Friday, May 9, 2008

Building a Web Startup Company Today

I get the opportunity to work with and consult many companies about developing new business units and new companies in this web 2.0 space. Plus I have 3 of my own startups that I have launched or are in development currently to draw from. I find that so many of the questions and issues are common that it donned on me to do my own "list" of core components to creating a good web company today. I hope that you find some value in it and if you think I've missed anything, tell me, I really want to know!

1. Answer the question - What makes you social? If the answer is nothing, or if you are grasping at straws, that's OK. But know the answer, you can't fake it. Now why do I start here? Because we are in the midst of the Social Web transformation, its the train that's left the station, you need to know if you can ride it, or not. I think your business plan should devote several pages to this topic. If you don't have a social network account, you are in trouble because you have alot of catching up to do:)

If you are wondering what do I mean, try to look at your product or service as an organic thing and consider how it would look when touched, commented, shared or even modified by the market. Think about the possible touch-points and recognize that in the social web you are not fully in control. Stand back, does your product/service stand up in this medium? Is it better? If you answer yes, then you can exploit the social web to grow your company.

2. Rapid Deployment: you will never build the perfect mousetrap, I don't care if you are crazy smart and have all the money in the world in your hands, someone will beat you with a really good mousetrap that connects with the market and leaves you in their dust. Build, launch, tweak and repeat.

3. What's your PROMISE? At some core point your product/service/company makes a promise to its users. What's yours? In my opinion this is your only real currency with your customers. Recently in speaking with a good friend about her new venture where her primary value will be based upon her ability to build a strong connection with her customers. I pushed her to define and make her promise to her customers and put it right out there in front of them. You want to build a relationship with your user base? Make a promise, keep it, and watch that relationship flourish.

4. Fall in Love with Revenue: You can never have too many revenue sources. I am not a big believer in online advertising as the single means to a successful new web startup. I love it that Google has made it so easy to create revenue streams for a web co, but its simply not enough for 98% of the new companies. Now this exercise is really hard, all of us are trying to figure it out, but I propose that if you don't you are dead out of the gate.

5. Partner Well: Find strategic partnerships, figure out other companies trying to grow that you can help and in turn help yourself. But here's the catch, be very careful. A bad partnership can ruin you, be decisive about exactly what you want to accomplish and be willing to walk away.

6. Believe. Make sure you truly believe in what you are doing, it just isn't easy to win at this game, so if you don't believe in yourself/product/team it probably won't work anyway. Start and end the day by affirming your belief in your company, show your customers and investors and team mates that you are completely sure about your path. Being honest with yourself is probably the most important aspect to being an entrepreneur, don't BS yourself. If it isn't good enough for you to believe in, get it there or get out!

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