What I look for in a new venture
These are the things I look for in a new venture:
Sustainable business model
Founding team alignment
Funding as a means to an end
Forward thinking approach to work
In writing this, I realized it applies to far more than my current situation.
You could use this to assess businesses you might want to start, work for, invest in, or who knows what else.
1. Sustainable business model
Taking inspiration from Jason Cohen’s talk on Designing the Ideal Bootstrapped Business, I believe B2B SaaS is the most viable and sustainable business model out there.
With past ventures, I’ve made the mistake of not having a clear business model from the start, or long-term sustainability in mind. I won’t make those mistakes again.
I have yet to actually start a B2B SaaS company, which is why it’s the next frontier in my entrepreneurial journey.
Further, selling products > selling time. Time doesn’t scale.
2. Founding team alignment
The founding team needs to be on the same page in terms of values, expectations, and what success looks like.
I haven’t gotten this right yet. With OMG Transit, the team was misaligned because we started at a hackathon. This wasn’t a problem as a solo founder, but I was lonely as a team of one.
Entrepreneurship is a roller coaster, and the team needs to be committed to supporting each other during the highs AND lows.
3. Painful problem
It’s got to hurt enough that people are willing to pay for a solution. “Nice to have” problems won’t go far.
People were eager to use OMG Transit because we solved a real problem, but it wasn’t something they wanted to pay for. Invisible Network nailed this, though.
With any new venture, you’ve got to hit people were it hurts.
4. Clear vision
There’s got to be a simple, well articulated vision, and narrow focus to start.
This will allow for rapid progress, short feedback loops, and quick iteration, which are all critical while you’re validating the idea.
Looking back, I’ve found success this way. I did goof things up with Invisible Network, in that the initial focus was too broad (which was later corrected).
Keep it simple, stupid.
5. Funding as a means to an end
My personal preference is to bootstrap whenever possible.
There are many factors that go into funding decisions. Health insurance, technical help, and risk aversion are all reasons to pursue it. There are businesses that warrant investment, but that’s not typically the case with software.
In my experience, fundraising is a means to an end. All the time and energy that goes into it could otherwise be spent building your product and business. And after raising, you’ll have investors whose interests may not always align with yours.
6. Forward thinking approach to work
This feels like table stakes for any new business starting today, but its worth articulating: people need the time and space to do their best work.
This includes a remote-first culture and communicating asynchronously, along with the flexibility and autonomy people need to get their work done on their own terms. Plus four day workweeks.
This may seem like a long or unrealistic list, but I’d rather define a target and flex on one or two things, than not know what I’m looking for at all.
What do you think? What do you agree or disagree with? What’s missing? How does my ideal venture differ from yours?