This is What “Startup Success” Looks Like
by Jonathan Sexton
Startup Success, for better or for worse, is usually measured by “amount of funds raised.” I’m not here to contradict that. “Access to Capital” is critical to the success of a young business, especially one that’s proven it solves a problem and has some traction in the market. (note: and those things come pre-money these days… sorry, kids.) BUT – I’m going to dig in here and say that capital is only one piece of the puzzle, and it’s not the first piece.
I get asked EVERY DAY what “investors” are looking for. On a large scale, a startup’s ability to land early customers, especially influential customers is very telling of the trajectory of that business. Who are the key leaders in your industry? If the answer is Mark Cuban – think again (but hey, if you can get Mark Cuban’s attention somehow because he is your aunt’s cousin’s husband, then I say go for it). Otherwise, start local/regional- at least that’s what I suggest if you are starting in Knoxville. Who are the key industry leaders, or professionals that you can get to, and win their affection (and yes, dollars) for your product?
Local business leaders ALSO have a role to play here. We cannot reach our full potential as a startup community if we don’t have a culture of innovation and creativity within the existing business structure. Startups have to solve real problems in an elegant way. Local business leaders have to be open to new ways to work with new ideas. It takes both values for local startups to gain traction, and win the hometown before moving on to the bigger stage.
Looking for a shining example of this? Here you go. Recently, local business DigiTrax Entertainment announced a major partnership with, KaraoQ, a karaoke startup out of Nashville EC’s Project Music Accelerator. (DigiTrax’s subsidiary, Childrens’ Media Studios, is an alum of KEC’s Accelerator programs MediaWorks and What’s the Big Idea 48-Hour Launch). Both companies started up locally and gained traction in their own backyards before a mutual connection suggested they meet (hat-tip Shawn Yeager from the Back Porch Group, who taught classes at both the Nashville EC and KEC). The resulting joint venture between KaraoQ and DigiTrax represents a new and innovative business model for both sides, and most importantly, the partnership shows how LaunchTN’s leadership efforts to grow and expand startups through local entrepreneur centers are paying off. In short, CEOs Joe Vangieri and Michael Amburgey said: “How can we make this work?”, NOT, “This is will never work, I don’t have time.” Full PR is here; check it out.
The idea of regional collaboration is catching on. NorthSouth Productions is another example of a local business that looks to regional startups as an opportunity to try something new and find a new model. In the words of Mark Hickman, CEO of NorthSouth – “Everyone in the television industry recognizes that the market is changing. Viewership via traditional distributors, like cable and satellite, is being eroded by online or digital platforms. We see companies like Sparetime or EvolVR as the new gateways to audiences.” And it doesn’t stop in Knoxville. NorthSouth is now expanding intros to regional startups through KEC, like Made In Networks in Nashville and RootsRated in Chattanooga to find even more synergies. Tennessee’s entrepreneurial ecosystem is thriving and provides unparelled opportunities; sometimes you just need the Shawns and Jims of the world to bring a bigger picture into sharper focus.
It’s time to CELEBRATE. This is what success looks like in a startup community, so three cheers for KaraoQ and DigiTrax for blazing a trail. Startups have to create real value with real solutions to real problems, and existing businesses in the community have to be willing to admit they need help, and then be willing to look outside their comfort zone for innovative solutions. When that happens, we are really starting to get somewhere: partnerships are formed, jobs are created, money is made on all sides — and the all-important investment dollars become easier to unlock for entrepreneurs (IF they even need it by then).
So, Local Business Leaders: “Can you make it work?” We’d love to help.