Michael Maloof - The Startup Survivor

THE

STARTUP
SURVIVOR

A New Entrepreneurs Guide to Starting , Surviving and Succeeding in Business

MICHAEL MALOOF

The Startup Survivor

Copyright 2017 Michael Maloof

All rights reserved. Printed in the United States of America. No part of this book may be used or reproduced in any manner whatsoever without written permission except in the case of brief quotations embodied in critical articles or reviews.

For information contact :

Michael Maloof

1324 N. Liberty Lake Road, Suite #276

Liberty Lake, WA 99019

http://www.michaelmaloof.com

Book and Cover design :Derek Murphy of Creativeindie Design

http://www.creativindie.com/

Photographer:Beverly Guhl

www.beverlyguhl.com

Contents

My wife Michelle is my best friend and biggest fan. Shes also my business partner. While she chose to take a behind-the-scenes role in the creation of this book, she is the heart and soul of what youre about to read, and the love of my life.

Words cannot express my gratitude for Michelles support and encouragement in this effort, and more importantly, in building an extraordinary life together. Our partnership, the businesses weve created, investments made and lessons learned fill these pages, but its our mutual love, personal respect, and incredible teamwork that made our entrepreneurial adventure possible.

Those of you who know Michelle will see her in these pages; youll hear her voice, and recognize her wisdom. Most of you will be meeting her for the first time, but youll discover why we all learned to ask, What would Michelle do? and knew the answer would set us on the right path.

Michelle, thank you! Our startups would not have survived without your insight, perseverance and sheer determination to succeed, and The Startup Survivor would not exist without your inspiration and guidance, and the occasional loving prod Michael, go write.

Most startups fail. By some estimates, the death rate is 90 percent. Dont let that number scare you off, though; you can beat those odds. You can build products that people actually want, manage cash long enough to get to market, hire a capable and enthusiastic team, and lead them toward a common goal. You can succeed, but first , you must survive. The Startup Survivor will show you how. Youll learn how to avoid common traps, focus on whats most important, and make tough decisions based on identifying your best chance of success (BCOS).

As a wife-and-husband team working together for more than twenty years, Michelle and I built and sold two multimillion-dollar software companies and learned countless lessons, some of them expensive. One of them was BCOS. We learned that a business decision isnt an ending; its just the beginning. Every choice you make dictates the path youll take. Some of these paths lead off a cliff, others take the scenic route and arrive too late, a few will keep you on track. How do you find the right path? Learn to ask and answer this question: What is my best chance of success?

With the sale of our businesses and a track record of success, investors sought our advice, and entrepreneurs pitched their plans. Michelle and I transitioned from business builders to startup advisors and angel investors, the patrons of the startup funding world. We looked back critically at what worked and what didnt in our businesses and used that insight to make investment decisions for ourselves and recommendations for others. This book captures both points of view. It describes some of the challenges we faced and decisions we made as business owners and identifies the risks and mistakes weve seen in startup teams and proposals. Many of our lessons are common to all businesses, others you may never encounter, and some we pray you dont. I encourage you to read them all, just in case, and treat this book as a visualization tool. Youll be better prepared if youve at least considered how you would respond to various threats.

The Startup Survivor is for anyone who dreams of being an entrepreneur, is already living the life, or wants to be part of the adventure. Whether founder or teammate, the roles are demanding and few people are truly equipped. During our darkest moments, wed smile and say, If it was easy, everyone would do it. Had we known what lay ahead, would we have still taken the leap? Yes! But some ignorance is truly bliss and perhaps even a prerequisite. While this book may contain a few spoilers, nothing can fully prepare you for the journey, and thats half the fun.

When the inevitable occurred, or the unexpected happened, we dealt with it. We paid the price, sometimes dearly, and continued onultimately hitting the elusive Ten X return on investment in a record-setting acquisition. That wasnt luck. We structured our businesses to survive and succeed. We built them on solid fundamentals. You can, too, and this book will show you how.

Inside every entrepreneur is a dreamersomeone who sees what is and imagines what can be. Im here to tell you that dreams do come true, but wishes dont. The difference is focus, effort, and execution. Theres nothing quite as rewarding as seeing your dream made real and building something of value. How you measure value is entirely up to you. I wont judge, but I will say that when the work is the most draining and the prospect of failure most unnerving, building something meaningful can be the rope you use to climb out of the abyss.

You dont have to change the world or be front-page news to find meaning. The software products we built, at companies youve never heard of, served small to medium-sized businesses you probably didnt know exist. These businesses, thousands of them, are an overlooked and underappreciated segment of the economy, and collectively one of the largest employers. We took great pride in how we helped protect and grow these businesses, and our success was reflected in our small town. As a major employer, we watched as employees bought homes and cars, and supported local businesses and charities. We had a direct and measurable impact on the regional economy and our communitys quality of life. This is work that feeds the soul and combats the often soul-sucking nature of building something out of nothing.

If youre currently building or running a company, you will see yourself in these pages. Some of what you read youre likely already doing, and it can be reassuring to know youre not alone. You may spot a problem youre facing and see a solution you hadnt considered. Some of what you read may be entirely new, and I hope it inspires or prepares you to take action. There may even be things you reject out of hand. Thats good; contrast is part of the journey. I expect that your business will have characteristics that are like many others and attributes that are unique to you, your team, and your market.

Whatever your dream, my goal is to help you discover your best chance of success, beat the odds, and become a Startup Survivor.

So, you have an idea for a business. Is it a good one? How do you find out? What will you call the company or product and where will you build this business? How is this venture going to impact your life and the lives of others?

These are a few of the questions youll be asking and answers you need to find - the sooner, the better. Starting a business is easy. Saving one is hard. Mistakes made in the beginning can haunt you for years if the startup survives that long.

Entrepreneurs are often encouraged with Jump in! The waters fine. Alternative advice might be Caution, snake-infested swamp, but neither is accurate because you, the business idea and target market are all unique. You must collect data, consider advice (much of it unsolicited), and weigh the costs - personal, professional and financial.