Starting a Start-up: Advice from a founder

I've always wanted to run my own business. My first attempt was a print broking business when I was around 20. Since then, I can count at least five other attempts that have had various levels of success, but nothing like AiRE.

So, what made AiRE special? Here are three key things I did differently compared to all the other false starts.

1. Have a one-year personal runway

Runway is the amount of time you have to operate your business until it runs out of cash.

For me, it wasn’t just my business I needed to worry about. I had two small kids, a wife, and a mortgage to pay. While my wife earned a good income, we still needed a second income to make sure we could keep our house.

The cost of founding a start-up can vary depending on your chosen product or market. Doing the software development myself meant the actual start-up costs were small. The biggest thing I needed to be sure of was that I could go at least a year without needing a pay cheque. And I personally wasn’t prepared to ask for money from other people to act as seed capital.

So, I saved up. I did the maths and knew that I needed about $100k in the bank to ensure that I had enough time to get the business up and running, and earning enough to give me a small income.

I also needed to be comfortable to lose that money if it didn’t work. I assumed that I could get another job if it did fail, which is always a big assumption. If you’ve ever been unemployed (and I have) you know how stressful that situation can be.

Start-ups are gambling. They are high-risk. If you find the proposition of losing $100k of your savings too much, I’d be thinking again about whether this is the right option for you.

For me, I compared the risk of losing all that money with the regret of never having given my dream a chance. I could live with failing, but not with never having truly tried.

2. Think big, start small

Until I started AiRE, I’d always approached life in three-to-five-year increments. It's the typical question you get asked: "Where do you see yourself in five years?” The problem with a five-year timeline is there are very few really big problems that can fit within a five-year timeframe.

The genesis for AiRE came when someone asked me a bigger question: “What could I spend the next 25 years of my life doing?”

25 years!? We're talking flying cars and teleportation stations here. But that’s the point: the world changes quickly. If you focus on what’s five years away, chances are by the time you get your business up to speed and positioned to take advantage of the market, you’re going to be too late. Not only that, but you’re going to limit your possibilities to those constrained by today’s technology.

In 2017, AI was just starting to get into the mainstream business arena. Nearly every keynote on the topic was about how AI was going to mean 40% of human jobs would be replaced by robots within the decade.

Now that sounded interesting. I loved data. I loved technology. And here we were, at the beginning of a mass migration from human labour to digital labour. It got me thinking about that 25-year question and what I wanted to spend that time doing.

3. Learn the business first

You can’t underestimate the importance of experience. While some might say it isn’t necessary or that it stops you from thinking differently, I would encourage you to learn the business you want to be in while getting paid a salary.

I always knew I was likely to do a start-up in the software space, but I’d never really worked in a large technology business. So, when the opportunity came to take a senior role at a publicly listed technology company, I jumped at the chance and I committed at least three years to learning as much as I could in the process.

Some people do a university degree for three years. I chose to learn on the job. I didn’t just seek to understand my role, but rather all the roles that existed in the business to be successful.

I built strong relationships with the CTO, CFO and CEO. I spent time with the Head of Support. I spent time with the Engineers. I got to understand what a software business looked like at scale. I learnt what worked – and, importantly, what didn’t.

My “degree” turned out to be four years long. And while you might think that’s a long time to lose before starting your business, I can’t emphasise how valuable these years of learning were. I’m almost certain I wouldn’t have been as successful as I was had I not put in that time.

It may not help you in the early start-up days, but knowing what a business looks like at maturity makes it easier to understand where it needs to be in the end.

Image Credit: Midjourney

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