Seeds of Thought is a new blog with views on how to think about seed-stage businesses, how to facilitate their growth and how to harness the immense value they can create.
In the years since I first got involved in entrepreneurship and the startup world, I’ve been surprised and disappointed to see how little attention is paid to seed-stage businesses as their own class of enterprise. There seems to be a strong tendency among investors, advisors, observers and even entrepreneurs themselves to view these nascent ventures in one of two ways: either as just another startup, subject to the same investment criteria, needing the same sorts of mentorship and advice and facing the same measures of success as businesses that are up, running and generating revenues; or else as an irrelevance, something less than a real business that should be neither seen nor heard until the entrepreneurs have “something” to show the world.
I think both of these approaches are wrong-headed. I see seed-stage businesses as a unique sort of creature with very different methods, needs and potential from later-stage startups; and far from being irrelevant because of how early they are, I think they serve as key players in the entrepreneurship ecosystem and as the locus of tomorrow’s most important and lucrative innovations. There is an elegance and a brilliance to a few people with a great idea, a plan to execute it and no legacy obligations or structures to get in their way, and it’s at this stage when a business has the most room to think about how to change the world and to start trying to do so. And while the risk of failure is highest in early days, that doesn’t make the business any less worth focusing on and encouraging, but it does mean that different approaches to investing in and developing it are needed from what will be appropriate once the business is further along.
I believe this failure to appreciate seed-stage businesses as a distinct and important type of enterprise has long led to inefficiencies in the market for seed capital and to entrepreneurs receiving and acting on bad advice, and I think it’s been a direct cause of vast number of businesses that could have done wonderful things never quite getting off the ground. And as much of a problem as this failure has been in the past, it’s likely to have an even greater impact in the future: as the costs of innovation rapidly come down — and its speed increases — what happens in the earliest phase in a business’s life will become an even more important determinant of whether it will realise its potential.
This blog seeks to address the deficit of thinking and understanding about seed-stage businesses. The main focus will be on issues around raising and investing capital — as I believe that money is generally both the biggest challenge and biggest opportunity of the seed-stage world — but I’ll also look at a range of topics on management, growth, external advice and support and other matters. Suggestions for subjects are more than welcome, and I hope some of these musings generate response and discussion: there’s a huge amount to be said about this space, and while I’m looking forward to sharing my contributions, I’m well aware that I’m far from having all the answers.
