Lessons in sales and strategy, Aligning purpose with strategy, and Bootstrapping #0024

18/12/2023

LESSONS IN SALES AND STRATEGY

Ash Maurya, Founder at Leanstack and best selling author, shares some of his key learnings from 2023 "My 3 Biggest Insights From 2023"

• Counter positioning is your unfair advantage:

  • "Most founders think they have no starting unfair advantage."

  • "While you may not have a cornered resource, network effects, or brand power at the outset, counter-positioning is one power you should focus on leveraging from Day one."

    • "Counter-positioning involves developing a business model that the incumbent (status quo) cannot copy due to damage to their existing business."

  • "Innovation is fundamentally about causing a switch from the status quo to your new way. To do this, you must uncover your business model’s unique value proposition (UVP) built on an unfair advantage (UA) that cannot be easily copied."

• Fear of Messing Up (FOMU) > Fear of Missing Out (FOMO):

  • According to an extensive study, 44% of deals fall apart because buyers fail to see the problem as big enough. Sales people often deal with this by creating FOMO.

  • However, the same study found that even more deals fall apart, 56%, because the buyer was afraid of messing up (FOMU) and the tactics to manage FOMO hurt FOMU.

  • The author suggests leaning on Mafia Offers (structuring deals that are too good to say no too) to win deals

ALIGNING PURPOSE AND STRATEGY

Harry Stebbings, Founder at 20VC interviews Davis Smith, Founder and Chairman of Cotopax, delving into Davis' insights on leadership, and his thoughts on business and societal impact in “Davis Smith: From Selling $6M of Pool Tables to Scaling Cotopaxi to $150M in Revenues | E1095”

• Align Your Startup's Purpose with Its Business Model:

  • “If you focus instead on why do you exist, what is your purpose, how can can you make the world a better place, how can I give them a life-changing experience working with this brand, how can I make sure they're compensated fairly. If you're focused on on on the things that make your team happy and add value to the world everything else will work out.”

• Consider Equity Distribution and Company Culture:

  • “I'm proud that we have people that work in our warehouse, that lead our retail store operations, that have Equity. I just I believe that wealth needs to be better distributed and I actually think it's a win for Cotopaxi. [...] I actually want to create something that can create wealth for many people within our organization and that can allow them to go pass this to their children and allow their children to go have new opportunities.”

• Pursue Ambitious Ideas to Attract Venture Capital:

  • “I think a lot of entrepreneurs don't understand how big and ambitious the idea needs to be to go raise Venture Capital... You need to go build something that's that's going to do a billion dollars in revenue. You need to have that vision and you need to go sell that Vision to an investor with confidence and you need to have the data behind it to explain how you're going to get there.”

• The skill of the greatest entrepreneurs:

  • “I think the greatest entrepreneurs are incredible salespeople. They know how to sell a vision, they know how to sell an idea, they know how to sell a product and so you're selling every single day as an entrepreneur and I think that starts with that original idea and getting people on board.”

BOOTSTRAPPING

Lenny Rachitsky, Author of Lenny’s Newsletter interviews Jason Fried, co-founder and CEO of 37signals and Basecamp, on how to build a business without venture capital, the concept of life long mastery and more in "Jason Fried challenges your thinking on fundraising, goals, growth, and more"

• Building a Business Without Venture Capital:

  • Insight: Bootstrapping can be a viable route to success, offering more control and less dependency on external funding.

  • Suggested Context: "At Basecamp, we have consistently made double-digit millions in profit each year, entirely bootstrapped, showing that venture capital isn’t the only path to success."

• Advice for Starting a Bootstrapped Business:

  • "Starting a bootstrapped business is not just about conserving resources; it's a mindset. It's about embracing the challenge of growing a business organically, relying on your own revenue and profits. This approach forces you to make smart, sustainable decisions, understand the true value of money, and most importantly, retain your independence and freedom as an entrepreneur."

• Embracing Infinite Games in Business and Life:

  • Insight: Focus on continuous play and evolution instead of a fixed end goal.

  • Suggested Context: "In business, like in life, we see more success when we play infinite games – focusing on ongoing improvement and adaptability rather than a singular end goal."

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