How to get a head start as a web3 entrepreneur
In the fast-moving blockchain sector, it's crucial to stay up to date on the latest developments in the industry. At BFG, we have a powerful network of advisors, startups and experienced entrepreneurs that helps us stay ahead of the curve and anticipate market trends. In addition, with an annual influx of over 1000 pitch deck submissions and funding requests from startups, we learned to identify and capitalize on emerging niche industries successfully.
In this article, we are sharing our best practises on finding top entrepreneurs to build successful web3-based business models and communities in growing markets. – Authors: Max Zheng, Jong-Chan Chung, Elias Mendel, Philipp Sandner
Having skin in the game
Unsurprisingly, the matchless approach to being informed about any relevant developments in the crypto and blockchain area is to be in touch with its actual builders. Our extensive deal flow and deal sourcing allow us to anticipate many trends in advance. Through daily conversations with our network of advisors, startup businesses, and close interaction with our board of directors, all of whom are experienced entrepreneurs themselves, we get to hear many different angles.
In addition, we receive over 1000 business funding requests for startups and pitch deck submissions of business ideas every year. Combined with close monitoring of crypto analytics providers, this helps us to identify emerging niche industries at an early stage.
Knowing what DOES NOT work
Equally, this enables us to have a good idea of what startup ideas and trends might be unlikely to be sustainable, be it due to regulatory pressure, small market size, environmental concerns, technical inefficiency, and so on. Just to give you an example: Many consortial blockchain solutions were said to enhance corporate supply chains, data structures, and financial services, yet, most could not deliver on their promises. The same goes for blockchain databases - even though there are decentralized storage solutions, there is nothing like typical server-client systems and cloud computing when it comes to efficiency. It is also crucial to look at the business competition - if a niche is already saturated, it’s incredibly hard to enter it. The active players have already amassed all market share. That is not to say that the entire niche is unattractive for startup businesses to enter - it’s just more about auxiliary, complimentary services than competing ones.
Effective teams first
When looking at pressing challenges, such as the aforementioned regulation, staying in touch with experts specialized in that particular field always helps guide the turbulent waters and evaluate trends. However, what we keep stressing is that most business ideas are indeed technically feasible. The technical implementation will still be a challenge, but more often than not, it's not the technical complexity, but rather the lack of persistence in execution combined with a bad product-market fit that is lethal for a web3 startup business.
We want to further stress that the idea itself is a secondary concern, as long as the direction is the right one.
“Because an idea pivots 4-5x before it becomes relevant.”
Max Zheng, Head of Corporate Development
As such, our company-builder and incubation program BFG Superstars primarily focuses on identifying top entrepreneurs to build great web3-based business models and communities in a growing market.
What makes a good Web3 founder?
After having had the opportunity to work alongside some great entrepreneurs and founders over the last years, there are a couple of key characteristics we observed in each one of them. Of course, each individual has their own strengths, but still, there are some overlapping traits that are very conducive when it comes to founding a Web3 startup business:
- Flexibility & Adaptability: Staying agile throughout the entire entrepreneurial journey is a must. As we already stated above, most ideas are iterated and pivoted multiple times before they turn into an actual business venture. One should always actively seek criticism to reveal potential weaknesses as early as possible and embrace failure as a natural part of the process. Being surrounded by a team of yey-sayers that don’t tell their honest, unbiased opinion is lethal for any startup business.
Figure 1: We recommend using the “lean testing cycle”, a methodology developed by Eric Ries that aims to develop a startup business in many iterative, small, feedback-driven steps.
- Avoid delays: Likewise, startup entrepreneurs need to be capable of finding the right balance between a long, patient breath and being “pushy” to ensure the targeted deadlines are met, without appearing too overbearing. For example, engaging with regulators or bureaucrats can be a tedious process, but still, one should send regular follow-ups and reach out to the right contacts to move your startup business forward.
- Presenting & Researching: Similar applies to one’s presenting and research skills. Firstly, it’s crucial to create visually stimulating slides for pitching and capture one’s audience through the right choice of words, a suitable talking speed, and so on. Secondly, we want to stress that as important as research is for validating and conceptualizing an idea, it’s equally important not to fall too deep into the rabbit hole, as research can quickly turn into an endless bottom with no real outcome. Any research conducted should yield specific results and should be timed well, e.g. by using a time box.
- Networking: Networking is highly critical for any business startup. Only through active and steady conversation with experts, mentors, and potential customers can you deepen your knowledge and understanding of customer needs, potential risks, and bottlenecks. The “interview sample” will substantially influence whether a potential Web3 founder will achieve their goals with more or fewer hick-ups. We want our cohort entrepreneurs to talk to 10+ people each week until the product launch. In particular, after covid, networking becomes crucial, since there will again be more face-to-face conferences to meet the community, customers, and startup investors. Simultaneously, use the interactions to do as much personal branding as possible - spreading the word and building a good reputation is a core pillar as well.
- Brutal honesty: Be fully honest when assessing whether your idea really needs the blockchain component. Oftentimes, a centralized solution will lead to more efficiency, fewer regulatory issues, or a better UX.
- Vision: And lastly, although it sounds a bit cliche, look at the likes of Elon Musk or Jeff Bezos. They have a clear vision of what the upcoming 12-18 months, but also the farther future, will bring. Be bold, and act according to how you believe the market will be like in the future (after having conducted thorough Due diligence, of course).
Obviously, the advice condensed into this guide only poses a fraction of best practices. Nonetheless, following these practices will help to head start your startup business in the web3 space. In case you feel a calling to join us in our mission, take a look here.
About BFG Superstars
The BFG Superstars Program is a crypto incubation program for pre-seed ideas and a place for blockchain talents and co-founders to meet and launch crypto startups in 2 to 3 months. Each cohort will launch 5+ crypto startups with different blockchain-based solutions. At the end of the program, selected startups will receive funding amounting to $60,000. Find more information about the program: https://en.blockchain-founders.io/bfg-superstars.
Contact: Max Zheng, Head of Corporate Development & BFG Superstars Program, email@example.com
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