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How to Build a Purpose-Driven Venture

Mike Quinn is a 2007-08 Skoll Scholar and Oxford MBA alumnus, he is also the co-founder and former CEO of Zoona, one of Africa’s earliest fintech companies. With over 10 years of experience running a successful social business, Mike shares his hard-learned tips and experiences on how to get a purpose-driven venture started, built and scaled. This is the second article in the series, how to ‘build’.

In my last blog, I outline a three part strategy to starting a purpose driven venture:

  1. Start by falling in love with a big problem
  2. Pick the right co-founder(s)
  3. Rapid prototype to discover product market fit

If you get that far, you are well on your way and should be able to raise investment. The art of fundraising is a topic on its own that has been extensively covered, including this excellent piece by Y-Combinator’s co-founder Paul Graham. In this article, I’m going to assume you have some capital and now it’s time to build. Specifically, there are three critical foundations you will need to put in place in advance of scaling your venture (which will be the third part of this series).

Build a Model

I used to falsely believe that innovating means everything needs to be new and unique. A more mature approach is to first research what other models are out there that you can learn from. As John Mullins and Randy Komisar wisely advise in Getting to Plan B, start by finding successful analog models that you can emulate, and figure out how to copy and adapt them to your market. When launching Zoona, we studied M-Pesa’s agent and money transfer model in Kenya and figured out how to adapt it to Zambia where it didn’t exist. It’s a lot easier to build off of someone else’s successful innovation than to start from scratch.

Conversely, it is also useful to identify antilog models that are past their prime and explicitly define what you want to do the opposite of. In Zoona’s case, this was deploying entrepreneur owned and managed kiosks instead of branches as the banks and the post office were doing.

You will also need to figure out your growth levers, how you make money, and establish metrics and feedback mechanisms to track if your model is working. The faster you can learn and adapt, the greater the probability of success.

Build a Team

Your ability to build a motivated, aligned and high-performing team will make or break your venture. This is one of the most important jobs of an entrepreneur and ironically one of the easiest to screw up. When there is so much work to do, it is extremely tempting to hire the first person who walks in the door and leave her alone to sink or swim. I have learned that it’s much more effective to be purposeful and systematic every step of the way. Here is a checklist I use when building a team:

  • Do you really know what roles you need, and have you defined them as clearly as you can?
  • What roles can you outsource or make part-time to avoid taking on too much fixed cost?
  • Have you defined what values, abilities, and skills (in that order of importance) are required for each role?
  • Do you have a clearly defined Employee Value Proposition to attract the right people? (i.e. Why would anyone want to work for you?)
  • Do you know where to find potential candidates? (The good ones most likely already have jobs). Have you looked within your organization?
  • Do you have a non-biased process to assess candidates?
  • Have you thoroughly checked their references to identify red flags and validate their track records?
  • Can you “try before you buy” by starting new hires off as consultants?
  • Have you defined clear 30/60/90/180/365 day objectives and key results that will determine if the new hire is performing?
  • Do you have a process to give and receive regular and honest feedback?
  • Do you have a simple and effective performance management system?
  • Do you have a process to identify exit the wrong people?

The last point on identifying and exiting the wrong people is as important as hiring the right ones. A mentor once told me that the best recruitment firms in the world will only get it right 75% of the time, but the best companies in the world are those that efficiently deal with the other 25%. If you want to build a great team, learn how to compassionately offboard people who stand in the way of that goal.

Build a Culture

With the right people in the right roles, amazing things are possible. But for anything to be achieved, those people also need to exhibit the right behaviors, which is where your culture comes in. As with all my advice, the starting point is to be purposeful about designing what culture you want and then taking steps to shape that. If you don’t do this purposefully, a culture will emerge anyway, and it may not be one that is productive or that you want.

  • Have you defined your purpose, values and principles?
  • Do you live your purpose, values and principles?
  • Do you reflect and learn from failure?
  • Do you celebrate your successes and acknowledge achievements?
  • Do you care about your people and their well-being?

The golden rule for building an effective culture is “do what I do, not what I say.” As a leader, everyone will watch how you behave for signals on how they should behave. As Ben Horowitz rightly titled his latest book about creating culture, “What You Do Is Who You Are.” With any purpose-driven venture, time and energy spent designing and improving your model, team and culture will be time well-spent. It will pay off in multiples when you enter the next phase: scaling.

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My journey from Bangladesh to Oxford

Anjali Sarker is a current 2019-20 Skoll Scholar on the Oxford MBA. She is passionate about empowering women’s rights through economic opportunity. She reflects on her impact journey so far and what led her to Oxford.  

It was a hot summer afternoon in 2014. A group of middle-aged women were sitting under a tree, giving me and my colleague a very skeptical look as we were trying to explain how mobile payments could possibly make their lives easier. They did not seem to be convinced at all, for good reasons; at least for reasons that were valid to them.

“We, women, don’t understand those things… too complicated for us.”

“My husband handles all financial matters. Those are men’s responsibilities.”

“My marriage will be in trouble if I use mobile money. My in-laws will assume that I’m secretly sending money to my parents.”

Anjali Sarker headshot outside Saïd Business School

I wondered if it was at all possible to challenge the age-old traditions and gender norms that made women believe that managing money is men’s business, and they should ‘stay out of it’. As a deep believer in gender equality, and being a woman myself, I wanted to challenge the status quo.

At that point, the mobile money revolution in Bangladesh was just building momentum. However, as with all new opportunities, it was mostly men who were able to utilise mobile money. In particular, rural and poor women lagged behind. By 2017, the number of mobile money account holders in Bangladesh shot to over 24 million, the highest in the world. Shockingly, at the same time, the gender gap in financial inclusion increased 20 percentage points within only 3 years, leaving 38 million women unbanked. BRAC, one of the largest NGOs in the world where I worked at the time, had been active in the microfinance industry since the early 1970s, providing rural women access to small loans. We saw mobile money as an opportunity to expand the coverage of financial services to every corner of the country. However, the challenge was how to take it to the poorest women who need it the most.

The next few years became a roller coaster ride for my team, pulling off a massive nationwide project, funded by the Gates Foundation, to get digital financial services to the fingertips of one million women (literally). Leading the project taught me more than I could have ever imagined – taking me to the remotest corners of the country and exposing my eyes to the harshest forms of poverty. On one hand, it was incredibly inspiring to see how our clients’ eyes lit up when they made their first digital transactions and sent money to their loved ones. On the other hand, I felt numb when I heard many stories of husbands’ abusing their wives for being “too independent”. I realised that beyond providing necessary services and ‘doing good’, development interventions should also take responsibility for the consequences, both intended and unintended, that come later.

“A more effective way of changing the status quo is to build a better system that makes the existing system obsolete.”

Anjali Sarker, 2019-20 Skoll Scholar

The project left my mind full of complex questions, which motivated me to take a two-year study leave. Before coming to Oxford for my MBA, I did an MSc at the London School of Economics, where I studied Inequalities and explored how emerging technologies impact the existing inequalities. Many people raise their eyebrows when I said that I was going to do an MBA, after studying “inequalities”! Aren’t these the two extremes of the world today where the richest 1% are exploiting the whole planet and the activists are protesting on streets to bring them down? Well, I believe the realities are much more complex and nuanced than that. One can choose to fight the system and in extreme cases of injustice, that might as well be the only option. However, in most situations, a more effective way of changing the status quo is to build a better system that makes the existing system obsolete. This hope for change is what inspired me and brought me to Oxford.

While looking into business schools, Oxford’s Saïd Business School clearly stood out because of the Skoll Center for Social Entrepreneurship, the Skoll Scholarship, and the incredible privilege to be immersed within the wider Oxford University community. In fact, my motivation for an MBA was understanding the world of business and investing the knowledge, skills and connections gained in social good, specially to create systems that work for women. Unfortunately, women are still the biggest minority in the world. More often than not, their needs and realities do not get the attention they deserve. To make things worse, if they are poor, illiterate or live in rural areas, they become almost invisible to the systems and decision-makers. My hope is that spending this year in Oxford, and all the incredible opportunities that come with an MBA from Oxford Saïd, will enable me to better serve millions of invisible women in Bangladesh.

How to Start a Purpose-Driven Venture

Mike Quinn is a 2007-08 Skoll Scholar and Oxford MBA alumnus, he is also the co-founder and former CEO of Zoona, one of Africa’s earliest fintech companies. With over 10 years of experience running a successful social business, Mike shares his hard-learned tips and experiences on how get a purpose-driven venture started, built and scaled. This is the first article in the series, how to ‘start’.

In October 2019, I had the privilege of being a Social Entrepreneur in Residence at Oxford’s Saïd Business School. I delivered three talks and coached dozens of entrepreneurial MBA students who were seeking practical advice on how to start, build and scale a purpose-driven venture. This blog summarizes my first talk, ‘How to Start,’ with the others to follow.

Start by falling in love with a big problem

When starting a new venture, there’s a lot of pressure to come up with that one novel idea that nobody has ever thought of before. It can be discouraging at the idea formation stage to hear comments like, ‘Oh that’s not very unique!’ or ‘There’s another company already doing that!’ This pressure can lead to you spending a lot of your time trying to come up with a unique solution before choosing and understanding the problem you want to solve.

This is a backward approach for a few reasons. First, it’s almost impossible to come up with an idea that someone else hasn’t thought of or tried already. Second, if another company is already doing it, that means there is a real-life analog to learn from. And third, trying to come up with a solution before fully understanding the problem is the fastest way to start-up death.

A better approach is to spend time up front falling in love with a big problem. Pick a problem that you are passionate enough to spend the next decade of your life solving. Make sure it is big enough that no one solution will solve it completely. And be confident that if the problem no longer existed, the world would be a better place and you would be proud to have contributed to the solution.

Falling in love with a big problem is what will keep you motivated through all the investor rejections, people challenges and product failures that will surely come.

Pick the right co-founder(s)

There is a saying that ‘Founder’ is the loneliest number for good reason. There is so much to do when starting a new venture that having a team of 2-4 co-founders can make a huge difference in both the venture’s success and everyone’s well-being. However, finding the right co-founder(s) can be fraught with challenges, especially for first-time entrepreneurs.

Before you look to find others to work with, you should start by finding yourself:

What is your purpose?

What are your core values?

What is your personality type?

What are your strengths and weaknesses?

Which tasks do you jump out of bed for, and which drain your energy and cause you to reach for the snooze button?

I like to capture these on a ‘Me on a Page’ document that I review monthly to keep me grounded.

Next, understand that the ideal co-founder(s) enables you to be the best version of yourself (and vice versa). Find people who share your passion for the problem, resonate with your values and are equally committed for the long haul. Make sure they have complementary strengths and weaknesses and are people you enjoy being around.

This is a high bar to meet, and so it should be. Over my ten years at Zoona, I spent as much, if not more, time with my three co-founders as I did with my wife. We experienced exhilarating highs and gut-wrenching failures together. We had to work in a pressure-filled environment that was never stable, even when things were going well. Working in a start-up will either bring co-founders together or destroy relationships, so it’s critical to be purposeful about the people you will share this special bond with.

It takes time to know if you have the right co-founder(s), so in the interim there are some practical steps you can take. For example, ‘try before you buy’ by agreeing up front to test for fit and working relationships before formalizing anything. Build in staged check-ins and exit off ramps where people need to either commit or leave. When splitting equity, introduce share vesting so that a departing co-founder returns their unvested shares back to the company.  Have honest conversations and learn how to give each other feedback. This all takes courage and maturity but is absolutely necessary if you want to build a successful venture.

Rapid prototype to discover product-market fit

With the right problem and co-founder(s), you will have solid foundations in place to shift your focus to discovering product-market fit. Your goal is to develop a minimum viable product (MVP) that solves a major pain point for your targeted customers. You also need to validate that they are willing to pay for your product above what it costs you to deliver it. If you’re lucky, they will start telling other people who are like them to try your product, and you will achieve lift off.

A lot of things have to come together for this to happen, and it’s typically a race against time and running out of cash. If you spend all your time building a perfect product in your office, you are destined for failure.

Rather, take a rapid prototyping approach. Start with a small and consistent customer segment. Get to know who they are, their pain points, and the root causes of their pain points. Learn from them about how they already overcome these pain points on their own. Then, design hypotheses for how you could help reduce or eliminate their pain. Test hacked solutions that require the least amount of time and money to develop and seek quantitative and qualitative feedback. Make adjustments on the go and keep iterating as fast as possible until you have a working MVP and delighted customers.

With any new venture, there is never a guarantee of success and always a high probability of failure. But if you get these three foundations right – falling in love with a big problem, picking the right co-founder(s), and rapid prototyping to discover product-market fit, you will be off the starting blocks and living the entrepreneur lifestyle!