Setting Up Your Startup for Success: Advice from a Venture Capital Investor

Don’t be different. Be distinct,’ advises Joseph de Leon of Bullet Day Consulting and MAIN.

In this special feature from The Business Manual, Joseph de Leon gives priceless advice to startups. A leader in the venture capital landscape, de Leon is influential in matchmaking Philippine businesses with institutional investors, private equity funds and venture capital from here and abroad He is currently Principal of Bullet Day Consulting and a founding member, Board Ambassador, and head of Screening & Mentoring of Manila Angel Investors Network, the country’s largest active angel investor network.

Don’t be better, be distinct.

When starting a new business, there is genuine merit in being cheaper, faster or first. It’s a proven path to breaking into a market.

At least until someone else comes in even cheaper, faster, or better.

In Matt Lerner’s Growth Levers he highlights that the top 1% of startups aren’t slightly better, they’re fundamentally different—with different metrics, different assumptions and different processes. Tesla is a prime example, and the results show. While probably still overpriced and far from its peak, Tesla’s market cap of $598.45Bn (as of January 2024) is larger than Toyota, Porsche, Mercedes-Benz & BMW combined.

Don’t be different just for the sake of being different.

Pushing that further, it isn’t enough to make your business different. In this new era, you must strive to make your business and brand distinct.

By definition, “distinct” means being different in a noticeable, meaningful way. It’s a game of nuance and balance. Like great alternative music, a distinct startup or strategy has got to be fresh enough to stand out but not so far out that it is disturbing.

Be different so you make a difference. Be the Anti-Hero.

Founders often excitedly bombard me with a laundry list of different features. Understandably, they built something, and they are justifiably proud. Unfortunately, these features often fly right in one ear, through the cavern of my simple mind, and leave out the other ear.

Conversations go a lot better when founders provide context of how their solution actually makes a difference to the end user by being different from the incumbent.

From a marketing standpoint, it is easier to find customers by rallying people against something. Coke vs Pepsi, iPhone vs Android. Ferrari vs.Lamborghini.

If you are a new brand in an old business, be the Anti-hero to the current leaders. Even if you are that market leader.

Founders often excitedly bombard me with a laundry list of different features…
Conversations go a lot better when founders provide context of how their solution actually makes a difference to the end user…

Joseph de Leon, Principal of Bullet Day Consulting

Google didn’t win the browser wars just because it was better than Yahoo! Besides both products being search engines, they almost couldn’t be more diametrically opposed. On the front end, Yahoo! is a busy bazaar, practically a palengke. Google is a white space. On the back end, Google designed a fundamentally different algorithm anchored on pagerank not just keywords.

Now, search is being disrupted by other platforms from other angles. Instead of looking for a how-to guide, we go to YouTube (an Alphabet Company) for an explainer video. Rather than clicking on the most popular result, we are learning to prompt-engineer our AIs such as Chat GPT and Bard. If you don’t trust baby Skynet, then we ask a question on Reddit, post a wrong answer from another account and learn from all the trolls correcting the n00b.

Find Your Distinct Audience, Experience & Impact

You don’t need to be a coding genius or eccentric engineer with a high-tech breakthrough to be distinctly different. Two old ideas can come together and provide a breakthrough when brought to a new audience.

Liquid Death is canned water for rockstars and worth $700mn. Obviously, water isn’t a new idea. Evian has been peddling overpriced water since 1789 if not the Roman era. Red Bull has been marketing drinks to party goers since 1987. In 2009, graphic designer Mike Cessario saw Vans Warped Tour concert goers drinking water out of Monster Energy cans to stay hydrated. Eight years later, he trademarked Liquid Death with partners JR Riggins, Pat Cook and Will Carsola and used punk rock to make water “cool again.” By using aluminum cans, Liquid Death is not just “murdering thirst,” it is also fighting for “death to plastic.”

Brandomize: Mix & Match Inspiration

We often make boring choices because we don’t think we are creative. Fortunately, creativity is a skill we can learn. In Made To Stick, the Heath Brothers popularized the unexpected power of finding the familiar with a twist.

So to jumpstart your Discovery of Distinctiveness, find something familiar and add your own twist. When my playshop clients are stuck with a problem, I ask them to pretend they are someone else for a while and let that guy solve it. When a telco wanted to break into the youth segment, Team IBM thought of partnering with school associations for a nationwide inter-school competition. Team Apple wanted to launch a concert series.

List down innovative brands and pull one out from a hat. Then just imagine how differently you would do things if you were “Brand X” for this industry. Would you pick a new audience? Offer new solutions? Whenever you get stuck, spend a few minutes learning about the business and what worked for them. Or just pick a new brand and be inspired by that one. Before skipping a brand, work on it for 15 minutes at least and see where it takes you. You can even put the brands in a randomizer like  wheelofnames.com

For inspiration, feel free to play with with your own team, your friends or the voices in your head using my Brandomizer  (https://bit.ly/BulletDayBrandomizer). Have curated some thought-provoking options you wouldn’t think of as brands (e.g. William Shakespeare, the Catholic Church, The City of Paris) and excluded a few predictable ones (e.g. Apple, Microsoft and Amazon). Will keep updating this, so keep checking in bulletday.com/resources from time to time.

Don’t just be better. Be distinct. Maybe you can make a difference.

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