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Stick to Your Guns and Understand That Failure is Natural

Written by: Geoff Whitlock

Article Overview: Stick to your guns. Outside advice should be welcomed but the vision should come from the entrepreneur and you should stick to your guns. Just because nobody has done it before doesn’t mean that you can’t; I urge entrepreneurs to maintain their vision, and the payoff will come.

Stick to Your Guns and Understand That Failure is Natural

How I Got Started - The company has five founders. We started just after SARS hit Toronto and two of our founders were laid off from their jobs because of a lack of work. We were five friends who got together to open up a production company specializing in advertising, marketing, and film production. We were shooting for Adidas and Kidzpace in our first couple of years. Over time we began placing videos online; we never expected to take this direction. When our creative director Daniel Riley, began with us full time, the transition to the entire web became inevitable.

We had no money when we first started. All we had was $15,000 from a silent angel investor and we built up the business doing basic work and putting some of our own money in as well. University friends helped connect us to Adidas and our other first clients. We started doing one off projects because brand name customers didn’t want to take a gamble on a startup company.

LCI had strong focus in Internet marketing and web development; some clients became confused about our offering. So we split the company up into Life Capture Interactive, which focuses on online marketing and web development, and Motorcycle, which takes care of all our production work. Motorcycle has ties in many areas of production now and is quite active on its own. They even work for a few of our competitors. We are still debt free and are growing through our profits. We bought out our original angel investor in 2004 and now own 100% of our company. Our goal is to be a $30 million company by 2012.

Advice for Startups - Stick to your guns. Outside advice should be welcomed but the vision should come from the entrepreneur and you should stick to your guns. Just because nobody has done it before doesn’t mean that you can’t; I urge entrepreneurs to maintain their vision, and the payoff will come. As an example of great payoff, I wrote a four-month sabbatical into our partners shareholder’s agreements. We were advised otherwise our lawyer; but we built this for ourselves – it only makes sense to get what we want out of it. If you don’t stick to your guns then your reality will be hard to achieve.

This may sound a little harsh, but failure is natural. Without it, we can never progress as an individual or a business leader. Some people think failure is bad – I believe that every failure can only build a better person and better understanding of what will work. We’ve made a lot of decisions that lost us money and are fortunate enough that we’re so lean and financially oriented so we’re able to keep the same corporation. Expect failure and try your hardest not to go bankrupt – it looks bad on your record.

There are very few friends in business. A customer company once befriended us, treated us great when we worked for them. But when push came to shove, they stole IP video technology from us, so we sued them and won! It opened up our eyes that even friends in the business world can be pretenders, and even sharks. There are very few friends in business. We are now more aware of people and what to look out for. That one shark opened our eyes to all sharks. A lot of entrepreneurs open themselves to every opportunity and are too vulnerable.

Stick to it. Never stop. Failure after failure, time after time, stick to it and you’ll get it; even if you feel like you can’t, you will. Stick to what you’re doing and stick to charging what you’re worth.

Find good partners. We’re really lucky that we have a malleable group of people who want to help each other and grow. Friends in business worked here because we needed to work together to succeed. The guys here are just amazing; we would fall down dead for each other. We help each other but don’t actively try to push each other around. Leave your ego at the door and be very modest.

Entrepreneurs, by their very nature, generally want to lead – I’ve been the CEO since we first started and it’s always been organic. We never sat down and decided who would be in what position - our jobs were natural as we grew. When it came time for real corporate documents we automatically knew where we sat. I recommend developing formal corporate documents between partners in the beginning of the company, as I said, we got lucky; we had no real shareholder agreement until 2006.

Use your advisors wisely. Dr. Dennis Schakel from Western University was a great help but I don’t go to advisors for typical advice. I turn to them for external communications, business realities, and bigger picture business issues. They are very much at arms length; from finance to sales to upper executive management. We’ve thought about putting a formal structure around our advisors but we’ve found that when we need help we call them and they are there; they are wise friends more than formal advisors.

Get used to hiring and firing. Hiring the first person was fun. Firing the first person was harder. It’s hard to find good teams – it’s not the team’s fault if a project doesn’t work out, it’s our fault. Human resourcing is a really complicated science. At the end of the day, people are people. If you follow Dale Carnegie’s work you’ll learn a lot as a leader. We have had a good solid team at LCI, finding good management has been difficult.

My favourite interview question: Can you handle an entrepreneurial environment? Can you work quickly and deal with multiple projects? We’re not a company where you walk into regimented systems. We like being creative and off the cuff. It’s not a place where everyone can thrive. We don’t offer that structure. We need people to come in and build their own structure.

You never know what you’re going to get when you’re hiring somebody new. I test people by the way they email me, by the way they write or talk, and by other cues they give off. You can’t pass judgment on people based on what you see but you can kind of tell if you’re going to like someone or not when you meet them. If we can converse on a casual level then that’s a manager I can deal with. If someone is way too stiff or regimented then I can’t deal with that person. We’re not your average business environment, however, I guarantee that our company won’t get to $30 million without the countries best MBAs.

Built to Last or Good to Great? Good to Great is a leadership manual of how successful business leaders who have actually companies did it. Built to Last is more of a operational book, bust still worth the read. Good to Great is my choice. It has clean ideas, a simple approach.

Mistakes to Avoid - I don’t regret anything we’ve done. Any single small change would change everything we’ve done (the butterfly effect). Some common mistakes that you can make starting up are not researching your partners or people you’re dealing with and not understanding the scope of a job before you take it on. I wouldn’t take back the mistakes I made but I also won’t do them again in the future.

Manage expectations through documentation. Set goals in advance with your clients so they don’t get surprised down the line. As an example, when we achieve a percentage over the targets we set with our clients, they pay us more money. One time we charged for driving 100,000 people to a website and we ended up getting 167,000. We also always factor in 10% as a buffer – your ideas change and so do theirs as you get into working on the project.

Opportunities to Watch - There are a ton of entrepreneurial opportunities out there now. The Web is one. It’s convoluted and is a mess, just like the car industry was at the beginning of the industrial revolution. There is a lot of money to be made and countless opportunities to find a niche.

If you are truly an entrepreneur you will find a way to make money anywhere. I can’t be an entrepreneur and be successful somewhere where I’m not passionate about what I’m doing. I’m not going to open a company for the sake of making money. Most people work in companies and businesses they don’t like, being an entrepreneur enables you to get into something you will love. Our market didn’t exist when we started. What we do doesn’t exist in its entirety anywhere – we just built it. When all else fails, build it yourself. Great entrepreneurs have no idea what they can’t do; that standpoint has made the best businesses of our time.

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Article Tags: 30 million, adidas, advertising marketing, angel investor, brand name, creative director, entire web, entrepreneur, film production, five friends, founders, guns, kidzpace, lci, sars, shareholder, silent angel, startup company, startups, university friends



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