8 Tips for Running a Lean, Mean Startup Machine
Serial entrepreneur Dina Yuen shares her top ten tips on launching a stellar startup, without the five star budget.
I’ve been founder and CEO of three successful startups and serve as advisor to several others. Starting and growing businesses is one of my greatest passions - to be part of that exciting period when amazing ideas are created, when teams are built, when obstacles are surmounted and when a team recognizes that success is a journey, not a destination.
Having bootstrapped all of my businesses, I’ve learned a few things along the way on how to create and maintain a lean, mean startup machine.
1. Define How Much Your Goals Mean To You.
The number one most important task in creating a lean, mean startup machine is to have an honest conversation with yourself.
How much does this journey mean to you? How do you define success? What are your ultimate goals and what are you willing to do to achieve them?
Talk to any wildly successful business leader and you’ll hear the same pieces of advice over and over again - success requires immense sacrifices, hard work, smart work, good timing and relentless dedication.
When friends are wearing this season’s latest fashions and you’re not, you’ve got to remind yourself that there’s much more at stake than simply looking fashionable today. When friends are going out to nice dinners and bars at the weekends and you’re not, you’ve got to be steadfast in your determination that what you’re building is far more meaningful than a night out.
When you understand your own goals, ethics and values clearly, decision making becomes much easier and quicker which translates to less wasted time and resources, not to mention less heartache.
2. Cut Down Monthly Expenses In Small But Realistic Ways.
For most of us, making drastic cuts are unrealistic for reasons such as lack of time, inconvenience or simply not wanting to feel like we’re living a life of drudgery in order to achieve our dreams.
That’s why I’ve always felt that making cuts in small but manageable ways will yield the best results.
If you love your gourmet coffee from Starbucks/Peet’s/Philz (or wherever you go), then have it, but just cut down from maybe 5 times a week to 2 or 3 times a week. If you spend an average of US $18.25 (average grande latte with no add-ons is US $3.65) on 5 lattes a week, that comes out at about US $876 a year. Cutting down to twice per week would yield a yearly saving of US $525.60. That’s an average of 9 tanks of gas or you could hire a high school student for roughly 41 hours of office work. You’ll miss the daily store Java but it’s a realistic sacrifice without complete deprivation. If you used to get weekly manicures, cut back to bi-monthly and that’s an automatic saving of half of whatever you used to spend on nails.
3. Choose Networking Activities Wisely.
During my two years being deeply entrenched in the networking rounds of Silicon Valley and San Francisco, I was at nearly every major event with every major speaker in addition to all the smaller events on a daily basis. Did I meet anyone that would become instrumental in my path or forge any long term friendships? Absolutely. But they happened at events that were geared towards what I was passionate about - not at events that were just the same recycled 'BS' each time. You know what I’m talking about; those stale events with the same faces that are forever trying to get ahead by behaving in that unsavory manner they think of as an “aggressive go get 'em attitude” when everybody else sees them for being rude and annoying.
You won’t miss anything by choosing your networking events wisely instead of killing yourself to attend every event you can squeeze in.
In fact, you’ll end up being far more productive not only from having more time to actually build your business versus telling everybody what you’re trying to build, but from actually extracting value from key events with key people.
The right events should leave you with new knowledge, new insights and new important contacts.The wrong events will leave you with a feeling of I’m reading the same book over and over again and I’m collecting as many business cards as I can get to decorate my office with.
4. Treat Your Business’ Online Expenses Like Your Own Health.
Most people go through medical bills with a fine-toothed comb because none of us like being charged for things we don’t need or ask for. If you’re that careful with your health and medical expenses (as we all should be), why wouldn’t you be that careful with expenses for websites and all web related issues?
As someone who used to be CEO and lead designer of a web design firm, I can’t begin to count the number of clients I had who were cheated by their former web designers/developers.
Instead of doing their due diligence on what it really costs for domain names and website hosting, they simply took the word of the first web designer/developer they’d ever worked with. That’s like believing the first gynecologist you ever met who tells you that you definitely need a pap smear every year and each one is going to cost you $1000. Wouldn’t you get a second opinion or at least, in this day and age, go online and do a bit of research (upon which you’d find you probably don’t need a pap every year and it certainly will not cost you $1000 even without insurance).
In my years at the helm of my web design firm, I’ve heard the gamut of web designers charging clients up to $500 a year to “take care” of the clients’ domain name registration and monthly hosting fees. To put this in perspective, a regular domain name registration can range anywhere from US $5 to $20 a year. Unless you’re after domain names like food.com or women.com, you can expect your domain name to be safely in the aforementioned range.
Website hosting runs on average about US $5 each month or US $60 per year. So what’s the tally on owning one domain and having that website up for a year?
That’s an average of roughly US $72. If any web designer tells you that you need to pay him/her hundreds of dollars, run fast. The only way you should be paying a web designer hundreds (or even more) per year is if you have an arrangement for them to continuously manage your website for modifications, which is common for people running online stores for example. However, if you’re someone who has a simple business website that does not require constant changes, you should be paying the designer a one-time fee to create the website and you pay for your domain name and hosting fees directly to whichever company you choose (GoDaddy, 1&1, FatCow, etc.).
5. Use A Hybrid Legal Team.
When you’re just starting up, you don’t have the big bucks to hire the big flashy law firms. That’s not to say that you should go to the bottom of the barrel and hire disreputable attorneys in sketchy neighborhoods. You can create a “hybrid” legal team for yourself. For the basic needs such as incorporating, copyrighting and even filing trademarks, you can use one of the many online services available nowadays. Choose one that fits your needs and talk to them on the phone a few times to gauge their customer service in addition to reading online reviews.
For the more important and crucial issues such as lawsuits or restructuring, you should develop a long term relationship with a highly reputable firm that supports up and coming talent like yourself. Not all great law firms are filled with cold hearted, money-hungry attorneys. Make those calls and go in to meet with a range of attorneys face to face before deciding. First consultations are always free.
Many of them are willing to lower the regular retainer amount if they feel you are a promising prospect with talent and passion to see your business through.
With this hybrid method, you’ve got yourself covered without having to pay big dollars to the big boys just to file simple paperwork.
6. Get Sponsorships For Things Your Business Needs.
Depending on what your business is, you can potentially form strong, mutually beneficial relationships with other great, more established businesses. In my current multimedia company, AsianFusion for example, I have long term relationships with amazing companies such as KitchenAid, Blendtec, Lee Kum Kee and Zojirushi whereby they provide me with products/equipment I need that are of great value in exchange for me using them exclusively and promoting them across all of my endeavors (including my books, websites, social media and upcoming television show).
You don’t need to necessarily have a television show or published books to forge these awesome relationships.
Let’s say you have a small office that desperately needs a top quality photocopy printer machine all in one but can’t afford one. You can approach the company that produces the very machine you covet and ask them if they’d be willing to sponsor one of their machines to you in exchange for you promoting them on your website and/or business cards. Don’t be shy about letting them know (succinctly) why they would benefit from creating this relationship with you, what makes you awesome and who will see their brand/logo on your site and business cards.
Think having another company’s name and logo on the back of your business card will look tacky? Think again. Designed properly, showing your colleagues or potential clients that you are sponsored by a major company like Xerox or Toshiba gives your new or growing business more credibility and “weight.” In turn, those major companies just might make a few new clients out of your promoting them which will more than cover their cost of sponsoring that one machine you needed.
7. Take Advantage of High School & College Students.
Not every startup or growing business is fully funded so hiring a full office staff right off the bat may not be feasible. In that growth period, don’t be hesitant to take advantage of a great resource - high school and college students looking for part time work. By take advantage, I certainly don’t mean to abuse their honesty and hardwork for mediocre or no pay. I mean simply to realize that not all office tasks require a professional staff of college graduates.
There are plenty of intelligent, honest and hardworking students who would welcome a few hours a day or a week of work for a fair wage that you can afford.
Whether you need documents filed, research done or errands run, students can be a saving grace, not to mention that you could be a great mentor and even potentially be grooming your company’s future recruits. Just a few years down the road when you are fully funded (or profitable) and that student has earned his/her degree, he/she may be a perfect fit for a full time career at your company.
8. Take Care of Yourself.
I saved this one for last because it’s crucial to keeping your startup lean and mean. Many of us skimp on health insurance when we start an ambitious business; sometimes there is just no choice.
Regardless of whether you’re covered or not, nothing slows down a lean machine like a founder or CEO who is sick or not at peak performance whether physically or mentally.
You need to take care of yourself and potentially spend a little more in the short run (like a gym membership or a good pillow) to save big time in the long run. Eat well, sleep well, exercise well - at the very least, do one of these three. You can’t skip out on all three of these and expect to be running at top performance. Your body will break down for sure; I speak from experience after having run on 4 hours of sleep a night for several years. Thankfully I ate well and eventually went back to exercising. My body, my mind and my company’s performance thanked me for the self-care.
Just remember - without you, your lean mean machine will never start up.
Of Chinese and Russian heritage, Dina Yuen is an entrepreneur, published author, journalist, musician, chef and CEO of multimedia company AsianFusion. She was the youngest student to ever graduate from the Nila Chandra Culinary Academy at 12 years old before going on to study Industrial Engineering and Classical Piano. She has traveled extensively throughout Asia working with orphans and rescuing young girls forced into prostitution - issues she continues to support as a voice for women’s and children’s rights. She is currently developing several product lines under the AsianFusion and AsianFusionGirl brands, creating her first television series and writing her third and fourth books. Dina is based in San Francisco. Her websites are Asian-Fusion.com andAsianFusionGirl.com.
Image courtesy of Ambro
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