Founder Tips. Alexey Makin, CEO of RedMadRobot

    Today, Megamind announces the Founder's Tips rubric. The guests of our new column will be the founders of well-known IT companies. They will share their experience with readers of Megamind and give invaluable advice to young entrepreneurs, as well as to anyone who wants to start their own business in the future.

    The first to agree to participate was Alexey Makin, co-founder and CEO of RedMadRobot . This company is already known to the audience of “Habrahabr” and “Megamind” with its publications on the corporate blog . Red Robot, at the moment, is one of the leaders in mobile development in Russia.


    Sometimes men come who somewhere cut down the money and urgently want to shove them somewhere. Investing in IT is still in trend. These men are not professional investors, they cannot sensibly evaluate a company, team, idea. Collaboration with them is dangerous for two reasons. Firstly, these men are not ready to lose their money, they don’t even allow such thoughts - they invest in anybody, and then they demand everything to be returned or buried in a ditch. Secondly, such quasi-investors are ruining the business - for those to whom they give money, there is a feeling that everything is already fine, there is no need to develop in terms of processes, marketing; one concern remains - how to spend. When a team finishes spending, it ends up in a ditch.


    Who are professional investors?


    Professional investors explain why they don’t give money right away, and what the company needs to do to get the money.

    In contact with the business, a professional investor begins to evaluate it - knocking down managers' arrogance, he shows their immaturity, underdeveloped processes, crazy risks. The investor asks questions, thereby pumping up the business - answering investor questions, top managers of the company see where they really are, and where they should be and what needs to be done to do this.

    Investors help to understand the market and show how to manage a business, how to do business, how to turn from a small company into a medium-sized business. Financial management, strategy, etc. This is the biggest contribution of investors. Because after that you get the money is not a problem. But the paradox is that you simply don’t need this money.


    Where to start a startup


    Set the right goal. Cutting the dough is not the goal. Taking an investment is not the goal. The goal is to do business.

    At the idea stage, you need to stay away from investors. I’ll clarify that we are talking about IT start-ups, not scientific ones, requiring investments in the development of complex technology.

    Next, we typologize the holder of the idea, or rather its competence, expressed not only in the presence of theoretical knowledge, but also in practical experience.

    • Sales, Marketing, Promotion
    • Control
    • Technology

    An idea without competence is nothing. We observe a lot of people with burning eyes (“I think this will trample!”), But they really can’t do anything.

    If you do not have competencies, go get them - get a job and work hard. I worked as a programmer for 6 years, then went to an advertising agency and studied selling for 4 years - I knew that I needed these skills to create my own business, and collected them.

    The ideal option is the presence of all three competencies, but at least one is a minimum. Then you either get the missing parts and the team bring the project to the market to start making money, or you turn to the investor - not for money, but for the missing knowledge.


    Where to get a salary


    The most important deception and self-deception of all startups is that they are not looking for money to launch or develop a project, they are looking for money for their salaries. And this is called self-employment. A normal investor will not give money for a salary. Because as soon as he gave people money to pay, they sat on the ass and do nothing more. This is how a person works - he will burn other people's money. And it doesn’t matter anymore - they gave him a small salary or a big one. That's it, he was hired. This is self-employment.



    How to find a strategic investor


    If you were able to take the project to your “pocket” time in your spare time from your main job, launch a startup on the market, and go cash flow, you can think of a strategic partner - to grow your business and build mature business processes.

    A strategic investor either knows the market that you want to go to (he can give contacts that will pull you to a new level), or understands in management (and will not let you make mistakes that will lead to the death of your company). And he has enough money to pull you by the ears so that you can go through the "valley of death" while you are studying business.

    In order to choose an adequate partner who does not take away the business, helps build business processes and does not ruin the project with financial injections, you need to look at those who have already successfully built the company. What you want to come to is there and look for a partner. A technology company, an IT company ...

    And it is important that the partner is a man-system, and not a man-fire. So that he taught you how to do business, rather than starting to cut yourself. A serial entrepreneur with his project launch team, which can drive a business into a management system. Take, for example, Ingvar Kamprad, who was able to build IKEA around the world this way. He had his own launch team, which he landed on new territory, he raised, for example, a new shopping center or a network of shopping centers in the country for a super-short period of time, set up a control system and left, and the system continued to work. That's the kind of person you need to attach your startup to.


    What the strategic investor will teach


    A strategic investor grows a business from a project and first learns to live on profit. As soon as the company begins to live on profit, other financing tools arise that help grow and do no harm. For example, a strategic investor may open a line of credit for you without washing your share.

    An important point. If an investor takes away too much of your company (“OK, dude, you are with us, but we take 51% or even more”), then gradually you begin to feel like an employee in this business. And then ... For every smart-ass investor there is a smart-ass startup who will open a clone company and get half of the orders there.


    How to "sell yourself"


    While you are in a bad situation and you need money, no one will give you money, because you have a bad situation - a vicious circle. And here the skill of persuasion and sale is important. You need to convince the strategic investor that you need to invest (and time is also an investment). You can call it strong vision, adventurism, self-confidence - the investor must believe in you, in every member of your team, in those young guys whom he sees. An experienced person looks at potential, studies your track record (it’s good if you did a small test trial with an investor, showed your capabilities, your honesty, your principles), and estimates what your startup will achieve with the application of its efforts. At the junction of its value and your team, a business should just turn out that will increase the investor's investments.


    Where to look for an idea for a startup


    Most Russian startups are looking for gold around the lantern. Go a little further - there are a huge number of scenarios and business processes that can be automated and modernized. For example, there is the Eurasian Economic Community (EurAsEC), which includes a number of countries (Belarus, Kazakhstan, Russia, etc.). There are many gaps in this space now - make some kind of Internet-spent accounting for labor migration for enterprises or an online platform for goods exchange - and you will become billionaires. See what needs can be covered in Russia and the CIS. This is a gold mine.

    Normal companies will immediately invest in the prototype of the system that EurAsEC needs. Stop boiling in a cauldron of round investments with incubators and financial investors, stop serving this industry.


    One startup example


    Redmadrobot brought to the startup market without attracting investment. Two competencies have developed - our technological experience and the publishing experience of Alpina Publisher. We created a joint company Alpina Digital, developed a platform for an electronic library with e-lerning elements, where legal content from leading world publishers is delivered. The project reached self-sufficiency in 8 months and now has a multi-million annual budget, selling hybrid books to users and corporate libraries to large companies.

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