3_0_ScanMag_66_July_2014_Text_Svetlana:Scan Magazine 1
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Instant success can take 15 years! I am surprised nowadays when I hear young people talking about getting funding for their new business ventures. They seem to think that they are going to be overnight millionaires if only they can get the funding. Well, self-belief is one thing, but does everything have to be instant to be successful? Do we really do our young entrepreneurs a favour by giving them big investments at the start-up stage? By Annika Åman-Goodwille, executive chairman of Goodwille Limited
We all know that ‘overnight successes’ are mostly mythical. The years of preparation and the trials, errors and refinements that go on beforehand, unseen, are usually the foundations of that ‘instant’ success. And why is ‘instant’ so important anyway? Is not the journey as valuable as the getting there? Improving the product, finding the market and building a strong brand takes time. Experience and foresight are vital to good business decision making. Can these attributes be acquired overnight? Steve Jobs gave a good example in his commencement speech when he talked about joining the dots. If he had not dropped out of college and taken that calligraphy course he may not have thought about having different fonts on screen. After a long recession, venture capital firms with overflowing coffers are eager to
invest in new start-ups and equally expectant of instant success. Competition to attract the most talented young entrepreneurs is fiercer than ever. Yet Bill Gates says of VC firms that their hit rate is pathetic with only 1 in 10 investments being successful. Easy pickings and short-term gains are what they are primarily interested in. Is it really so important to grow a business fast, even in this fast-changing world? History tells us that first is not always best. How much of your company will you have to give away because you cannot wait for that funding? Do you really need it all now? A VC company is extremely difficult to get rid of once you have let it through the door. And its business decisions are often less informed and very often more short-term focused than yours are likely to be.
I would like to research those 9 out of 10 ‘failed’ investments to see how many of those companies could have been successful given more diligent and longerterm thinking. It may well be that more than a few were never meant to have been fast growing. Maybe sometimes better a 15-year hard-slog millionaire than an overnight flash-in-the-pan failure.
Annika Åman-Goodwille www.goodwille.co.uk
Issue 66 | July 2014 | 91