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Business Entrepreneur

A raw account of life inside of a brand new startup

Every entrepreneur loses sleep over something, be it a learning curve, a need for more programmers, a decision about financing, or otherwise, and there are always multiple ways to skin a cat. This is but one account of the “why” behind a budding startup.



The inner workings of startup-life

The goal of my column here is to reveal the inner workings of start-up life, and with that life comes an entire spectrum of emotions. I feel like I should post a large emoticon board on my wall so every day I can circle one of the emotions as to how I feel. That changes minute by minute depending on what I am dealing with. No, I am not bi-polar. That’s just how it feels to have a startup.

I was recently asked in a private Facebook group “why do you do what you do?” When I first read the question I did a double take just to read it correctly. That felt like a metaphor because I needed to think about what I was reading and then actually think about the answer. Why DO I do what I do? Because i’m passionate! I’m passionate about the consumer, transparency, being an entrepreneur, the need to make a living, disrupting, creating something people like, technology, the schizophrenic highs and lows of success and failure, seeing if others think like I do, making a great product, efficiency, useful data, the unknown, asking the question “why” and “why not,” and because someone told me once…”you cant do that!”

I have no idea if anyone will relate to these answers or not.

A third business venture

This is my third venture in business and I can happily say I wouldn’t trade my first two experiences for all the tea in China. They are what has made me who I am today, for better or for worse.

We were labeled “pioneers” at my first company. What did that translate to? Nothing but experience. What we did do was blaze a path for many who followed. We pushed forward the evolution of an entire industry. A lot of people who followed in our footsteps made a lot of money. I did not. But I helped changed the way an entire industry operated and I helped champion a cause for the consumer.

My second journey was by accident. It was after my first company was no longer in operation that I accidentally fell into homebuilding. The time was right. I had been raised in a family that was extremely architecturally conscious, I had an eye for design, I am crafty by nature, and many people over the years had said, “you should be a homebuilder. You would be great with your eye for detail.” So, I said what the heck? It was a great run for 10 years building million dollar plus spec homes, but we all know how that ended.

Back to the question of why

Which brings us to today. Why am I here? Why do I do what I do? I already listed the reasons. The problem is that doesn’t make it any easier and it doesn’t always make it fun.

Lately I have been struggling with the issue that nothing can happen fast enough or be good enough. One of my favorite commercials on TV is for Staples where a single person named Dave is cast in his office doing 12 different things all by himself. He walks down the hall, saying “Hi Dave”, as he waves to his alter ego. As an entrepreneur with my own startup, that is my life.

The real frustration for me is the reliance on others to do things I wish I could do myself but aren’t qualified. On the top of the list…WRITE CODE. I would give anything to be a programmer.

Currently, my programming is outsourced. This was the only option to create my beta product. My team is excellent! There are, however, inherent issues that I face. They have other projects. I am not in control of their time. I rely on them for application management. As an entrepreneur starting a company, there is NO ONE willing to work as hard as me, as long as me, or to create a product as well as me! If I could do all of the things I pay others to do, I would never sleep. It is very difficult to get others to share your start-up passion.

Getting others to share your start-up passion

Case and point: on occasion, we will push out a release to our production site. After the fact, I might notice a bug. If I was able, I would work tirelessly to push a fix, but I CAN’T. It kills me because no one feels quite the same about that [bug] as I do. Yes, I want perfection. Is that so bad? Everything I am creating depends on delivering the best product and the best customer experience possible and once it makes it to www, it is a reflection on us.

My team does their job and does it well, but I will soon face other issues. I need better controls on what we are doing. I am a one man show right now. Our dev takes place in a completely virtual environment. I work daily with a team of four. Three live almost an hour away and one is in London. We are extremely agile.

Two ways to develop

For those of you who dont know what I mean, let me explain. As I see it, there are two ways to develop:

First, you can sit down with a company, pay them to do a Scope & Discovery with you for a cost of $10,000 to $15,000 dollars where they will go over as many details of your application as you can think of. They will help you develop user stories, functionality, workflow, and if they provide assistance in business consulting, they will throw in some strategy planning as well. Strategy might consist of pre-launch planning such as creating a buzz, capturing sign-ups to keep prospects “in the know,” beta testers and when to take out your MVP (minimum viable product).

The BIG problem is after you have spent a week with these guys, they will want a big deposit. Then they will want you to GO AWAY! They will try to create and code your product, working from what they have as their understanding, with as little contact as possible. The reason for this is logical. They want to knock out as much code while not allowing for any scope creep. This is actually a good business practice [for them]. If you are a hands on type of person (like me), you will not be sleeping for an indefinite period of time.

Then you show up to review your deliverable and, VIOLA, it’s nothing like you expected. Now you have to pay for the time already spent in dev and the time it’s going to take make corrections. It becomes a “he said, she said” argument about how it was SUPPOSED to be. Everything becomes subject to interpretation. The developers say…”you never said that”. You say…”I thought that was understood,” and the cycle begins. I have painted a worst case scenario here, but it happens.

The second method is developing in a very agile environment which is more of a “make it up as you go along” routine. This is more favorable for the hands-on entrepreneur, and arguably better for the team because there are less mistakes along the way, and things are constantly being refined to be exactly the way you want it. However, with this model exists the dreaded “scope creeeep.”

Scope creep is when you want to add one “neat” little thing. That turns into three “neat” little things and so on and so on. Now you are off track from the prioritization of the deliverable. The devs have spent time appeasing your need for instant gratification, and the project is taking twice as long as anticipated on twice the budget. As ugly as this may sound, it is still my preference.

Every day, subject to their availability and other projects, my team and I are banging on IM’s, group calling on Skype, emailing, sharing files and previewing work on our dev site. This is as close to being a developer as I can be, without actually being one. I love that!

My next challenge

Now comes the first problem as we move forward. I want a dedicated code team. I want more input on a more frequent basis. When there are bugs, I want them fixed immediately. I dont want my project subject to someone else’s time based on commitments to other clients. I want a group that can brainstorm together and not feel like I am imposing on their time. I like a cohesive team working together in a single environment in a single place. I want a team that feels such a strong sense of commitment to our project that they will stay until it is done, and done right. Maybe I live in la la land. But that brings me back to… if I could do it myself… I would!

There are time to market concerns. I wrote last week about the blistering pace of technology roll outs in the real estate technology space right now. That keeps me up at night. I know of only a handful of companies that seem to be headed in the same direction as NuHabitat (my company), but I’m sure there are others. Some of these guys are the big boys with deep pockets, and others are like me.

My next challenges lie ahead and there is a great deal more I have to do to get my company where it needs to be, but that is the life of a start-up – constant pursuit of perfection.

As the leader of NuHabitat LLC, Jeff brings a unique qualification to the table with 10 years experience of buying and selling homes as a high-end luxury homebuilder while working with clients, agents and brokerages. Motivated by a unique set of circumstances, his goal is to provide a more efficient and economical approach to prospective home buyers and sellers in the modern day world of residential real estate.

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  1. Ken Brand

    April 20, 2012 at 11:20 pm

    Everything about this is brilliant. God bless the unreasonable men and women.

    “Reasonable men adapt to the world around them; unreasonable men make the world adapt to them. The world is changed by unreasonable men.” ~ Edwin Louis Cole

  2. Drew Meyers

    April 21, 2012 at 10:06 am

    Lately I have been struggling with the issue that nothing can happen fast enough or be good enough.”

    ugh…I know the feeling all too well.

    “I want a dedicated code team. I want more input on a more frequent basis. When there are bugs, I want them fixed immediately. I dont want my project subject to someone else’s time based on commitments to other clients. I want a group that can brainstorm together and not feel like I am imposing on their time. I like a cohesive team working together in a single environment in a single place. I want a team that feels such a strong sense of commitment to our project that they will stay until it is done, and done right. Maybe I live in la la land.”

    La la land without a budget. Having that development team you want is entirely possible, but it’ll cost you a fair amount of money.

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Business Entrepreneur

Why receiving big funding doesn’t guarantee startup success

(BUSINESS ENTREPRENEUR) You finally got that big funding check that allows you to make your dreams come true, but most startups fail because they shoot for the moon.



funding box

The first thing every startup needs to get off the ground is funding. It’s crucial to have enough capital to cover equipment, inventory, and employee salaries, along with other basic expenses unique to the industry. Most startups cover these initial costs through business loans and capital from private investors.

Some business owners perceive getting funded as the first milestone toward success. While receiving capital is critical for success, being well-funded doesn’t guarantee success. Plenty of well-funded startups have failed, gone bankrupt, and all but disappeared.

How could so many well-funded startups possibly go under? The 90% failure rate for startups is due to a variety of factors including bad timing, no market, and most of all – mishandling of finances.

Here’s why receiving big capital doesn’t guarantee success.

Getting investment capital provides false hope

Getting funded can make you feel invincible and cause you to be too relaxed about spending money. It’s a powerful feeling to have plenty of money and know an investor believes in your business. Investors are smart; they wouldn’t throw money at a startup unless they had every reason to believe it will succeed, right? Not exactly.

Startups in big tech areas like Silicon Valley and San Francisco often have an easy time generating large amounts of capital from investors who can’t wait to throw money at the latest startup. Many investors ignore risk and throw their money at long-shot bets hoping to invest in the next Facebook or Instagram. The size of the pot is too mesmerizing not to take the risk.

These long-shot bets carry similar odds to winning a “Pick 6” bet in horse racing. The Pick 6 is one of the hardest bets to win because you have to pick the winning horses for six consecutive races. What if the top horse becomes injured before the sixth race? Investors who toss money at random startups have to pick a startup that will continue to meet all the right circumstances to become profitable long-term. Some of those circumstances are unpredictable.

No business owner wants to view their startup as a long-shot bet. However, the reality is that many startups are. You can’t gauge your potential for success based on how much funding you receive.

Having plenty of cash encourages premature scaling

When you’ve got the cash to scale your startup it seems like a waste not to dive in. Just one look around the internet reveals plenty of videos and articles encouraging entrepreneurs to scale their business. Advice online gives the impression that if you’re not scaling your business, you’re falling behind. However, scaling too soon can tank your startup.

Research conducted by Startup Genome found premature scaling to be the number one cause of startup failure. Nathan Furr from explains this finding and what it means for businesses. Premature scaling is defined as “spending money beyond the essentials on growing the business (e.g., hiring sales personnel, expensive marketing, perfecting the product, leasing offices, etc.) before nailing the product/market fit.” Furr says any business is susceptible to premature scaling – not just startups.

The problem is that premature scaling depletes your cash reserves more quickly. This leaves you with less cash to fix mistakes and readjust as you go along. Failure is what happens when you don’t have the necessary cash to fix mistakes and move toward success.

How to make the most of your funding and increase your odds of success

To increase the odds of developing a long-term successful startup, here’s what you can do:

• Save as much money as possible. For instance, you don’t need a giant office with expensive furniture right away. Work from home and hire a remote team until an office is absolutely necessary.

• Make sure the cost of acquiring each customer makes sense. Know how much money you’re spending to acquire each customer. Track all marketing efforts and eliminate the avenues that don’t generate paying, loyal customers. If the cost to acquire a customer is more than what they spend with your company, revisit your marketing strategy.

• Aim for an order-of-magnitude improvement with your innovation. Skip Prichard advises startups to strive for a 10x increase in the value of whatever innovation is being provided to the world. For example, if your company is offering a lower price for a greater value, aim to increase the value 10x. Attract the early adopters who want big improvements and they will validate you.

Money is a tool – use it wisely

Celebrate when you get your funding, but keep that money in the bank for necessary expenses. Money is a tool that doesn’t guarantee success, but if you budget wisely, you’ll have a better chance at beating the startup odds.

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Business Entrepreneur

How to know when a candidate is a true fit for your startup

(BUSINESS ENTREPRENEUR) Knowing whether a potential hire is a good fit for your startup is a difficult one, so we suggest asking these 3 questions at your next interview.



startup hiring practices

Hiring, in general, can be a daunting task. Knowing whom you like to fill the role can seem pretty ethereal until you put pen to paper. The struggle is even bigger for smaller companies, such as startups, as they’re not only looking to fill a role based on skills, but they’re also looking to find someone who will jive with their existing employees and culture. And while culture-driven corporations like Apple do this to a degree, too, it’s nowhere near as delicate as hiring can be for a startup.

Startups often struggle in bringing on new hires from beginning to end. A lot more is at stake when you’re hiring for a small company. Any missteps can be detrimental to profitability, productivity, efficiency, and even business projections. But if you’re a startup looking to hire, look no further.

Writer and former Google Vice President, Jessica Powell, has some great questions to ask your potential future hires to limit any possible setbacks.

It’s important to realize that Jessica’s experience is pretty limited to corporations and that she’s spent much of her time at one of the biggest of them all – Google. Therefore, as a seasoned businesswoman with vast experience in startup life, I’ll be adding some colorful insights that should help both employers and employees even further.

1. In her article, Jessica alludes that an employee’s resilience is a big part of being able to handle a startup, and I completely agree. Startups are typically very touch and go. Even if the startup appears successful, policies, processes, and even something as critical as re-allocation of budget are all subject to scrutiny – often until a time when the company sells or goes public. This is exactly why Jessica recommends employers ask resilience-related questions, probing for “weaknesses and missteps”.

Our favorite question related to resilience that she suggests employers ask in interviews is: “Some people tend more easily to put responsibility or blame on others, and some people tend to put it on themselves. Where would you see yourself? Can you give me an example of when this happened?”

We like this question because it’s incredibly important to know if a new potential employee has perfectionist tendencies and is incredibly hard on themselves, or if they are incredibly hard on their co-workers. If you’re speaking with someone who already puts the blame on themselves half the time, you may be looking at a self-starter who has the potential to lead – very important when considering future scaling, especially because many startups like to promote from within. If they’re more on the perfectionist side of things, you may also be speaking with someone who is incredibly resilient. Why? Because they’re already hard on themselves, which often times leads to allowing others to be hard on them. That means they’ve probably experienced a lot of defeat, but they keep on going, which, in my opinion, is exactly the type of employee startups need.

2. Jessica also goes over how ambiguity in the workplace (again, something very common for startups) can affect new hires, which is why she makes it a point to ask pointed questions that not only gauge the potential hire’s comfort with ambiguity, but also what they value their work environment and career and “to see how they approach complex problems”.

We actually have 2 questions we think startup employers should ask in the ways of ambiguity. The first is pretty basic: “Do you love your routines or do you like to do things on the fly? How much structure do you like in your work day?”

We love this question because startups are often moving so quickly that any employee needs to be accustom to changes be made on the fly. It’s a question that basically assesses whether or not something is a go-getter and can work with unknowns. Let’s say you’re an employer hiring for a sales role. What someone who has never worked at a startup might think is that they’re 100% supported with consistent documentation, training, and pay.

What they don’t realize is that startups often shift gears pretty quickly, so any collateral they may have provided you (I’ve worked for startups where this wasn’t even offered), for example, can quickly become out of date – and with the limited resources some startups have, it could be a month or longer before someone actually gets you what you feel you need to do well in your job. If that’s too ambiguous for you as an employee, you may consider working in a more corporate environment.

The second question is one that I see fit for anyone above entry-level, but mostly for those potential hires who are looking for an upper management or leadership role. Reason being, this question brings experience into question and obviously, if you are entry-level, you don’t have much yet. The question is: “Where was your favorite place to work and why?”

There’s a lot that an interviewer can learn about an interviewee with this question. Not only does the topic of past employment come up, but it also asks the potential hire to dig deep and explain why they liked their past role. This can often lead to other probing questions, such as “why are you looking to leave your current role” and “was there anything about this role you didn’t like?” Depending on their answer, an employer can quickly see if the interviewee’s past experiences, and their preferences, line up with what the employer is looking for.

There are many more great questions you can ask in interviews, but when it comes down to figuring out if someone is fit to work at your startup, starting with these questions can push you past the average, cliché questions at warp speed, making room in the often time-crunched interviews for solid and valuable data on the potential hire.

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Business Entrepreneur

Which city has your back when trying to start your business?

(BUSINESS ENTREPRENEUR) Have you ever wondered which city will support your big idea, and help you achieve your dreams? Well here are the top 10 entrepreneur friendly cities.



best city Austin skyline

So, ya want to start a business? (Even if you don’t, just play along.) Well, then it’s important to know the best city in which to start a business. Take a moment to come up with your top-10 predictions prior to seeing what Inc. Magazine and Startup Genome had to say are at the top.
The top 10 are as follows: 1. Austin (what’s up?!), 2. Salt Lake City, 3. Durham, 4. Denver, 5. Boise, 6. San Francisco, 7. Charleston, 8. San Diego, 9. Phoenix, and 10. Miami.

10. Miami:

  • is number One in rate of entrepreneurship
  • number 19 in high-growth company density
  • number 22 in net business creation.

Much like the weather, the startup scene just keeps heating up.

9. Phoenix:

  • is number 2 in net business creation
  • number 7 in population growth
  • number 9 in job creation.

Many have flocked to the Arizona city for warm weather and lower costs of living.

8. San Diego:

  • is number 7 in rate of entrepreneurship
  • number 7 in high-growth company density
  • and number 7 in early-stage funding deals.

Three rated sevens in a row? Somebody call Monica Gellar!

7. Charleston:

  • is number One in net business creation
  • number 6 in high-growth company density
  • number 10 in job creation.

In the Souths of Carolina, founding tops funding.

6. San Francisco:

  • is number One in early-stage funding deals
  • number 2 in wage growth
  • number 8 in high-growth company density.

All of this in spite of the pricey cost of living.

5. Boise:

  • The capital of Idaho is number 2 in population growth
  • number 3 in job creation
  • number 3 in net business creation.

According to the data, you can buy four houses in Boise for the cost of one house in San Francisco. Breaking that knowledge out at my next cocktail party.

4. Denver:

  • is number 2 in rate of entrepreneurship
  • number 4 in high-growth company density
  • number 8 in wage growth.

People have been moving to this Colorado city like crazy

3. Durham:

  • is number 3 in high-growth company density
  • number 8 in net business creation
  • number 10 in job creation.

This North Carolina hub was once known for big tobacco

2. Salt Lake City:

  • is number One in high-growth company density
  • number One in job creation
  • and number 3 in population growth.
  • This spot is popular with adventure seekers

    1. Austin:

    • is number 3 in population growth
    • number 27 in net business creation
    • number 4 in early-stage funding deals.

    The American Genius’s home town is leading the nation in job creation and high-growth company density.

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