🦄 Startups of the Future...

Hi there,

From hiring your first employee(s) to the metrics to track from day 1, the Leiberman method for building a startup audience to what scale-ups should and shouldn’t automate, we’re here to add value at every stage of your innovation journey:

1. Startup Phase

2. Growth Phase

3. Scale/Sale Phase

Hiring Your First Employees: Getting the Best

Few hires are as important as your first ones. And OfferZen co-founder Phillip Joubert recommends here that you 1) start in your personal network before looking outside, 2) hire all-rounders based on strengths (not lack of weaknesses), and then 3) move fast but devote enough time to the interview process – like spending half a day coding with each candidate. 

Using Customer Feedback to Improve Your Product

Take a page from Rob Fitzpatrick's The Mom Test and realise that most people inadvertently give you false feedback to spare your feelings. To get the real picture (which is what building requires), forget your product and 1) focus on how they normally solve the problem, 2) stick to how they did it in the past, 3) ask them to tell you stories of how they normally do X, Y and Z and 4) listen for queues of what’s really important to them in the process – that’s what will tell you what your product needs to do for them.

The Metrics that Matter When You Just Start Out

A startup is more than a product, it needs to evolve into a fully-fledged business. So how do you know you’re on track? As startup strategist Renier Kriel points out here, for investor relations start by calculating your 1) Anual Recurring Revenue, Rule of 40 and Revenue Burn multiple, and for customers, look at 2) Gross- and Net Rand Retention and Gross Margin-Adjusted CAC Payback. To measure employee effectiveness, look at 3) ARR per Employee (FTE).

Are you in the start phase? Have questions? Hit reply and let us know how we can help.

Cash Flow Management and Forecasting

One of the biggest determinants of success and failure, cash flow is not something to leave to chance. And, as UAE Agile consultant Michael Tadros points out in this video, it’s worth learning to not only 1) control your spending and 2) build cash reserves, but also 3) develop deeper customer relationships, 4) make receiving money a priority, 5) employ professionals to manage your money and 6) automate your cash collection as much as possible.

Developing Audiences for Engagement and Conversion

Building predictable pipelines and channels has become so complicated, it pays to step back and listen to some sanity. As Morning Bru founder Alex Lieberman explains here, every channel starts with 1) an absolute laser-focus target audience and an understanding of 2) rented-, owned- and monetised audience dynamics, so you can identify the exact right platforms to reach them. Next, you need to match up 3) what you can and enjoy creating with what that audience really needs – he, for example, focuses on the audience’s likely KPIs, because then their own boss/business will drive them toward topics in your content.

Identifying Potential Partnerships for Growth

Solidifying partnerships is a key way to increase your capabilities, but, as veteran “alliance” guru Ben Gomes-Casseres points out in this video, partnerships are so complex, considerations should always 1) start with what alternatives you have – can’t you do it yourself, how many potential partner options are there? Then, for each potential partner you need to be able to state simply 2) what the joint value the partnerships will create for each of you, 3) the mechanics of how you will work together and 4) who gets what share of the returns.

Need help growing faster? Maybe it's augmenting your team, or perhaps coffee with one of our growth experts — either way, hit reply and let’s find your solution.

Channel Development for Sales

The biggest mistake scale-ups make when looking to build more/new distribution channels is to choose those that fit with how they work (internally) says VC Ben Horowitz. And, as he explains in this video, channels are a function of the nature of your product and the target audience, where: 1) how the product needs to be delivered (online versus physical), 2) the level of assistance the customer needs to get started with it and 3) how complex the buyer decision-making process is, limits what channel you can use. For example, even if yours is a SaaS product, if it’s highly complicated and needs 20 different departments’ sign-off to roll out, social ads are probably not going to work as well for you as an outbound sales team would.

Automating Intelligently in Large-Scale Operations

The march of AI and tech means it’s easier to automate than ever before. Be warned, though, that not every function delivers ROI when automated – a recent Gartner survey shows using AI for customer service could devastate your reputation. In fact, the Forbes Tech Council has a list of what not to fully automate, including 1) customer relations, 2) education, 3) security, 4) software development, 5) quality assurance, 6) usability testing, 7) feedback analysis and 8) hiring and interviews.

Long-term Business Resilience Strategies

In his book Built to Last, James Collins notes that, while most companies only live a few years or decades, some “visionary” companies outlast even their own products, to keep innovating and delivering value. And there are some gem insights in this video summary of the book, including 1) they focus on building outstanding organisations over individual performance, 2) they develop almost cult-like cultures that you either love or hate, 3) they train their future leaders internally and 4) they encourage experimentation and accept that most experiments will fail (therefore never punishing an employee for trying something new if it lines up with their core values).

Want to scale faster? We have people that are comfortable with the discomfort of the scale phase. Hit reply and let us know how we can augment your team.

Have your say…

What’s happening in SA’s tech community

1. SA Innovation Summit

It’s almost time for Innovation Summit 2024, and tickets are selling fast for this year’s focus on “Catalysing Capital,” i.e. connecting investors and founders to accelerate Africa’s ecosystem.

• When: 19–20 September 2024

• Where: Cape Town Convention Centre

• How much: from R6’495  

• Get tickets: Register here

2. The Open Letter Community Event

The Open Letter is hosting their first-ever in-person event – and it’s in Stellenbosch. Octoco founder Heinrich De Lange joins Renier and the team at LaunchLabs for what promises to be a “lekker” startup event.

• When: 6 August 2024, 18:00–20:00

• Where: LaunchLabs, Hammanshand Rd, Stellenbosch

• How much: R100 (free to Open Letter Pro members) 

• Get tickets: Book here

3. Eco-system Support

We met Riche Attorneys’ Zinta Strydom at The Founders Den in Joburg, and they are very active in supporting the tech ecosystem. So, if you need legal advice or services, reach out to Zinta via email: [email protected] or phone: 072 374 5652.

Hit reply if you think we’ve hit or missed the mark, tell us what you’d like to see or hear more of and, just in general, what would really add value to your journey…

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