I recently mentored a certain startup, a very smart SaaS platform for the consulting industry. They were able to generate their first $10,000 fairly quickly, which led me to ask the founder: “Did your clients sign up for the service because of the product or because of you?” His answer: “Because of me.”
Is this a good or a bad thing?
In my experience, the first cash should be made much more organic than that. It’s the way you prove that your concept works. This isn’t the case here. And the absolute influence of the founder’s image tampers with the results, making it harder for him to improve and refine his startup’s service.
However, the fact that this sort of thing happens shows the power of personal branding. You are indeed the one who generates revenue—your relationships, your experience and your integrity, among other things.
But what about your product? Would it be better to pull back this founder’s personal branding and risk the chance that no one will buy? Not really. The founder’s personal branding does play a huge role in startups. It’s a big topic, and today we’ll cover what it really means to be the face of your company.
It’s not just business, it’s personal
The most basic concept of business is when two people trade money for a service. In the early days of trading, we had to figure out some sort of equivalence between goods, and ultimately come to an agreement where everyone is happy and satisfied. For ages we did that by talking to each other, by communicating our concerns and our opinions, by examining how the other handles conflict, mishaps and difficult situations. The service or good these people provided at this relatively small scale would be immediately associated with their personal character, and therefore one would inevitably affect the perception of the other.
Let’s take the butcher down the street as an example. You know him as a family man, a caring father, so you trust his advice when choosing a piece of meat for the next family dinner. Something your children wouldn’t fuss about. You’ve been going there for years, so you also understand when prices rose 5% because he’s been having issues with his delivery guy, and the purpose of that extra money is to afford a better delivery company. You trust the butcher, his character, and his knowledge; therefore you trust his service.
Times have changed, and that brick-and-mortar sort of business doesn’t work for everyone. The scale, the demand, and the amount of standards and regulations have increased; so service providers have grown accordingly, becoming more efficient and cost effective. As bigger corporations were born, we learned to assign the same human characteristics to companies. We began to talk about how you trust a certain brand because they were able to support you and provide their service when others wouldn’t or couldn’t; or how you prefer a certain line of restaurants because they care about entertaining your kids and provide healthier options than a fast food place.
The advantage companies have over people is that their reputation can be longer lasting and span throughout generations. The good and bad experiences are accumulative. So the longer a company stands, the more opportunities they have to learn from their mistakes, fine-tune their product, and showcase their values to win over more customers. All the same, for the consumer, it’s always personal. The way products affect their lives makes it personal. So it’s only natural that they favor doing business with people, or at the very least with companies who have earned their “people-like” qualifiers.
Learn from the best
Personal branding efforts are evident in companies of all shape and sizes. For example, Morgan Stanley ranked as the 67th largest United States corporation by total revenue in 2018 by Fortune 500. Their image is built upon Henry Sturgis Morgan’s and Harold Stanley’s reputations, i.e. their founders,’ public images; but the company’s history and reputation has long transcended its founding partners.’
Stéphane Plaza is another great example. He is a famous French realtor who became a public figure and a TV personality after hosting and participating in several real estate TV shows. He’s currently partnering up with M6, Bernard de Crémiers and Patrick-Michel Khider to create a network of 500 real estate agencies under the Stéphane Plaza franchise by 2020.
And of course, there’s Apple. They’ve kept the high-quality product and their positioning from the original founders. I’m sure Tim Cook, Apple’s current CEO, is not as well-known as Steve Jobs, and that’s because Apple products aren’t built around Cook’s image, but its founder’s. The best play for Tim Cook is to maintain that branding for the company, while integrating some personal branding of his own that reinforces the existing one.
So what about the startup I was mentoring? Well, we now know how important and relevant personal branding is to the concept of business in general. So the idea is to keep the founder’s personal branding efforts, but redirect them towards a smarter, more sustainable path for his business. Learning how you should start a personal brand and how far that should shape your startup’s image is exactly what we’re going to cover in the next article.
I hope you liked this post. You can check out more articles, videos and trainings on startup tech management on this blog and my FAQ video series AskMyCTO, and my in-depth courses on myCTOfriend.co will dive in deeper into certain topics (with worksheets and templates included).