Entrepreneur turned investor, Jason Njoku, put a post up on his blog as an attestation to Spark's progress.
Spark is his Angel Investment company that invests in other companies. Although Jason insists that they are not a fund or an incubator - "It is a company that builds other companies focused on Lagos, Nigeria." This is understandable as companies like Hotels.ng and other Spark beneficiaries have gone ahead to make positive impacts on the ecosystem and Nigeria as a whole.
In the blog post, Jason gave a brilliant run down of issues ranging from Lagos as a Nigerian gateway, linear revenue models, and a preference for homegrown entrepreneurs amongst other things.
But I managed to pick up a few success pointers from the post -- some of which were not implied -- that I slightly spun and intend to share with you.
Build a product that works; it will sell itself
My #1 issue with startups are when they believe ‘aggressive marketing’ can solve their problems. I always, always, always recommend zero marketing until they have a certified product market fit.
Startups tend to believe publicity is the cure. But before you delve into sending -- paid and unpaid -- PR materials to news houses, ask yourself if that product is interesting enough. The truth is if the product cannot sell itself by word of mouth, extensive marketing can be counterproductive.
According to David Ogilvy; the 'Father of Advertising', great marketing only makes a bad product fail faster.
That makes sense, as the more you try to spread the word on a product that is not properly thought out, the more negative criticism it gets. This ultimately kills off any hope of getting the product a positive reception when -- and if -- it gets better.
In funding, less is more sometimes
The one thing I know is that a lot can be achieved with less capital.
Like marketing, raising money is really overrated! Considering the large amounts being raised here and there, the first thought that comes to mind is what all those monies are used for.
According to Jason, the efficiency of redeploying funds is a very important factor to consider. It is even more important than raising lump sums without planning. If adequate preparations are not put into structuring a strategy, the monies can -- and will -- be wasted.
You are going to make mistakes
We made a ton of mistakes at Spark. Nothing fatal. But at the minimum, we learned from them, mistakes which I believe others will join in making as they try to deploy capital locally.
Being afraid of mistakes and failure is the start of failing itself. As an entrepreneur -- and a human being -- making mistakes is normal.
According to Jason, the millions lost in investment will serve as a roadmap for future successes and references. Thomas Edison said failing 10,000 times has shown him 10,000 ways it won't work.
Failure should be a way to gain experience and an eventual breakthrough. In Jason's words, "Embrace failure!".