There may never be a right time to start a business. But a global pandemic felt like a pretty good one for me. The last year has been like no other, but despite living through fear, isolation, and economic uncertainty it's probable that we’ll see some of the most exciting companies, ideas and entrepreneurs emerge from the dark depths of the pandemic.
Much like a phoenix flying through the flames, humans have a great knack for turning adversity into opportunity. In the current climate entrepreneurship is a very viable way for us to build a more sustainable future, create a new generation of jobs and transform the way we see the world - creating a safer place for us all to exist. Despite the harsh circumstances, In Q3 2020, there were about 1.5 million new business applications. That's a 77% increase from Q2 and more than double any quarterly report from 2004 to 2017 - which I must add, is the largest increase since records began.
So it seems, much like me, many others have found inspiration in the pandemic, taken the plunge, and started a business. I’ve learned more in this last year than I ever thought possible and I want to share these learnings with you. From the idea to start, failings along the way to investment and scaling reboxed - I’ve distilled all my learnings into this guide on how to find love in your work and give yourself the best shot at success.
Find something that really inspires you
I believe the key to a successful relationship with your business is finding a problem you're truly passionate about solving. This can be something that can have an impact on you, others and for me personally, the planet. If the pandemic taught me anything it was that we, quite seriously, need to take better care of ourselves, each other, and the world around us.
It is important to align your business idea with your own personal goals and ambitions. The sweet spot is to find something big enough to scare you but can be achieved. And, of course, there’s a need to balance between passion and profit. Ask yourself the hard questions now. Is this going to be something that gets me up every day? When shit gets hard will I have the energy and passion to push through? Is this truly worth the pain and sacrifice?
If your answer is no to all of the above, Houston we have a problem. If you’re stumbling on one, maybe two then take time to reflect and reconnect with yourself. Entrepreneurship is tough - you’re not always going to win, so finding love and enjoyment in what you do is your superpower.
2. Source industry experts
Never underestimate the power of teamwork. I’ve spent the last 10 years building brands with my business partner Matt and we’ve always been pretty good at surrounding ourselves with experts. So, one of our first steps at reboxed was to begin developing a team of leaders, mentors, and advisors who really knew their shit about an industry we were new to.
With social networks and email, it’s pretty easy to stalk a few well-connected people in the industry you are looking to table. Start by asking what industry am I in? Who is considered an expert in this industry? And, who has seen immense success? Now those people are who you need to be speaking to, extracting knowledge and learning from.
One of my biggest learnings collaboration over competition, people are generally willing to give you 15 minutes to share their story, plus if like me you’re an extrovert who is desperately missing human connection after nearly a year on/off isolation - this is a sure good way to keep your energy topped up.
To relate it back to my own experiences for a moment, I have a great example of how this can be hugely beneficial.
Early on in my journey, I asked myself the same three questions which led me to Pete Petrondas, founder of Envirophone. Pete had left the business a few years back but had gone on to work at Music Magpie. I sent him a message on LinkedIn explaining reboxed and that we were looking for some guidance. Within 72 hours Matt and I were on a train to Manchester to meet him. We returned to London not only having given our first Pitch but having gained our first mentor. Pete went on to become our lead investor and helped us structure the business to where it is now, all from a LinkedIn message and some hustle.
This is just one example of how it works, there are many others over the last year for sure, but surrounding yourself with people who are better than you, does open up networks and doors. When a group of people shares a vision, from teammates to investors, the right people in place is undoubtedly the most important piece of the puzzle.
3. Build your brand story
This is something we learned from Crossing the Chasm, as founders you’re constantly thinking about the big vision; the 5-7 year goal, and the product when it’s finished. In doing so it can be easy to forget that big success stories, such as the likes of Amazon simply started as a bookstore. One of the tips that worked well is to distill the idea into phases and create a story A, B, and C. For example, story A: where you are for the first year or two, Story B: the 3-5 year plan, and Story C years 7-10
This particularly helped when it came to sharing our plan with investors, as we weren’t so much at risk of scaring them away by showing them something seemingly unachievable whilst still providing a concise breakdown of how we plan to reach our goal. So much of storytelling is communication, so it’s important to understand how to communicate your story and how to sell in the vision and roadmap to get there.
Don’t be scared to share your big vision and whole story but be patient and understanding of the fact not everyone will be into it until they’ve enjoyed reading the first chapter.
Practice writing down your story and testing it with friends and family - if you want the ultimate, try explaining your idea to a child, I always use my two nephews as a good barometer - as Einstein would say 'If you can't explain it to a six-year-old, you probably don't understand it yourself. ' If they don’t get it then it’s probably too complex for simplicity is genius.
4. Make a killer pitch deck
Making a killer deck is all about simplicity, how can you get your idea and story to translate in the easiest way? Distilling months of ideas, research, and vision into 15-25 pages is hard, so it’s important to be laser-focused and get as much feedback as you can. Below you can find a link to our investment deck structure, which you’re welcome to use as a template. We regularly customised our deck depending on who we were sending it to adding slides and storytelling elements or traction stats where we needed. Personalisation never goes amiss.
We raised our initial £150k SEIS off the back of a deck, no product, just the idea of one. We did have a core team lined up, some financial commitment from key players but above all we had our big vision. Ideally, you want a minimum working demo of the product or MVP (minimal viable product) but some people can raise based on track record and opportunity. I can’t stress enough, a business isn’t a business without numbers, so do your homework and get help, if you need it, as this is the easiest part to fall down on.
When it came to our EIS raise, we amended our deck further - It’s worth noting, pitch decks are always a work in progress.
When you’re pitching you must be prepared to get pushed back. Hearing people slate your idea isn’t easy, but try to push past the pain, turn that criticism into action and keep pushing forward. We struggled, everyone does, but once you come to terms with it simply being part of the process gets easier. After 2 years of deck building, we’ve found a format and style of presenting that feels more natural and allows us to convey the story, and business and answer most questions that were thrown at us.
I’ve stripped back our deck format and added it below so you can use the slides or download it and add your own info, it helped us raise our investment and I hope it does the same for you!
5. Find the right investors
We started the investment process nearly as soon as we had the nucleus of the idea, and some investors actually saw two or three versions of the idea (and deck) before they signed off on the investment. Going in with an unfinished proposition has its risks, but getting investors involved, listening to feedback, answering questions, and evolving the product in front of their very eyes has been invaluable to us. Getting investors involved in the process helped to take them on a journey and kept them engaged in the process.
Raising funds is pretty much the same as sales - not everyone is going to and the same maths apply, the more meetings you set up, the more likely you are to reach your target. The raising investment process can take 5-8 months, at least. Be prepared for setbacks and rejections, not everyone will like you or your idea, but try to learn and refine your pitch and proposition with every round of feedback.
I highly recommend using Google Docs or Trello so you can keep on top of where you’re at with everyone (like you would with leads in Salesforce). Some of our investors took over a year to convert before they committed to investing, so keep going and stay connected - you never know when the timing will be right.
Get your legals inline
You wouldn’t scale a mountain without a sherpa, so why would you start a business without some guidance. More than ever with reboxed we knew we needed a few people to help advise us and point in the right direction as we set off on this long journey. The funny thing is, so many people are worried to ask for help, but in all honesty, most people if you ask nicely are willing to help. Going through the process of raising money from outside investors for the first time was quite daunting, how do I set up contracts? What happens if someone says yes? Do I need to do due diligence on each person?
So many questions. It can look like a minefield and understandably you don’t want to get it wrong, one of the best decisions we made was to use a platform called Seed Legals - it’s a digital platform that acts as the one-stop platform for all the legal you need to start, raise and grow your company. We used it loads in the first 12 months to get our advanced assurance completed (cheaper than everywhere else quoted) we created our term sheets, did our investor due diligence and got all of our round documents together including our cap table, and closed the round all within 8 months. The platform also has amazing quick agreement sections which include all you need for consultants, freelancers, and lots of HR docs, which I've been using for the last year.
I can’t thank the team there enough, the founder Anthony Rose being from the start-up world himself is building a company that truly adds value to the process, saves you time and money, and really supports you on the journey. I was lucky enough to have the team at seed guide me on the journey, who went above and beyond to make sure I got the best out of the product. The whole thing costs a few thousand pounds, which is a significantly better deal than I would have got elsewhere, so highly recommend it.
Don’t forget you will need to put in the time to get your due diligence together, your accounts, contracts, and suppliers agreement so make sure you try to keep track of all your important docs as they will all get reviewed, this will save you time when you are trying to close your round off and get the money in your bank.
7. Your network is your net worth
Some investors took 12 months to join us, others jumped aboard after just one meeting. So, I think it is safe to say there’s no secret formula. Having the “right” investors is important and we wanted to try and find people who could add value to the businesses, not just with money, but with energy, advice, and network.
As I always say “Your network is your net worth“ and this proved to be a crucial factor in reaching our first £150k investment. Our lead investors helped to open doors with their friends and family - without those introductions, we’d have struggled. I must say, it was not the easiest way to do it and if I go back in time, I would have had a better MVP in place, we had done a lot of research and pulled together a great story but we had to rely on our energy, previous experiences and leverage our relationships to get it over the line.
Investors aren’t just about the money either, it’s about what else they can bring to the table really take that into consideration - think of your initial investors like your first team - the advice, experience, and network they can bring is as valuable as the money they inject in the business, in my opinion, more important - so try and make choices that are smart for your cap table and your board.
Although the last year has been hard, it’s been amazing to see reboxed spring to life and I hope to share knowledge with other founders and creatives who can use my lessons to help their business grow. Follow me on Linkedin for all the latest content or check out our medium for regular BTS updates on the journey.
Comments, questions, thoughts - hit me up or drop me a comment @philkemish, and to try out reboxed visit www.reboxed.co