What should you launch? I love the concept of a Minimum Viable Product—what’s the minimum you can launch without sacrificing customer experience? New features are easy to add but hard to take away, even if they’re generally not well received. And if you’re still unsure, remember to KISS—Keep It Simple, Stupid! The very best products initially focus on doing one thing really, really well. You can always add more complexity later.

Act 3. This one focuses on bootstrapping, aka the process of getting your business to the next stage—raising venture funding or getting to profitability by whatever means necessary. This could mean savings, borrowing money from friends and family, racking up credit card debt, or all three. The term bootstrapping has become slightly fuzzier in recent years; I’ve met startups who claim to be bootstrapped, having “only raised” half a million dollars. To me, bootstrapping means doing whatever it takes, so long as you don’t sacrifice your long-term vision.

Act 4. After a period of bootstrapping and refinement of the product and message, many startups will attempt to traverse Act 4, raising venture capital. For the first time entrepreneur, venture capital is a scary place, filled with previously unappreciated terms like valuations, cap tables, warrants, and liquidation preferences. So why take on the burden of venture capital? Frankly, VC money will allow you to grow far faster in a competitive market. If you don’t raise VC, someone else will; so be prepared to eat their dust as they accelerate beyond you. Great VCs also bring a wealth of experience and connections. We raised our first round of VC money from Eden Ventures in the UK. Their team provided help and advice with hiring, business development, and future fundraising. Venture capital may not be the cheapest money you raise, but it should be the best value.

Act 5. Here we focus on hiring and growth. You’ve raised a few million dollars. Now what? The downside to bringing venture money on is that you’re no longer in total control. Your VCs will expect you to hit the accelerator on your business development, and as Notorious B.I.G. sang, “mo’ money, mo’ problems”! One of the hardest things for a founder is relinquishing control of parts of your business. If you’re going to let someone else hold your metaphorical baby, you need to make sure they’re an A player. There’s been a lot written about hiring great people, but, in short, hire people who are better than you—always. If you don’t, you’ll find yourself eventually surrounded by mediocre B and C players. And no company ever made it all the way to the top by being staffed by OK people.

One further thing to bear in mind is nurturing and inspiring the great people you hire. Little things go a long way. At Huddle, we’re all incredibly proud of the brand we’ve built, and our team loves to get involved. This means wearing Huddle-branded swag around the office and on the weekends (v-neck tees and hoodies), treating our team to food and drinks throughout the week, and throwing regular parties for Huddlers (that’s right—we have a collective noun) and their families. At the end of the day, great people can get a job anywhere, but it’s rare for them to be treated like family. I always wanted to create a place where 21-year-old me would have wanted to work, and I think that young-me would have given an arm to work at Huddle.

Act 6. Expansion. In 2010, Huddle raised its second round of venture funding, and we opened our first international office. The thought process was relatively simple. If we were to become the big international business we believed we could be, we would need a presence in Silicon Valley. International expansion isn’t for every business, and even the businesses who do expand have to decide where they should go. For Huddle, our new investors were based in California, and a huge percentage of our potential customers were out there too.

I moved to San Francisco in 2010, leaving the rest of the company behind. We’ve been growing our presence steadily since then, and we now have an additional office in New York and will soon be opening a base in Washington DC. But what have we learned about this part of business development? Simply put, geographic dispersion (be it a second office across the hallway or an operation 6,000 miles away) is hard—really hard. Over-communication is key and don’t expect people to just know what you’re doing anymore. Surprise, surprise: email doesn’t convey emotion particularly well. So rather than getting annoyed by that terse message that was probably quickly written on the bus, pick up the phone, get your colleague on Skype, or find another way to talk. You’ll be surprised how effectively you can work things out.

Act 7. A few words on selling your company for a huge sum of money or floating on the public markets. We haven’t done either of these with Huddle (yet), so I don’t really feel particularly qualified to advise on this, but I would certainly caution against optimizing your business to be acquired. Great companies are built to last, built to make money, and built to delight their customers.

Most great entrepreneurs will tell you that success is part good choices, part hard work, and part good luck. And remember, it’s not easy. If it was, everybody would be doing it. For more insight on business development, take a look at Andy’s presentation below.

Disrupting London – The Seven Ages of the Entrepreneur from Andy McLoughlin

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