How to Help Entrepreneurs by Teaching the Power Of “No”
Mentors can help entrepreneurs see blind spots
Sometimes the best way to assist an entrepreneur is not to do what they ask. The vetted service providers in Rev1’s program are there to be an advisor to our portfolio companies—not just to handle transactions.
Sometimes that means stopping entrepreneurs in their tracks. Entrepreneurs don’t always know what they don’t know. Great service providers don’t always say “yes.” They slow the process down and ask the tough questions. They aren’t hesitant to say, “Yes, I can do the work, but at this stage, it isn’t in the best interest of your business, and this is why.”
Here’s what three vetted serivce providers say about the art of saying “no.”
Alex Brown, member, Dickinson Wright: “I’ve seen clients regret spending money in one area and not another. My job is to point out the pros and cons of a situation, so when I’m dealing with a startup with a limited budget, I do a legal triage. What’s the best way for them to spend their very limited budget to get the most liability or legal protection they can? I work to show them how to get what they need to survive long enough to get some revenue and become investable. I advise them on the risks and costs, and they make the call about how to go forward.
Entrepreneurs can spend too much too soon on intellectual property. Take the entrepreneur who wants to put together a patent application for software. That’s challenging and expensive ($10,000 or more). The money might be better spent on developing really good customer contracts that limit liability and protecting the software via trade secret (which is free) rather than on a patent. And it’s not just patents. When it comes to registering a trademark for their brand or logo, I suggest that they kick the tires for a few months. Make sure they like the branding and that it’s going to stick. Most startups pivot more than once, and it often involves a re-brand.
Sometimes I tell people not to use me. I might send an entrepreneur to buy commercial liability insurance from an independent agent rather than write a private placement memorandum or other expensive documents. When an entrepreneur is determined to sue, I might refer them to a contingency attorney who will bill only if funds are recovered.”
Aimée Eichelberger founder, Superior Public Relations: “PR is not a faucet you can turn on and off. To maximize PR, a company needs a continuous drip. It is ineffective to distribute one press release and neglect to follow through with additional communications. Until a startup has the budget to commit to a sustainable PR program, think about investing in PR efforts in other ways.
For instance, before outbound efforts even start, it’s wise to invest time and energy in the development of solid and succinct messaging. Know who you are and how you’re different to ensure you’re communicating it effectively to the market. When your startup starts gaining media traction, you don’t want to drive prospects and partners to an irrelevant or out-of-date message.
Once your messaging is solid—if you have big news that you want to release, try approaching one reporter with an exclusive to encourage a more in-depth feature article versus distributing one press release that only skims the surface. To further that, know what your prospects and partners are reading—and do not be tempted by the shiny object. For example, The Wall Street Journal may not move the needle as much as Chief Learning Officer, so it’s important to do your homework and be strategic about your media outreach.”
Ryan Frederick, principal, AWH: “Humans are fundamentally wired to solve problems and to offer solutions. It feels like progress when we do those things. Entrepreneurs can fall victim to this predisposition. They risk solving a problem that isn’t high value or start solving for a high-value problem too soon, and still miss the mark.
I tell entrepreneurs to slow down and stop developing. We live in a time where it is possible to validate everything with customers and with users. I tell entrepreneurs they don’t need to be building anything until they confirm their hypothesis that a problem is high-value enough that people would exchange money for a solution. The only way to prove that is to get in front of customers and ask them.”
How Rev1 can help entrepreneurs
Rev1’s vetted service providers push back on clients, even when it’s counter-intuitive. They are aligned with the goals of the company—to build a great business and enduring mutually beneficial business relationships.