Allocating your time based on this decision could be the most important decision for your company.
Every founder has a daily struggle on how to allocate his or her time. Is this you? We can work on developing our product or fine-tuning that Facebook campaign. We can work on managing our staff to generate more productivity or we can work some back office tasks like paying bills.
But there are two very important tasks I left out that could be viewed separately but in which I want to link together today:
- Time spent on acquiring new customers (sales)
- Time spent on acquiring new capital (fundraising).
As mentioned, it is easy to view these as simply two additional tasks in your list of 5-8 company-building tasks. In fact you could view all of these tasks as equally weighted and simply round-robin these every day. But that would be wrong and in fact I would encourage you to consider a much different tack.
Dollars flowing into your business trumps everything else.
Money buys you time. Time is your worst enemy and forces you to make difficult decisions. Money buys you time. Find more money. Hopefully, I have moved all other tasks to the back of this line so that you can concentrate on money-producing activities.
So, if we go back to my previously mentioned conundrum of time spent on sales or time spent on fundraising, how would you juggle that balance, Chris? Here is my simple formula – 75% on sales and 25% on fundraising.
You can’t spend zero time on fundraising as fundraising is about building a relationship over time. It is not a light switch you turn on and off. So you need to build relationships with funding sources. So, allocate time to reaching out and keeping these targets up to date on your progress. Progress? What should I be sharing with them?
You could share the improvements you made to the product, or the results of the Facebook campaign, or the improvement of team productivity or the fact that all of your bills are paid. You know where this is going; very few investors really care about those.
Or, you could share your progress on sales and the general state of your customers.
Increasing revenue and/or sales (in case you are acquiring users not revenue) is the primary filter investors will use to judge your company. So, if you want to improve your chances of garnering investment, spend time on sales.
If I have one regret from every company I have run over the past 15 years, it is that I should have spent more time on customer development and sales. Selling and the selling process is THE BEST way to increase the value of your company.