Entrepreneur
This article is part of the America’s Favorite Mom & Pop Shops series. Read more stories
Key Takeaways
- Discover a simple framework that keeps your startup on track without letting ego take over.
- Learn how top founders turn uncertainty into clear, actionable decisions.
Have you ever wanted to launch a successful startup? Maybe you’ve thought about an idea that can solve a problem or make a small difference in the world. The truth is, ideas are everywhere, and starting a business today is easier than you think.
Today’s startups look very different from the ones in the 90s, when even a basic phone system could cost tens of thousands of dollars. AI and outsourcing make it faster and cheaper to launch a business than ever before.
When I first decided to start a small business right out of college, my classmates thought I was crazy. “Become a lawyer,” they said. “You’ll make a lot more money.” I worried that if I launched and failed, it would be humiliating. But I told myself, “What do I have to lose anyway?” My first business lasted 14 months before I had to shut it down, but it generated enough money to launch my second company.
Since then, I have started dozens of companies, some successful and others spectacular failures. One flop was Shareholder Blockchain. I invested $50,000 to build an MVP in 120 days, hired a lawyer and two programmers, and went to work. When I returned for a demo, the team had gone in a completely different direction and was floundering. Within 24 hours, I shut it down. That failure taught me the power of defining checkpoints before emotion takes over.
Related: The Art of Navigating ‘No’ — When to Persist, Pivot or Give Up and Pack it In
In my book Start. Scale. Exit. Repeat. I introduce the concept of “Stage Gates,” a S.M.A.R.T. checkpoint in time. Why use this framework? Because it is Specific, Measurable, Attainable, Relevant and Time-bound. If we don’t measure progress, we can’t succeed. At a college incubator in South Florida, I ask students to define a stage gate. I am very specific: “By Jan. 31 at noon, deliver an MVP that you can pitch to customers and investors.”
Stage gates work because you define success in advance. If you don’t hit it, you either pivot or kill it. Success could be the number of customers signed up by a certain date, distributors secured, revenue generated, or profit achieved. Think of it like arcade driving games in the ’80s. If you were skilled, you could complete the track and earn extra time. If you were exceptional, you might hit two or three gates before inserting another quarter. Stage gates work the same way: hit your checkpoint or the game ends.
For Shareholder Blockchain, I chose to shut it down. In other cases, a postmortem can help you pivot and reset a new stage gate. Ego is a dangerous trap for entrepreneurs. Too many founders hold on too long to failing ideas. Stage gates give you the clarity to make honest decisions if you miss them.
Related: Should I Stay or Should I Go? 8 Key Points to Navigate the Founder’s Dilemma
Stage gates offer several advantages. They give you room to make mistakes and show others that you won’t panic unless a gate is missed. You can also set mini goals that may fail without beating yourself up. They make success visible. Investors, employees, and stakeholders know exactly what success looks like. At one company, we even tied CEO compensation to milestones: break even, clear debt, hit $1 million in profit. When you meet your target, you prove both your concept and your ability to execute.
Once you hit a stage gate, set the next one. You now have something tangible for investors, whether a product demo or paying customers. Early-stage fundraising is difficult, but as you demonstrate consistent progress and show the lifetime value of customers versus acquisition costs, raising money becomes easier. KPIs are crucial. Understand the metrics that drive your company, hit them, and present them to investors.
Dust off that old idea and create a S.M.A.R.T. stage gate. Define your checkpoints, commit to them, and measure relentlessly. Either way, you win, because clarity beats hope every time.
Key Takeaways
- Discover a simple framework that keeps your startup on track without letting ego take over.
- Learn how top founders turn uncertainty into clear, actionable decisions.
Have you ever wanted to launch a successful startup? Maybe you’ve thought about an idea that can solve a problem or make a small difference in the world. The truth is, ideas are everywhere, and starting a business today is easier than you think.
Today’s startups look very different from the ones in the 90s, when even a basic phone system could cost tens of thousands of dollars. AI and outsourcing make it faster and cheaper to launch a business than ever before.
The rest of this article is locked.
Join Entrepreneur+ today for access.
Read the full article here
