The Top 5 Questions Entrepreneurs Want Answered
By Marc Lore, President & CEO, Walmart U.S. E-Commerce
December 21, 2018
Last week I had the opportunity to host my first AMA (ask-me-anything) on LinkedIn. I was impressed by the perceptiveness of the more than 250 questions that were asked on a variety of topics related to entrepreneurship. In case you missed it, here are the top insights that emerged based on the most asked questions, in order of volume.
Take Risk, Move Fast
(Q: What can large organizations learn from startups?)
Larger organizations have near-term operational challenges and an imperative to deliver results quarter to quarter that many startups don’t have. This makes it tougher for them to simultaneously achieve their near-term performance goals and invest for the long term. But, it can be done. One strategy I recommend is to fence off long-term investments from the rest of the organization and assign different teams to focus on each.
We did this at Walmart by creating Store No. 8, an incubator that allows us to internally nurture startup businesses that have the potential to shape the future of retail. In an incubator environment, these businesses can source great external talent more easily and move faster. More importantly, they can implement strategies with a longer-term payback. So far, we’ve spun up three companies in Store No 8.
I also think large organizations should take more risk. Big companies are actually in a better position to take more risk because of their size and the ability to invest in a number of things at once, which mitigates risk, versus a startup that only has one shot. Corporations can improve their risk-taking by creating incentives that reward people for taking it on. I expanded on this idea in a previous article, Think You’re Too Big to Act Like a Startup? Think Again.
Find Your Passion and Go All In
(Q: When is the best time to start a company. How do I start?)
Any business idea can be made into a viable business if the entrepreneur is willing to eat, sleep and breathe the business. So, if you have multiple ideas and are choosing which to pursue, I recommend that you pick something you’re extremely passionate about.
Beyond that, begin with a clear vision of what the end game looks like and work backwards from there. A useful tool for articulating that vision is to build a sales pitch because that will be a critical tool as you sell employees, investors, vendors, partners, and others. It doesn’t cost you anything, and there’s nothing to fail at because you haven’t invested anything other than time.
By the way, sometimes people ask me if there are good and bad times to start a business. There aren’t, really. You just need to commit and go all in. I had a very comfortable, six-figure job in banking when I decided to quit my job in pursuit of entrepreneurship. It wasn’t the most convenient time, either, given that my wife and I had a newborn at home.
Stay True to Your Vision
(Q: How do I secure funding?)
You have an idea and a vision for seeing it through. Now you need funding, but where do you start? Funding can come from a variety of places (self, friends, family, angel investors). In my first company, I went all in by using my entire savings.
If you don’t have savings to contribute, there are seed investors who are comfortable investing in the vision. That’s why it’s critical to have a big, clear vision and a plan for achieving it. Once you secure seed funding, use it to create customer traction because other investors will need to see proof before they invest.
Also, be prepared to have 50-100 conversations with potential investors and resist the temptation to alter your vision. Most investors you pitch will not see your vision the way you do. You need to find the one that does.
Build and Maintain a Strong Culture through Core Values and Empowerment
(Q: How to build and scale a strong culture and hire the right talent?)
Creating and maintaining a strong culture comes down to your mission and core values. We started Jet.com with a mission to empower customers to shop smarter to save money, which inspired our core values of trust, transparency and fairness. Our decisions, whether in hiring or merchandising, aligned with our mission and core values.
It’s no different at Walmart, which is why we decided to sell Jet to Walmart. We had more things in common than not. I’m still so inspired by the way Sam Walton’s mission and core values have stayed central to the company through the years. It’s a true testament to what it means to scale culture.
To keep culture intact, it’s important to hire individuals who believe in the company’s mission and live out the core values. You should come up with no more than three core values that will guide the company and culture. Then as a leader, it’s important to keep your talent engaged by empowering them, giving them end-to-end ownership, and constantly reminding them of what they’re working to accomplish (i.e. your mission). You’ll develop trust and respect in addition to keeping your culture strong.
(Q: What’s your perspective on failure?)
You will encounter many failures and they don't necessarily turnaround. The key is to fail in a way that allows you to learn without breaking the bank. Be careful of entering one-way doors where you are betting the company. Fail fast and often, learn and try again. I have failed too many times to count, but I always learned, adapted and evolved. One thing I learned is that you can't get tied to an idea. Constantly be open to reevaluating your strategy as you obtain new information.
Thanks again for such a fun AMA. I look forward to hosting another in the future.