“Unlike to analogy to the Hospitality Structure, Tech employees are more likely to jump from Intrapreneurship to Entrepreneurship. Admonition to Tech, today’s layoff is tomorrow competitor.” – Read Part 1
The loss of Intrapreneurial development within Big Tech with the massive layoffs is an opportunity to liberate innovation. Although a certain amount of comfort exists within the confines of large entities, many Intrapreneurs’ creativity is also confined to the business models of their employers.
The layoff has a certain shock and sense of betrayal/malaise that will affect the talents creativity and confidence. Anger will recede, as Entrepreneurs will attest to the reckoning of a failed Startup, and the vision of opportunities will become clearer
MGSN reached out to an Entrepreneur Network to conduct Concept Generation market research and identify a business idea that laid off Intrapreneurs can use to bring the idea into the Pre-Seed Stage. In the Startup development stages, the Pre-Stage is a funding stage that requires infrastructure development funding in order to identify a business model around the business idea that was produced during the Concept Generation stage. The Founder may seek funding through friends/, family, crowd funding, and or a strategic alliance. However, massive layoffs create a vast array of talent in the marketplace. Several of Tech layoffs were high earning professionals. Many of the laid off workers were in Engineer/Tech sales and are skilled at Business Development and Marketing &Sales.
These Tech professionals are in a position to provide Pre-Seed Funding to the buildout of the business model for the idea. The business idea incorporates a launch in a significant macro-economic recession. The path to profit will be identified through organic revenue derived through a bootstrapping funding platform. Bootstrapping is the utilization of Founders assets, funds and talent to fund a Startup to the sales/revenue stage. In contracting economic conditions, Bootstrapping should be used deep into the Startup’s early years. The goal would be to avoid Venture Capital.
Business ideas and models that are developed to structure the ideas into a Startup that will use Bootstrapping as a funding platform will have to build a revenue generating offering within Startup that can produce consistent sales. Professional Service lines tend to produce revenue with manageable production cost.
The Pre-Seed Stage requires a disciplined collaboration by the Founders. The business idea that MGSN offers for development is a Peer-to-Peer Network Startup. The Startup will build out both short- term and long-term offering for commerce. The Founders will also need to build out a viable bootstrapping platform. The ideal starting point for collaboration would be a machine learning (ML) engineer, and concept/idea generator. ML Engineer will be able to quarterback the architectural team that will build out the Peer-to-Peer Network. Concept Generators build and design new product lines that are generated by the Idea generation. The key in this Startup is match the Concept Generation Founder with the key Sales Engineer Founder.
The important factor in shifting from tech employee, even an intrapreneur, to an entrepreneur is the need to expand skillsets. Research, mentoring and constant continuing education is a key to life as an entrepreneur. Although this may seem daunting at first, as you settle into the entrepreneurship, you will find this aspect most rewarding, as your skill set expands, and you cross over from fear to risk management.
Sales Engineers are in the best position to jump into the “expansive” role. Sales Engineers are utility players in the life blood of any company, Sales. They have experience in inbound lead development, sales leads that are generated from social media, web, and trade shows. The lead contacts the entity directly and the Sales Engineer will have the experience of a Sales Development Representative (SDR) in driving the lead down to closing the sales. Operating as the SDR, the Sales Engineer has worked with the Account Executive to close the sales. Many Sales Engineers have extensive experience as a Business Development Representative (BDR). BDR’s drive the outbound leads, sales leads generated from an eclectic Business Development model that shift seamlessly to a Marketing &Sales model which is usually driven by the entity’s Account Executive. Utilizing standard prospecting tools such as LinkedIn Sales Navigator, or Crunchbase pro integrated with Salesforce CRM and or any such prospecting tools that a Sales Engineer has experience operating in the BDR space, especially if that experience includes a solid working relationship with Account Executives, will be invaluable to the Pre -Seed Model.
The Sales Engineer is also skilled in networking. This skill set will become crucial in developing an important relationship, an engaged lawyer. The relationship between entrepreneurs and lawyers historically has not been holistic. Legal fees, “deal killing” advice and the fact that a business decision may clash with a legal decision has placed a barrier between lawyers and entrepreneurs. However, an examination of a recent case will identify the dangers of ignoring the need for lawyers to review event pitch decks.
In 2015, Palo Alto based Headspin launched a Startup, after the pre/seed R&D that provided beta hardware and software, provided enterprise with testing and diagnostics of APPs and SaaS performance across several global platforms. According to the SEC “from August 2018 through October 2018, HeadSpin’s CEO made numerous false and misleading representations about HeadSpin’s ARR, financials, and customer growth in connection with the offer and sale of HeadSpin’s preferred stock in the Series B round. In promoting the Series B offering, HeadSpin’s CEO knowingly or recklessly provided investors with the false impression that HeadSpin was experiencing substantial growth in both its expected revenues and its number of customers. HeadSpin’s CEO personally met and communicated those misrepresentations to prospective investors through emails, telephone calls, and in-person due diligence meetings. He also directed his employees to include false information in written investor materials provided to investors, including pitch decks, financial spreadsheets, and other promotional materials. The Series B offering succeeded in raising approximately $20 million from about 26 investors.
There is a perception that the Pitch Decks and Business Plans need to present the Startup offering in the most enthusiastic terms. However, when enthusiasm crosses the line into false representations, the Founders may face legal, both criminal and civil, liability. The drive to develop hyper fundraising goals can lead to a corporate culture of hyper enthusiasm concerning the truth metrics of the startup’s products/services and market valuations.
Further, as product and service lines are being developed issues of IP infringement will need to be resolved in the seed stage of development. Product/Service line development will need IP protection. #TradeSecrets #Trademarks #Patents #Copyrights all have very specific dictates that must be discharged in order to secure the #IP. According to an analysis of the US Department of Commerce, innovators lose billions of dollars annually by IP theft.
Conversely, Entrepreneurs need to know early on in the technology development that they have the #FreedomToOperate (FTO). A specialized legal analysis is needed to obtain the FTO. The challenge for our proposed Startup is obtain the legal services at rates that would reflect the constraints of bootstrapping company.
The role that the Sales Engineer will need to assume in building out the outsourced” legal department” will be a key development feature in this Pre Seed-Stage. The bar associations and law schools will be a significant resource for the Sales Engineer. However, the first port of is to secure a relationship with a global #LegalProcessOutsourcing (LPO) firm. The high cost of legal fees is caused by varied reasons. One of the significant causes of the cost is the research and drafting of the reports, memorandums, and briefs. Law firms, corporate legal departments and researchers utilize LPO firms to curtail the expenses. Another cause of legal cost is the turnaround time that Startups and frankly even establish enterprises needed to process the work. The quicker the turnaround, the higher the cost. An LPO that can add time to the workday by operating out of a strategic location that can leverage the International Date Line. The addition to the workday will preserve Pre-Seed funds. The Sales Engineer is the one to secure the LPO. Extensive due diligence is needed to pick the right LPO. The best means to enhance the LPO is present demo assignments for research and memorandums based on a hypothetical tech case. The Sales Engineer should be able to negotiate a no fee for the test case.
However, securing the LPO is only one part of the task. A licensed lawyer is needed to review the LPO’s research, documents, and provide the needed legal opinion. MGSN has documented dynamic startup ecosystems in the US markets that provide cost-effective alternatives in New York City and Silicon Valley. Detroit is driving innovation.
Chicago has been offering innovators homes, work, coffee and finance at a fraction of the cost of New York or Silicon Valley.
MGSN Business— MGSN (@MGSNHQ) June 20, 2022
CHICAGO IS A DEFINITE DESTINATION TO START YOUR COMPANY
Investment into a city's Startup Ecosystem needs to be examined as an important part of education investment. Chicago has invested in building one of the best Startup climates in the US. pic.twitter.com/Dejx2Dx1FQ
Cincinnati is growing in opportunities with affordable housing and topflight public transportation.
In these three cities, the Sales Engineer will find young innovative lawyers who will be open to the global networking opportunities:
- Detroit Mercy Law, ABA Grant
- Chicago Bar Foundation, Law Firm Supporters
- NKU, Center For Law and Entrepreneurship
Once the legal structure is built, The Founders can concentrate on building the Peer-to-Peer Network. The Bootstrapping funding platform will leverage the skillsets of the ML engineer founder, the chemical engineer founder, the manufacturing engineer founder and the sales engineer founder. The mechanical, chemical and manufacturing engineers will offer non-recurring engineering (NRE) and R&D outsourcing solutions. The Sales Engineer will create the digital marketing, SDR, BDR and Account Executive platforms to procure the NRE & RD contract work to fund the Bootstrapping Funding apparatus. The Sales Engineer will also procure Tech/Engineering sales outsourced retainers.
The funding work will be distracting at time, but keep in mind, most Founder find the fundraising process consuming and it involves funds, investors, lawyers and bankers. At lease the Bootstrapping Platform distract the founders with work that is in field of their choice.
The most attractive aspect of developing a Peer-to-Peer Network is the creative networks that Founders can develop and build into the Peer-to-Peer model. The expertly development of the blockchain spine of the Peer-to-Peer Startup will be key. One obvious network that the Founders should build on the Peer-to-Peer Startup should emanate out of the Bootstrapping Funding Platform. As the Sales Engineer build out the Bootstrapping products and services lines, the Business Development should drive the internal sales model to an external marketplace of multi-disciplinary engineering services for hire. The experience with the LPO should be developed into a legal processing market.
Another network that the Startup can develop is new tech product development. The network should commence around Concept Generators. The IP would be secured by the smart contracts on the blockchain and a redundant contract with Non-Disclosure Agreements (NDA), Non-Circumvention Agreement (NCA) and Trade Secret Protection Plan. The exciting aspect of this marketplace is that Innovators can form subnetworks to build out the Concept Generation into product development.
Another network that can be built on the Start Up Peer to Peer Network is the facilitation of domestic SME in the Fast-Moving Consumer Good (FMCG). North American and European manufacturers, packers and co-packers are facing contracting consumer bases. The markets in the African Continental Free Trade Area (AfCFTA) have robust consumer markets that would provide a steady base of transactions. The Peer to Peer would use its Legal Outsourcing strengths to build verifiable due diligence protocols that SME market players would undergo to qualify for the unique B2B marketplace. New Distributors and factories would be developed in the AfCFTA markets. The Peer-to-Peer Network would allow the Parties to develop relationship, host virtual trade shows and provide secure FinTech solutions.
Big Tech’s layoffs will bring new innovation to the marketplace. It just won’t be under their brand.