“You are all going to die – eventually.” “Just do it.” “Hire people who are better than you.”
Mandeep Singh of Trouva, Nigel Whiteoak of LoveCrafts and Rich Rosser of Movemeon answered questions from consultants & ex-consultants interested in running their own businesses. They touched on how you know when to give up, on how you hire, and on the best time to go for investment. Read the full Q&A, or scroll to the questions you find interesting below.
“You are all going to die – eventually. Life is short. Choose what you want to do.”
On 22nd June 2017 movemeon organised a panel dicussion with LoveCrafts and Trouva. Current and ex-consultants interested in running their own businesses attended, to find out what it takes to start and scale your business. A summary of the evening’s Q&A can be found below.
Nigel Whiteoak, Founder of LoveCraft, Mandeep Singh, Co-Founder & CEO of Trouva and Rich Rosser, Co-Founder of movemeon
Q1: You [Nigel and Mandeep] both have experience in consulting as well as the entrepreneurial world. What prompted you to leave great jobs with BCG/OC&C?
Nigel and Mandeep took slightly different paths, but neither went directly from consulting to launching their well-known and successful start-ups. Nigel eventually started his own business because he didn’t like advising and wanted to be able to shape his own career. Mandeep felt he’d learnt a lot in private equity (the industry he moved to from consulting), but he was missing the sense of having created something himself. They agree that if you want to start your own company, you should go for it. As Nigel put it, “You are all going to die – eventually. Life is short. Choose what you want to do.”
For Rich, what really helped in making the decision to leave consulting was having a great co-founder. Nigel and Mandeep also have co-founders they referred to regularly throughout the evening, and they agreed that launching a start-up is much harder (and less sensible) on your own.
Q2: When you decided to leave, did you make a financial plan – did you try to work out how much you’ll need and save that amount first?
Mandeep had saved to be able to invest in the business personally in the beginning, but he stressed that you can’t plan everything. And, of course, you can always go back to being employed if running your own business proves too hard. Nigel also advised against trying to plan everything; you eventually have to just go for it. Rich explained that at the start, he would take turns with Nick, his co-founder, to do freelance consulting while the other focused on growing movemeon. “Most people don’t realise how much they can make as freelancers, and that there is this middle ground between being employed in an established company and running your own business.”
We write about freelance consulting a lot – if you are interested in this option while you get your business going, take a look at our dedicated content here.
Q3: You’ve all mentioned that the people with whom you start can be a driving force. How do you manage the need to find people who work well with you while creating a balanced team?
The reality is that even if you are fairly similar to your co-founders when you start, you’ll diverge as you each start to focus on your areas of strengths. This was certainly the case with Nigel and the founding team at LoveCrafts. Mandeep has one co-founder from a similar background (PE experience), and they have also ended up diverging – even if investors do perceive them as similar. For Rich, what is important is to be completely honest with your co-founder(s) from the start. That’s how you end up working well together, even as you start to own different parts of the business.
Q4: All three businesses have tech at their heart, which is often the biggest challenge coming from consulting. How do you handle it?
Mandeep has a tech co-founder. This made it easier for Trouva to secure funding and it’s helpful on a day-to-day basis. Nigel echoed the importance of a tech co-founder to raising funding early on. But they both warned against thinking that you need really deep technical expertise to launch a business. A lot of the early development at LoveCrafts was outsourced. There are also a range of tools now that can help. Rich also added a warning note about over-planning the tech. Start-ups pivot all the time, so don’t over-estimate the importance of the first product. And do a lot of testing in the real world – take your product idea to your customers and find out whether they actually like it.
Q5: Did you do a lot of competitor research when you first thought of your business idea, or did you trust your instincts?
Again, it is important to test your idea in the real world, and to see whether you could actually sell your product. As Mandeep put it, what consumers say and what they do is not always the same, so market research isn’t as important/helpful as it might seem. Nigel agreed that, although there is merit in doing some research, there are thousands and thousands of businesses out there that do really well. Consultants are naturally good at spotting when consumer behaviour is changing, so that’s when they should step in with a new business.
Q6: How long should you keep trying before you give up?
It depends on the kind of business you are in. In the test-learn-iterate phase, you should be discarding ideas relatively fast. Looking back, Mandeep now feels that Trouva should have been more ruthless in that phase. Nigel echoed that there’s no hard and fast rule, but that sometimes you do have to give up – on the idea, that is. You don’t have to give up on running your own business if you can test your way to a product that sells.
Q7: How do you deal with having to hire people you don’t know? How do you make sure they are right for your business?
Hiring is hard. As a founder, your business is your baby, so it can be extremely hard to give up control. This is why Mandeep finds it really important to hire people who are better than you, so you can have faith in them. Thinking along the same lines, the key for Rich is to hire functional specialists instead of generalists – however strong the temptation to recruit more of the latter, especially when you are not yet sure which way your business will go.
Q8: How do you make the decision that it’s time to expand?
In Nigel’s experience, this is one of the hardest decisions: what pace do you grow at? As you grow, your costs will increase but so will your opportunities. In the end, the decision is a very personal one so the how and the when depends on the entrepreneur.
While Mandeep agreed, he also reminded everyone that you can’t just stop growing – if you have a great product, you should be growing!
Q9: At what point and why do you go for external investment?
LoveCrafts turned to investors 12 and then 18 months in – they were seeing traction, investing in marketing and product, but couldn’t afford to fund any more growth internally. Trouva was even earlier – nearly as soon as the idea emerged. Mandeep explained that they didn’t even really think that there was another way to go. Movemeon, on the other hand, has never gone to investors because of the different nature of its market.
Q10: If you were to give just one piece of advice to someone starting a business, what would it be?
Rich: Just do it.
Nigel: It’s all about the execution.
Mandeep: Hire people better than you.