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Why Staying Grounded as a Founder is More Important Than Raising Capital

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Opinions expressed by Entrepreneur contributors are their own.

I’m the founder of a social impact startup. No, you won’t find me on a 30 Under 30 list. You also won’t find any articles about our software on Techcrunch — even though we’ve invented two natural language processing algorithms and have nearly $2 million in booked annual recurring revenue. We work with more than two dozen major institutions (Fortune 500s, international nonprofits and major state agencies). We have raised nearly $1 million in capital, and we are thriving as a startup. And this is not because we are experiencing product market fit. 

On the contrary, it is because our company focuses on who we are and who our customers are more than we focus on numbers. Our values and authenticity have allowed us to carve a space in existing markets. We’ve been able to align ourselves with people who have felt othered in their methods of thinking. Let’s take startup leadership for example: the general expectation is that startup founders should be extremely active on social media to build your personal brand because as they say, at early stages the founder is the brand.

As a startup founder, I maintain a low profile on social media by only posting on Twitter and Linkedin occasionally and sharing very limited aspects of my personal life. I have always been this way and while I felt the pressure to change my behaviors to help my startup succeed I ultimately chose not to. There was no data showing a direct correlation between our sales and my tweets or between social activity and acquiring new investors. Staying off social media has helped me maintain sanity but most importantly use that time for strategy and sales. 

Being semi-incognito also results in less stories in major publications like Techcrunch or Forbes; honestly, sometimes I do think of what this can do for our company. But again, I go back to the data and have seen founders featured in these publications and still yield no revenue and no consistent growth. Every time I have considered going the traditional path of what I see founders do, I go back to the values of our team and our customers. Because this is what constitutes our company. 

Related: A Founder’s Most Important Job Is Staying Connected to the Business

The question every founder should ask themselves

One thing I remain cognizant of is the fact that every social group, every institution is made up of people who have similar values. Within their social or institutional systems it is those values that foster a common set of values, language and symbolism that develops a culture you all commit to. It took me some time to figure this out and get off the pop culture startup wave that can draw one in so easily. However, once I did figure this out, mapping our values and using those to stay grounded became natural. 

Our focus as a company and my ethos as a leader has always been about challenging the status quo. So every day, when I ask myself the question, am I doing this for the right reason for my business?, I also ask myself, am I doing this for the mission that we serve? By asking myself this question every day, I started to map out the core of what I do and why my team and I were so committed to this mission. At first, it started with small words and a recognition of the obvious things: a lot of team members have tattoos, we all believe current social systems should change, we all honor we are intersectional beings. 

Over time these small phrases grew into core values that now feed three rules we live by: 

1. Focus on sustainability, not scaling at a fast rate

Simple, right? However, most startups will focus on cash burn and having enough money to spend. Then focus on their next fundraise so that they have enough money to burn through all over again. They don’t focus as much on revenue models in early stages. Before they know it, they have burned through their capital and need to raise again. Fun fact: I had one investor tell me on a call that I am not focused enough on getting money back to investors. Rather, I need to create a strategy that is focused on my exit and work backwards. And I completely disagree. That’s not what I need to do. What I need to do is create a business that is sustainable and that can weather economic times. And if the economy falls apart, my business is still surviving. This is why we grew 10X in the middle of a pandemic. This is why we’re projected to grow another 10X this year. And this is why, even if we don’t raise another round, we will still survive and scale at this rate. Because we’re building a business that’s based on sustainability, not on how much cash we burn through. So ask yourself: Are we profitable? Are we putting money to the side for our reserves? Are we safe for a rainy day and not based on investors but our actual cash and what we’re growing? This is just how businesses used to operate before venture capital. People tend to forget that VC only came around in the mid-1900s. Businesses have thrived for thousands of years without it.

2. Our greatest investors are our team

Our team is really diverse and at the end of the day, everyone has their own personal focus and personal beliefs. But one thing we can come together on common ground and say is that the change that we are working towards is something we really care about. And so we design our interview and our hiring practice to be focused on that. And honestly, sometimes team members don’t. In addition to that, it’s not only about finding the right team, it’s about retaining them. Our minimum salary is $70,000. Our benefits focus on equity, mental wellness and making sure our team members are the key investors in our business. Our board and investors are also committed to this value, ensuring that we are developing our team and creating a company where they can thrive. 

3. Our best advice comes from customers

I’ve taken time and we will continue to take time to listen to our customers. To understand what features they want, why they care and then find that line that connects all of our customers together. When we look at our business, that line is the groups of people working in corporations, government and nonprofit organizations who have dedicated their lives to listening to community members. They are actively working towards the benefit of people. And that is something that’s beyond demographics. When they tell you to make a user persona and you’re writing, oh, it’s a female and she’s 45 years old and this is her title. That is one thing, and sometimes that can work for you. It honestly can if you’re trying to automate your marketing. But if you look a little bit deeper, you’ll see that there’s a common belief system and a set of values, actions and philosophies that many of your customers have. And that’s what we built into our customer persona, not some set of demographics that kind of describe what they look like and the things that they do on the weekends. But it’s actually a set of values. And by looking at that even deeper, we’re able to repeat the sales cycle and find those people over and over again. So they can finally see something in the market that is a tool that they want to use that aligns with their beliefs and value systems.

Related: How Strong Company Values Build the Team Fledgling Startups Need

Capital is nice, but staying grounded is way better

I look at many of the startups today that are trying to do things that are great, create a new vision for the world and a lot of them really are doing things that are great. But I also speak to a ton of founders who are terrified of pushing against the status quo. Even though they really want to. Because if they push against the status quo, they can’t get the big funder they want. 

My honest response to this is always: but is that what you need? Yes, a lot of startups depending on the sector absolutely need upfront capital to build their company. I truly understand that but we also have been conditioned to believe this. Because honestly, without startups asking for capital, VC as an industry would die. They need us, we may not need them. 

You did not build your business for investors or splashy headlines. You built it to solve a customer problem and your team will continue to build it to solve that problem at scale. No word matters more than that of your customer and there is no greater investor in your business than the team you hired. With that at your core, you can truly change the world. 

Related: 3 Tips to Align Your Startup’s ‘Core Value’ With Customers

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Amazon may lay off 20,000 employees, including managers: Report

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Amazonmay lay off about 20,000 employees across divisions as the company reevaluates its pandemic-induced hiring spree, according to a media report.

A Computerworld report stated that the tech giant could lay off employees across the company, including distribution centre workers, technology staff, and corporate executives. Staff at all levels will likely be affected, it found.

Last month, the New York Times reported that Amazon plans to lay off approximately 10,000 people, and “the cuts will focus on Amazon’s devices organisation, including the voice-assistant Alexa, as well as at its retail division and in human resources”.

However, according to Computerworld, the layoffs could impact nearly double the number of employees– roughly 6% of the company’s corporate employees and about 1.3% of its global workforce of more than 1.5 million composed primarily of hourly workers.

YourStory could not independently verify the report.

Corporate staff have been told that employees will receive a 24-hour notice and severance pay, in accordance with their company contracts, the Computerworld report noted. “There is a sense of fear among employees in the company as the news has come out,” the report added, quoting a source who was informed directly about the layoff effort.

The layoffs would be the largest staff reduction in Amazon’s history.

“There is no specific department or location mentioned for the cuts; it is across the business. We were told this is as a result of over-hiring during the pandemic and the need for cost-cutting as the company’s financials have been on a declining trend,” the source told Computerworld.

After the New York Times report, Amazon Chief Executive Officer Andy Jassy shared some information about role eliminations in a note. Jassy confirmed that layoffs were occurring, though he did not specify the planned number of employees to be laid off.

“Our annual planning process extends into the new year, which means there will be more role reductions as leaders continue to make adjustments. Those decisions will be shared with impacted employees and organisations early in 2023,” Jassy wrote in the message, noting that Amazon had already communicated that layoffs would occur in the Devices and Books businesses, and would be extending a voluntary reduction offer for some employees in the People, Experience, and Technology (PXT) organisation. 

“We haven’t concluded yet exactly how many other roles will be impacted (we know that there will be reductions in our Stores and PXT organisations), but each leader will communicate to their respective teams when we have the details nailed down,” Jassy noted.

Meanwhile, the Computerworld report noted that employees on Amazon’s robotics team have been laid off.

Amazon’s muted third-quarter earnings as well as disappointing fourth-quarter projections led the company’s stock to plummet. Its third-quarter earnings were severely impacted by unpredictable consumer shopping habits and inflation. 

Amazon is likely to lay off several employees in India across divisions, according to media reports. Last month, Amazon confirmed that it will shut down its wholesale unit Amazon Distribution. This is the third business unit to be closed after the e-commerce giant announced the wrapping up of Amazon Academy and the food delivery business in India.

Globally, tech companies have announced layoffs as part of their cost-cutting efforts. In November, Meta CEO Mark Zuckerberg announced that the company had decided to reduce the size of its team by about 13%, cutting over 11,000 jobs. In the same month, Elon Musk reduced half of Twitter’s workforce or about 3,700 jobs at the social media firm.

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Unlock The Entrepreneurial Potential Of Your Team With Employee-Ownership

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A strong team of many outperforms even the most hardworking of entrepreneurs on their own. But when hiring employees, freelancers and contractors, how do you ensure they have the same entrepreneurial skills and drive that you do as your company’s owner? Is it unrealistic to expect employees to be motivated and committed to an organisation they didn’t found?

Nicki Sprinz thinks she has cracked the code of unlocking the entrepreneurial potential of your team, and the answer lies in employee ownership. Sprinz is managing director of B-Corp certified ustwo London, a company of over 200 employees, and cofounder of Ada’s List, an 8000-strong community designed to support women working in the tech industry. ustwo has recently become employee-owned and has already seen the benefits of breaking down the distinction between owners and employees.

According to the Employee Ownership Association, this way of working can improve productivity, support more resilient regional economies and empower team members, resulting in them being far more engaged. Sprinz explained the main benefit for entrepreneurs of this model along with practical tips for managing directors and company founders to make the transition to becoming employee-owned.

Employee ownership protects the company

“Being employee-owned means existing team members, who are now partners, feel empowered as owners,” said Sprinz. She believes that this encourages everyone to put in the work to uphold a strong company culture and course-correct if they see anything awry.

Whilst this might not happen automatically, a founder can make it more likely that their team upholds the vision. Sprinz has put frameworks in place to ensure everyone has a voice. “We hold open firesides, have elected partner representatives on the board, and ensure there are regular channels of communication for all team members to be part of growing the culture and living the values,” she said.

Keeping the team on board means protecting the company. “There are no surprises about the direction we are taking with the business,” explained Sprinz. “We involve everyone in the decisions we make on our projects and ensure we are accountable, both commercially and ethically.”

Attract and retain top talent

In a competitive market, how does your company attract and retain the best talent in the world for the benefit of your clients? Employee-ownership could be the solution. Not only does it make job listings stand out, but it attracts individuals who are like-minded and think long term. They are committed to a future with whichever company they choose to join and are prepared to push themselves to make it happen.

“High quality potential recruits and employees are interested in values and purpose,” said Sprinz. “Being able to talk about employee ownership helps you stand out in a tough hiring market. We have several interview stages so a candidate can get to know us as well as we’d like to know them.”

Sprinz’ interview stages aim to weed out “cultural and value mismatches that ultimately lead to an unfulfilled team.” They ask candidates multiple questions about their values and examples of them in practice, and they encourage candidates to probe with questions about ustwo. They also “publicise the salary for all open roles and candidates have the opportunity to meet other members of the team,” she added.

Control quality

When scaling a business, ambitious entrepreneurs cannot afford to let quality slip. Growth at all costs is a false economy that ends with the business back at square one and having to work harder to undo reputational damage. “A more entrepreneurial team ensures quality stays high,” explained Sprinz. Not only do your team members care deeply about the work they do, they also know they benefit from company growth, so they are incentivised to keep raising the bar.

“If your team is invested in the long term financial success of the company, they also feel pride that their work contributes to overall success,” said Sprinz. “They respond by raising the bar on their work.” Sprinz also believes that, “Regular transparent sharing of financial results and metrics maintains dialogue on personal and company impact.”

Direct the future

An employee-owned company has options for the future. The owner might one day want to step aside or sell, and the company’s succession plan will already be in place. In the meantime, the company has hit new heights and progressed with new ideas because its foundations are solid.

Like Maslow’s Hierarchy of Needs, you cannot reach self-actualisation without warmth and shelter, and a company cannot break through ceilings with constant recruitment issues. When team members are bought into the company, they are bought into its future too, making more certain outcomes for everyone involved.

“The partner representatives on the board surface the priorities of the rest of the team and ensure the conversations of the board are directed accordingly,” explained Sprinz. “The representatives are actively part of the bigger picture and playing a huge part in shaping the company’s future.”

Unlock the entrepreneurial potential of your team by exploring employee ownership, advised Sprinz. The best people will be proud to tell their friends that they are part-owners of the place they work. They will feel valued and listened to and respond with their effort and devotion. Could employee ownership be the right step forward for you?

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With $3M new funding, Egyptian startup OneOrder sets out on growth drive • TechCrunch

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OneOrder, Egypt’s supply chain solutions provider for restaurants, has raised $3 million seed funding led by Nclude with participation from A15, and Delivery Hero Ventures. The latest funding brings the total funding raised by the startup to $10.5
million, including $6.5 million working capital financing from financial institutions.

Launched in March this year, OneOrder makes it possible for restaurants to order food supplies through its online platform, solving the fragmented supply chain challenges that lead to erratic prices, waste, quality issues, and storage cost.

By using its platform, restaurants no longer have to deal with tens of suppliers, and can order only what they need, for next day delivery, stemming wastage and doing away with the need for warehouses. The platform also ensures operational efficiency and helps restaurants save money by leveraging OneOrder’s economies of scale.

The startup plans to use the funding to scale its operations in Egypt including increasing its warehouse footprint, and to explore growth opportunities within the Gulf Cooperation Council (GCC) region, and Africa.

“We are exploring Saudi Arabia and expanding south into our continent. I think Africa has a lot of markets that feel the same pain points that Egypt does,” said OneOrder co-founder and CEO, Tamer Amer, who co-founded OneOrder with Karim Maurice (CTO), also founder Cube, an online restaurant-reservation service.

“The solution that we’re providing has shown that this industry is ready for tech solutions…[and] we are working on a more substantial operating system for the restaurants not just the supply chain and inventory management system, rather the full cycle that would turn their operations automatic by using AI and machine learning capabilities to drive the supply chain,” said Amer, a restaurateur for over two decades, initially in the U.S before settling in Egypt from 2008.

Amer, told TechCrunch that the sourcing challenges he experienced operating two restaurants in Egypt — Fuego, a sushi bar, and Longhord Texas Barbeque — inspired the launch of OneOrder, to serve the country’s total addressable market of 400,000 restaurants.

“I had always taken the supply chain in the U.S for-granted; we would order and get the supplies all the time. We didn’t have to worry about shortages or price changes. I realized that Egypt is so underserved and the industry is really doing a lot of things that we shouldn’t be doing,” he said.

“… restaurants should not have a full-time job monitoring the supply chain and procuring products because it takes away focus on the core business, which is serving customers. So that’s where the idea really started,” he said.

OneOrder plans to, through its partners and backed by its extensive data, begin extending working capital financing options to restaurants as a way of helping them scale their operations.

Basil Moftah, the managing partner at Nclude, said: “The product-market fit of the OneOrder solution is very impressive, along with the positive impact it is delivering to all stakeholders in the value chain. Through the use of technology and alternative data, OneOrder’s embedded financing will help underserved clients who are unable to secure traditional financing. This aligns perfectly with our investing philosophy and we are glad to be embarking on this journey with the team.”

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