Think Like A Start-Up, Sting Like A Bee: The Three Attributes You Should Be Aiming For
Anthony Stevens (pictured below) is the founder and CEO of Digital Asset Ventures and co-author of the book Chasing Digital: A Playbook for the New Economy (Wiley). In this guest post, he argues technology is increasingly taking the risk out of those considering their own start-up…
Conventional wisdom says that 90 per cent of start-ups fail. But the data says otherwise. Cambridge Associates, a global investment firm based in the US, tracked the performance of venture investments in 27,259 start-ups between 1990 and 2010.
Its research reveals the real percentage of venture-backed start-ups that fail (as defined by companies that provide a one times return or less to investors) has not risen above 60 per cent since 2001. So, what are start-ups doing right these days?
For starters, they’re more agile than ever. They’re able to move fast and get things done because they reward and promote managers who are highly efficient and focus on execution, rather than just talking about it. But these types of managers aren’t just in start-ups. They are in every organisation – including yours. In my experience, there is a particular, commercially oriented mindset that will optimise your return on investment. That mindset can be summed up by three distinct attributes
- Understanding the cost of regret
As strange as this concept might sound, regret has a tangible cost. It is incurred when a project needs reworking or is a failure. Regret is the human response to making the wrong decision. The cost of regret can lead decision makers to spend long periods of time collecting information to make a perfect decision, and can paralyse managers from making any decision at all. Regret aversion has a particular bearing on digital transformation because many pre-digital businesses know it as a hangover from the era of traditional IT projects.
There was a time when implementing technology always meant big and expensive and untested, so leaders spent years planning and building project roadmaps in an attempt to ensure success. Now, thanks to capabilities like cloud computing, companies can deliver much smaller ‘pieces of value’ for a nominal cost.
As a leader, you have a role in communicating the new truth that a single project failure no longer destroys the bottom line, and can be fixed and improved upon quickly. This will minimise the regret incurred and free your best managers to act, rather than over-engineer a solution. The cloud removes the need for costly on-premise infrastructure, and allows organisations to build and deploy solutions from anywhere in the world.
It has also led to the creation of new delivery approaches that allow for rapid development times and shorter customer feedback loops, enabling a more iterative approach. Managers who understand that the cost of regret varies, depending on the size and flexibility of the project, will spend the appropriate amount of time collecting the minimum necessary information to make a decision, so they can spend more time on execution.
- Focusing on burn rate
Burn rate refers to the rate at which a new company spends its initial capital. But the concept has broader uses as well. Every time your teams run a meeting, for example, have your managers considered how much it costs? They could calculate the cost using this formula: Combined salaries (as hourly rate) of participants x meeting length = cost of meeting
Have you calculated the cost of your team for a day? Thinking about projects in terms of burn rate often changes your mindset around how you make decisions and what is actually important.
A project is just a controlled burn of money. It’s important to remember that the money is limited, but the results aren’t. Great managers can control this burn, get the maximum output, and deliver higher quality.
Here are a few tips on how to do this:
- Measure at all times. Acknowledge the cost of time in absolute and opportunity cost terms. This will help you recalibrate decisions more regularly.
- Less is more. Managing large, expensive teams is difficult and adds unnecessary pressure in terms of the related burn rate.
- Do not conflate hourly rates and output – they are not the same thing.
- Actively assessing value
Businesses often get caught up in the projects of consulting engagements, architecture assignments and planning. These initiatives can deliver well-researched information and recommendations to the buyer of the services. Too often, however, the resulting reports are not distributed widely enough, or contain recommendations that require a different level of executive stakeholder buy-in to implement. The reports can also be costly. Has the business realised the value of that investment?
Investment-oriented leaders think differently, repeatedly questioning and assessing where the value lies. This continuous process needs to be applied to everything, from projects to personnel. This approach has less of a temporal element than return on investments, allowing the manager to focus on quality outputs, rather than just wins.
Latest News
Sydney Comedy Festival: Taking The City & Social Media By Storm
Sydney Comedy Festival 2024 is live and ready to rumble, showing the best of international and homegrown talent at a host of venues around town. As usual, it’s hot on the heels of its big sister, the giant that is the Melbourne International Comedy Festival, picking up some acts as they continue on their own […]
Global Marketers Descend For AANA’s RESET For Growth
The Australian Association of National Advertisers (AANA) has announced the final epic lineup of local and global marketing powerhouses for RESET for Growth 2024. Lead image: Josh Faulks, chief executive officer, AANA Back in 2000, a woman with no business experience opened her first juice bar in Adelaide. The idea was brilliantly simple: make healthy […]
Is Meta’s New AI Chatbot Too Left-Wing?
Meta's chatbot accused of being left-wing after being caught wearing a Che Guevara T-shirt & listening to Billy Bragg.
TV Ratings (23/04/2024): Why Did No One Tell Angela That Farmer Wants A Wife Is Set On A Farm?
As wonderful as this headline is, let's face it, we all know an 'Angela', don't we?
PubMatic Unveils New AI Partnership To Turn Social Posts Into Ads For Any Digital Channel
Here's some nifty tech for turning social posts into ads. Assuming said posts aren't one-star character assassinations.
Intuit Mailchimp Makes A Splash With Its First Australian Brand Campaign
Ever laugh along at a gag you didn't get so as not to appear dumb? Get ready for more feigning with this new work.
GumGum’s Rob Hall: Advertisers Can No Longer “Rely On Binary Descriptions” Of Consumers
If anyone's got their finger on adtech's pulse, it's Rob Hall. He also avoids using the good paper in the office printer
Mastercard Nabs Florencia Aimo From Marriott International
Marriott International's Florencia Aimo jumps from the hotel business to the exploitative credit card one.
Bastion Agency Appoints Cheuk Chiang As New ANZ CEO
Cheuk Chiang takes the reins over at Bastion Agency. But not the rains down in Africa.
Spotlight On Sponsors: Major Sponsorship Wins After A Disappointing Week In Sport
B&T continuing our deep dive into local sport sponsorships & that's despite not a single offer of a free ticket as yet.
Macca’s Marketing Director, Samantha McLeod On Big Mac Chant: “What Was Once Old Is Now Cool Again”
Macca's using the power of nostalgia in latest Big Mac campaign. Well, only for those who've ever eaten one sober.
World Premiere Of Midnight Oil: The Hardest Line To Open Sydney Film Festival 2024
Oil's biopic to open Sydney Film Festival. Here's hoping Molly Meldrum will take his pants down at the premiere.
Entries Are Now Open For The 2024 Brandies, IntelligenceBank’s Annual Brand Marketing Awards
The Brandies are, of course, a prestigious marketing gong and not the mystery tipple favoured by nannas everywhere.
The Fred Hollows Foundation Appoints Ardent For PR
Yes, we all like to have a joke at PR's expense. But sometimes it does important work, like this.
AI, eCommerce & Marketing Specialists Are In Increased Demand By Businesses, New Data From Fiverr Shows
Has your philosophy & anthropology degree left you with nothing but a huge HECS debt? Here's what you should've studied.
Perth’s First 3D Anamorphic Billboard Arrives Courtesy Of oOh!media
Do you love a buzzword? Now you can add anamorphic to the list as it relates to billboards, not a colleague's ears.
MasterChef Australia & Crown Resorts Launch Unique Dining Experience With ALUMNI
A pop-up restaurant staffed by MasterChef contestants! That's fine dining prices for first-year apprentice chef cuisine!
Amanda Laing Announces Resignation From Foxtel Group
Foxtel's chief commercial & content officer heads for the exits. Read nice things the bosses said about her right here.
The Lost Letters From Our Diggers: News Corp Unveils ANZAC Day Special
It's nice when brands respectfully acknowledge ANZAC Day.
Howatson+Company Acquires Akkomplice
Large indie acquires a slightly smaller indie. Much like a shark eating a tuna, just with less thrashing and blood.
Google Delays Third-Party Cookie Deprecation Again
In good news for the sale of picture library biscuit photos, Google continues to tease over the end of cookies.
Education A Low Priority For Aussies More Concerned With Cost Of Living Forethought Study Reveals
Study finds Aussies cutting back on education due to cost of living. Booze & Uber Eats sales remain largely unaffected.
“I’m Still The Same Person That I Was”: Rikki Stern Says “Fucc It” To Cancer Stereotypes
B&T always happy to promote the anti-cancer cause. Even brands that massively overdo it with the hot pink.
The Unapproved Climate Certification Allegedly Causing Mass Greenwashing
Are you left flummoxed in the canned tuna & free range eggs aisle? Just wait till this green certification gets up.
TV Ratings (22/04/2024): Fans Mock “Over The Top” Reaction To New MasterChef Judges
MasterChef returns for its 2024 season. B&T stands by putting peppercorns in Gravox & no one will be any the wiser.
Dentsu Restructure: Muddle, Harvey & Johnston Take Leadership Baton As Bass & Yurisich Exit
A large broom has swept through Dentsu's local ops this morning, taking with it some big names & the air con's cobwebs.
Industry Shares Trends Shaping The Industry This International Creators Day
B&T's asking adland creators to reveal their top trends. And it's not good news for your Jenny Kee cardigan collection.
Mable Extends HOYTS Sensory Screenings Partnership
Mable has extended its HOYTS sensory screening partnership. Vigorously defends its two-star Oppenheimer review.
Orphan Launches ‘They Need Our Help. We Need Yours’ For Children’s Cancer Institute
Anything to do with childhood cancers has B&T's 110% support. That said, we do ignore the red meat & alcohol warnings.
Smile Team Orthodontics & Keep Left Collaborate On Smile-Inducing Campaign
As parents would attest, given the cost of orthodontics you'd expect this campaign to be a lavish production indeed.
Opinion: How Video Calls Neglect Learning Diversity
Need an excuse to duck out of a video call this arvo? Show this to your boss.
DoubleVerify Achieves First-Of-Its-Kind Responsible AI Certification From TrustArc
DoubleVerify receives responsible AI certification. However, not its robotic vacuum that's been seen menacing the cat.
Smile For A Good Cause: The Social Media Campaign Giving Back To The Community
Are you known as the office Austin Powers? More for you teeth than shagability? Get snappy new fangs with this news.
Elon Musk Mocks Albo After ESafety Wins Court Injunction Against X
Albo's 2024 from hell continues - Rabbitohs in crisis, down in the polls and now feuding with world's richest man.
Real Estate Developer In Hot Water Over “Sexually Exploitative” OOH Campaign
Real estate agents again tops in the 'least trusted profession' polls, nudging used car salesmen & ad creatives.
Epsilon’s Shane Hanby: Post-Cookie Era Relies On “Teamwork” Between Brands, Marketers & Tech
This pro predicts more "teamwork" in a post-cookie era. Which spells bad news for the uncooperative or plain stubborn.