Craig Ceccanti of T-Minus Solutions: “Knowing the numbers”

…As they say, the devil is in the details. When you understand how a business will work, you can start to see all the little nuances to its costs. Things like insurance, rent, payroll, taxes, and other stuff that you might not yet know the specifics of can greatly factor into your margins and overall success. […]

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…As they say, the devil is in the details. When you understand how a business will work, you can start to see all the little nuances to its costs. Things like insurance, rent, payroll, taxes, and other stuff that you might not yet know the specifics of can greatly factor into your margins and overall success.

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 Craig Ceccanti.

Craig Ceccanti is the founder of T-Minus Solutions and the cofounder of Pinot’s Palette and sEATz, among others. He is also the author of A Founder’s Guide to a Software Startup, which will be published this summer. Craig lives with his wife and children in Houston, Texas.

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 am pretty well-known as one of the founders of Pinot’s Palette, the paint-and-sip franchise. That is what started my career as an entrepreneur. I have founded, led, invested in, and advised a lot of other businesses since then. I’m also a “techie” and have developed software for various companies other than my own.

Basically, I have started and launched a lot of companies. I have also had a lot of ideas that failed. It’s all part of the learning process, and I feel that it’s safe to say that I know enough about the entrepreneurship world to teach others (which I do at my alma mater, Rice University).

What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?

The “Aha Moment” came while I was transitioning from being the interim CTO at sEATz to the next new thing. I was thinking about buying a company, but I just wasn’t really sure what to do. So I reached out to my mentor, Don, and his advice was to step back and think about my skill set and my passions. What am I good at? What do I really love to do?

I’ve learned over the past twenty-some years as an entrepreneur that I love two things: building stuff and helping people. And, I’d say that I’m pretty good at doing it. T-Minus Solutions came as basically the intersection of that. It’s a startup firm that serves as an incubator for new entrepreneurs. T-Minus is basically the trifecta of all the things that I love to do most and where I think my skills are best used. I get to advise, educate, and invest in these young businesses, and it’s personally been really fulfilling.

The other part of that story is that I not only got the idea for T-Minus from what I personally wanted to do, but also from what I saw as a lack in the market. It is very difficult to get software built for a tech startup if you aren’t doing it yourself. Since we built it all in-house at Pinot’s Palette, I have never really been exposed to that. My eyes were suddenly opened at sEATz to what a startup’s budget will afford. And, the options aren’t great.

Most consulting agencies will not work on a project under a certain budget. sEATz was under that threshold for most established agencies. As interim CTO, I had to piece together a band of developers and firms from my network to make it work for us.

But a new entrepreneur is probably not coming in with the MBA and decade of development experience that I have. They often end up either overspending at a firm or getting in a legal dispute with a freelancer. It’s a real problem for a non-technical founder, and it tends to become a barrier for getting their idea launched. Reliable agencies addressing the startup and mid-sized growth market are scarce and T-Minus fills that void.

So, T-Minus came to exist not only because I love to do it but also because it needs to exist. That was the “Aha” for me.

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?

Like I said, Don is a great mentor. I really have to thank him here for helping me figure out what I wanted to do and all of the continuous support. Thank you, Don.

I also have to credit my longtime mentor, Dr. Al Napier, for shaping who I am as an entrepreneur. As a professor at Rice University, he taught me that being an entrepreneur is about establishing a life of meaning rather than just making money. I’ve strived to follow that philosophy throughout my career. Thank you, Dr. Napier.

What do you think makes your company stand out? Can you share a story?

The biggest thing: trust. Building software is not tangible the way that building a house is. If you’re not technical, it’s more or less a magic trick that can go terribly wrong. It can be difficult to verify if things are on track. Our clients can trust that they are.

A lot of that comes out of the fact that we are not in a position where we need to sell anything. We are financially stable enough where we only want to sell a deal when it makes the most sense for the client.

First and foremost, we just want to tell them the truth about technology. We’re honest about not only whether it can be built, but whether it even should be built at all. A lot of the time when I meet someone for coffee, I’ll advise them not to build software and that they would get a better value from renting something that’s already built. But there are times when the stars align and it does make sense to embark on a custom build, and that’s when we get to work.

I think our sheer honesty with everything is what makes us different from other companies. Because we value honesty over most anything else, our clients can trust us to truly make decisions based on their best interest.

How have you used your success to bring goodness to the world?

Well, our company is not even a year old, so I think a lot of that is ahead of us. But, I will say that we have a couple of projects in the works that have the potential to do a lot of good. I am lucky that we can pick and choose the projects that we want to work on. I really enjoy the impactful, people-focused projects that we have.

I started T-Minus because I have a love for building things and helping people. Sometimes they both happen at the same time, but it’s not a necessity. Maybe more selfishly, whenever the opportunity arises I put time into teaching and mentoring new entrepreneurs and believe that paying it forward will result in the ultimate good for them, new employees, and happy customers.

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?

  1. A service mindset. I don’t want to call it “consultant skills” because they are way beyond that. It’s a lot more like relationship skills, though my wife may not quite agree with that statement. But in any business, you’re always serving somebody. As a CEO and founder, that’s a big part of my job. I have the attitude that I work for them, whether it be my employees or actual clients, and that every day is an opportunity to better help them be successful. I’ve seen a few leadership books where they basically invert the typical “pyramid” of hierarchy in business. They put the customer at the top of the pyramid and the “boss” all the way down at the bottom. I love that. I think that’s how it should be, truly. A CEO or leader is really there to support all of the other ranks to best help the customer. So really, I think an instrumental part of success in leadership is just taking that service mindset.
  2. Interpersonal skills. Startups are a team sport. You’re going to have to rally, manage, and work with a lot of people. And as it always eventually happens when working with others, some friction is going to arise. Whether it be with your employees, your clients, or investors, it’s your responsibility to figure it out. As a leader, you have to know how to talk to people, listen to them, mediate conflicts, and come up with resolutions to move forward. Developing these kinds of soft skills comes from #3.
  3. Empathy. You have to step outside of yourself and take the time to understand the people around you. Having total empathy for others is critical to being able to fix issues as they come up. By being able to consider another person’s perspective, you can figure out their cause of concern, acknowledge it, and then learn what you can do to help them feel more comfortable. That’s what empathy allows you to do, and that’s huge.

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 was a new entrepreneur, I had a lot of people tell me to take my time and go at a really calculated pace to launch a startup. And going slow is often the gut instinct of a lot of new entrepreneurs, so it makes sense. Most people would rather try to bootstrap than to take on equity and sell some of the company just to get it started. But taking your time to bootstrap can often be a double-edged sword. I constantly find myself looking back on past businesses and wishing that I had gotten them off of the ground faster than I had.

Especially nowadays, your speed is critical. How quickly you can get to market and react to customer feedback can be the make-or-break factor to your success. Sometimes it isn’t about how good your idea is, but about being the first to bring it to life or hitting the market right when it is right. Sometimes, that might mean having to give up some of the ownership to do that.

Depending on how old you are, you might no longer have however long it will take to bootstrap your way through. Managing that grind all by yourself in those early stages is exhausting. I am in my forties. I have a family. I can’t burn the midnight oil like I did in my twenties. If I tried, my life would get out of balance very quickly. So it can make sense to bring in a partner or get people sooner if it means that you can get through some of the most painful parts of the startup quicker.

Can you tell us a story about the hard times that you faced when you first started your journey?

When starting any enterprise, the hard times for me is when doubt starts to creep in. Sometimes it can be hard to have the confidence to keep going when so many different uncertainties pop up along the way. I’ll start asking myself stuff like: Will I find another project? Will I find the right people? Are my resources secure? Can I do this? These questions are never really all that helpful to the journey. Really, I think it’s just a way that you may try to subconsciously “talk yourself out of it”, if that makes sense.

When the doubt starts and I start feeling unsure, I turn to my support network of other entrepreneurs. I’m on a roundtable of CEOs from a bunch of different businesses. Once a month, we meet up for four hours and discuss everything under the (entrepreneurial) sun. I can share my uncertainties with them and they can give me a more objective, informed opinion on it. Usually, they pep me back up and push me to keep going. Having that kind of support in place is tremendously important to all entrepreneurs.

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?

Aside from that support I just talked about, I’ve just always had the mindset of: What else are you going to do, lay down and give up? Quitting has never really made sense to me. I think part of my fighter’s mentality of getting up each time you’re knocked down is in my blood, but another part has come from experience. Having that past experience helps build the confidence needed to keep going. Like, I’ve been through this plenty of times before, and so I know that I can make it through this one.

Another technique that I use is not to always focus on the macro and to compartmentalize what you’re doing. If you think about every single thing that’s going on, you are going to get overwhelmed. Just focus on solving one problem at a time. Once you solve one problem, move onto the next. Eventually, you’ll make your way through.

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?

We all know that entrepreneurship is very different from a “regular” job. You put your time and money at stake. You don’t get the comfort of the paycheck fairy every two weeks. There’s a wide emotional variance here. You can go from nothing, to your company being worth a million dollars, and back to nothing in a very rapid set of time.

Of course, we are all looking for that not to be the case. We are all always trying to work the risk out of things so that our companies get — and stay — successful. And the highs are obviously a lot easier to ride than the lows here. But you know what? I have come to appreciate the lows, too. They definitely make things more exciting.

I think the biggest thing is just to be prepared for those low points by building up a support network to lean out if/when they happen. Your family may be there to help get you through, but they might not necessarily understand what you’re going through. I always recommend finding an entrepreneurial support group. That monthly roundtable that I’m in is absolutely everything to me. It’s important to have people that have been through exactly what you’re going through to tell you that things will pick back up because you’ll really be able to believe it when they say so.

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?

I don’t actually view this as an either/or kind of thing. I think that the answer is usually going to be both. Most people are going to bootstrap to some degree. You want to get your startup far enough down the road without taking on capital too early and needlessly giving up equity, but you also don’t want to stunt your startup’s growth by trying to bootstrap too far either. So really, it’s all about timing.

If you aren’t sure when the right time is to bring in capital, first ask yourself: How far can I get bootstrapping? You have to look at how much money that you personally have to grow the startup. Do you have enough to get the company to the next inflection point, and fast enough? If you know that there is a certain point where fundraising is necessary to get to that next level of growth, then that’s where you’re going to want to do it.

The dream scenario is to be able to take your startup all the way, all by yourself. But say fundraising can let you do it quicker. For a lot of people, especially people like me, that may be worth it. Sometimes it’s the better option, sometimes it’s not. It just depends on your personal and business goals.

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.

I actually spoke on something very similar to this a few years back, published as “5 Tips to Starting a New Business” for the Rice University blog. It fits perfectly here, so I’ll go ahead and summarize those here.

  1. A truly good idea. The definition of what is good can be vague and subjective, of course, but my definition of a good idea is something that solves a problem that affects someone. A lot of the time, these problems are something you encounter every day and the solution is staring you right in the face. You need to turn on your “business radar” to see it. As an example, I’ll tell you about how sEATz started. Marshall, one of the co-founders, was stuck in the concessions line with his kids during a World Series game when he watched a home run hit by Yuli Gurriel fly right over their empty seats. If they had not had to go wait for food, they would have caught a ball hit by a baseball legend. That was a problem that he personally experienced. The solution, an app that delivers concessions right to your seat, came to him that day. That’s a good idea, and that’s the foundation of all successful startups.
  2. Knowing the numbers. Spreadsheets are boring, I get that. Crunching the numbers is not usually the interest of most entrepreneurs, but I can tell you firsthand how being an analysis geek has let me mitigate a lot of the risks in my businesses. As they say, the devil is in the details. When you understand how a business will work, you can start to see all the little nuances to its costs. Things like insurance, rent, payroll, taxes, and other stuff that you might not yet know the specifics of can greatly factor into your margins and overall success. Being able to identify those exact costs and risks (or having a partner that can) is critical to knowing if a startup will work at all and understanding the viability of its long-term success.
  3. A support system. As Dr. Napier says, “your net worth is your network.” As I’ve already said, you need to have fellow entrepreneurs that will support you through the highs and lows. But, they’re also there to encourage you to keep your foot on the gas and to honestly tell you when it’s time to hit the brakes. Having these people in place is so critical to keep you in the right frame of mind throughout that grind and know if you’re on the right track.
  4. Passion and energy. If you don’t love something about what you’re doing here, you’re eventually going to burn out. Now, I’m of the opinion that you don’t have to absolutely love the exact thing that you’re doing. For example, I’m actually not too crazy about watching sports. But, I love being able to solve problems, and that’s why I have so much genuine energy for my work with sEATz. There has to be something in your startup that really truly jives with you. If not, that “new business” excitement is going to wear off fast and you’re going to feel unbearably lonely and bored, even if you do somehow become successful. To check your genuine passion for your project, I like to use The Lunch Test. How many times have you worked right through lunch because you were that focused and that into this idea? That’s always a great way to measure your passion for it.
  5. Play Monopoly. I mean that literally. That might sound odd but think about how the game encourages you to spend your initial money quickly. Monopoly gets you used to the idea of spending money and forces you out of the entrepreneur’s tendency of (overly) conservative resource management. Doing this often also makes people realize that if they try to bootstrap all of the way and stay underfunded, they will pretty quickly suffocate the business. If you don’t have enough water, so to speak, then you will not be able to cross the desert to that next inflection point of your business. Playing Monopoly can help you practice the skills needed to have the confidence to spend when needed and preserve funds when necessary, which is absolutely critical to getting your startup to the point of profit.

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 mistake that I’ve seen people make is picking the wrong cofounder or getting a co-founder when they don’t actually need one. Some people will split ownership of their company with someone just because they’re there or because they don’t have the confidence to believe that they can do it alone, and that leads to unnecessarily giving up part of your company at best. At worst, this can lead a startup to crash and burn before it even has a chance to get off of the ground. Avoiding this mistake is a matter of really thinking through whether you even need a cofounder and, if you do, carefully vetting who that person is. Do they bring a value worth giving up ownership of your company? Are you compatible as business partners? Asking yourself these questions is really important to saving yourself from a bad or unnecessary partner.

Another surprisingly big problem that I’ve seen is just not having a work ethic. I’ve seen so many founders have everything in line — a good network, a good idea, and the money to do it — and fail solely because they didn’t have the grit to get their head down and grind through the boring stuff. All startups are going to have that boring stuff that you have to do. If you don’t have the grit to get through it, then you’re going to fail. It’s as simple as that.

This may be contentious, but I also think that a lot of founders fail by not following an agile process. Like a lot of things, the process of entrepreneurship has shifted over time. Many entrepreneurs no longer spend a large portion of their time planning out and researching their business model and product. What we do and teach instead is basically what’s described in The Lean Startup by Eric Ries. We no longer test the market through surveys and studying those numbers; we test the market by building our MVP as quickly and as cheaply as possible, and then going out and seeing how many people will pay you money for it. You don’t want to spend two or three years to build your MVP and then hope that it works. If you put all of your time and money into building an MVP that fails at the beachhead, then you often can’t recover from that. If your idea doesn’t work, then you want to see it fail as fast as possible so that you can recover and then either pivot or move onto something else entirely. Fail fast, fail often, and eventually you’ll come on something that works.

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?

I’m one of the many entrepreneurs with a family, and that personal obligation is one of the biggest things that keep me out of burnout. I want and need to spend time with my kids, especially while they’re young. I want and need to be present at home. I have to save that time and energy for them. So my wife and kids pull me back from disappearing into my work entirely.

Even if you don’t have a family, you have to think of yourself as a key, long-term asset to the company. Think about what it would do to the company if you overworked yourself and broke down. You have to put in the time to take care of yourself and prevent that from happening. You might feel like a diva to decide that you need a day off, but you really need that day. Just take it.

I know exactly what happens when you don’t do that preventative maintenance. You end up in bed and useless for a week, and that can really hurt your company. The short-term benefits are not worth the long-term consequences. You have to take care of yourself so that you can keep taking care of others.

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. 🙂

This is hard to answer without sounding all “Kumbaya man”, but I’ll risk it by saying that if I could just snap my finger and get everybody off of YouTube, Twitter, Facebook, all of those platforms, I would. The current mainstream news cycle does not reflect the day-to-day around you, and I think that a lot of people are distracted by this and can’t see what’s going on right in front of them. Don’t be blind to bigger problems, of course, but I encourage everyone to go out into their communities to make local relationships and figure out how to make a positive, local impact.

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.

Oh man, I’d honestly have to say Mark Cuban. He’s in Dallas and I’m in Houston, so he’s basically right next door too. I would tell him to meet up for some barbeque anytime. 🙂

How can our readers further follow your work online?

I’ve got a couple of spots:

This was very inspiring. Thank you so much for the time you spent with this. We wish you continued success and good health!

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