Why do I write this blog?

I am not an entrepreneurship guru. I do not have ambition or experience to be one. I do not want to lecture on the right or wrong ways of doing business. I lecture at the university and that completely satisfies my desire for attention, self-importance and influence on the life of others, even if in a small way (at least five students each semester are genuinely interested in my subject).

Career of professional blogger is also not on my list. Of course, it would be nice to have an alternative if all of my start-up enterprises fail, but I am neither hilarious, nor have ground-breaking ideas about anything. My English is far from being perfect, since I am not a native speaker, hence do not expect sophistication and puns in my writing.

I write mainly for my own benefit. Writing helps to clear my head and gather my thoughts, fight stress and not to lose focus. Writing for me, as for many other people, is a form of meditation, since I have never been able to master the art of the real thing. I honestly have been trying to meditate more or less regularly for some time, always failing miserably. Instead of clearing my head and enjoying empty silence, meditation brought me more stress and more wandering thoughts. After I noticed that writing a piece about something leaves my head as empty as a white sheet of paper, I ditched meditation and started my blog.

On the negative side, writing a blog helps to procrastinate and find one more reason not to do the important stuff, while at the same time giving a false sense of accomplishment. It is not the same meaningless occupation as watching sit-coms on TV or checking FACEBOOK without any reason, isn’t it?

Anyway, to justify writing is easy, the questions is, why share it with everybody? Well, there are no real reasons for that, apart that I want to share. One day, while googling business related information I kept stumbling on the interviews and blogs of famous entrepreneurs and various gurus. And, despite how outlandish it may sound, none of their advice and experiences worked for me. It was not the first time, either. I remember some time ago sitting in the lecture of a guest speaker at my university – he is a very famous entrepreneur from Lithuania – and thinking to myself: “It is really interesting, what he is talking about, but I have not a clue how can this be relevant to anyone in this room”. And it was not relevant – he was too high above on the ladder for any of us to relate and learn from his experience. As a new entrepreneur in a country in the middle of nowhere, I find myself in this situation quite often. And I believe that I am not the only one, therefore I want to share my thoughts with people, who might be going through the same stuff.

I might not say anything extraordinarily clever, brilliantly innovative, or of “guru quality” in my blog. Most likely, my observations will be common sense for more experienced entrepreneurs. But, to my defense, I have read more than a few books, which did not say anything more than common sense, and they still were the best sellers. By the way, the same applies to any country’s strategic plans on innovation and economic growth, but nonetheless they are proudly presented as a new way forward. So, there is a fairly good chance, that sharing my experience will be interesting for someone out there and we will be able to discuss common hardships of entrepreneurship, celebrate our victories, solve our problems and laugh at silly things. And that is worth the effort!

My lessons from one of the biggest Kickstarter campaigns failure

This night I had a terrible insomnia most likely caused by constant thoughts about my not so successful start-ups. This is not a rare occurrence these days (or more precisely these nights) – a side-effect of entrepreneurship, I believe. Anyway, around 2 am I became tired of mulling over the same problems and the same dubious solutions, however sleep was still successfully eluding me, so as per usual I sought the modern remedy for escaping real life – my phone. Somehow starting with the review of the best and the worst dressed at the Oscars, then going to the analysis of Donald Trump’s triumph at Super Tuesday I ended up reading a very interesting (but terribly long) article by Mark Harris about notorious Zano Kickstarter campaign. Zano was supposed to be a super small and a super cool drone for personal use (mainly selfies and videos), at least that was promised to its Kickstarter backers’ by the start-up Torquing Group.

Their Kickstarter campaign was astonishingly successful – it ended with over 12,000 backers and $3.5m crowdfunded investment, which was 20 times Torquing Group’s original goal. As M. Harris states in his article, “it was, and still is, Kickstarter’s most funded European campaign”. But it is also one of the biggest failure of all Kickstarter campaigns: only four Kickstarter backers and some guys, who pre-ordered Zanos directly, did get their drones, which were a terrible disappointment, barely working and without any fancy features, promised by Torquing. The company itself went bankrupt leaving their backers without drones and without money. It is an awful story, which now is used as a case study by crowdfunding platforms as well as by technology entrepreneurs around the world. Lessons are multiple: from how to run (or not run – it depends on your point of view and, I guess, business ethics) a crowdfunding campaign and how to (definitely) not run a technology business. 

Since Zano case occupied my time from 2 am till 4 am, I managed to read plenty opinions about the lessons which have to be learned from its failure. At some point I will give this case for my students – it is really educational. I personally also learned something – otherwise precious hours of my nocturnal life are terribly wasted. However, I am not so sure, that these insights are student-friendly, at least they are not for the freshmen. And so it goes:

1.  It is possible (in fact very easily) to sell products, which do not exist - vaporware. It seems that you only have to concoct a cool back story, preferably showcase a hip co-founder and promise unbelievable technology. Oh, and have a good video, which may not even show your real product or prototype. And people will believe you!! Zano case showed that clever marketing and PR can sell and oversell products, which have not yet reached a VMP. They promised such technological features, which were doubtful at very best, but even Engadget at one point proclaimed Zano as one of the best products of the International Consumer Electronics Show in Las Vegas. And it seems that the guys from Engadget did not test it or seen it working! But please, understand me correctly – the lesson is not to exaggerate PR and marketing of a non-existent product. I just think that this case shows the true power of PR. You absolutely must have the working prototype or MVP and you absolutely need to create a good story behind it, even if there is none. 
2. People will believe if you promise a too good to be true technology, especially if you add to the equation unrealistic delivery terms. This is definitely a lesson, what not to do. Zano drone was unbelievable, excellent too good to be true case. Still more than 12,000 people believed in it and formed expectations to one day have such technology in their possession. This shows that people do not pay attention to technological details and do not question the feasibility of cool gadgets. This is good to know, if your goal is to run a scam. But if you want to build business, you have to do a reality check, even if you personally want that cool technology. Lesson for me is to double check and triple check feasibility of innovative ideas, which technology guys might present as “piece of cake” and also quadruple check marketing guys that they will not promise a trip to Mars when our rocket is not assembled yet. 
3. It is very cool to become an overnight success. I want that too! Probably as the majority of entrepreneurs I want my start-up to become the next big thing. I want to be written about, to expand and supersize, and to boast about high profile endorsements and huge achievements on my FACEBOOK, TWITTER, INSTAGRAM and this blog. But once again – reality check is necessary in this scenario as well. What drove Zano and Torquing into a certain death was not only unrealistic promises of their inventor and marketing, but also greed – and, I am certain, greed not just for money, but also for success. I can imagine that when they saw the number of Kickstarter backers explode beyond initial prediction, they were caught in euphoria and a dream that they can do it. That they can deliver much more drones than they thought, despite having no working prototype and no experience in mass production. I am honestly surprised how easily such important things were ignored and my lesson is – never trade reliability and credibility for overnight success and better underpromise than underdeliver. 
4. New black BMWs are the right car choice for start-ups, which launch crowdfunding campaigns. Come on, guys! Really? I know that we all want at some point to enjoy the fruits of our labour, but you got your BMWs when there was no product in sight. It is definitely very hard not to lose focus, when you suddenly get more than $3m into your bank account. I believe, that you feel rich and successful! But that is up-front money, which were given for your future performance, therefore rigorous financial planning is in order. So my lesson, if it ever happens for me in the future, is to immediately hire a very competent CFO, who is able to stay grounded and keep me and my colleagues grounded as well. The focus must stay on building a product, not personal luxury.

To sum it up, this case made me realise that I pay too little attention to marketing and PR in my own start-ups. I believe I have a good story behind both of them, however, my attempts at showcasing it so far were few and inadequate. So now I am going to write a press release while inspiration is still there :).