Recently it became known that Victor Khamenok finished his work and left the founders of the Rozum Robotics company he created. This startup, founded in 2015, has become a bright project in the field of robotics. Moreover, he inspired thousands of people in our country who dream of an innovative manufacturing business. The company had its own R&D division and production in Belarus, as well as representative offices in the USA and Russia. Why didn’t this beautiful project “shoot” in seven years? Viktor shared his findings on his personal Facebook page. According to the Pro Business editors, his hard but honest post is more valuable than many success stories. We publish it in its entirety with minor editing.
— I decided to share my experience for you:
- The funding must match the ambition, and the ambition must match the funding available. Did I say fit? Exceed in both directions!
- Costs are often underestimated and funding opportunities overestimated. A healthy ratio is when the planned funding covers the planned costs by 2-4 times. If everything came together penny to penny, tutelka to tyutelka – you are in flight.
- Hardware is expensive. In addition to salaries, it is necessary to purchase components and equipment. Experimental samples are worth their weight in gold. To get a good discount from the supplier, you need to buy a lot for the warehouse.
- If you live on investor money, then the company should have a person who deals exclusively with fundraising and investor relations. Otherwise, it will be possible to deal with the product and the team only when the issue of funding is resolved (hint: never).
- If you live on investor funds, then you need to run for the next round as soon as you have closed the previous one. Or even much earlier.
- You should have 2-4 “hot” investors on each round. Do not give up alternatives and continue communication, even if you have signed a term sheet (a document on the main terms of the transaction, – approx. “About business”) with one of them.
- Speed and efficiency are two opposite characteristics of a business. When you need speed, you need to be able to make quick decisions and make mistakes. When you work on efficiency, speed decreases, because only ideal solutions are welcome. The ideal is to either change the priority from time to time (speed/efficiency), or have two forces in the organization, each working on its own priorities.
- Don’t work with assholes. Do not think that if a person is an asshole in ordinary life, then this will only happen outside the office. At some point it will hit you hard. I would put this rule first.
- The matrix organizational structure looks great on paper and works very badly in real life.
- Some people, without exaggeration, work for ten. I am indebted to each of them. I myself was like that. And will.
- The company should have a healthy rotation of personnel, weak people should fall off, strong people should remain. If the rotation in the company is 0% (or if the weaklings leave on their own, and not at the initiative of the company), then the company is in serious trouble.
- All functions must be reserved. The loss of a “unique” specialist should not slow down the business.
- The business must grow. Stagnation is killing business. Stagnation is a big financial cost and loss of team motivation.
- The first 90% of the project is not as scary as the second 90% of the project.
- The complexity of a system grows exponentially as its size grows. This applies to both the product and the organization. The only way to control a large system is to decompose it into smaller subsystems and transfer control of these subsystems to other people (decentralization, as a rule, is associated with a decrease in overall efficiency).
- You have 3-5 years maximum to achieve success. There is a higher chance of burnout.
- A startup at the beginning of its life is a triangle: a large R&D developing a product, a small production unit prototyping products, and a small commercial department testing the market. Try to turn the triangle upside down as early as possible: a large sales department that generates sales, enough production to meet the needs of the sales department, and relatively small R&D that innovates with the money that sales earn.
- Do what you know and love to do. Give to others where you are ineffective. The fish are excellent swimmers, but very lousy climb trees.
- If in a few years you are the most irreplaceable member of the team, then you should be fired as quickly as possible.
- Relax, exhale, reload…
In the near future, Pro Business plans to record and publish a long interview with Viktor Khamenok. Follow our news.