The internet is littered with data about failed tech start-ups, the figure is as high as 90%. That’s scary, but it doesn’t have to be you. You have your world-changing idea, you’ve roped in a coder and now you’re gonna change the world. Or are you?
Peter Magner, funky accountant and Director at Iridium Business Solutions and his brother Simon, have defied these stats as a tech start-up themselves. They’re accountants, but their mission is to help business owners make better decisions. They have worked with over 250 entrepreneurs over the last six years and share some start-up saving tips on which they have based their own business.
They practice what they preach.
THREE IS NOT A CROWD
Don’t go it alone – Every tech start-up needs the visionary, the guy with the good idea, the salesman, the girl to get the message into the big wide world, and the grinder, the guy to do the work. Or in the words of failed founder Bram Krommenhoek, a hipster, a hacker and a hustler.
Peter believes a conductor is also crucial in bringing everything together. “A visionary alone isn’t enough, he needs grinders who get joy in seeing innovations and ideas becoming reality,” he says.
If something doesn’t work, look for another solution.
THE TWO A’S – AGILITY AND ADAPTABILITY
If something doesn’t work, look for another solution. Start-up owners should always be looking for ways to make the business grow and constantly adding tech to their existing tech stack. One of our clients was installing a payment gateway on their website, and that business owner did not give up until he found a way over, around and through.
Don’t accept no for an answer. “In our world, the ‘old style’ accountants who never followed the worldwide trend of cloud solutions, are stuck, bleeding clients, pouring over a ledger.”
TAKING THE BUCK
As a tech entrepreneur, don’t abdicate your finances, take responsibility for the Rand as the buck stops with you. Be sure to know your SARS requirements, diarise VAT and Other Tax deadlines. You don’t need to fully understand the intricacies of the Income Tax Act, if it’s not your strength, pass on the duty, but not the responsibility. When SARS comes knocking, it’s on your door.
NETWORK LIKE YOUR LIFE DEPENDS ON IT
Peter isn’t down at the running club every day, he’s on LinkedIn, Twitter, Instagram, nurturing relationships with potential team members, potential clients, and potential partners.
“I’m a regular LinkedIn poster, I integrate it into my lifestyle. What business lessons or insights can I offer from the ordinary things I do in my life,” is a question Peter asks weekly.
It’s okay to run your business from your garage or your flat. Designer couches, sushi and foosball aren’t essential tools for a tech start-up. If you’re not making money, don’t spend money. Facebook pioneered staff chill zones and designer canteens once it was a multi-million $ company, not before. They were a bunch of guys working from a college dorm room. Investors want their money used on growing the product, not designer offices.
BE A CULTURE VULTURE
Simon and Peter learnt the hard way about how vital it is to invest in the culture of your business.
“When we started Iridium, we were firing and hiring people weekly, but we didn’t know the DNA of our culture and were hiring wrongly. In one month we lost a whole team, as we recycled people.” The cost to them and to their clients was enormous.
“We’ve changed that now and building our culture is one of our highest values,” said Peter.
The Magner brothers have invested plenty of time applying the principles from Simon Sinek’s latest book, The Infinite Game into their business. They are building will (the intangible morale) into their people resources.
Peter doesn’t believe you can throw cash at culture, but you can use the money to build human connections over time, on events and activities that develop and entrench culture and he leads from the front. He cites a case study from the crash of 2008: a plastics manufacturer took a decision not to fire people, but to freeze salaries across the business and to actually take pay cuts. Before long, people were finding ways to save money: staying with friends instead of hotels. Their culture and will help them, band, together and save the company.
Peter shared some ways in which they value people and build their culture:
- A focus on a healthy lifestyle – each team member participates in some healthy activity paid for by the company
- Compensation – Peter and Simon take pay increases last if there is any money over
- Celebrate every birthday with a cake and a gift
- Monthly get-togethers – for the January get together (Friday SpitBraai), they will connect with two team members based in Namibia via Zoom, plus ensure a cake and flowers are delivered to Windhoek to demonstrate they are part of the team
- Annual Values awards – the Grit Award, The Questioner Award, The Client Partnership Award, The Team Player Award and the Respect Award.
As Published on Heavy Chef – https://www.heavychef.com/blog/2020/2/2/how-to-avoid-becoming-a-tech-start-up-statistic