Adii Pienaar

Since 500 Startups - headed up by Dave McClure - announced its new Accelerator program, I've been following their blog where they've gotten the founders of their startups blogging about loads of different things. In one short summary, I think this strategy is absolutely brilliant.

It goes without saying that Dave McClure obviously has a lot of pull in the startup world, which is why 500 Startups have been successful in getting the kind of funding they have. Taking that a step further, as a result of Dave's reputation the media has been all over the launch of their Accelerator program and the 500 Startups blog is thus a perfect place for these startups to be getting some traffic (which is what they are getting by blogging on their).

But there's a flipside to this: this is also working out really well for 500 Startups. Content is still king and there's always a marketing strategy involved when you can create quality content, which is what the founders are doing. So in a very similar way in which we are using the audiences of the individual entrepreneurs contributing to Aboard Entrepreneurship (to generate traffic), 500 Startups is leveraging the experience and knowledge from their founders not only to build new businesses, but also to generate hype & traffic for the company. Brilliant!

WooThemes is a predominately B2B business. We sell products to people that use them in their own businesses or for their personal projects; most of which has a direct or indirect focus on generating a financial return of some kind.

So whilst we have a pretty diverse customer base, they share one characteristic that has been hugely profitable to us: they do not mind spending money on our products.

I guess this is sounding really simple and obvious right about now, but I've got a point here. :) To do so, we just need to back up a bit and look at a very basic example of how a business / entrepreneur operates...

Entrepreneur A invests $100 in his new trading business. He buys $100 worth of goods, sets up a little stall somewhere and proceeds to sell all of his goods with a nifty profit mark-up for $150. To re-stock he again purchases $100 worth of goods and re-invests his profit of $50 in making spiffy new (premium) packaging for his goods. Due to the new packaging, he manages to sell his goods at an increased mark-up and generates $200 in revenue.

Simple take-away from this story: Entrepreneur reinvested the $50 profits (from his first round of sales) in packaging, because he knew that it'd contribute positively to his revenues (and ultimately his ROI). He didn't spend the money on a new office (which may not have contributed to his ROI), but reinvested directly in something that would enhance his business.

Back to B2B

Back to what I said about WooThemes' users... I believe that WooThemes' users are happy spending money on our products, because it enhances their businesses and / or personal projects. Because this is directly or indirectly linked to generating a financial return, the expenditure of buying a WooThemes product could potentially turn into a simple reinvestment in enhancing those businesses.

The fact that the majority of our sales are thus B2B-esque, has meant that even though economies worldwide has suffered from economic recession we've been able to grow our business. Recession doesn't mean that people stop spending money; they're just thinking twice about every dollar that leaves their bank account, which means they're more than happy to spend money on something that will enhance their businesses / potentially generate more revenue.

VC Focus

I spoke with a prominent, US-based VC a couple of weeks ago about WooThemes and asked him point-blank why they were interested in our company, considering that we'd never rack up the kind of user numbers that the "platforms" like Facebook, Twitter & Tumblr can boast. He remarked that they believed there to be a shift in the marketplace where companies - like WooThemes - could profitably provide value-added, B2B-type products to users within those platform ecosystems.

Whether that has influenced their firm's investments, I don't know, but - to me anyway - it made a lot of sense.

B2B products and services just seem to be less sensitive in tough times and I certainly don't think that we have to fight as hard for every single sale on WooThemes when compared to general consumer expenditure.

So if you're thinking about starting a startup, I don't think it's a bad idea to create something that will enable other people to make more money. Even VC's seem to be liking that model.

I'm an ambitious guy, which means that I'm currently working on a bunch of different projects (to name only a couple). And on top of this, I'm hiring a new Rails developer to help push it even more projects...

The thing is that there are some days - like today - when I feel as if it is absolutely impossible to be working on all these projects and I just crave the simplicity that comes from only working on one thing at a time. But no, I have this uncompromising ambition which means I want everything done yesterday and that instead of multi-tasking, I just multi-project.

This isn't intended to be some kind of emo tale of how I can't cope, how I can't find time for everything and how I'm not executing enough to be happy / successful. Nope, I'm incredibly happy with my life and I have many blessings which I'm incredibly grateful for.

But this uncompromising ambition has a few consequences though.

I have sacrificed most of my hobbies in life as a result of this ambition... I can't use the internet anymore, without checking my mail or checking in on sales / progress from my different ventures. I only read business- or web-related books and / or content, instead of just chilling out with a mindless novel. Heck, I can't even let my thoughts wander (and relax), without it veering to new ideas, optimizations or business experiments.

Is it a curse? Probably not. In fact, this ambition is probably a good thing, because it makes me work really hard. And deep-down I know that everything doesn't need to be finished yesterday, that I need to delegate & prioritize better and that I need to learn the skill of switching off properly.

It's just that some days - like today - it feels as if I'm completely standing still.

Conundrum indeed.

See the above image? Well, that was from an e-mail, which almost caused me to spend 4x the amount I had to spend to secure a domain that I would've liked (read: not needed).