JHU Business Plan Competition Keynote Address 4-28-2011


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Advice to young entrepreneurs looking to start their own business.

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JHU Business Plan Competition Keynote Address 4-28-2011

  1. 1. The Johns Hopkins University Business Plan CompetitionApril 28th, 2011<br />Lessons Learned the Hard Way OR<br />Why Didn’t Anybody Tell Me About This When I Was A Student?<br />Brian Razzaque, WSE 2000<br />
  2. 2. Lesson 1: Naming Your Company<br />Acronyms are stupid.<br />Long names are equally stupid.<br />If you can’t get the domain name to match you have a problem.<br />No, .NET, .BIZ, .US, .ETC, doesn’t count, unless you build it into your name.<br />I know how to spell, and your company name should end in an ‘S’ not a ‘Z’.<br />Be prepared to live with your name for a long, long time.<br />
  3. 3. Lesson 2: Hype Is Not A Business Plan<br />Cool technology does not translate into revenue generation.<br />Because you can convince an investor otherwise does not mean you have a business model.<br />Being in a hot space and making some money doesn’t mean you can turn that into something scalable.<br />
  4. 4. Lesson 3: Avoid Employees at All Costs<br />Employees suck cash.<br />Employees cause headaches.<br />They’re like children.<br />They must be managed.<br />This takes time and resources.<br />They create a need for things like insurance and cause you to have to care about taxes.<br />
  5. 5. Lesson 4: Since You Can’t Avoid Employees, Be Prepared To Fire Them<br />See Lesson 3: Employee Suck Cash.<br />Firing is emotionally draining<br />Still needs to be done, doesn’t make you a bad person.<br />Have your documentation ready.<br />Fire when it is in the best interest of the company.<br />
  6. 6. Lesson 4: Pay Your Taxes<br />Taxes cannot be avoided and must be paid.<br />Not paying them is expensive.<br />It is also embarrassing.<br />Audits are also expensive<br />But they will happen even if you pay your taxes so be ready.<br />
  7. 7. Lesson 5: Manage Your Cash<br />Cash is King.<br />Revenue is not cash.<br />Have sales projections.<br />Have cash flow projections.<br />Have a backup plan for cash.<br />Have a backup plan for your backup plan.<br />Prepare for the worst.<br />
  8. 8. Lesson 6: Take Advantage of a Hot Market<br />Read the signs.<br />Position your company.<br />Ride the wave.<br />See Lesson 1: Hype is Not a Business Plan.<br />
  9. 9. Lesson 7: If Riding a Bubble, Exit Early<br />Be honest about the fact that you’re riding a bubble.<br />Be prepared to change course when need be.<br />Know what your exit will be.<br />
  10. 10. Lesson 8: Learn What it Means to Scale<br />Management needs.<br />Technology needs.<br />Cost of scaling.<br />Supporting Customers.<br />
  11. 11. Lesson 9: Sometimes You Need Lawyers<br />People will sue you.<br />You will need to sue people.<br />IP protection costs money.<br />Lawyers are expensive.<br />
  12. 12. Lesson 10: Raising Money is Not Easy<br />Money from family and friends is fairly easy, but then you feel guilty if you lose it.<br />Know what you’re asking for and why you need it.<br />Meeting angels requires knowing people and getting out there.<br />You’re probably not ready for VC just yet.<br />You’re probably not asking for enough.<br />
  13. 13. Summary<br />Creating a business plan forces you to focus.<br />It can help you raise money.<br />It does not prepare you to run a business.<br />Running a business takes training and or experience.<br />The Center for Leadership could have saved me years of heartache.<br />Being an entrepreneur is fun and rewarding, and harder work than anything else you could ever do in your life.<br />