Start by defining your idea precisely in writing. If it is a niche product, take precautions to prove that you are the original creator–with a patent for instance.
Startups have such a glamorous reputation. Companies like Facebook, Instagram, YouTube, Uber, and Airbnb once started as scrappy startups with huge dreams and huge obstacles.
Yet we of course know that most startups don’t end up as success stories. What does a founder or a founding team need to know to create a highly successful startup?
In this series, called “Five Things You Need To Create A Highly Successful Startup” we are talking to experienced and successful founders and business leaders who can share stories from their experience about what it takes to create a highly successful startup.
I had the pleasure of interviewing Stephanie Tumba
Stéphanie Tumba was born in Paris, France and resides today in London, United Kingdom. She is the founder of Sté Tumba Capital, an angel investment vehicle focused on seed and early-stage investments. She offers the founders she invests in, her exclusive 360-degree Wise & Rise Program designed to provide purpose and set out clear roadmaps to success, giving them the guidance and advice, they need in all aspects of their life: health and fitness, intellectual life, emotional life, character fulfillment, spiritual life, love and relationships, social life, financial life, career, and, ultimately, a great quality of life.
She has recently been involved in a brand-new initiative called Filming For Charities. The venture matches artistic passion and talent with a drive for philanthropy. The initiative aims to transform and improve the lives of others. Each video is a unique creative project inspired by a specifically selected charity, and that charity becomes the beneficiary and receives the proceeds from the video filmed by the team.
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I have always been entrepreneurial-minded. At 16, I worked (evenings and school holidays) as a door-to-door salesperson, dealing in arts and antiques from unknown artists to buy my first real estate investment in Paris (where I was born). I had no fixed salary, but the commissions were mega-high, and that pushed me to go the extra mile to hit my targets. This was how I started my journey in entrepreneurship, buying my first property.
I went to university to study Languages, with a major in English Civilization & History. Alongside university, I set up my first two businesses with my two sisters: one in fashion, Celest Couture, and an events agency in Paris called Agence Féerique. When my businesses failed, I switched university course and graduated in Business Management, starting my career at L’Oréal in France for a few months before moving to London via Madrid.
What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?
Well, I have to be honest, I never really had an “aha!” moment. My story began when I was hired through LinkedIn to work in a private family office and invest in luxury goods and fashion brands.
A few months in the company, my former boss, now mentor and friend, Marie asked me about my own investments. She was surprised that I was only investing my money in classic investment schemes.
I recall her saying what a waste a of talent it was. “You can certainly make some money.”
At the time, I knew near to nothing about being a business angel. I had Finance as a major for two years at university and switched to Marketing to work for L’Oréal most of my career.
I did some research, sold some assets, and invested in my first venture–in the hospitality and leisure industry.
Was there somebody in your life who inspired or helped you to start your journey with your business? Can you share a story with us?
Marie, my former boss, did inspire me, indeed. Firstly, she contacted me at a time when I was jobless and didn’t even have a place to stay in London anymore, offering me a job I thought I was unable to fulfil. She believed in my abilities, my skills, and experiences despite my young age, and, as I thought at the time, lack of experience. I initially refused the job saying that I’ve never really worked in finance, and, even less so, investments. The only experiences I had at the time were two internships, at HSBC and BNP Paribas in Paris. But, I surrendered to the experience and let myself go. I had nothing to lose. And this is how my entrepreneurial journey started; I didn’t pick my industry, the industry picked me.
What do you think makes your company stand out? Can you share a story?
Today, Sté Tumba Capital is embedding ESG in all its investments. This gives us a unique opportunity to invest in and be at the forefront of all the dramatic changes the world is going through today. We are aiming to tackle the world’s biggest challenges, including climate change, social inequality, and looking after local communities.
Today, we really want to make a difference and invest responsibly, having a healthier approach to wealth.
How have you used your success to bring goodness to the world?
We have done a couple of things to bring goodness to the world, like our previous donations of 10% of our profits to a variety of charities in the UK. And, today, we are involved in a project called Filming For Charities.
The venture matches artistic passion and talent with a drive for philanthropy. The initiative aims to transform and improve the lives of others. Each video is a unique creative project inspired by a specifically selected charity, and that charity becomes the beneficiary and receives the proceeds from the video filmed by the team.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
Firstly, resilience — never give up. Keep your goal in mind, yet don’t be rigid; try again and again but differently. It is very important to keep on going with your ideas but learn from your failures.
I had a couple of trials before I managed to achieve sustainable success. I had an events company at 18, and two other companies, one was in fashion, and one was a lifestyle brand, in my twenties. All of them failed miserably for a variety of reasons. Yet, I never gave up on my dream to have a business, and I have always known that I wanted to be an entrepreneur and work for myself — since I was 16. But I would never have imagined that I had a gift for investments.
Next, a commitment to learning is very important for an entrepreneur. When I had my events company at 18, I was studying English at university. When I failed, I switched to Business Management. I committed myself to becoming an entrepreneur and I decided to learn all about it: finance, marketing, sales, etc.
And self-discipline would be my last choice. It is fundamental to success. You really need to have the ability to forgo instant and immediate pleasure, in favor of some greater gain — YOUR BUSINESS SUCCESS.
Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?
When I started investing, I had a dilemma. I was working with a startup founder with an amazing idea of business. Yet, I did not like him as a person. Something about him put me off, and I could not explain why.
When I sought his advice, I was told to “follow the money” rather than the investor. Well, as far as this story is concerned, this was the worst advice I ever had in my career.
The relationship with this founder degraded very rapidly; we had constant fights, and I had to exit the partnership much earlier than I aimed to.
Today, I invest in people. I look at how compatible we are before working together. I have no tolerance of traits that I know would be unbearable for me to work with.
Can you tell us a story about the hard times that you faced when you first started your journey?
Well, that conflict I had with one of the startups I invested in is one of them. Overnight, the existence of the partnership was put in jeopardy. There was no way to resolve the conflict as we both went too far and could not trust each other anymore. I had to sell my shares.
Also, when you start your journey as an entrepreneur, it can be very hard to downgrade your lifestyle and work so much more than before. I had to be a strategist, a financier, and a communicator without being able to pay myself the slightest remuneration for the first few months. I had to be financially responsible, so I found other ways around what I was doing to make money, to have cash coming in. I had a precise business plan from the start of the activity and reassessed it monthly, including remuneration, with creative and innovative ideas to make money, such as coaching, talks, and other ad hoc projects.
Where did you get the drive to continue even though things were so hard? What strategies or techniques did you use to help overcome those challenges?
I am very competitive, and I love momentum and accomplishment. I like to have goals and targets to achieve, and I tend to be very resilient when I have something in mind. When I have an idea, I rarely hesitate for long before acting on them; I try, I try, and I try in different ways, different manners, with different strategies, and I always find a way. Resourcefulness is one of my best qualities.
The journey of an entrepreneur is never easy, and is filled with challenges, failures, setbacks, as well as joys, thrills and celebrations. Can you share a few ideas or stories from your experience about how to successfully ride the emotional highs & lows of being a founder”?
I like to think of creativity as my working style. To move forward, try thinking of inalterability as an engine, withdrawal as a fender, and you need a good steering wheel to adjust the direction–all to find solutions to problems and, of course, to succeed when everything is against us. Nothing is more enjoyable than being creative. This makes the job much more interesting: If the paths are limited or lead nowhere, nothing prevents us from creating new ones. Without a deep faith in our ability to forge these paths, we would not be able to project ourselves beyond a strong block.
Let’s imagine that a young founder comes to you and asks your advice about whether venture capital or bootstrapping is best for them? What would you advise them? Can you kindly share a few things a founder should look at to determine if fundraising or bootstrapping is the right choice?
Well, I am going to put myself in the founder’s shoes for this particular question. And for me, the correct choice is pretty clear: definitely bootstrapping. The longer you can sustain your business without external funding, the higher valued your company will be. And one does not go without the other.
Nowadays, bootstrapping is more likely to be part of every startup, and nearly every successful company. Venture capital involvement used to be the pot of gold for most startups, but, today, startups’ founders want everything yesterday, and, on some occasions, dealing with VC can be time consuming, taking months to set up a deal. It’s important to note that seed investments have dropped by 1–5 million dollars over the past three years, in funds, deals, and dollars. But I firmly believe that with platforms, such as http://equitymatch.co/ this number will reverse. These sorts of platform facilitate the relationships among VC, Business Angels and founders.
Whether you choose to bootstrap or raise, these key factors may be very helpful for you in deciding:
- The market–the bigger the market, the more funds you will need. You need to have in mind that your competitors who have taken venture-backed funding will be penetrating the market rapidly, leaving you no slice of the pie.
- Risk–how much risk are you willing to take on your own?
- The product–if the product is easily replicable, you need cash immediately to enter the market rapidly.
- How innovative is your product? Innovation can be costly, and this may require you to look for extra funds.
- Your network–how strong is your network in the industry? It will be very hard for you to enter a market if you have no experience of that industry, and no contacts in terms of resellers or partners.
- When are you breaking even? If profitability is attainable in a short period of time, it would not be useful to involve a VC at this stage. Make money, create value, and maybe search for a capital growth fund that will make your company worth much more.
- Channel–what channel are you using to penetrate the market? Is it through retail? Or low-cost channels, like social media (virality) and SEO, or is it going to be more events, paid marketing, sponsorships, etc.?
- What about your margins–low or high? If it is the latter, use the profit for growth.
- Outcome–how big can your pie get? Think of your end goal, do you want to exit your business one day with a big check, or do you want to be part of your startup’s growth, and maintain its sustainability through the years.
Ok super. Here is the main question of our interview. Many startups are not successful, and some are very successful. From your experience or perspective, what are the main factors that distinguish successful startups from unsuccessful ones? What are your “Five Things You Need To Create A Highly Successful Startup”? If you can, please share a story or an example for each.
When you start your entrepreneurial journey, it is essential to go through these steps in order to create a highly successful startup:
The first is to define your idea. An idea often takes the form of a simple desire at first. Then it deepens and matures over time. The newer or more original the idea, the more you will have to question the ability of future customers to accept it. The more commonplace it is, the more you will have to think about its real usefulness compared with what already exists on the market.
Start by defining your idea precisely in writing. If it is a niche product, take precautions to prove that you are the original creator–with a patent for instance.
Finally, make sure that there is consistency between your personality, your motivations, your objectives, your know-how, your resources and personal constraints, and the requirements of your project. If any incompatibilities appear, you will need to look for solutions now.
Next you need to crunch your numbers.
This step consists of answering three essential questions:
Will your business be profitable, and when?
What capital is needed to launch the project under good conditions, and to ensure its growth?
Will the revenue collected by your company throughout the year allow it to constantly meet the expenses of the same period (standard charges, suppliers, utilities bills, etc.)?
In other words, how to prevent cash-flow problems? This approach will lead you to build a coherent and viable plan for your enterprise.
My third thing is a popular saying in business, “Try, Fail, Fix.” So, take failure as an opportunity to build resilience. Pugnacity is an essential quality for an entrepreneur, you must “never take no for an answer.” It is not enough to test your idea among family and friends at the beginning, it should be verified throughout the growing process.
Next is to surround yourself with the best! If you play solo, you will always lose against a competitor with a team. You have to pay particular attention to the first recruitments, and work with people who are better than you.
And finally, express your talents and develop your own qualities.
Never lose sight of “innovation” and “learning”. By training yourself, you increase your chances of success and decrease your chances of mistakes. You are at the forefront of your competitors’ awareness of the changes in your industry. And do not be scared of change; you want to be Netflix, not Blockbuster.
What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?
The most common mistakes CEOs and founders make when they start a business are:
Working without a mentor and ignoring advice from experienced people.
No one knows your project better than you, and you don’t need someone else to implement it…really? As I mentioned before, a competitor with a team is stronger and has bigger advantages to tackle the industry than you. A mentor, business coach, or fellow entrepreneur are always useful and valuable, especially in moments of discouragement–rely on the guidance and experience of a mentor who is already experienced in starting a business.
You don’t know anyone who can help you? Then join a group of entrepreneurs without hesitation, and rely on solidarity to help you move forward.
Giving up too soon.
Starting a business is a long process. If you’re having trouble finding suppliers, people are interested in your product but don’t buy it, or you’re short on funds, don’t necessarily give up right away.
Suppliers can be found. Interested people who do not buy, means that the business model needs some changes. Remember “Trial, Fail, Fix.” Encountering difficulties does not necessarily mean that your whole project isn’t good. If you are having trouble raising funds, reconsider the situation and find alternatives. Starting a business is a path, strewn with pitfalls, that requires resilience.
Neglecting communication and marketing.
Don’t neglect communication; you can offer the best product or the most efficient service in the world, but if no one hears about it, no one will buy it!
Products that succeed in breaking through without an ounce of communication are extremely rare. Even with a great product, word of mouth is usually not enough.
From the start of your project, build an ambitious marketing plan, taking care to assess the expected returns and the estimated costs of each communication or marketing action.
Startup founders often work extremely long hours and it’s easy to burn the candle at both ends. What would you recommend to founders about how to best take care of their physical and mental wellness when starting a company?
Burnout remains a taboo subject among entrepreneurs. Most still refuse to discuss it publicly.
The startup ecosystem is a world filled with uncertainties, where the founders must convey an image of strength and stability for their investors, mentors, family, and shareholders. However, more recently “starpreneurs” such as Elon Musk, Jeff Bezos, or Marie Forleo are talking about it more and more.
There are loads of ways to prevent burnout, and I would give these three main tips in this instance:
Tip one is not to sacrifice your personal life for your business. Passion can’t excuse everything. Having passions outside of work and a stable personal environment drastically reduce risks of burnout.
Tip two is, unsurprisingly, having a healthy lifestyle with regular hours of sleep and physical activity, it puts you in a much better shape. Do something, even if it’s just walking, because a sedentary lifestyle increases the risks of burnout dramatically.
Tip three is to stablish clear priorities rather than just making endless to-do lists. One of the hardest things about being a founder is coming home every night with 20 items left on your to-do list. A good way to avoid this is to focus on the top 2–3 priorities you have for the day, and come home with a free spirit. Leave your to-do list at the office!
And I’m going to give you one more that just occurred to me–establish clear boundaries. Decide how much time you need to work on your startups, and do not work more than is required. You need to differentiate your life and your business. You can do long hours, but they need to be sustainable and feasible, and enable you to have a proper dinner and a private life. I would advise an 8–7 p.m. timeframe to start with, with one hour for lunch.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
On this occasion, I would pick the Entrepreneurial Movement; live in a world where everyone would be able to do what they like, when they like, and be paid for it. They could work from home or an office, work at night or during the day. They would be able to work to their own convenience and take their vacations as they wish. We would be living in such a different world if this were the case.
We are blessed that some very prominent names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch, and why? He or she might just see this if we tag them.
A breakfast with Warren Buffett as, obviously, he is known as one of the most famous investors in the world, so for my line of business it would be ideal to have him for breakfast.
His multinational Berkshire Hathaway owns more than 60 companies, including battery maker Duracell, and restaurant chain Dairy Queen.
I would love to discuss investment today with him, including ESG, cryptocurrencies, properties, and happiness.
How can our readers further follow your work online?
They can follow me thought the following medias:
This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!