It’s hard to know what’s good advice, what’s bad advice, and what’s really terrible advice when running your business. This article covers how to discern good startup advice from the bad.
George Chilton has lived in the UK, South Korea, Colombia and is now based in Barcelona, Spain. He is the co-owner and Creative Director of Hubbub Labs, a content marketing agency for startups. He loves writing about tech, education, and travel.
Aspiring entrepreneurs and startup leaders often find themselves in unknown territory. It’s similar to being lost in a big city without a map. There’s often a strong desire to grab the first person you see and ask for help.
Unfortunately, even the most well-intentioned startup advice can send you off course. It’s hard to know what’s good advice, what’s bad advice, and what’s really terrible advice. So how do we decide which to follow and which to run from?
I spoke with a number of leaders with experience in technology, startups and investing. And they gave me a ton of good advice…about bad advice.
Don’t Forget Who Is Giving You Startup Advice
Déa Wilson has a lot of experience working in Silicon Valley alongside startups. As an angel investor and startup founder and CEO at Lifograph, she knows exactly what it’s like on both sides of the table.
She told me that there are many types of advisors in the startup world. It always pays dividends to know who is who.
“Founders need to be aware especially of the investor-advisor, consultant-advisor, and friend-advisor,” she says. “Most investors want to maximize their return on investment. Sometimes their advice might be in conflict with the founder’s vision of the company.”
It could well be that the investor wants to scale too fast or sell up too early – putting everything you are working towards at risk.
Vested interests also come into play when you hire outside, professional counsel. “Most consultants want to maximize their fees and therefore advise founders to do things they might not necessarily need at the initial stages of their company.”
Listen to the wrong startup advice and you could find yourself investing too much in product development, spending unnecessary money filing a patent, or even paying a high commision on raising money.
So always evaluate why someone is giving you the advice because it might not always be in your best interest.
Déa goes on to say that even friendly startup advice from people with no skin in the game should be taken with a pinch of salt. “Most friends want to help, but they may be subjective in their advice and afraid to tell founders exactly what they think.”
Her conclusion? “The best advisors are experts in their field who completely understand the company vision, have a large network and are not afraid to give neutral, constructive feedback to the founders.”
Don’t Get Tricked into Playing Buzzword Bingo
Dave Mendlen is the General Manager at Microsoft. He’s also the executive producer of the Decoded Show and works with lots of startups and VCs in the tech space.
“I talk to startups – especially when I’m doing research for the Decoded Show. I consistently hear a few themes, and one theme is around technology,” he says.
“Some of the worst startup advice I’ve heard from VCs is ‘hey, now that you’re scaling, it’s time to rewrite your application or platform in another technology.’”
In his view, this will cost startups time and money that they likely cannot afford. The truth is, unless you’ve built a poorly designed application, it’s rarely a good idea to rewrite it.
Dave also strikes another important point. “Avoid playing buzzword bingo,” he says. “Lately every startup is adding Blockchain to their technology simply because it’s the hot tech for today.”
There’s a big problem in jumping on the bandwagon. You never know what technology is going to stick, and what is going to go away.
“These fads pass and now you have this weird piece of tech that doesn’t really need to be part of your solution and is now baked in. So don’t fall into the new buzzword trap.”
Don’t Believe in the One-Size-Fits-All Startup Advice
Jonny Miller is the co-founder of Maptia and Tribe Leader at Escape the City – an initiative that helps individuals build businesses and change careers.
“Most startup advice is fudged by survivorship bias,” he says. Survivorship bias is when we ignore past startup failures and concentrate on the startup success stories, leaving us with a rose-tinted, optimistic view of things.
“Practice skepticism at all times (this included!),” he continues. “Those who are further along the path will be eager to apply the strategies that worked for them. But there is no one-size fits all approach,” he continues.
“Instead, question assumptions, seek out better questions and mental models. Above all do your best to make decisions from first principles and your lived experience.”
As a startup leader, evaluating which advice is sound and which misses the mark is crucial. But if you know who is talking and what their agenda is, you can consider whether it will further your business objectives or theirs. So stay sharp and use your own best judgment, because that’s what will take you to the top in the end.
