3 decisive lessons learnt from a dynamic entrepreneur - Gordon MacSween
Gordon MacSween has enjoyed a successful career in industry, having studied engineering at Cambridge and then eschewed the more common path of a career in the City. After working as a production manager in the UK and Germany, he gained an MBA at INSEAD before passing up another common career path - in management consulting - to return once again to manufacturing. His last two roles were as Director of an £80m division at e2v plc, and then running his own £0.2m start-up in ad tech. He has learnt plenty from the transition.
3 Things I've Learnt
- Invest enough to show personal commitment, then seek third party investment
- Firstly the process of funding is an education - winning over investors requires clarity about how the business will make money, helping you to focus on proving or disproving that from the outset
- Secondly most entrepreneurs take more than one attempt to get it right - whether via a pivot or a second start-up. The fact that even experienced angels make significant returns on only 1 in 10 investments shows just how many 'unknowns' there can be
- So : keep back enough of your own savings to re-invest in case - like Richard Branson and others - your first plan isn't the right one
- Unless there are real IP concerns, get your Proof of Concept to market asap
- Exposing your concept to customers and other influencers in the value chain is even more educational than raising funding
- Of course there's some risk of idea theft, but there are far greater risks : running out of cash in 'stealth' mode or developing the wrong product because you've missed some crucial customer insight
- So : find out all you can early and adjust course while you still can - investors are more sympathetic to change than to running out of time
- Try-before-you-buy when expanding the team
- Business growth typically involves expanding the team, and a high % of funding is often budgeted for salaries - but each hire also brings recruitment costs, training costs, expenses and equipment ... and sometimes termination costs
- Do the skills you need add up to a full-time role? Is one person likely to be the best fit for every one of those? Will the same requirements persist over time? Could you get the job done by a series of interventions / projects by contractors, interims or suppliers - perhaps supported by a low-cost and enthusiastic intern? Could you start out that way, then hire someone if and when they prove themselves a great fit?
- There are employment law considerations to all of this, but do consider the speed, flexibility and access to specialist skills available today before taking the plunge into hiring - it's expensive when done right, and punitive when done wrongly