Aussie in the Big AppleFriday, 31 August 2012 15:02
The power of slow: Why building a customer base is worth the time
Too many start-ups are focused on the wrong things. They care more about users, publicity and raising capital over getting customers.
Revenue and profit is foreign to them: ABC doesn’t mean Always Be Closing, it means three rounds of funding.
They are the new type of Ponzi scheme. They continuously need new capital to replace old capital because they burn through it so quickly.
As my dad would say, they might as well be sitting in the corner tearing up 100-dollar bills.
It’s amazing how many entrepreneurs I meet who are only thinking as a far as their next fund raise.
If they can’t raise again, the business dies and employees lose their jobs and worthless stock options.
Recently I attended a PandoMonthly event featuring one of my favourite New York-based entrepreneurs, Ben Lerer from Thrillist (DailyCandy for dudes).
He sets a great example for other entrepreneurs.
He raised a seed round to get started, then rolled up his sleeves and built a company profitably over the following seven years until just recently, when he raised $13 million to provide financial flexibility and pursue acquisitions.
Thrillist has more than 200 employees and generates over $60 million in revenue. They’re a real business.
Forget about users, and think about customers who pay for your product.
It takes decades to build a great company, and the road to greatness is long. Siimon Reynolds calls it the power of slow.
Michael Giles is the founder/CEO of Roboinvest, a tech start-up. Michael, an Australian, is based in New York. He tweets @harland.
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