As I write this, I am traveling several thousand feet above the Appalachian Mountains. I am en route to South Carolina, where Brandcave will deliver its first presentation to an international client. My wife is asleep on my shoulder, and my partner Mike is curiously filming out the window.
Without trying to sound too dramatic, the moment is symbolic. It is the calm before the storm. I suppose it goes without saying we are all a little apprehensive; we are not arrogant enough to believe our proposal is a sure-deal. At the same time, I am also acutely aware of the consequences of the opposite. “Winning” this meeting will mean Brandcave has entered that stage where my full-time job is not an option. I will have to leave my current agency.
I’ve been considering my motivations behind Brandcave. Knowing full well, at least in theory, the difficulties and risks of a start-up, why would anyone attempt to do it? After all, I’ve managed to create a comfortable life for my wife and I, given our current lifestyle. We do not hurt for anything. Moving forward with Brandcave would mean I would be temporarily (or permanently) cutting our income in half. The risk is understood.
I’m resolved to say, the motivation isn’t money. It isn’t status either, or a desire to create a better agency than the one that currently employs me. I think it’s deeper; it is something internal that wants to prove to myself that I could do it. Or, maybe it’s a very selfish ambition to become my own boss. Maybe both. Time will tell.
Obviously, this article is very personal. As you’ll come to learn from this blog, most of our attention will be devoted toward inbound marketing insights and research. But, in the months leading to this flight I have come to several very personal revelations that I believe any start-up could appreciate. And, despite numerous meetings with the SBA and hours of their toilet reading material, these 3 points were never touched. Hopefully, this article will be beneficial for others like me, who are willing to risk comfort for reasons they do not know.
Here are 3 revelations I had while launching my start-up.
1. Who We Are is an evolving statement.
At the onset, Brandcave was positioned to be a digital services firm. However, we learned early on that this wasn’t a successful business model. There were two reasons for this, and both now appear obvious in hindsight. First, in order for us to be seen as more than a freelance/outsourcing resource, we needed to position ourselves differently. Second, the early success of our company would require an on-going relationship with our clients, not one-off projects.
Both of these dilemmas were met with one answer, but the initial failure was upsetting. My vision of an entrepreneur (rightfully or wrongly) was a picture of a resolute leader charging forth no holds barred with a brilliant idea, overcoming obstacles with certainty and clarity. Instead, I was reconstructing our company’s offerings with the business acumen of Donald Duck.
Since then, I’ve discovered that everyone feels like Donald Duck sometimes. Moreover, start-ups should not be afraid of changing business models. In fact, it’s a very healthy practice called pivoting. We resolved our initial failure by re-positioning Brandcave as more than a digital services firm, but a digital solutions partner — an integral part of our client’s online marketing. In other words, we would not only undergird marketing departments with services, but ideas and long-term campaigns. Instead of one-off projects, we now offer a collection of services that work together to accomplish larger goals.
In web development, we use the agile methodology to build and test the applications we create. This method is essentially an on-going cycle of analyzing, building and testing. A few years ago, this practice was adopted by start-ups. It’s called the Lean Start-Up. There is a fantastic resource on the subject written by Eric Ries. Read more here.
2. The law is open to interpretation.
For people like me, who follow installation manuals to the letter, the legal aspects of starting a business can be frustrating. This is mostly because every attorney believes they are right, and every attorney has a different opinion. After meeting with several attorneys and CPAs, I came to one conclusion: there isn’t really one right way to do anything.
For example, the partnership agreement between Mike and I turned out to be more difficult than I expected. One attorney told me there needed be at least a 49-51% split. In this scenario, one person would have the majority share and final decision, which allegedly would protect our relationship. Another said we needed to have a 50-50% split and a trusted third-party arbiter to have the final say. Still another (the one we ended up choosing) said that a 50-50% split is fine, and differences should be handled like a marriage. I suppose this means we say passive-aggressive comments and go to sleep early. My wife says Mike and I act like we’re married anyway.
CPA’s were the same story, except their opinion seemed to have heavier consequences. When it comes to taxes (and who really understands taxes), I trust a CPA’s opinion like the voice of God. But, after speaking with several CPA’s, I realized that even taxes are not as cut-and-dry as you’d hope.
I suppose I should have guessed this would happen. As a marketer, I understand spin well. I just didn’t expect to get it from my lawyers and CPAs. The lesson to learn from this situation is that the personality of your legal affiliate will determine how stringent or lenient they stick to the books. While there is a lot of grey area, some will be more conservative than others. We’re pretty even-keel, so we made a team that matched our personality.
3. Solidarity is most important.
When I first met Mike in our high school freshman IPC class, we unknowingly started a competition of one-upmanship that continues even today. We’ve always been friends, but our respect for each other’s work fuels our relationship. I’ve seen Mike in almost every major phase of his life. We lived together in college. We traveled and performed in a band together. I was the best man at his wedding. We’ve been through a lot. When it came to building a company together, there was no one I trusted more.
But, starting a business with Mike wasn’t just between us. As a start-up that began without any funding, we had to invest from our own piggy banks. This meant that, no matter how much we wanted to be autonomous and run our business the way we wanted, our wives would ultimately become our bankers. And, as co-investors, they have a say in our decisions. This has proved to be difficult for me, because I’m always right.
For people like me, who are shrewd and can often be abrasive, the input of others can seem insulting. Isn’t it? I take the time to calculate every step, and it can feel like an attack to be questioned. But, that’s pride and it’s ugly. When I can set myself aside, I realize that there is a wealth of expertise and knowledge in both Amy and Shawna. They are incredible in ways that I am not. Amy delivers financial, legal and organizational clarity; Shawna understands PR and is an expert content manager. They’re not consequences of starting a business, they’re huge assets. They help Mike and I focus on doing what we’re good at.
I realize everyone goes into business to make money, but I’ve learned that solidarity between our partners is most important. I would rather fail as a business owner than become a sucky husband and friend. Who could have anticipated how much our wives’ input would shape our company? And, as mule-headed as I can be, I’ve learned that their opinions are invaluable to me. This was a hard lesson to learn, but I’m glad I learned it before I lost a friend, or possibly a wife.
Update: We won our proposals in South Carolina. We’re taking Brandcave full-time. Pray for us.