During this week’s roundtable I addressed a commonly held critique of the 1M/1M program: that we're focusing on the basics and stating the obvious. I have seen this criticism at various places where this recap is syndicated on a weekly basis, as well as in certain random forums on the internet.What is 1M/1M?
Well, I have coached early stage entrepreneurs for a couple of years now - diligently, patiently - and have learned a few things. First is that there are, perhaps, a thousand people in the world of entrepreneurship who know what they are doing when it comes to dealing with issues like financing, positioning, market sizing, customer validation, customer acquisition and other seemingly obvious topics that all entrepreneurs need to deal with.
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However, 1M/1M is a development economics project. We're trying to bring the lessons we have learned in Silicon Valley to a million entrepreneurs. As you may know, 99% of the entrepreneurs who seek financing, get rejected. Please try to understand why. I happen to have a pretty significant understanding of the reasons behind this, and have created a curriculum within the 1M/1M premium lounge to address these commonly repeated mistakes. For a rather small $1,000 annual membership fee, we're addressing the needs of a large pool of entrepreneurs trying to navigate the entrepreneurship waters, and mostly failing.
Let me remind you again: 1M/1M aims to reduce infant entrepreneur mortality. 600,000 companies go out of business every year in the United States. Globally, this is a much larger number. We're trying to make a dent on these staggering numbers.
So, before you get on a high horse and start criticizing our work, please try to understand what we do.
It is easy to come to the rescue of victory. The entire startup eco-system is interested in the 1% of entrepreneurs who are fundable, have already defined strong market opportunities, and are already well on their way. We are trying to reach the 99% that is not up to a certain level, and help them achieve success.
Some critiques have said that we're focusing on amateurs. Well, I was once an amateur. Mark Zuckerberg was once an amateur. So was Steve Jobs. All first time entrepreneurs, arguably, are amateurs. And in 1M/1M, we're trying to short circuit their process of learning and maturing into successful, seasoned entrepreneurs by teaching them things that they need to know, and augmenting their rolodex (or lack thereof) by putting ours to work on their behalf to help recruit customers, channel partners, and investors.
What we have taken on is hard enough. We can do without the armchair slander.
So. On to the roundtable recap.
First up today was Yogesh Sharma presenting Rangrut.com, a business that connects employers with learning institutions and on-campus students to fill job openings. He discussed his business model analysis and it was clear that he needs to move to a subscription-based model where the employers pay and the universities and students can come online for free. He also needs to create a pricing strategy that works by asking employers what they are willing to pay for the access he is offering. Since hiring relationships between branded employers and branded universities already exist, I believe the best opportunities are for Yogesh to connect brand name employers with unbranded institutes, and unbranded employers with branded and unbranded institutes. The crux of the discussion revolved around segmentation and business models.
Yogesh already has 45 employers onboard, but while discussing his customer acquisition strategy it became clear that he needs to figure out some way to close sales by phone or online without personally traveling to close every sale. The first step is to develop some reference customers, something all early stage startups should do. Telesales simply don’t work without reference customers. But once a set of reference customers are in place, this business definitely needs a telesales channel, not a direct, feet-on-the-street sales force.
Also, it is too soon to raise money, so Yogesh should continue to finance the business through consulting and executing on various customer hiring projects. To interest investors, the pricing model and customer acquisition strategy would need to be scalable. I cautioned Yogesh from believing that he has to raise money. For now, he should stay focused on his customers and gradually growing the business organically.
Next Pascal Nicolas presented SalesVu, a cloud based sales management tool for restaurants interested in tracking the value of their promotions. With a growing variety of online coupons and social media promotions available, Pascal is looking to bridge the gap between the online world and the often dated marketing approaches of physical restaurants. His analytics product links back to online coupons used, for example, to help restaurants see what did or did not work and plan for future promotions.
As for acquiring customers, so far he has used internet marketing and they have just started a partnership with a large reseller of restaurant management software, which is great. I believe he needs to find more partners to go to market through. Since they have already connected with OpenTable, I think they are a natural to explore a partnership with since their customer base is already so familiar with using technology to promote themselves. Yelp, ChowHound, and even Zagat come to mind as other channels worth exploring.
Another idea he has not yet tried is to use search engine marketing to make sure that when any restaurant goes online to look for the type of service he provides using popular key words, they find SalesVu. And by regularly adding to their online content, restaurants will also find them organically through SEO.
It is clear to me, after doing these coaching sessions for over two years, that entrepreneurs need a lot more training on positioning and go-to-market. As such, I have created video lecture modules with case studies in the 1M/1M premium lounge on these topics with very specific guidance on what analysis to perform and how. The easiest way for me to teach a large number of entrepreneurs some of these basics is to have you spend 30-40 hours on the curriculum I have created, and THEN have you come work with me on refining your strategies and positioning.
About 1M/1M premium lounge
I have thought a lot about how to make entrepreneurship education and eco-system scalable and accessible to a vastly larger number of people. The answer to that question, I believe, is the 1M/1M Premium Lounge. Over the upcoming months, the program will become much, much richer. But for the moment, we can get you started and give you a significant jump-start.
About Sramana Mitra
Sramana Mitra is a technology entrepreneur and strategy consultant in Silicon Valley. She has founded three companies, writes a business blog, Sramana Mitra On Strategy, and runs the 1M/1M initiative. She has a master’s degree in electrical engineering and computer science from the Massachusetts Institute of Technology. Her Entrepreneur Journeys book series, Entrepreneur Journeys, Bootstrapping: Weapon Of Mass Reconstruction, Positioning: How To Test, Validate, and Bring Your Idea To Market and her latest volume Innovation: Need Of The Hour, as well as Vision India 2020, are all available from Amazon.