A Five-Step Guide To Creating A Business That Works
How to build a brand – from three men who know
Setting up a business is not much harder than applying for a passport. Fill in a few forms at Companies House and you’re all set. Then you get an accountant, probably a good accountancy app, and a business bank account. Snap up your domain name and the only things between you and success are your determination and the strength of your idea. Or that’s how it ought to be.
But things can get, well, a little tricky. Even with the greatest idea, the road from starting up to making a business successful is filled with potholes and pratfalls. To find out how best to navigate those first few miles, we speak to three men, in three very different industries, who know them well and know how to overcome them.
Mr Hayden Wood is co-founder of Bulb, the east London energy startup that has gone from zero to 300,000 customers in less than three years; Mr Luis Ribeiro runs a small physiotherapy business, 88 PHYSIO, in Knightsbridge, London; while Mr Suranga Chandratillake, of London-based Balderton Capital, has invested in innumerable (no longer) small businesses, including Revolut, Crowdcube and Carwow.
SOCIAL MEDIA IS KEY
In 2018, businesses need to strive for authenticity to flourish, but it can be tonally tricky to get right. “Historically, a company was a fairly abstract, removed thing,” Mr Chandratillake says. “You could very closely control how people saw your company and products. Today, those barriers have gone, primarily by means of social media.”
Social accounts and blogs allow companies to reach new audiences, while also leaving them vulnerable to complaints that can go viral. “The good news is that if you do it well, you can build positive marketing without spending a penny,” he says. “The bad news is that you have to be on top of every comment or complaint. The fact that you can’t create an image and have a different reality any more means you have to realise that your image is your reality – and embrace it.”
Bulb came to the same realisation in the company’s earliest days, and launched an online community of customers that now has more than 30,000 members. Effectively an in-house forum, it is a place for discussion and new ideas. Mr Wood says the company’s idea to pay the exit fees that some energy companies charge customers who switch came from the community, among other innovations. “It’s an essential part of the lean startup model where you’re creating new features and products and testing them,” he says. Managed well – and with that all-important authenticity – a platform for honest customer engagement is also a source of free ideas.
NETWORK UNTIL YOU FIND THE ONE
Mr Wood met his co-founder, Mr Amit Gudka on a boat in Croatia, where the friends of friends were both at a music festival. It was a chance encounter that became a professional relationship following a series of drinks after work, during which they thrashed out the idea for Bulb. In the high-stress, highly competitive startup world of today, Mr Wood says it’s “incredibly important to find someone you can trust and rely on because it’s a really big commitment. But my other tip is to find someone who’s a bit different because sharing the work is important, but so is having someone with a different skillset and background.”
Mr Chandratillake agrees. Before he does anything else, he advises solo startups seeking investment to find a co-founder. “Having someone there with you with the same incentives and concerns is hugely powerful,” he says. “Building a company can also be an incredibly painful process and you can share that with your family, but that can have a detrimental effect.”
Hiring people thereafter should be an evolving mission. “First, it’s all about getting people who are very entrepreneurial and versatile without much ego,” says Mr Chandratillake. Those characteristics are vital during the seat-of-pants, sleeves-rolled-up first few months, he says. But as the business grows, he advises finding specialists with experience in particular areas. Responding to those people and capitalising on their different backgrounds and approaches then becomes critical. And, if you don’t know anyone who fits the brief, cast your net broadly and network until you do.
COLLABORATE, DON’T ALWAYS COMPETE
Working with those you know, even if those people are potential rivals, has become vital in the new startup economy. “I had so many meetings and coffees with consultants and other practitioners in the area,” says physio Mr Ribeiro. Honestly and openly, he was building a network of professionals he could compete with, but also rely on. For example, private medical consultants and personal trainers now refer patients to him for better physiotherapy than they could deliver, and he sends people to them in return. “I was also doing treatments for important people, sometimes for free, so they would get the word out,” he says. This spirit of collaboration in today’s market is more fruitful, businesses find, than the old model of suspicious isolation and cut-throat competition.
Sometimes it pays to be shameless, too. Messrs Wood and Gudka, the Bulb founders, were both married the year before they launched. They used their wedding guest lists to tempt friends to become their first customers.
THINK BEYOND THE BANK
The startup graveyard is scattered with good ideas that died without funding. Bank loans are tough to secure, but wooing investors is a necessary part of the early game. “We’ve gone about it in a quite unusual way for a business like ours,” says Mr Wood. “Lots of companies raise money from venture capitalists and have big funding rounds. We raised money from angel investors with relatively small ticket sizes.”
Bulb has raised tens of millions of pounds from more than 50 investors. “We’ve been very deliberate about the investors we take on, says Mr Wood. “They have to believe in the problem you’re solving and you have to show them exactly what their investment will go on.” And, says Mr Chandratillake, “There is such a wide range of investors today.” But how do you meet them? By way of old-fashioned shoe leather, he says – meetings, introductions, events, the train journey home. Multiple investors providing relatively small individual amounts exist anywhere beyond the traditional world of the biggest chequebooks. It’s always worth looking close to home, too. In 2004, a New York dentist agreed to invest $100,000 in his son’s struggling startup. Mr Edward Zuckerberg today holds shares in Facebook worth tens of millions of dollars.
Wherever the money comes from, Mr Chandratillake advises looking for something beyond it. “A pound is a pound, but what isn’t the same is whether that person can provide connections, time and advice,” he says. “The smartest founders really think about that.”
It’s also important not to forget to invest in yourself. “In the beginning you feel like you’re counting your money, but when you take the time and spend money on education or good equipment, that benefits you in the long run,” Mr Ribeiro advises.
YOUR PEOPLE ARE YOUR BEST BRAND MESSAGE
It goes without saying that the look of a company, from its name and website to its offices and staff, is important. But it should never be a startup’s primary focus. “We got so stressed about what our name was going to be and our visual ID, and it became a distraction,” says Mr Wood. “If you concentrate on the real stuff – what you’re doing for customers and why – then those things will come through in the branding and marketing and that’s what you want.” Bulb’s name came out of a brainstorming session. “The original idea was Lightbulb and then we just said, ‘Let’s cut it in half,’’’ he says. “I googled bulb.co.uk and bought the domain there and then.”
For Mr Ribeiro, a former semi-pro footballer in Canada and Portugal, branding could only revolve around himself. Even while manipulating unsupple patients, he wears one of his collection of eight three-piece, £2,000 suits. “In the beginning I was like, I’m going to wear suits – that’s how I want to dress,” he says. “I feel comfortable and good and confident and I think people respect it, but it’s also become my calling card. I’m the guy with the suit.”
It’s also important to place your people right alongside the brand rather than hiding them behind an expensively designed logo. Companies that once banned social media in the workplace are now encouraging employees to use it. Studies show that brand messages go much further when shared by employees rather than by faceless brand channels. In today’s startup culture, people are the brand.