In this episode of The Buzinga Podcast, I'll discuss the 10 most important guidelines to follow when you're building any new startup. Know which decisions will be fatal, and which will help you grow!

1. The Buzinga Podcast
Ep 7: 10 Fatal Commandments Of Building A Startup
• Hey guys, Logan Merrick here and you’re listening to
episode 7 of The Buzinga Podcast:
• The number 1 resource for startups building and growing
their business in the tech space.
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2. The Buzinga Podcast
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• How you can listen to this podcast:
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3. Listen on our blog at buzinga.com.au/buzz with
shownotes for each episode.
4. Watch with accompanying slides on Youtube
5. Read the slides without audio on SlideShare
Ep 7: 10 Fatal Commandments Of Building A Startup

3. What we’re talking about today
10 tough lessons you need to learn about building a startup
• What is a ‘startup’?
• A startup is not the same thing as a small business.
• “A Startup is a human institution designed to create a
new product or service under conditions of extreme
uncertainty.” – Eric Ries, author of The Lean Startup.
• The aim of a startup is to GROW as fast as possible.
• Buzinga was a startup once…We learnt quickly what
decisions would be fatal, and which would help us grow.
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4. In this episode…
• How to survive the startup phase, in 10 Fatal
Commandments…
1. Thou shall not build a unicorn
2. Thou shall not focus on revenue first
3. Thou shall not lack the ability to pivot
4. Thou shall not be a lone warrior
5. Thou shall not hire the wrong people
6. Thou shall not launch at the wrong time
7. Thou shall not startup without a plan
8. Thou shall not mishandle finances
9. Thou shall not think too small
10. Thou shall not ignore hunches
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5. 1. Thou shall not build a unicorn
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• A unicorn is a company that is valued at $1Billion, based
on fundraising alone. Eg: Snapchat, Uber, Slack,
Facebook
• The aim of building a unicorn startup could not be more
meaningless for entrepreneurs – It’s a vanity metric.
• Don’t set out to create a unicorn. They’re impossible
(and even dangerous) to replicate.
• INSTEAD: The goal of your app startup should be to have
a point of differentiation. You need to find an innovative
solution to the problem your target users are having.

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• Mark Zuckerberg didn’t aim to create a billion dollar
company. He just had an awesome idea that helped
people connect and communicate in a unique way.
• His aim was to build a long lasting company that would
have an impact over the long term.
• Facebook’s wealth creation was a side effect of their
hard work and determination.
1. Thou shall not build a unicorn

7. 2. Thou shall not focus on revenue first
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• Making an app into something people actually want is a
lot harder than making money from it.
• The startups that win and make money are the ones that
focus on growth first and revenue later.
• For example, Google: They made search work first, then
worried about how to make money from it later.
• Making money came easy in the end, given that they
held 84% market share.

8. 2. Thou shall not focus on revenue first
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• Instagram also focused on their users first. It was
then acquired by Facebook.
• It’s irresponsible not to think about monetisation. It’s
even more irresponsible not to think about the product.

9. 3. Thou shall not lack the ability to pivot
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• You’re not just stuck in the one place! You need to be
constantly moving forward or pivoting in either direction
to continue moving forward.
• Every startup at some stage faces the challenge deciding
when to pivot and when to persevere.
• As yourself the question:
“Are we making sufficient progress towards our original
idea and strategy, or do we need to make a major change?”

10. 3. Thou shall not lack the ability to pivot
Example:
• Nokia was once a paper mill and also made rubber
boots…
• You could also make the argument that it’s time for
Nokia to ‘pivot’ again… Time will tell.
• Startups that are unable to pivot in a new direction on
the basis of feedback from their marketplace will fail.
• See also: 10 Successful App Pivots You Won’t Recognise
From Their First Versions
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11. 4. Thou shall not be a lone warrior
• How many successful startups can you think of with only
1 founder?
• Even the few sole founders (like Mark Zuckerberg)
needed a lot of help from others to succeed.
• Sole founders also aren’t as likely to get external
investment – co-founders reduce investor risk.
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“No one accomplishes anything alone”

12. 4. Thou shall not be a lone warrior
In my mind there are 5 universal criteria for a co-founder:
1. You genuinely feel that the person is irreplaceable and is
a requirement for success.
2. You both believe that building a startup is the best thing
you can do with your lives now and into the future.
3. When defining success, you both have the same
definitions.
4. You’re both keen to put the startup ahead of your
personal life and other priorities until success is
achieved.
5. You genuinely like each other as people.
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What defines a real co-founder?

13. 5. Thou shall not hire the wrong people
• Hiring the wrong people drains your startup financially
and may even hinder your startups progress and future
successes.
• I know many startups that have folded due to hiring the
wrong people.
• There’s many reasons for this. Perhaps you hired a friend
who lacked the necessary skills for the role.
• Or, you hired someone who didn’t fit in with the team
and startup culture because of a personality mismatch.
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14. 5. Thou shall not hire the wrong people
• Make sure you’re continually tweaking the hiring process
so you’re hiring the best quality people.
• Cash flow in startups is always tight. Any leftover funds
are usually funnelled into growth areas of your business.
• Instead of paying staff huge wages, attract talent by
offering them an incredible workplace culture.
• See also: Why We Chose Company Culture As Our
Growth Strategy.
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15. 6. Thou shall not launch at the wrong time
• Timing is EVERYTHING in penetrating a market.
• Launch too early and the market won’t be ready for the
product. (For example, Airbnb didn’t take off for years,
until the GFC made people so desperate they didn’t
mind taking a risk sleeping in someone else’s home).
• Launch too late and you risk losing market share to an
earlier competitor.
• “If you’re not embarrassed by your first product then
you’ve launched too late”.
• Release an MVP to gather feedback and optimise
performance.
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16. 7. Thou shall not startup without a plan
• The business plan is your foundational pillar upon which
everything will be built.
• Your business plan will be your startup’s road plan. At
least for the first couple of years.
• It will also serve as a ‘first look’ for potential partners
and investors.
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17. 7. Thou shall not startup without a plan
The 6 critical answers your business plan must provide:
1. What problem is your startup solving?
2. What’s your point of differentiation/your unique selling
proposition?
3. Who’s your target user?
4. How will you generate revenue?
5. How will you market your business?
6. What do you need to get started?
See also: The 1 page, 20 Minute Business Plan For Startups
– this is an adaptation of the Lean Canvas designed
specifically for app startups.
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The business plan

18. 8. Thou shall not mishandle finances
• The biggest mistake startups normally make after raising
funding is hiring people too quickly.
• You’ve suddenly gained all this money and you’re eager
to expand through hiring extra staff.
• Only hire those who are truly needed. Always reassess
your new hires to ensure maximum ROI is being
achieved.
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19. 8. Thou shall not mishandle finances
“What if’s” to be mindful of…
• ‘What if… the original plan must be scratched in favor of
a backup plan?
• What if… an investor backs out or a client doesn’t pay?
• What if… a vital element for the business costs too
much? Is there money to handle such scenarios?
• What if… your business has to make a very costly pivot?
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20. 10. Thou shall not think too small
• If the market you’re targeting is too small or ‘niche’ then
your success may be elusive.
• Many startups belief that it’s ‘safer’ to target smaller
markets to avoid competition.
• “You can only avoid competition by avoiding good ideas”
• If you make anything great, then you’re going to have
competitors, so you may as well face them sooner or
later.
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21. 10. Thou shall not think too small
• You should’ve already done your research into your
market and know who your competitors are.
• This should be factored in when building your
application, so once you’re ready to launch your app, it
should already be a step ahead of your competitors.
• See also: How To Perform Competitive Analysis On Apps
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22. 10. Thou shall not ignore hunches
• Entrepreneurs are a savvy bunch. And as such, you
should always trust your instincts.
• It’s probably the reason many get far with their startups.
• So don’t ignore that hunch. Use it to your advantage.
• Be smart about it though.
• Make sure this ‘hunch’ is thoroughly’ investigated by
crunching the numbers and conducting the appropriate
research.
• Don’t act blindly upon it!
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23. Summary
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• Building a startup is not an easy task. By avoiding the 10
fatal commandments, it will give you every possible
chance of succeeding.
• You’ll make some great and not so great decisions along
the way.
• If you can make more good decisions than bad, you’ll be
well on your way to building a very successful startup.

24. Further resources
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• Hope you learnt something from this!
• If you want to learn more tips for being a successful
entrepreneur, then check out our blog, I’ve included 3
relevant blogs in the show notes:
1. 5 Steps To Becoming A Key Person Of Influence In Your
Startup Niche
2. The 2 Forgotten Secrets to Startup Success
3. 5 Lessons Every Startup Entrepreneur Must Learn

25. Thanks for listening!
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• For more of this please subscribe on iTunes, watch on
Youtube with accompanying slides or on our website at
buzinga.com.au/the-buzinga-podcast
• See you on the next episode!