“Stop competing on credibility — be more interesting.”
These are the words from Angel Investor, Paul Singh, that still ring in my ears after the Enterprise Rising conference in Minneapolis.
I went to Enterprise Rising with one question in mind — what does it take to make it as an IoT entrepreneur in this hearty land of agriculture, manufacturing and retail? Subsequently, do they have the talent, capital and the support system to create things that improve the way we work with each other? Is the region positioned to become a leader in emerging tech like IoT, Machine Learning, Blockchain and VR?
The answer? Here are 5 traction strategies from startup founders and serial entrepreneurs who are shaping the future of the midwest with emerging tech.
1) Capital is a commodity – be interesting and start small
Paul Singh, Serial Entrepreneur and Angel Investor @ Results Junkies
In the Midwest there’s a perception that access to capital can only be found on the coast, and that a lack of angel investment causes many startups to fail. Paul travels the country in an RV finding the most interesting entrepreneurs across America — and he calls these kinds of excuses “fake work”. When founders complain about how they can’t create new things because it’s too hard to raise capital, Paul points out how easy it is to earn just $1,000 from your idea in 30 days.
It’s cheaper than ever to start a business which means capital is commoditized now and more people can become investors. To Paul, success is a function of the things you’ve tried – not how long you’ve been doing something. “You can collect money in just a few minutes – what you need to do is get off your ass.”
His advice: find 10 or 20 people who are willing to give you a few thousand dollars each instead of telling yourself there are not enough investors nearby.
2) Focus on your proof of concept, not your proof of technology
Justin has become “Mr. IoT” of the Midwest — from large enterprise rollouts to college classrooms, he’s working to position Minnesota as a leader in IoT, or as he would say, “Things on the Internet”. He recently held his annual conference for IoT Fuse, a community that hosts local Meetups and trainings.
“I teach at the university of Saint Thomas on the IoT and the students have to do a capstone project. At the end of 15 weeks they have to have built something but we leave the end product very open ended. Students have projects ranging from ‘let me get alerted when the mail comes to my house’ to ‘let me monitor the soil so I know when my plants need to be watered.’ It’s very fun. Are those commercially viable projects? Probably not – at least not on a mass scale.
In companies, we need to be careful about this bottom up approach where an engineering team says “we could put a sensor on that.” The technology is available now so that people could do most things in a weekend — anyone can go pick up a raspberry pie or a little arduino board and buy some sensors — slap it together and then they have product. But that’s really a proof of technology – not a proof of concept.
You’ve really got to take a more top-down approach starting with the problem. Just because you have the best idea doesn’t mean everyone else sees the world the way you do. Often it turns out there are some people that do — but they’re in the hundreds, not hundreds of thousands.”
3) We have to stop measuring success by “customer satisfaction”
Scott Burns, CEO & Cofounder @ Structural
Scott is a veteran entrepreneur now running Structural, an AI based Employee Success Management Platform. As a non-technical founder, he believes his primary job is to empathize with customers and understand the problem better than anyone else, even if he hasn’t had the problem himself. After selling his first company for $50M, he’s doing things faster and better the second time around.
“We have to start measuring our success by the success of our customers. Stop asking if they’re satisfied and ask if they’re kicking ass because of the product.
This is easier said than done because your customer doesn’t always spell out what their problem is. If you’re selling Slack to someone they’re not going to say “I have a messaging system problem” — they’re going to say “my team isn’t moving fast enough”.
I can empathize with someone who has less money than I do even if I’ve never been dirt poor. I can imagine what it’s like to not know where your next meal is going to come from. I can empathize with people and then, instead of sharing my product, I ask things like “what did you work on today,” “why does it happen that way” “who do you interact with one a daily basis” “What matters to you this year” “How would you know if the next 6-months have been really effective for you”. Then you start to realize what’s important. Whoever is buying the product has to name the problem you’re solving as one of the top 3-5 things that matter in their world.”
4) Keep your feature set lean
Muhammad Abdurrahman, CEO & Cofounder @ Clutch Inc
Muhammad is the former cofounder of Reemo Health, a wearable startup serving senior citizens that is now an enterprise partner with Samsung and ADT. He’s an inspiring example of an entrepreneur that scratches his own itches. His new startup, Clutch, alerts your friends and family if you find yourself in an emergency.
As early as 2014, Muhammad had created a wearable device that monitored the health of seniors in assisted living homes. Believe it or not, in the early days of Reemo Health a major feature was the ability to use hand gestures as a remote control for the physical world.
He showed me a video (here’s one I found hiding in a corner of the internet) of himself pointing to window shades and raising them like a Jedi mind trick — wild stuff. Ultimately, while the feature was an futuristic feat, it was cut from the product while other features stayed.
When I asked him about this pivot, he corrected me.
“Keep in mind, it’s not a pivot if I design a product for a senior citizen and it finds value in the market — as long as the ultimate product solves the problem that I set out to solve, it’s not a pivot. If I bring you a meal and you focus on the main course and the salad, does that mean it was a failed meal? No – maybe you just didn’t want dessert! I keep going on a feature until I notice customers aren’t seeing value.
If you keep stacking features on – people feel like they’re over paying. ‘I don’t eat cake – can you cut the price down.’ I had created a solution to a problem that didn’t exist yet. Some really smart people told me that I was 15-20 years out. It’s not a question of whether or not you can do it but it’s about whether or not people can put the innovation to work.”
5) Stop chasing the whitespace and go head-to-head with large competitors
Deepinder Singh, CEO @ 75F
Deepinder is a former Olympian turned IoT entrepreneur. His company 75F creates smart building products that save major energy dollars for any building — and its on the top 100 list of most disruptive companies in the world. These products are so easy to use even kids can install them. As we sit in the bleachers of the new US Bank Stadium in Minneapolis, he warns against thinking small when it comes to your target market.
“Startups can go for the throat of enterprise — don’t be afraid. People tell you not to compete in an existing market and that you need to find a niche. But I’ve found that’s all crap.
I was looking at all of these small commercial buildings because I didn’t want to compete with the Honeywells of the world — but knowing what I know now I would have directly come in and competed. We just got the Mercedes Benz corporate headquarters in India — we beat out Cisco, Johnson Controls, Siemens, everyone and their mother. How did we do it?
Technically we’ve made a much better product — because we have one holistic product that focuses on improving employee effectiveness through higher performing buildings. We don’t just focus on making the building smarter — we focus on improving the occupant experience and operations expense. Harvard found that you’re 101% more efficient at cognitive processing if you’re in a smart building. If you truly want to move the needle — if you want a building to be more efficient you better be looking at the people as well.”