Seedscout is a new platform helping founders build their networks (both online and in-person) through strategic connections to investors and operators. Seedscout’s goal is to streamline the process of raising venture capital across all industries, especially at the earliest stages.
We sat down with Mat Sherman, Founder of Seedscout, to dive deep on how successful founders are riding out the challenging market. Our conversation topics include:
- How early-stage founders can reach their leadership potential
- Why founders should optimize for originality & cost-efficiency
- 3 common mistakes to avoid while finding product-market fit
“At the core, employee attrition and retention come down to how good the founder is. They should essentially be the spark plug of the company.”
How Early-Stage Founders Can Reach Their Leadership Potential
Mat has two pointers for first-time founders to succeed as leaders:
- Leaders Lead Themselves First – Running a startup with dedication to your original vision is hard. So founders have to operate with grit, resilience, and self-determination.
- Managing ≄ Leading – Leaders get the most out of their employees by setting good examples, while managers ensure employees finish their work.
In addition, Mat emphasizes that the best founders understand it’s crucial to nail product-market fit and expand their networks. He gives two tips to assist those processes:
1. Keep Experimenting
Early-stage founders typically lead by, in Mat’s words, creating chaos through unusual experimentation, rather than sticking to one thing and trying it for nine months.
The search for product-market fit is usually tumultuous but, once your company finds it, it enters the management phase, hires managers, and is primed to scale.
2. Be Ready to Network
It's the founder's unofficial job to expand their network and meet people who can help them (and their company) down the line. The process of network-building also improves leadership skills.
If people like you, they'll likely want to work with you. But they must also find your project compelling. Creating that kind of persuasive product thus requires initiative and leadership.
"If you can't lead yourself, you probably can't lead anyone else."
Why Founders Should Optimize for Originality & Cost-Efficiency
Founders should create something that makes zero sense to most people. If your product is easy to conceptualize, it’s likely not original enough to succeed.
By extension, founders only need to convince a handful of people about their original vision.
The people they can convince will then truly be around for the long haul, because they feel compelled by the uniqueness of the problem and its potential solution.
Many founders try to convince the masses of the importance of their startups. This is unproductive, seeing as the next big thing is often polarizing at first.
The Moving Triangle of Strategy
Mat views scaling through a framework he calls the "Moving Triangle of Strategy."
In the early days, there are many strategies or plays the founder would like to make, but they simply lack the capital. They wind up making do with what they have.
They rightfully shouldn’t go bankrupt over choices they can’t afford, because, a few months later, they’ll likely have more capital to revisit that “point on the triangle” and enact that strategy.
At Seedscout, there are plenty of moves Mat would like to make, but he chooses not to due to various constraints. So, he tables things he can’t afford for a later date.
Jack of All Trades, Master of Some
Mat posits that pre-product startups shouldn't have big teams. Rather, early companies should hire as few people as possible since founders gain far more from troubleshooting alone.
Many founders hire large teams to start with since they lack specific skills. Silicon Valley has normalized this behavior, but Mat encourages founders to be more independently resourceful.
A founder who builds a company by themselves is far more valuable than one who knows how to throw five people at a problem before they’ve even cracked product-market fit.
Unless a company begins with wealth, every new hire drains equity. As such, founders should try to learn new skills themselves before they dilute 20% of their company pre-seed.
“If the product feels obvious or makes too much sense, it either already exists or won’t take off because something comparable is already available.”
3 Common Mistakes to Avoid While Finding Product-Market Fit
Below, Mat spells out common mistakes made by founders and how to prevent or avoid them.
1. Not Trusting Your Gut
Most people believe the world works in a certain way and there’s no need to change it.
Because of this, when founders identify original problems they’d like to solve, that view’s not widely shared. Some founders even hear enough dissent that it erodes their original vision.
However, as Mat puts it, what’s the point of realizing anything other than your grittiest, most authentic ideas? He advises founders to avoid the mistake of not trusting their gut 100%.
When building toward a new world vision, it’s typically (and unfortunately) the case that no one can clearly visualize that future but the builder.
2. Not Seeking Feedback
Some founders look to giants like Steve Jobs and decide they also won’t need feedback on anything because they have pure vision. They're wrong.
Founders should always receive and consider feedback on their leadership, execution, etc. With this, leaders can continually refine their management techniques and persona in their field.
Raw vision might create excellent products, but it’s not a perfect business strategy.
3. Idolizing Your Heroes
Along those lines of looking to industry giants, Mat reminds us that idolizing a leader in your field doesn’t guarantee they’ll be knowledgeable about topics relevant to your startup.
Ultimately, founders shouldn’t put too much pressure on meeting their heroes, because, quite simply, everyone is different in person from their presences online or in the press.
By not placing people on pedestals, you also make space for self-confidence. It’s better to stand in your own opinions than to idolize the supposed expertise of others.
“Creators become founders when they go super deep on a topic and discover something notably wrong with the world.”