For new founders as well as existing business owners who are entering a phase of growth we recommend using a zero-based approach to entrepreneurship.  This approach requires that teams begin from scratch, without preconceptions or existing models to guide them such that they uncover their true core customers, capabilities, systems, and processes.  This zero point is critical in setting the right foundation for growth, because what served the business well in the past may not stand up to the pressures of growth in the future. A zero-based approach means nothing is sacrosanct – everything is up for discussion even if the business already has a product built and revenue coming in, we need to evaluate everything.

We realize this is extreme, but every business has something that needs to be altered, if only to optimize performance.  In most cases, we find that by just asking pointed questions you can find real cracks in the foundation of the business, product, and/or business model that have been glossed over and need serious attention if the business is going to bear the serious weight of growth that is demanded by owners, investors, and capital markets.  Rather than ignore the cracks or not even look for them, we suggest getting to the zero point by reviewing the business brick-by-brick and rebuilding everything that needs to be addressed.  This is the core of Zero-Based Entrepreneurship.

Some key areas of review include:

• Painkillers, Not Vitamins: We seek business opportunities that are “painkillers” and not the nice to have, but first to be cut “vitamins” in the solution world.  We want to zero in on a solid product market fit with real organic demand that customers cannot live without.  
• The Right Team: The right people need to be in the right seats and incentivized correctly.  
• Hygiene: The fiscal and organizational hygienes of reporting, communication, governance, etc. need to be in place and developmentally appropriate.   We keep their eye on the prize, measure zero cash days, and money invested to specific milestones.
• Marketing, Branding, and Communications: The branding and communication need to resonate and not misguide.  
• Systems and Partners: IT systems and software need to be in place for growth.  Key partnerships need to be equitable.  
• Legal and Incentives: We even review the legal structure, capital stack, and employment incentives.
• Capitalization: Beyond these foundations we need to evaluate the capital and investment strategy.  This is where a zero-based approach can really help catalyze movement for a startup.  There is such a thing as over raising – raising more money than you can manage to impactfully spend.  On the flipside there is a minimum that needs to be raised to reach meaningful milestones. A good portion of the time we find startups on two ends of the extremes and not the ideal middle that the capital markets will support.  Zero-Based Entrepreneurship can assist here.
• Governance and Culture: There needs to be a culture of growth taking shape in the form of governance, mentoring, and other forms of support that make sure the business leaders are maintaining their entrepreneurial edge without adding excesses that are not appropriate for the developmental stage of their business.  

Getting on Track with Zero-Based Entrepreneurship

With these and other foundational areas assessed two things need to occur: 

1) remedies need to be made to the foundation of the business, and 

2) the business needs to conduct a series of sprints.  

If Zero-Based Entrepreneurship sounds analogous to a lean startup method, you’d be correct.  After challenging the status of each area and beginning with the end in mind (building a high tech, high growth business of great value) over a series of sprints in customer and market discovery, iterating over a product or prototype, and gaining revenue and financial resources, we set the business on a path to the optimal state and position for high growth.

Slow Down, To Speed Up

If it sounds intense, it is.  We estimate that it takes two to three times more business and technical focus as well as assistance, but has the advantage that it requires less investment capital.  This is employing a “slowing down, to the speed up” method with an understanding that money is often the least valuable investment made in a startup or a business that is growing.  When you need to get results and punch above your weight class, we believe that zero-based entrepreneurship is the best way forward. 

Positive Business Culture

By setting a zero-based entrepreneurial culture in your business, you have added cultural benefits of transparency, candidness, care, and other norms and values that have come to be a signature of successful and well run businesses.  We further realize the benefits inherent to zero-based accounting (where we first saw a zero-based approach take root) in this zero-based entrepreneurship approach: flexibility, focus, lower costs/investment needs, and more disciplined execution.  The only disadvantage in zero-based approaches is intensity, but that would be present in a growth phase anyway. For us the benefits of zero-based entrepreneurship justifies the intensity.