Capital is one of the highest hurdles early entrepreneurs encounter. Most people won’t work without compensation and most vendors won’t give away goods or services. It’s easy to see why lack of capital can be a challenge. When I meet with founders at the idea stage, though, I often remind them that capital alone won’t lead to success.

Capital is a tool. It helps you acquire the resources you need to build a vehicle that will carry you (and others) to your destination. The tool and the vehicle are cool, but what counts is the destination. Without it, the tool and vehicle have no purpose.

The most successful entrepreneurs I know all had a vision for their company early on. They saw a problem and envisioned a solution. Where others saw obstacles, they saw opportunity. In my opinion, it was their vision that allowed them to become successful. Sure, the capital they raised along the way (if any) was helpful, but the vision was indispensable.

If you’ve identified a problem you want to solve, consider taking time to develop and expand on your vision. If you’re successful in solving this problem, what does the world look like? Share it with people who can battle-test it and help you make it better. This simple exercise will be valuable and help you convince others (including investors) to join you on your journey.

Yesterday I caught up with a good friend who’s also an entrepreneur. He said he was recently asked, “What would you change or do differently?” We’ve both been asked this question for various reasons, so we had a great chat about it.

Things will inevitably get challenging during the entrepreneurial journey. Entrepreneurs will find themselves making important decisions based on imperfect information. Having lived this scenario many times, we agreed about what matters most:

• Everything happens for a reason. The reason may not be clear at the time, but there is one. Take time to reflect on what happened, and why, so you can apply what you learn in the future. What seems like a failure today could be a steppingstone to a decision that leads to massive success. Reflection and the understanding it engenders are key to improving your decision-making.
• Neither of us would change any of our decisions. We don’t second-guess them. We didn’t know then what we know now, and we stand by our decisions because we did the best we could with the knowledge and other resources available to us. Don’t continually relive the past. Focus on the future.
• It isn’t over until the clock reads double zero. Stay focused on getting the win. Sometimes you’ll make decisions that don’t pan out. That’s OK. Dust yourself off and get back in the game. Remember that it isn’t over yet and you can still make a comeback. If you win in the end, all your turnovers and air balls don’t matter anymore.

My conversation with my buddy was a great reminder for both of us that we wouldn’t change a single thing. As he so eloquently put it, “All windshield, no rearview mirror over here!”

Today I attended Atlanta’s Techstars Demo Day. Techstars Atlanta is a partnership between Cox Enterprises and Techstars. These demo days are held in cities all over the world and historically they’re hosted by each city’s local Techstars accelerator. Accelerators are three-month programs in which entrepreneurs receive “funding, mentorship and access to the Techstars network for life.” Because of the pandemic, all 2020 demo days are virtual (I’m not sure if virtual attendance used to be an option). These virtual events are a great opportunity for people to learn about new companies that are solving problems in interesting ways.

Techstars accelerators give entrepreneurs access to a lot of really smart people—including past and present entrepreneurs in the Techstars network—who can help them fast-track their progress and otherwise support them. Demo days are a great way for entrepreneurs to get introduced to customers and potential investors.

Feel free to check out the latest Atlanta Techstars cohort (and pitches) here.

Friday marked the end of my thirty-first week of working from home (mostly). Here are my takeaways from week thirty-one:

• Month seven – Hard to believe it’s been seven months . . . but it has. Writing these weekly posts has been a great reminder of how much time has passed. I’ve settled into working from home at this point, but the lack of separation can still be a challenge. My workday wants to creep into the evening. I’m actively trying to consistently end it at a certain time.

I was happy with week thirty-one. I was more intentional and managed my time better, which helped a lot.

I’ll continue to learn from this unique situation, adjust as necessary, and share my experience.

Entrepreneurs are sometimes held to a standard that isn’t realistic. Some people think of them as superhuman and hard-charging, with everything figured out. This is only partly true! Most are hard-charging, but they experience the same emotions as everyone. And they definitely don’t have everything figured out—figuring it out as they go is par for the course.

Like everyone, entrepreneurs have to do things they aren’t good at doing. Unfortunately, when you’re building a company your weaknesses are exposed early and how you mitigate them can be very public. For example, if you’re not great at communicating, that will be quickly apparent to your team. They’ll see firsthand your evolution—the ups and the downs—as you become a better communicator.

I myself spent many years unaware of (or ignoring) my weaknesses at CCAW. I thought founders had to be strong and show no cracks. I was trying to live up to an image that was ridiculous. And I wasn’t alone. Other founders (in my opinion) were doing the same. Over time this charade wore on me mentally. I was failing in key areas and trying unsuccessfully to figure out why. It felt like I was drowning.

When I joined accountability groups with other entrepreneurs and listened to them describe challenges and acknowledge weaknesses, my perspective changed. As time passed, I began to open up and share my own weaknesses. I got feedback and learned from their experiences. Being more self-aware helped improve my decision-making and leadership. I no longer expected perfection because I accepted that I’m far from perfect myself.

I’m sharing this because I want to help early founders avoid this kind of self-inflicted pain. From the other side of the table, where I am now, it’s great when a founder is self-aware and willing to articulate what kind of help they need. We know they have weaknesses because everyone does (we’re not shocked or disappointed!) and we appreciate not having to guess what they are. Often, we can help by making an intro, sharing a resource, or describing a similar experience—but only if we know what would be useful.

In August, I taught a lesson lab for Start It Up Georgia. The experience was great and the turnout was huge. There’s clearly a desire for something that helps people start companies in these uncertain times. Today I had the opportunity to connect with five entrepreneurs who are participating in the program. One question everyone was asked: “What piece of technology do you take for granted?”

I learned a lot from this discussion. Most of them chose their cell phone, for various reasons. With less in-person communication and people tired of Zoom meetings, phone calls are more appreciated. The ability to do tasks on a phone while walking in the fresh air was also mentioned. Very interesting altogether.

Also mentioned was high-speed home internet. With so many working from home (and spending all day on Zoom), it was a great choice. Without high-speed internet, productivity wouldn’t be what it’s been over the last seven months. I believe it’s one of the reasons many companies are considering allowing working from home indefinitely.

What piece of technology do you take for granted?

I’ve written about how important finding a co-founder is for entrepreneurs. But equity (company ownership) is a big concern. Specifically, what happens if things don’t work out? If one founder isn’t pulling their weight, do they own as much of the company as they would if they were contributing mightily?

It’s a valid concern. But there’s a simple tool to mitigate it: a vesting schedule. A vesting schedule outlines when each person’s equity is theirs, free and clear. Keep in mind that equity should be earned, not granted, for early employees and founders. The vesting schedule is a great tool to set expectations about equity.

The most common vesting schedule is time-based. You typically see a four-year schedule with a one-year cliff. What does this mean? No equity vests until after a year of employment. If someone leaves in month eleven, they receive zero equity. On their one-year anniversary, 25% of their equity will vest (they stayed for one of four years, or 25% of the four-year schedule). After that, their equity vests in equal monthly increments until the forty-eighth month.  Carta has a good article with details and examples.

At CCAW, we used a milestone-based vesting schedule with revenue as our milestone. As we reached certain revenue targets (while maintaining profitability), equity for leaders would vest. We had a minimum revenue threshold (i.e., cliff) the company had to hit before any equity vested. This schedule was very helpful because everyone was aligned. Our approach was specific to what we were trying to accomplish at the time and may not work for everyone.

Many investors will want to see that founders are on some sort of vesting schedule, which ensures that they’re committed to building the company. There are lots of details that I won’t get into, but the takeaway is that founders should have a vesting schedule (in some form or fashion) if they’re raising investor capital.

A vesting schedule is a great way to protect against someone who isn’t contributing having equity in a company. Finding a co-founder is hard, but vesting schedules overcome one hurdle.

Yesterday, I wrote about the insights Eric Feng shared during the Outlander Speaking Series. One of the things that really resonated with me was his answer to a question. For context, I asked him, “What’s one thing you know now that you wish you had known as a first-time founder early in your career?” Here’s his response: closing windows of opportunity. This has been on my mind all day today.

At CCAW, as at every startup, we always had a ton of things we were working on. Looking back, Eric is so right. I wish I had consistently prioritized opportunities based on their closing windows. Early on, we had an opportunity to be one of the first to offer a specific product category for online purchase by consumers. The market for this category is huge and it was primed for disruption. Being first mover would have required our full attention and fighting some battles to change an antiquated space. There were lots of technical challenges and we lacked a thorough understanding of the category and key relationships in the space. Big hurdles, but they were surmountable and worth the effort because of the size of the opportunity.

I chose to instead continue to focus on a product category that wasn’t growing but in which we had established relationships. Fast forward a few years: we tried to play catch-up in the high-growth product category—but we never did catch up. A competitor beat us to the punch and became a household name. That was a $250-million-annual-revenue decision. I should have pounced on the closing window of opportunity to be a first mover. I didn’t, and we paid the price.

Eric’s concept is simple and spot-on. It applies to everyone, not just entrepreneurs. Here’s an example that everyone can relate to: relationships. No one is immortal, so every relationship is a closing window of opportunity. I wish I’d spent more time with certain people who were in my life when I was young but who’ve since passed.

My mother reminds me often of something my grandmother told her: “Give me my roses while I can still smell them and sense the enjoyment they bring me.” I think Eric and my grandmother are loosely saying the same thing: some opportunities won’t be around forever. Be mindful of which ones are important, prioritize them, and make the most of them while you can—in all aspects of life!

Today, Outlander Labs hosted its first Outlandish Speaking Series. It’s our way of giving Southeast founders the opportunity to hear from high-quality speakers they otherwise might not. At today’s event, (click "View Details"), Eric Feng, Facebook’s head of commerce incubation, shared insights about the importance of timing in start-up fundraising. Eric was a Hulu founder and general partner at Kleiner Perkins; he’s seen start-up life from a variety of angles.

Eric’s insights were fantastic. Here are some of my core takeaways:

• Missionaries vs. mercenaries – Missionaries are better entrepreneurs than mercenaries because they’re driven by passion. This video explains it well.
• Runway and risk – Fund-raising adds runway to remove risk and grow value. As you raise later rounds of capital from investors, you should be removing risk with each round. For example, you shouldn’t be raising your series B funding without building a product and understanding whether prospective customers want what you’re building (i.e., whether there’s a product–market fit).
• Seed stage – Early investors (pre-seed and seed) understand that pretty much everything is a risk because they’re investing so early in the company’s life cycle. You may have only two people (not a full team), the product might barely work (implementation risk), and you may not have a clear idea whether people will pay for your product (so you don’t have a product–market fit yet).
• Opportunity window – Understanding whether something is an opportunity or a window of opportunity is important. If a window will close on the opportunity, consider grabbing it as soon as you can. Later may be too late. All opportunities aren’t equal, so don’t wait forever if you see a good one.

Today’s session was great and Eric was an amazing speaker. He has a wealth of knowledge that he readily shared with the audience. I’m looking forward to next month’s Outlandish Speaking Series. If you’re interested in attending or seeing other Outlander events, feel free to check them out here or here.

I shared my thoughts on people’s bandwidth the other day. Today, I want to elaborate on this a bit. I neglected to mention another tactic that helps founders get more done: delegating. It’s something I struggled with early on. Lots of other first-time founders do too.

Early founders often think they’re the only ones who can do something right. It’s the “if I don’t do it, it won’t get done right” mentality. The opposite is often true. Early founders are generalists: to get the company off the ground, they have to know how to do everything. They’re usually just okay at most things—meaning someone else can do them better. Most don’t recognize this, though, and are reluctant to give something up. They won’t let go until they’re forced to.

As I encountered new challenges, I rose to the occasion. I grew. And I learned to delegate. I thought through the best uses of my time and what others could handle. If a task wasn’t a good use of my time and someone else could do it, I’d train them and turn it over to them. This usually meant accepting that they were going to make mistakes at first and that they probably wouldn’t do it exactly the way I did it. This was hard at first, but I got over it. In the long run, it empowered our team and allowed me to focus on the things that mattered most. It increased my bandwidth—and the company’s, too.

If you want to be an entrepreneur (not a solopreneur), delegation is important. The quicker you embrace it, the quicker you allow yourself, your team, and your company to grow!