According to the last research from the Economist Intelligence Unit (EIU), the secret ingredient that nurtures the entrepreneurial success of a startup ecosystem like Silicon Valley is informal professional networking.
When you are a startup founder, you’re on your own working 24/7 tackling the challenges of how to find investors, how to find a business partner, how to promote your project and how to team up with other talented hardworking fellows like yourself. 78% of business owners confirm that building a face-to-face network that will support you with guidance and advice is more important for growing a startup than accelerators, incubators, co-working spaces and other formal settings designed for progress facilitation.
So if you feel bad hanging out at costly events, rest assured, creating a professional network that you can tap into for assistance is the most valuable investment of your precious time to provide a smooth launch of your business.
What’s the best networking strategy?
To save your time so you can focus on core business functions, we have conducted a survey on professional networking and here is what successful founders say on how to build a network of power relationships.
The best professional networking strategy is as simple as the soul of genius, and it is not what you think. The key insight is before growing your network, make sure you’ve grown your business and trust of your customers. Business first! You can pump up your communication skills and have your pitch on point for a networking session, but if there’s no personal gain for your potential investor, it’s done in vain.
All founders of successful startups to mention iconic Facebook, What’s up, Apple and Dropbox focused on product development and raising clients’ credibility, spending just a fraction of that time seeking funding. Once they produced something of value, investors came to them flocking at every event they appeared. Sure you can’t do epic shit with basic people, so you build your surroundings to create the right state of mind, but that does not mean that if you befriend with accomplished people they would magically sprinkle success into your existence. Having a working product is a prerequisite for the investors to take an interest in your startup.
To maximize the benefits of a networking event here are some top tips that prove useful
For picking a networking event
Attending every event would do you more harm than good, so be savvy, not sorry. Align your professional networking strategy with your target result so that you have a well-defined clear goal when picking an event. The rule of thumb is to choose highly specialized activity-based events where you can engage in problem-solving work or discussion and reach your ultimate clients preferably as a speaker.
For developing communication skills
Frankly, you don’t need to attend 99% of the events, if you can have a blast at the rest of them. There is another open secret that 90% of people feel nervous when speaking in public, while the other 10% are just faking it out. Practice makes perfect, developing communication skills becomes imperative when you are faced with the challenge of being paralyzed by fear of public speaking.
An idea that the better half of the visitors are introverted newcomers will relieve your anxiety besides no one has ever answered “No” to a phrase “Can I introduce myself?”. Follow your introduction with open questions like “What brings you here?” “What challenges do you see for your company?” Listen more, talk less, be genuine, think what benefits you and your product can offer and you are a networking champion!
For building network
There is a huge scope of events such as conferences, meetups, networkings, pitches and hackathons which are mostly designed for making connections. TechCrunch Disrupt, AMBAR’s SVOD, WebSummit and Collision are among the most featured, crowded and intimidating. That’s why you should go there if you see a clear benefit and have enough time to get ready.
Focusing on your specific goal, make a list of attendees you would like to meet, including guests, speakers, exhibitors and local companies’ representatives. A month before the event write a message to make sure your potential acquaintances have time in their busy agenda to schedule a meeting with you. Talking about your business, make a real personal connection.
Don’t forget to take business cards it may seem old-fashioned, but this is the first thing that will remind of you when the event is over.
Number one challenge for young entrepreneurs is funding, though it might be useful at early stage of your start-up to test your idea against the expectations of angel investors and market opportunities.
There is a number of events, where you can pitch such as PechaKucha, Participant driven Open space, PitchNight, though you should not expect it to work right the first time at these seemingly directly relevant events. Pitching works better through warm calling. A clever move would be instead of approaching investors to connect with their investment portfolio companies and ask them for an introduction. Сhasing your business angels, jumping around to every event, does not make any sense unless you have something worth investing.
The worth of your business when you seek outside funding is determined mainly by customer lifetime value. CLV is the borderline between success and failure. At the end of the day, it’s not the business idea but facts and figures mere metrics you can captivate and inspire investors with. So, when you make your pitch don’t forget to back it up with KPI’s.
For aspiration and mentoring support
The other key challenge for a young entrepreneur is a fear of failure and lack of mentoring support. Navigating through an array of obstacles such as regulatory compliance, lack of financing, promotion and talent acquisition issues, it’s easy to get discouraged. Networking groups like MXify and various meetups are places where you can get connected with fellow entrepreneurs in a casual environment and power up with encouragement and advice.
There are more than 10000 meetup groups with 4 million high-end professional members starting from web-developers and engineers and ending with security analysts and neuro-hackers. The strongest group in the east is NY Tech Meetup with about 50 thousand members and Silicon Valley Entrepreneurs & Startups with about 25 thousand members respectively. Provided you come up with the right questions, it will be the perfect place to engage in beneficial and insightful discussions with top experts.
To some degree tech meetups and hackathons could also be used as a talent acquisition source, since there you can observe visitors working on a specific problem and assess their competencies based on what they have accomplished. Don’t forget to check career history for relevant expertise in similar projects and add your potential candidates to your LinkedIn or other social networks. If it’s an immediate opening for top-notch specialists, turn to a hiring service which already built a strong professional network of leading specialists and can help you choose an employee with the right expertise.
Whatever your goal is, the basic idea behind building a strong professional network is quality supersedes quantity. Be savvy, not sorry, and remember, everybody knows somebody. Nurture relationships with your peers and they will be happy to introduce you to their partners and investors.