According to a January 2015 report on Gallup, the U.S. Census Bureau reports that the total number of new business startups and business closures per year — the birth and death rates of American companies — have crossed for the first time since the measurement began. Reportedly, 400,000 new employer businesses with one or more employees are being born annually nationwide, while 470,000 per year are dying.
Clearly, there’s a problem here, with business failures outpacing business startups at a rapid rate.
What’s going on specifically with these entrepreneurial ventures that fail – what’s missing, and what’s not happening as it should?
To understand more about how would-be entrepreneurs can achieve more success and viability in today’s challenging market, I was intrigued to learn about a new immersive series, “Quit Your Day Job” exploring the exciting world of entrepreneurship through the leadership of tech mogul Randi Zuckerberg, consumer products tycoon Ido Leffler, start-up advocate Sarah Prevette, and master marketer Lauren Maillian.
The eight-episode series features aspiring millennial entrepreneurs who receive the life-changing opportunity to pitch themselves and their innovative ideas to the angel financiers. The investment club uses their business expertise, industry knowledge, and creative vision to determine which up-and-coming products have the potential to be the next big thing. The investors provide on-site, hands-on mentoring to the young professionals, who must prove they have what it takes to turn their concept into a viable business. (You can find clips and episodes of “Quit Your Day Job” here.)
To learn more about how this powerhouse entrepreneurial leadership team makes decisions on the ventures they’ll back and those they’ll pass on, I caught up with Randi Zuckerberg and Ido Leffler for their insider tips and strategies.
Tech entrepreneur Randi Zuckerberg is a New York Times NYT +0.67% bestselling author, the founder and CEO of Zuckerberg Media, and former executive at Facebook where she ran the social media pioneer’s marketing programs.
Consumer products tycoon Ido Leffler is the cofounder & CEO of Yoobi and the cofounder and “Chief Carrot Lover” of Yes To Inc.
Kathy Caprino: Randi and Ido, what are the specific criteria you use to determine if you’ll invest in a new idea?
Randi Zuckerberg: First, you have to sell me on the market opportunity with data and statistics, not emotion. Then show my why you’re the best person to succeed in that space. Keep personal aspects like “I’ll work hard” out of it. This is a business decision so focus on the facts.
Ido Leffler: When looking at a potential investment, the person pitching the idea is the most important.?? The idea must be viable, built out and backed by numbers but at the end of the day we invest in people. As long as you can prove out your idea and clearly differentiate yourself then you’re already off to a great start.
Caprino: What are the team’s differences in how they perceive and evaluate each idea, and what stands out for them?
Zuckerberg: Oxygen did a great job in casting “Quit Your Day Job” since all four of us have diverse portfolios. We all four come from different backgrounds and bring different business expertise to the table, that being said this show is unique in that we all decide to invest together or nobody invests. If you walk away from this show with an investment, it’s because all four of us are fully committed to the success of the idea. As investors, we’ve learned to trust one another if someone familiar with the space feels strongly about a concept.
Leffler: In our investment group each of us brings something different to the table. Sarah brings incredible insight from her successful tech start-up background, Lauren offers her amazing marketing expertise, Randi contributes her extensive social media understanding and I offer the product and brand perspective. I love to focus on our 3 key pillars: Incredible People, Kickass Products and Awesome Cause.
With each of our perspectives we’re all able to contribute and evaluate investments differently. As a group and a team this works out really well. Even if at times we disagree, we approach ideas together as a very well rounded group so each is reviewed comprehensively, thoughtfully, and with various filters to best assure success.
Caprino: What are the top five steps that almost all of these budding entrepreneurs need to do to make their idea more potentially successful and commercially viable?
Zuckerberg: These are my top five suggested steps:
1. Know the market — Give specifics, what’s the global market revenue?
2. Have a solid 30-second pitch — Be able to sell you AND your product on a dime.
3. Test your product on a small scale before you quit your day job. Make sure the idea has traction in a small market.
4. Start small – no one builds a big empire overnights. Start with something you know you can do then grow from there.
5. Win early— Make a few sales, put together a focus group, market test—whatever it takes to get early projections on the marketplace, which will also boost your confidence in the product.
Leffler: And here are mine:
1. The BIG idea that can truly become a viable business
2. The incredible people with diverse skill sets that will make up your founding team (or co-found the idea)
3. Find some honest people to bounce your idea off
Caprino: What do the “worst” ideas have in common, and what to the “best” ideas have in common?
Zuckerberg: There’s no such thing as a bad idea as long as an entrepreneur is flexible enough to be able to pivot and adjust?? to the market place. The entrepreneurs themselves are just as important as the ideas. I’ve seen great ideas ruined by entrepreneurs who couldn’t get out of their own way. I’ve also seen questionable ideas be turned into huge successes by savvy entrepreneurs.
Leffler: Any bad idea is one that has not been thoroughly thought out. If you come to us with a half thought that you cannot back up with data, financial planning and a clear direction than it’s almost always a “no.” A good idea is one that has a clear story and point of differentiation. Most importantly the best ideas are backed by the best people. If I can tell that you have a clear vision, and an authentic story and desire to see that vision through than good things are going to come your way.
Caprino: What are you hoping you’ll accomplish with “Quit Your Day Job?”
Zuckerberg: We hope to help a few entrepreneurs attain their goal of becoming a profitable, global brand. “Quit Your Day Job” is a runway, helping light a path for other potential start-up founders to clearly see what the process of running your own business is like.
Once you make the decision to start, you should hit the ground running, give yourself challenges, and learn to stay fluid because changes occur often and roadblocks pop up all the time. I’m also excited to inspire people to become entrepreneurs themselves and see that there is no one mold for what an entrepreneur looks like.
Leffler: I am hoping to pay it forward with “Quit Your Day Job.” Along my entrepreneurial journey, I had help from mentors and people who took it upon themselves to open doors and help make things happen for me. On QYDJ, we offer that same opportunity but to people who would ordinarily never be in the position to skyrocket their ideas and companies into success.
I’m also hoping to inspire the next generation of entrepreneurs so that they can see and understand that they can do this too. I want for everyone to understand that if they have a great idea, and the commitment and drive to truly take it somewhere, it is possible.
We’re here to show them how they can succeed and ideally quit their day job or make it one they love.