It seems that every week there is an article or post that bemoans the shortage of innovation in America. However, this is not due to a lack of great ideas and the pace of discovery in the labs across the nation. The problem is getting the right team to lead and to grow these ideas into commercially successful endeavors.
Don’t go it alone
Having an exciting technology or scientific discovery on hand is not enough to form a successful company. You need a team of talented people to help you realize your vision. However, going from one person (you) with an idea and a passion to assembling an effective team and moving forward can seem daunting. The answer to this is not complicated. The first thing you need to do is assemble your first board members.
Who are they? Early Advisors vs. Active Board
Whatever you want to call them, you need others to help you take your idea to the next step along the way to a successful company. The best way to begin is to gather a small, but powerful group of people that you can rely on to help you develop a realistic strategy, identify productive tactics and complete the critical efforts needed to get this off the ground. You will find that there are many that will be more than happy to become advisors but far fewer that will become valuable board members. You need both but you need the active board member more, especially in the early days when this is still an idea. Here are a few ways to distinguish the two types of people:
Your board may typically only have 2 or 3 other members in the beginning which is fine. You will likely have significantly more advisors at the beginning but some of these may migrate over to the board member column as things progress. Your advisors allow you to get a breadth of guidance and ideas and your board will provide the depth you need to sort through all of the ‘suggestions’ and actually help you with the heavy lifting of launching your new startup. In addition to this, it is a lot easier to share the burden of this effort with a committed team than shouldering it all by yourself.
Identify 10 people who have the experience, resources, talents and connections you need and ask them to be on your board.
Schedule a kick-off meeting to discuss your ideas with them and to identify what commitments you might need from them.
Agree on a regular meeting schedule
Parse this initial group, using the table above and your intuition, into Active Board Members and Advisors.
Continue to recruit until you have at least 2 – 3 board members.
What does growing apples have to do with building a life science company? It turns out that there are a lot of similarities if you look closely. A successful orchard requires a huge investment in planning (what variety of trees, how much of each, etc.), effort (a lot of work before the first harvest), finances (cost of land, labor, farm equipment etc.) and time (trees need a number of years to mature before your first harvest) to become successful. The successful orchard keeper needs to have a good assessment of what types of fruit his customers will want in a few years and also how he can differentiate his own business from other orchards in the area to compete successfully. The leadership of a strong life science business needs to think in the same terms. What need will your offering(s) fulfill in the future and why will customers come to you rather than to your competitors? With an orchard, once you plant the trees, you are now committed to your view of the future market for your products and now everything is about nurturing your trees until you have your first harvest. With a startup, once you have selected a product and/or service, all of your efforts will be to get it successfully to market. The orchard keeper cannot rip up trees next year if he thinks that the market for his fruit has changed. Likewise, most startups do not have the funds (or time) to scrap a product offering once they are working to get it to market. The lesson here is, make sure to spend enough time to understand your market, your customers and how you will successfully sell and then commit to a laser-like focus for getting that offering to market as soon as possible.
Tips for Building a Strong Startup:
Plant Trees: Build your company for strong and steady future business. Whether you are offering a platform, service or a one-time sale of a large instrument, referrals are the key to efficiently growing profitably. Winning new customers is costly so getting referrals from happy customers is like harvesting apples in the fall. The time, effort and investment you put into winning strong early customers will pay off as they share their experience with your future customers. Building a scalable infrastructure that consistently and efficiently delivers the goods that delight your customers will insure success in the long run.
Build a Barrier to Entry: It takes a while to plant and nurture an orchard. However, once your trees have matured, you will have happy customers coming on a regular basis. Building strong relationships with key opinion leaders, establishing preferred vendor status with organizations and establishing your company as a market leader in the technology is a lot like planting new trees. There is a lot of prep work up front and the rewards are not immediate but once you have done this, this makes it very difficult for competitors to come into the market later.
Plant some Pumpkins Too: As a startup, you need to start generating revenues as soon as possible to prove out your business. Your team will need to put a lot of focus on getting your first sales and creating happy customers. Many startups make the mistake of neglecting to build in some time for creating a scalable and profitable business. You will be planting and harvesting an annual crop like pumpkins to do this. Developing a product road map that contains both near term (pumpkins) and long term (apples) offerings will allow you to get to market faster and get the insights you need to insure a better outcome with your later prospects. However, the key here is using what you have learned about your customers, their wants and needs and enthusiasm for your offering to build an infrastructure that will allow you to maintain the high level of customer satisfaction that will lead to referrals from your customers (See first point – Plant Trees).
Take Home Points:
Start building relationships with key opinion leaders and strategic partners early (even before the launch of your first product or service).
Use the insights you gain of your customers’ wants and needs from early sales to guide your efforts as you scale the business. (e.g. if you will start selling using distributors, make sure that you build in an infrastructure (tech support, technical inside sales, social media outreach, etc.) to maintain the level of support and service that your customers valued in the early days).
Everything you do and every interaction you have with the public will shape your brand. A strong positive brand can be a powerful barrier to block your competitors. Clearly identify the brand identity you would like to have and make sure that you and everyone in the company reinforce this in everything they do and with every interaction with the public.