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Mooney: Avoid these situations while you build your early-stage venture-scalable technology company

Guest post by Clayton Mooney, co-founder and CEO of Nebullam. This story was originally published on Substack.

The odds are always against us while building technology companies. After all, if you succeed, you’ll have changed the way the world works—and hopefully for the better.

Along the way, you’ll meet many individuals and organizations who want to help. The reality is, most of them cannot help. It’s not necessarily their fault. It’s because they haven’t been in your shoes, or they themselves are not as focused on ruthlessly prioritizing as you are.

Here are pitfalls you can avoid from external forces.

Advisors. If they want to help, they should either help for free and informally, or they should write a check to get equity. If they want equity and can’t put $ in (even a small check goes a long way in alignment), they shouldn’t be on the rocket ship you’re building.

Don’t list an advisor or someone who you meet with once per month on your team slide in a pitch deck to investors. It decreases credibility.  

I’ve made this mistake.

Banks. They’re dinosaurs because their business model hardly ever aligns with your trajectory and what actually needs accomplished. They say they want to work with technology companies, but they won’t work with you while you’re unprofitable. There’s a reason why most bankers haven’t started companies; they’re at the other end of the spectrum of taking risk (to each their own).

I’ve made this mistake.

If your bank is seemingly awesome and states they want to help, ask them: do you lend money to a company before it’s profitable?

*banks being dinosaurs are one of many reasons FinTech is a BIG industry.

The local startup event diehard attendee. You’ll often hear them ask far too many “what if” questions at the end of a 1 Million Cups presentation. You’ll often hear them speaking about the handful of ideas they’re working on, and how they want to help you. And then months will go by, and you’ll start to notice they’re saying the same things they did before, but with no progress made. Why? They’re stuck in the fake builder cycle and, instead of drawing inspiration from an event and getting to work, they’ve realized it’s easier to just attend events and play startup.

I’ve made this mistake.

Any investor who asks you about your EBITDA. Run far away. They don’t understand the stage you’re at, and they won’t be writing a check.

I’ve made this mistake.

Any investor who tells you not now but asks to be added to your investor updates list. That’s an ambulance rocket ship chaser.

I’ve made this mistake.

Now here’s the pitfalls YOU create (which can be far worse than those pitfalls above).

Measuring growth through vanity metrics. Your video views. Your number of likes. Those metrics do not matter. And your EOS dashboard is probably overkill for the stage you’re at.

Try to start with 1 metric. Hopefully, it’s something that matters now and builds toward a milestone in the short term, midterm, and long term.

Is it revenue? What is driving revenue (users, subscribers, transaction)? 

I’ve made this mistake.

Recruiting a non-senior level individual and giving them a senior-level title with no room to grow. It’s exciting to be able to recruit friends and peers to join your company. If you and your co-founder start off as CEO and CTO, or CEO and COO, that’s fine and expected. But what about your friend who knows marketing, or your friend who is a kickass scientist? Do you give them titles of Chief Marketing Officer and Chief Science Officer? If you do and they are awesome, how do they grow within the organization? Especially as they go from builder to having more managerial responsibilities and people directly reporting to them. If you give them the titles and they can’t handle it or have more maturing to do, then what? It gets even messier when you’ve given them a hefty # of shares that are vesting, related to that title.

I’ve made this mistake.

If you can’t tell, I don’t believe in flat organizations and 2-captain-ships.

Not knowing your topline revenue/gross revenue. Investors want to know; you have to know. Investors expect you to not have margins, unit economics, and economies of scale perfected. There’s always room for improvement. They do want to know where your company is at with sales, and where it’s been before. If you’ve made $20,000 in gross revenue on the year, and you won a business plan competition for $10,000, what is your gross revenue when an investor asks? Hint: it’s $20,000.

I’ve made this mistake.

Not caring about culture. You are a product of your environment. A startup’s environment is a newly created universe from the founders’ imaginations. As you prepare to recruit individuals away from every other opportunity on this planet, you have to sell them on the vision and the upside opportunity of your company. Because you likely can’t pay the candidate close to their market rate in salary, you must show them the upside opportunity of their shares becoming life-changing money, and how their ownership and dedication will help shape the future for the better. That means there is an opportunity cost to the candidate from day 1 to join your company, and you need to respect that. If you aren’t thinking about how their personality fits into the current team and culture you’re building, you’re only thinking short-term.

I’ve made this mistake.

Not caring about diversity. Diversity to me means bringing different experiences to the table. That difference between us should be celebrated because you approach problems and ideas with a different lens. The more lenses you have on your team, the more firepower your company has when going after new milestones and running through brick walls. If you aren’t thinking about building a more diverse team, you aren’t thinking in a growth and compounding mindset.

I’ve made this mistake.

If you’re not growing, you’re dying.

Mooney: Avoid these situations while you build your early-stage venture-scalable technology company | Clay & Milk
A central Iowa ag-tech accelerator has secured more backers and finally has a name. The Greater Des Moines Partnership first announced the accelerator last year, naming four initial investors. On Monday, the Partnership said the program will be called the "Iowa AgriTech Accelerator" and named three new investors. The new investors include Grinnell Mutual, Kent Corp. and Sukup Manufacturing, all Iowa companies. They join investors Deere & Co., Peoples Co., Farmers Mutual Hail Insurance Co. and DuPont Pioneer. Each investor has agreed to put up $100,000 for the first year of the accelerator. Startups entering the program will receive $40,000 in seed funding in exchange for 6 percent equity. Tej Dhawan, an angel investor and local startup mentor, is serving as interim director until the AgriTech Accelerator names a permanent leader. Dhawan held a similar role with the GIA before Brian Hemesath was named as managing director. As interim director, Dhawan said his main job includes hiring the accelerator's executive director, establishing a business structure and initial recruiting for the first cohort. The accelerator will place few filters, such as location and product, on the applicant pool, Dhawan said. "When you’re seeking innovation, innovation can come from every corner of the world so why restrict ourselves," he said. One area the the AgriTech Accelerator won't recruit from is biotech. For its first cohort, the AgriTech Accelerator will work out of the GIA's space in Des Moines' East Village, Dhawan said. A future, permanent home is still to be decided. The accelerator's program will host startups from mid-July through mid-October, ending with an event connected to the annual World Food Prize. The GIA, which the AgriTech Accelerator is based on, also ends with presentations at an industry event. The accelerator has also started lining up a mentor pool. The Iowa Corn Growers Association, Iowa Soybean Association and the Iowa Pork Producers Association have agreed to provide mentors, as has Iowa State University. While the AgriTech Accelerator is loosely based off of the GIA, it will differ in its business structure, Dhawan said. The GIA runs through a for-profit model for both operations and its investment fund. The AgriTech Accelerator will have a nonprofit model for its operations and a for-profit setup for its fund. Dhawan said the nonprofit model is being used so the accelerator can better work with other nonprofit partners, such as trade associations. "These are all organizations that are nonprofits and can be amazing stakeholders without ever having to be investors in the accelerator," he said. "It becomes easier to work with trade associations in their nonprofit role when we are also a nonprofit." When it's up and running, the AgriTech Accelerator would be one of a handful of ag-focused startup development programs in Iowa. Others include the Ag Startup Engine out of Iowa State University and the Rural Ventures Alliance from Iowa MicroLoan. Matthew Patane is the managing editor and co-founder of Clay & Milk. Send him an email at
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