10 tips for entrepreneurs by Ariadne CEO Julie Meyer

Tuesday, March 23, 2010 | Posted by: Fiona Cullinan
Categories: Business advice, Financing , Women in business | Tags: entrepreneurs, recession, entrepreneur, financial, tips, forecasts, Julie Meyer, business plan, Ariadne Capital, fixed cost, leader, cause, Dragons’ Den

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She is the founder of Ariadne Capital, a technology-orientated investment firm, a Dragon on the BBC’s online Dragons’ Den and, according to the Wall Street Journal “one of the top 30 Most Powerful Women in Europe”. She’s also the subject of Grant Thornton’s next My Big Decision. Here, Julie Meyer dishes the dirt on what it takes to be a successful entrepreneur.

1 Think big
If you ever stop thinking big as an entrepreneur, it’s game over. That’s what you’re meant to do: think big. Have great expectations.

2 Start small
Start small because you CAN. Because 10 years ago you’d have to raise 10 times the amount of money to do the same thing – but now the technology is standardised, componentised, cheaper; you can get going for £50,000 whereas 10 years ago, you’d have to raise £10m.

3 Move fast
The biggest advantage you have is to move very fast. Big companies can’t, they can’t organise themselves or mobilise themselves.

When I say think big, start small, move fast, as an entrepreneur, that’s your advantage. Corporates think that they think big, but inevitably they think middling. They don’t start small because they have way too much money. and they don’t move fast because they’re held back by inertia.

4 Get real
What amazes me is how the corporates think they can control the pace at which change is going to affect their industry. They know change is coming, but they’re going to control it. The nice thing about working with entrepreneurs is that they’re completely paranoid – they never assume they can control the pace.

5 Go low fixed cost
No or low fixed cost will be de rigueur in future. In 2010, we [at Ariadne] are going to move toward a low fixed-cost model across the board. [You can] even have no fixed-cost companies: where no one’s on the payroll (because the company doesn’t want to pay for PAYE or National Insurance); there’s no infrastructure; it’s all hosted desktop services and pay-as-you-use-it, all-in serviced offices.

6 Know your numbers
In pitching environments [such as Dragons’ Den Online], what has been surprising to me is the lack of general business experience. There are certain basics of business: you have to understand how to read financial statements and how to put together forecasts. You can’t fake it. If you don’t understand the financial forecast of your business, you can’t pretend that you do. You have to know what the numbers are.

7 Internalise your business plan
What entrepreneurs get most wrong is to not deeply internalise the business they have and its goal, ie, we have to sell this much, and these many people need to buy, and if we get this wrong, that will happen. It’s pretty easy, anyone with a spreadsheet can do it.

8 Have a cause
I believe the best companies in the world have a cause. Why do people love Apple? Because they build great products. Why do people love any company? Because there’s something more than just the widget they sell, they appeal to something emotional. So if you’re going to set up a business, you owe it to yourself to investigate, what is it we’re really about? Great companies have a cause; determine what yours is.

9 Trust me!
Leaders are those who create the conditions of trust so that great things can happen. Never abuse people’s trust; you can make tough decisions and still keep trust in the team.

10 Have a plan B, C, D…
Always have five different plans on how you’ll get any amount of revenue and cash through the door. And in a recession, you need 10 contingency plans not five!

Interview by Glyn Brown. Image: © James Pfaff/Seven Squared

FREE download of Elevate magazine
Julie Meyer also features in the next issue of Grant Thornton’s Elevate magazine for entrepreneurs, out in the spring. To view a PDF version of the current magazine, just register and download. To subscribe to receive future editions, either electronically or as a hard copy, please email your name, address and preferred format to elevate@gtuk.com

And watch this space for Julie Meyer’s My Big Decision – coming soon.