Sell when your company has achieved its mission. Sell when you have run out of ideas. Sell when the buyer offers a price that you feel reflects the company’s full potential. Theories on when to sell vary from the philosophical to the economic. These three mental models, gleaned from the work or writings of Elon Musk, … More Can you teach entrepreneurship? Part 8: When to sell?
Success in a startup requires skill in big sales. It is not widely known or accepted but big sales (e.g. which include hiring employees, getting investors and selling expensive products), require a set of skills that are very distinct from selling low price products (say, for less than $100). Sales is often something that we think of … More Can you teach entrepreneurship? Part 7: Be a master of big sales
A startup’s market size must be big enough to justify any upfront investment. Applying this logic suggests $5 million is a very minimum empirical market size for software startups. The same logic suggests very minimum market sizes for hardware should be larger, and, for pharma, much larger. Rigorously validating market size requires time and money and this … More Can you teach entrepreneurship – Part 6: Mastering Market Size
Raw entrepreneurial talent and a diverse founding team correlate strongly with improved startup success rates. In this blog, I’ll provide evidence for this claim and propose a way to measure the quality of a startup founding team by looking at prior startup successes and also the number of roles within the founding team. Data show that raw entrepreneurial talent has … More Part 5: The Dream Team
Over the last while, I’ve frequently heard that serial entrepreneurs have a higher probability of success. Mistakenly, though, I’ve taken this statement to mean that entrepreneurs improve by learning from past experiences. Serial entrepreneurs do have a higher rate of success, but their success may have more to do with them having the raw talent than learning while on the … More Part 4: Prior startup experience may not help much
Have you ever tried to make a decision by writing down, weighting and then rating a few different factors you felt were important? Maybe it was while picking a job, maybe it was picking a university course or maybe it was deciding on an employee to hire. If so, I think there’s a better way … More Can you teach entrepreneurship? Part 3: How to make better decisions
In this part, I’m going to combine some rules of thumb to predict the success of a startup. The model will be based on three of the four characteristics that Peter Thiel feels are important for a startup to achieve a monopoly (take a look at chapter 5). The model may give some insights into why it might be that venture … More Part 2: Check-boxes for startup success (inspired by Peter Thiel)