The Ultimate Manual for Fast-growth Startups

Being a voracious reader, I'm frequently disappointed by best-selling business books. Most are simply regurgitations of earlier books.  Old wine in new skins, as the saying goes. So I'm always very pleased to come across something truly fresh and different. I have one such book to tell you about today.

Back in the early 1990s, when I occasionally taught courses and seminars on entrepreneurship, I liked to start off by recounting the story of the opening of Disney World of Florida. At the opening ceremonies a member of the press walked up to a Disney executive and remarked that it was a shame that Walt hadn't lived long enough to see the completion of the second theme park. Without a moment's hesitation, the executive responded with, "You know it's precisely because Walt could see Disney World that it's a reality today." By this he meant that Walt was able to see every last detail of the final design and operations in his mind's eye well before the ground was broken. My point was to impress upon everyone that you needed to have a clear and compelling vision of what you were contemplating committing yourself to before turning on your startup's ignition. Many first time entrepreneurs lack a clear vision and understanding of what they are about to find themselves, in if they follow through on the idea. They're always focused just on "this month."

I recently came across a very impressive manual for startups titled Zero-to-IPO by David Smith which solves this problem. This detailed manual spells out the four possible destinations that startups will find themselves at like no other book I have seen. First off, Zero-to-IPO uses a dramatic graphic of "Startup Island" to show the four possible destinations for any high growth investor-backed startup. The three peaks a startup can shoot for, or detour to as Plan B, are "Asset Sale", "Cash Flow Sale", and "IPO". There's a significant elevation gain between the first and second peaks symbolizing the fact that asset sales will bring in a far lower valuation than a cash flow sale. The elevation difference between the second and third peaks is not as great because the net difference in proceeds to the founders between IPO and cash flow sale is usually not that substantial. The fourth and final destination where a startup may finish, although never intentionally, is the "Shut Down Sea". This is where a substantial portion of startups end up. Remember that we are talking about investor-backed companies here which will not be allowed to simply limp along indefinitely.

(Click on graphic to embiggen)

The level of detail in Zero-to-IPO's roadmaps is truly impressive. Not only does the author list every step you need to take, depending on which of the three peaks you have chosen as your destination, but he also provides map-like diagrams showing their most likely sequence sequence. (Yes, each startup will grow in its own unique fashion, but it's extremely valuable to have a laundry list of all the details as provided here.)

I am also impressed by the fact that he doesn't shy away from the possibility of a company finding itself sliding downwards into the Shutdown Sea. Again, he provides plans for an orderly shut down or a "reboot", if there's a will to give the venture a second shot.

Here's why I recommend this manual. Most entrepreneurs don't think too far ahead. Due to scarce resources, they must focus on short term survival. As a result, they often don't know how to answer questions posed by sophisticated investors about how they aim to grow the company after the launch phase and create a liquidity event for financial backers. They can't do this because they haven't had the luxury of time to research these latter stages of a startup's life, let alone even think about them. This is often a deal killer in the potential investor's mind.

I strongly recommend this for anyone involved with a venture capital or angel investor backed startup, as well as professionals working with these types of companies.

You can see the depth of detail this 412 page manual drills down to from its table of contents (pdf).

Get it today and it will become one of your most valued resources on company growth.

Go to Amazon.

Comments

[gvsgopalarao]

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