Interview with Luke Lazarus – Grooming New Startups for Success
About Luke Lazarus
Luke Lazarus has become one of Australia’s top business consultants. In his more than a decade of startup and small-business consulting, he has helped dozens of companies to streamline operations and develop the vision, human resources and attractive qualities to venture capital that they need to take things to the next level.
In this interview, Lazarus reveals some of the proven techniques that he uses to help startups make themselves attractive to investors, planning marketing strategies, as well as how to make dreams a reality.
Stephen Callahan: Hi there Luke. I’d first like to know, what do the words “business essentials” mean to you?
Luke Lazarus: The first thing is education. That’s why I went to Melbourne Business School to get my Master of Business Administration. I didn’t waste any time, so I graduated at age 24. I was inspired by my education and I wanted to start purchasing companies right away. I bought four and sold them all in less than 10 years. My experience starting my own businesses gave me what I need to help other businesses succeed whether they are doing well or not.
I could make the choice to focus on helping others because I didn’t need to make another $20 million. After I sold my four companies, I was financially independent, and I didn’t need to make any more money. After I started to help other entrepreneurs realize their goals, I realized that I found what I needed. I discovered solutions to some of the problems that many people are having with their companies, and I wanted to give those people my proven and tested strategies.
SC: What do you do to build a business plan that will be successful?
LL: I believe that anything that I do needs a business plan because a business plan clearly states my vision for my businesses and shines a light on the limitations. It’s also necessary to have a financial model to support the idea. I know that the business plan is a success when it can let investors, partners, employees and customers know what they need to know about the company. I have found that your product or your brand will succeed when you create a story around it, and the story will grow with the product if it is kept within the business plan.
Also, if clients are shying away from social media, this isn’t the best plan. Social media is necessary in the business world these days, and those who avoid it will be left behind. The fact is that consumers are very selective about where they will spend their dollars. It is becoming more difficult for businesses to communicate with their customers, but companies seem to have found a way to break through this impasse.
Some companies are actually starting to employ influencers to help them engage in social media, but it is too early to tell whether or not this strategy is going to be worthwhile or not. For now, it looks as if it will be very profitable for the companies that employ it.
SC: How would you advise people to present their ideas and business plans to investors?
LL: I communicate with potential investors with my storytelling, and I used it in meetings with several businesses. The stories explain why we need financial support, and I present them with illustrations that allow members of the board to identify with them.
I help startups present their messages, their books and their operations in a manner that will appeal to venture capitalists and angel investors. It seems that new entrepreneurs are not thinking correctly about the way that venture capital works, and it is the main reason that investors are not ready to buy.
You see, entrepreneurs are under the wrong impression that all they need to do to impress investors is set up a couple of meetings and show a few PowerPoint presentations. Entrepreneurs who do this about 20 times without receiving a hearing decide that venture capital isn’t for them. The truth is that entrepreneurs need capital in order to create multinational companies or even midsized companies. If they do not have enough money, they are not going to be in business for very long. Startups have to grow or else they will not survive.
One example comes from Shift Technologies. This company obtained $180 million in funding and then it created a new technology platform that revolutionized the way people are buying and selling used cars. People need to purchase used cars because of the necessity, so Shift Technology made the process as easy and accessible as possible.
SC: How do you perform marketing research?
LL: I study market segments and the factors that influence them on a daily basis, and this makes it possible for me to give my clients advice on any critically important variables that present themselves before we take a venture or a product to the market. I am fully aware of how e-commerce influences scalable business models, and this knowledge helps me let my clients know how they can expect their customers and their competitors to act.
SC: What preparations do you make before you present a plan to the marketplace?
LL: My clients receive my coordinated and cost-effective strategies, and they are outlines that introduce marketing plans that lead to organized sales. I stand by my clients as they set and abide by their timelines and budgets from the beginning of the concept until we develop a marketing strategy.
Entrepreneurs know their companies better than anyone else, so startups can actually market themselves. It’s important for them to take control of their marketing campaigns, and one thing that they can do is digital marketing. One strategy that I teach startup companies that have more than one partner is for each partner to learn one element of marketing. Then, they can bring their ideas together to communicate their brand’s identity.
I tell founders to determine what their marketing identity will be before they market the company. Whenever they release the company’s communications, they need to make sure that the communications are reflecting their brand identity and why it is different from everyone else. Another thing that startups need to have is a thought leader, and this job should be reserved for one of the founders.
A thought leader is the person the media will consult for quotes or opinions. The thought leader also writes articles about the industry and will be the one to give the interviews. If a company is unfamiliar with this type of thing, the thought leader can submit a written interview to various publications. He or she can also record podcasts, and these will help people find them on the internet.
SC: How do you manage to be as productive as you can possibly be?
LL: I begin each day with a 15-minute session of meditation. Then, I need to ensure that not one minute of the day is wasted by multitasking and keeping an eye on the clock. I find out if a client needs eight hours in a day or shorter segments, and I make sure that we are productive in that time. I do everything that I planned to do in a day by writing notes, and these notes give me something different to do each day.
SC: How do you make your ideas real?
LL: I use how I handled my personal problems as a model for how I help my clients with their problems. First, I consider the story behind the product or venture, and I use it to create solutions for the issues that are causing a business not to succeed in the marketplace. As I said before, a product has to have a story to be a success, so I go out of my way to make the story and the product interchangeable. This concept is so new that it allows my clients to find a niche so that they can create a need and then fill that need.
SC: What would you have advised yourself to do when you were younger?
LL: I always thought that I was going to do big things, but I worried a lot about that. The one thing that I regret about my younger days is my tendency to be overly anxious, so I pushed myself to finish my education as quickly as possible. I would tell my younger self to relax because I had the will to succeed. I think I wouldn’t have had as many headaches if I had been able to do that because I would have been confident in my abilities.
SC: How do you move past failure?
LL: Early in my entrepreneurial career, I failed when I went into business with a partner. The failure was from a lack of planning, but I learned a lot from the experience. The most important thing you can do is believe that you can succeed. You will feel apprehensive about every project, and you will be concerned about whether or not you will fail. Accept that and then know that having confidence in yourself means more than anything you are worried about. I make a bet with myself that I will win each time, and it makes all the difference in the world.