Maintain your will, let go of FOMO, and find your difference — doing so will help you run a lean startup.
That was the message from LiquidPlanner CEO Liz Pearce, who spoke Friday morning at GeekWire Startup Day in Bellevue, Wash.
Pearce, who was named CEO of the online project management startup in 2012 after nine years working in a number of different roles at the company, offered tips for how to build a successful lean startup.
She spoke about LiquidPlanner’s early days in a tiny, two-room office in Bellevue. Since then, the company has grown to 65 people with 1,800 customers across the world.
LiquidPlanner, which just raised a $2 million funding round, has reeled in $13.5 million in investment to date.
“That might not sound lean, but in the world of software startups where companies sometimes raise a hundred million dollars, it is,” Pearce said today. “Lean is a mindset.”
Pearce offered seven tips for building a lean startup, drawn from her experiences at LiquidPlanner:
Maintain your will
Pearce said the will to succeed is critical to the success of a startup, so make sure to nurture that will and don’t get burned out. “When competitiveness and optimism get together and have a baby, that baby is named will,” she said. “It’s important to sustain that will over time. Pace yourself to maintain your sense of will and optimism as you move forward.”
Let go of FOMO
Fear of missing out, or “FOMO,” haunts business decisions just as much as decisions for how to spend personal time. Pearce said it’s important to let go of FOMO — instead, focus on your business and your needs, rather than wasting time and energy comparing your startup to other businesses. “Comparison is the root of all unhappiness,” she said. “Instead, look at your business, your market, what a successful outcome looks like for your business and your investors.”
Find your difference and capitalize on it
Pearce said that when LiquidPlanner entered the project management market, people told the company that all the problems had been solved and they were wasting their time. LiquidPlanner disagreed and launched by focusing on one small difference from existing project management software companies: offering a range of time estimates for a project, rather than a single date. “Because we were different, that’s what fueled our business, even with less capital than our competitors,” she said.
Calculate areas of cost and gain
When your startup begins to make money, Pearce said, you have to start focusing on the math. “Predictability in revenue is the spice of life,” she said. To be a successful leader of a startup, Pearce said, study all of the different aspects of the business and know how each affects the business’ economic trajectory. Questions to consider: What does it cost to acquire a customer? How long will they stay with the company? How much revenue will they bring in? And how long does it take to recoup that revenue? Knowing the math behind each of these questions is crucial to making accurate predictions for the future of your company, she said.
Condense your efforts to the ones that really matter to maximize effectiveness. “Say no to things that increase the surface area of the business,” she said. When taking on a new project that will need to be staffed, maintained, measured and monitored, know that it will take away from other projects that might be more central to the business. Learn to consolidate energy and say no to projects that expand focus rather than narrow it, she said.
Instead of focusing solely on your business, look for ways to give back to organizations that are not yours, Pearce advised. When you give back to others, they will find a way to give back to you. “What you get from [giving back to your community] is visibility for your company, you get recruiting benefits, and you build a network of people in the community that create opportunities,” she said. “The karma bus drives in circles, so if you can carve out some time to do something for someone else, you won’t regret it.”
Value your team
The team is crucial to the survival of a startup. Pearce said that your team must be able to weather the hardest times and continue to stay united. Once, an ex-marine said to her that your teammates are the people you trust to link arms with you and to stick it out there by your side, holding tight even if you’re thrown into frigid waters. Spend time with your team, she said, and remember its value. “Invest in them. Communicate with them. Over-communicate with them. Build a family that will sit in the cold water with you because that water will sometimes be very cold,” she said.
Pearce closed her talk by talking about the rewards of working at LiquidPlanner. Even if her equity were worth nothing, she said, she would still continue coming into work.
“I’m still learning,” she said. “I still love what I do, I still love my team. I still love my customers. I hope that as you continue your journey as an entrepreneur, you can say the same things.”