The exuberance of the last year got us to a point where a lot of Internet companies were funded on half-baked business plans. A lot of them then failed and it is a very steep curve getting funding now. Good people who have really thought through their business plan might get funding, but it will be rare to get venture capital investment now.
It is back to the old days of having to prove yourself. You have to build a solid business plan, from having an operational plan to what milestones you need to achieve to stay on track. Investors will look for weaknesses, so every entrepreneur needs to stack the deck in their favour.
De-risk the business for investors or they will just move onto the next guy. You need to look at the worst-case scenario and ensure that it is still a feasible plan.
Experience counts and you have to have people who have worked on a start-up before and have been successful - or if they weren't successful, can explain why. Having finance people onboard is crucial. If you don't know anything about finance, hire someone who does.
You can't be everyone, so get people who complement you. There are agencies that outsource experience. I use an agency called Finance Professionals (www. financeprofessionals.com). A lot of people use First Tuesday for networking, there are also marketing organisations such as Agency.com.
With marketing, you need to make sure people are communicating the right vision. It is not mass PR, but really knowing what is going on. There are also people who specialise in the business of finding people with specialist skill sets.
In the dotcom world, you have to be persistent in finding people, which means networking like crazy. There are lots of different networking events, so go to where these people hang out. Go to one, and you will hear about others.
It is important to build up contacts in this game by being interested in what other people are doing. Lots of people go to networking events and just talk about themselves. Instead of doing that, try to figure out what is driving other people's business. Offer connections whenever you can, because the more you give, the more you get. You can't be sitting in your back room building a business. It is a sociable job. Be open and willing and prepared to be shot down. You have to be ready for someone to say it can't be done. Even if you would rather not hear it, feedback is good.
Business is all about flexibility and fine-tuning in the real world and being able to respond and act quickly. However, you do have to be persistent and actively create your own destiny.
Don't be afraid of hard work, because setting up an online business is time-consuming and not at all glamorous. You go to sleep thinking about it, dream about it and wake up still thinking about it. If you knew how tough it would be, you would take the safe job, because your lifestyle will be tested and your personal life will wither away. You have to be prepared for that, yet so many people think it will be given to them easy.
You need to believe that you will find the answers to questions - yours and other people's. Also, at the early stages, everyone wants to be a founder or a partner. But not everyone can be. A lot of dotcom people are operating two levels above what they really are and then how do you hire someone above them?
If you already have a chief marketing officer, you can't have a chief chief marketing officer. It is important to give people incentives like options-based assurance.