I’ve rediscovered what I’m starting to consider my Number One rule for software startups: Narrow your focus until you are successful and build from there.
Like all forms of “management wisdom” this idea has its conceptual limitations but it has proven to be a very important concept this week.
A friend and corporate advisor recently floated an idea where independent investors would put money into ConnectionPoint to buy the assets of a struggling software startup, start up a joint venture to exploit the business opportunity, build out the product, expand the business for a few months and then sell the joint venture off or perhaps find additional investors to spin it off on its own. The benefit to us of doing this would be to bring in some investment that would help us pay for the corporate infrastructure we need (staff, office, etc.) and likely allow us to allocate a portion of the investment to our projects.
It sounded good at first but the more I thought about the potential pitfalls, the less I was interested. The big issue for me was that we have a great market opportunity in front of us already with FundRazr and I don’t need other “side projects” to cover my butt in case FundRazr doesn’t work out. I would like to help out the struggling company but not if it will risk me taking my eye off the ball I already have in play.
To me, it is all or nothing. I’m already feeling we have too much split focus with our research into various markets for FundRazr, sports, school groups and political campaigns, for us to be successful and I intend to really narrow down to just one of them in the very near future. We won’t abandon the other two markets; we’ll just delay working on them until the first one is well underway.
I’ll keep an open mind about this other venture in case it changes for the better but for now I’m sticking to my knitting.