david hieatt

10 posts categorized “farm”

How to raise money for your idea?

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I get asked this a lot. But I’ll be honest with you, I am no expert. I have had to learn a lot of this stuff the hard way. Mistakes are good teachers, if you don’t repeat them. I share this in the hope of it being of some use.

1, The shares you sell at the beginning will cost you the most.

The shares you sell at the beginning are the ones you get the least amount of money for, and yet cost you the most in terms of the percentage of equity you have to give away. You can understand why: You have no sales, no track record, but lots of unproven assumptions. You are a risky bet. Once you have gotten some sales, proved your idea can work in the real world, you are in a much better position to raise money. And, get a better deal.

2, How to build something without funding?

Well, you could use your savings. There’s your credit card. There’s your mum and dad. There are your friends.  There are even your suppliers. (Arrange 90 days credit with them and then do your best to sell your goods within 30 days).

Another way to get your company going is to keep your job, and start it part-time. This allows it time to find its feet. It keeps your overheads low while you get sales. As Wu Tang say: Sales is power.

This way of starting is called Bootstrapping. It’s the approach to starting your company with the minimum amount of investment. It is helpful in the early days to find out if there is anything in the idea, to prove that it will sell, to have your customer give feedback so you can iterate quickly.

The problem with failure is it can take a long time and be costly. This technique can help you to fail fast, and fail cheaply. So you can move on to your next, and better, idea.

3, A track record helps.

Raising money is helped if you have some success elsewhere. Especially when it is in a related field. You will be able negotiate a better deal than a total raw start-up. People back people who know how to succeed.

4, Being first helps.

If you have a digital idea that hasn’t been done before, it maybe better to raise as much money as you can. And launch fast. That way, you grab the audience before a rival does. That is valid too.

This is the counterpoint to this view and it is worth a read for sure: http://theleanstartup.com/

Y Combinator is teaching startups the value of their ideas. And that is a good thing. Don’t sell yourself cheap. It is also teaching them the importance of speed in a digital world.

5, What if you have lots of people wanting to invest.

It can happen. Maybe you have had some good press, maybe your circle that hang out in are very connected, maybe the idea has just captured peoples imagination, but for whatever reason, you have several people who want to invest. This is a good thing.

You will now be able to negotiate better terms as a result. So the normal set of valuation rules fly out of the window. Also, you want your investors to be able to give you more than just money. Who will be a great mentor? Pearls of wisdom are hard to come by.

6, Split the Share types.

One thing to consider when you are selling shares is to try and split them between voting and non-voting. So that way you get some capital, but no matter what, you keep control. Nike did it this way. And Phil Knight was an accountant.

7, Build a team.

Ideas are important. But it will be the team who makes that idea happen. People invest in people, even more than they invest in ideas. A great idea with an average team will not succeed. Find people who are as good as you, but with a different skill set, and make them a co-founder.

8, Do the numbers add up?

Are the margins good or great? As you scale the business, do your costs scale too? Are you selling gold for silver prices? What bit of the business model are you changing to allow you to offer something ‘better’, ‘cheaper’ or ‘faster’ to your customer?

As Warren Buffett says: When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.

Just make sure in the cold light of day that the economics are good. Don’t kid yourself.

9, Show growth.

Investors like to see that. They like things that can scale.

10, Can you protect your idea?

Trademarks? Patents? Secret Formulas? Copyrights? How can you put a moat around your idea? It can be just that you were first, or your idea is written in high-level code, which means you can move fast. Investors like something other people can’t copy, or can’t do it as well as you currently are.

11, Nobody likes doing business plans. But, you have to show that you have done the thinking.

Doing business plans is a pain. But not as painful as going out of business because you didn’t think it through.

12, Don’t ask people for money.

There are lots of rules about asking people for money for startups. The FCA is very particular about this. If you are raising fairly big money, you will need to be FCA registered. That can cost you a good deal of money. You will also have to ask people if they are high net worth investors, and they will have to put that in writing before you can approach them about it. You will also have to declare all the problems of the business. Tell them all the ugly stuff. Hide nothing from them. And be very measured about the upside.

In a perfect world, potential investors will approach you, and that is different. Then you can talk to them.

13, What are you changing?

The best businesses change something. What are you changing? Customers like to be part of a company that changes something, and investors like to invest in new business models.

My investment in The 25 Mile as an example.

http://www.the25mile.com/

 1, The shares you sell at the beginning will cost you the most.

The 25 Mile, which sources its main ingredients from a 25 Mile radius, is a Gastro Pub that I invested in. I had just sold my company and had a year before I could start my jeans company. I had some time on my hands.

I did it with a partner, but alas the partnership didn’t work out. So instead of me being a sleeping partner, I found myself being the boss of something I knew very little about.

I had a choice to either just walk away, or try and make it work. But I believed in the idea, in our town and the team, who work so darn hard. They have my full respect. So walking away, well, that wasn’t an option.

All the investment money came from the founding Partners. So that was good. The first thing I did was to get Scott Davis on board. Scott is one of Britain’s unsung hero’s. He has worked under Gordon Ramsey, Marco Pierre White and worked at the amazing Nobu Japanese restaurant. And I just told him this is your canvas, go paint.

http://www.dolectures.com/lectures/the-dark-art-of-running-a-small-gourmet-food-company-in-a-small-country-called-wales/

We gave him part of the company. For me, he was the talent, and without him, we didn’t have anything. Once the original founding partners are bought out, which they have agreed to, Scott will become an equal partner.

If the talent, and the driving force of the company don’t have ownership, the chances of success are much slimmer.

2, How to build something without funding?

The 25 Mile was ‘Bootstrapped’ from day one. And there have been days, weeks, and even months when you think is this ever going to work. But against all the odds, The 25 Mile is still here. The team has never been stronger. And the business, and its reputation, is growing.

The thing I knew before I got involved in this business, I believe in even more now: If you build a team, you can build a business. If you trust the team, they will trust you. If you gather a team around something worth fighting for, they will fight till the end for it.

3, A track record helps.

I have never done a food business before. But, that is why Scott Davis is the driving force of it. And that is why he was given part of the company.

Ultimately, investors will be investing in his vision, his skill, and his ability to replicate simple.

4, Being first helps.

It does.And we are the first of our kind to set up our business with such a defined aim. We called it ‘The 25 Mile’ because it would source its main ingredients from a 25 Mile radius.

It would not be an easy thing to do. But restrictions can be a powerful thing. (It hasn’t hurt Twitter: 140 characters was a restriction forced on it because that was how many characters a text message could send).

Our restriction was we wanted to use the best ingredients on our doorstep. We wanted to make a stand for great local food.

The good thing is more and more people want to know where their food comes from, they love food that is fresh and that it supports a community of growers.

5, What if you have lots of people wanting to invest.

We have tried our best to stay under the radar while we get good at being The 25 Mile. So, not many people know that it exists, so this hasn’t been an issue for us.

6, Split the Share types.

We didn’t do this. We should have. And, once the original partners are bought out, we will.

7, Build a team.

In the early days, lots of people were leaving. And I didn’t get it. But the problem was that we hadn’t built a team. The best teams are built around two things: An idea that matters to the team; and trust.

The good thing is Scott has built a great young team who trust him. They believe in each other, in the idea, and in themselves. And the team has never been stronger, and happier, than it is right now. Kudos to Scott, for that.

8, Do the numbers add up?

It’s a tough sector. But the food side of the pub business is growing. And the ‘affordable premium’ side of the business is growing very nicely. By ‘affordable premium’ I mean doing simple but well. And pricing it so it doesn’t become a place when you only go to for special occasions.

For the 25 Mile, doing more of them will make the numbers add up. The management costs will be spread across multiple locations. And at that point it becomes a great little business.

9, Show growth.

The business grew last year by 20%. And, the team are forecasting, it will grow another 20% this year. And, it will turn its first profit.

So can we scale it? Yes, I think we can. We took a pub that was empty for 3 years, and it has become alive again. There are lots of empty pubs that we could bring back to life.

I can see them in locations up and down the west coast of Wales. But right now, the team are just focused on getting better at being The 25 Mile.

So it has potential for growth. That begs the question, where do we go from here? Well, we have hired a full-time manager.  And we are now telling the world we exist. Our new website went up last month. Our new blog launches this month too. And I am sure the day will come when one day the team will have to decide if they want to go and do more of them. But the team know, if we can make it in our small, humble town, then it could do very well in much bigger towns.

If we do more then it will be their decision, and not mine. The team must want to go and do it.

10, Can you protect your idea?

We have trademarked the name, of course. But the best protection will be our consistency of great local and simple food. Consistency comes from an understanding of our way of keeping things as simple and as fresh as they possibly can be.

The 25 Mile also wants to become part of the community. So we are open 7 days a week because the growers are out there, come rain or shine, 7 days a week. And we want our customers to use us to push their cause forward. So once a month, we are doing a ‘cause night’ where people can bring people to come and eat with us, and 25% of their food bill goes to the cause their raising money for.

Also, our long-term aim is to have a microbrewery with each pub, brewing its own ale. That would be cool. It also makes it costly to copy. That is good, too.

11, Nobody likes doing business plans. But, you have to show that you have done the thinking.

There was no business plan for The 25 Mile. And much of the stress of the startup was because of that. It was a mistake. Every other business I have done, we have always done a business plan. I don’t like them. But I like failing even less.

12, Don’t ask people for money.

We said to ourselves it would take 3 years to get good at being The 25 Mile. So we had a strategy of not telling anyone about it. Not a single press release has been written in 3 years. I have avoided getting any publicity, we even had a website for 2 years that never changed. I just think sometimes, the team’s best use of their time is just to get good at what they’re doing.

We have talked to breweries about the idea, we even had a whisky company interested in what we are doing, but we have not gone out and talked to anyone.

13, What are you changing?

Local food matters. Local isn’t a trend or a fashion. It is something that will always be important. Because food is important. And knowing where it comes from is important too. And keeping growers growing is what we are fighting for.

The first thing I did was to tell the team why what they were doing was important: We believe in local food and the hard working growers; and we believe in them as a team, in their work ethic, and their talent. And we believe in our town, and some of those great ingredients should stay here.

The most passionate teams gather around a cause that is important to them. That is why David can beat Goliath. It just matters to David more.

The 25 Mile is here to fight for great local food. We called it The 25 Mile because it would source its main ingredients from a 25 Mile radius. We made it hard for ourselves to succeed. But restrictions can be a powerful thing.

It hasn’t hurt Twitter: 140 characters was a restriction forced on it because that was how many characters a text message could be. 
Our restriction was a 25 mile radius. As the crow flies.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Love + Purpose

(Transcript LCC Talk – Jan 14th 2011)

Good morning, thank you for asking me to come and speak. I would like to talk to you today about a two words. They are ‘Love’ and ‘Purpose’.

I believe if you can bring these two things together into your work, they will help to bring you success and happiness. Together they are a much more of a powerful motivation for you than either one is on its own.

Firstly, I want talk about ‘Love.’ I want to start by showing you a film by Mickey Smith. He is a surfer, photographer, and filmmaker. I am hoping he will be speaking at this year’s Do Lectures. It’s a beautiful film, both in how it looks and what it has to say.


I could be wrong, but I think Mickey has found something he loves doing.

If I can only scrape a living, at least it’s a living worth scraping. — Mickey Smith

If you are lucky enough to find something you love doing, you are at an incredible advantage in life.

For you, work will never feel like work, no matter how hard you work at it. You will never look at your watch, and think ‘not long now to home time’. You’ll never have a Sunday where you dread the Monday. And all those hours and hours you’ll put in will come from a hunger to learn and you won’t begrudge a single second of it.

Without wishing to be too morbid, it’s good to remind ourselves that we will all be much longer dead than we are alive. And if we could choose, it would be better to do all the boring things when we are dead. And keep those things that we love for the short time when we are alive on this mortal coil. The choice of what we do is indeed ours to make. But sometimes we forget that.

I think you owe it to yourself to, by hook or by crook, to make sure that you do ‘Your Love’ for a living. There’s always a way. Don’t listen to the excuses that you give yourself. Start at the bottom. But start at the bottom of something that is related to your dream. In the beginning it won’t make you rich, but it will always make you happy.

Here are a couple of role models of mine. I recommend you find one or two of your own to help motivate/lead you/to show you the way.

 

Jake Burton runs one of the most creative snowboard companies in the world. His mission statement to himself is to spend 100 days a year snowboarding.

 

Yvon Chournard, founder of Patagonia. I recommend everyone to go and read this man’s book. It’s called ‘Let my people go surfing’. He has made a business and life out of bringing his love and purpose together.

Talent is the desire to practice – Malcolm Gladwell

This quote is from Malcolm Gladwell who believes it takes 10,000 hours to become good at something. 10,000 hours is a short time to spend at something you enjoy, but an eternity if it’s something you have no love for.

Two Kinds of Passion: Hot Passion. And Cold Passion

I think it’s helpful to understand passion. I believe passion can both help you enormously and hinder you too. I believe there are two types of passion. One is ‘hot passion’. It is all heart; the head is not being called upon to think. And that means sometimes things can go wrong. Hot passion is a bit like infatuation; it burns brightly, but fades quickly.

Whereas ‘cold passion’ is calm, considered and long lasting. Both the brain and the heart are working together. Emotions have been taken out of decisions. And decisions are given time. And looked at from all angles. Cold passion is much more effective at getting results. Cold passion is like a lifelong love. Once decided upon, it’s almost impossible to stop loving.

It’s good to be aware of the difference between the two.

Find something you can’t live without.

I was lucky, I discovered what I wanted to do for a living early on. I wanted to have my own business: A sports brand.

At 16 I quit school and with £500, which was all of my dad’s savings, I started a market stall selling sportswear in what was then the coal mining towns of South Wales. It was a tough place to learn about business, but a great place.

There would be days that I would spend all day on the market stall and sell nothing. And because I hadn’t sold anything, I wouldn’t have any money for petrol. And because my car’s petrol gauge was broken, I knew I would run out petrol, I just didn’t know when.

That car taught me more about the importance of sales than anything else.

Just 6 months after starting I had to close the business and put my dream on hold. I had too many days on the market stall without selling anything. I had lost all my Dad’s money.

I didn’t realise it at the time, but failure was a good teacher. I didn’t have the skills I needed to run a business. I would have to go and learn them. I spent the next 15 years working in advertising. I learnt about ideas, brands and how to tell a story. I also learnt I still wanted to do my own thing. The dream had not gone away.

So we (Clare and I) started howies in 1995. Of course, my first shareholder was my dad. Along with his money he told me this: ‘wherever you go, go with all your heart. With that advice ringing in my ear, we wrapped our whole philosophy and values about life into it. For 6 years we did not pay ourselves. The love of it kept us going.

We got banned from The Mountain Bike Show, we got banned from The Malvern’s Bike event, we got sued by Levis, we saw our favourite band wear our t-shirts, we argued with Banksy, we won awards, we got voted one of the best brands in the UK.

It wasn’t always fun. But it was never work.

(The audience are asked what their love is, and then one by one they stand up and tell everyone.)

I now want to talk to you about purpose.

In 2006, howies was growing too fast, and we needed some more investment. We were lucky in as much as we had two companies who wanted to invest. In the end, we decided to sell to the ‘current owners’ as they understood the importance of Wales. The other deal was much more lucrative to Clare and myself but was more focused on California than Wales.

A year or so after selling to the ‘current owners’ I was in a meeting in Boulder, Colorado. I was told that I had to move ‘this bit’ of the business to this country and ‘this bit’ of the business to this country, or they would ‘spin us off’. I had to ask what ‘spin you off’ meant. (It means to sell you.)

Those kind of meetings are called ‘Dream Breakers’ for good reason. I emotionally left the company at that meeting.

On my return, I tried to buy the company back, but it wasn’t to be.

I will keep my thoughts about the current owners to myself, but I also had to look at myself and ask some tough old questions. And the uncomfortable truth was if I had been smarter at running a business, I would never have had to sell it to anybody. The mirror is a hard place to stand in front of sometimes.

Looking back, I could see that I had learnt how to build a brand, but not how to run a business.

So in October 2009, I left howies. The pain of leaving something I loved was less than the pain of staying and watch it turn into something I didn’t love.

For 3 months, I wrote a business plan for a jeans company. I felt it was a good idea. I knew I could fall in love with it. I had plenty of investors wanting to invest in it. But something was stopping me from doing it.

There was an element I didn’t want to run around the same track again. I was tired. And I was a little bit heart broken, if truth be known. So I just shelved the idea.

Instead, I put all my efforts into The Do Lectures. I had always wanted to do something world class, and there it was and right under my nose all along. It had a magical setting in fforest. (I will speak more about the importance of luck later.)

The Do Lectures was getting millions and millions of views. It was attracting great speakers, more than we could possibly cope with. And its reputation was quickly spreading. It was voted one of the top ten contemporary events in the world. It was a remarkable event for remarkable people and I was very proud to be a part of it.

All the time I would go running with my dog. Not really to get fit, but more just to try and forget about everything. A year later, with many miles run, I re-read the business plan for the jeans company. I loved it, still.

Then one day, after a conversation with the old designer from howies, I worked out what was stopping me starting the new company: I hadn’t worked out its purpose.

You see, as well as love, you need a purpose to really motivate yourself, and therefore succeed. You need to understand the ‘why’ you are doing something.

This video is of a company over in America called Raleigh denim. They are a good example of a company that has a purpose. They wanted to make things where they lived. They wanted to revive an old industry. I wish them the best of luck.

 

 

It was the same for me. I wanted to bring jobs to this small town called Cardigan. I wanted to make stuff here. That was the purpose I was missing. Lucky for me, Cardigan was a small town but it had an odd thing going for it.

Luck can only get you so far – JK Rowling

You can’t just rely on luck, but oh boy, sometimes luck falls into your lap. And when it does it makes life an awful lot easier, I can tell you. Having a World Class venue like fforest on our doorstep, well, that suddenly makes The Do Lectures exceptional.

If you were going to start a jeans factory in Britain, then Cardigan would probably have to be top of your list. That’s because it used to have the biggest jeans factory in Britain. Right here. Slap bang in the centre of Cardigan.

And most of that highly trained, highly skilled workforce were still in the town. That’s just down to luck.

So this Spring I am going to offer some of those people their jobs back. We are going to set up a jeans factory and then start making jeans overlooking Cardigan Bay.

I hope we can bring together those two words of ‘Love’ and ‘Purpose’. I hope I can make this town proud of revitalizing the jeans industry here. And I hope I have learnt all the lessons of the past. I can’t wait to get making again. Wish me luck.

For you, sitting in your seats right now, I have just this last piece of advice. Don’t worry about how many followers you have on Twitter or Facebook, but the thing to really follow is your heart.

Try and find something you love, and do it.

It will reward you in so many ways.

(The audience are asked what their purpose is, and then one by one they stand up and tell everyone.)

www.hiut.co.uk

 

 

More quality than you will ever need

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Alternative Temp Gauge.

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 (As observed from the farm.)

 Minus 1 – Butter no longer needs to go in the fridge.

Minus 2 – Ponds freezes over.

Minus 3 –Mister Fox is still out and about.

Minus 4 –Handbrake freezes on the Fiat Multipla. (Always park it in gear.)

Minus 5 –Chickens give up all notion of ever laying eggs again.

Minus 6 –Outdoor tap cannot be turned on. (Even with the help of a housebrick)

Minus 7 –You can stand on the ponds without them cracking.

Minus 8 –No footprints of Mister Fox to be seen anywhere.

Minus 9 –Chickens stay inside. Ice can be seen on the sea. Salt is in short supply in the farm Co-op shop.

Minus 10 – Butter needs to be kept on the Aga.

 

 

 

7 business lessons I’ve learned whilst doing the guttering this weekend.

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1, Water doesn’t roll up hill. Set your guttering up with that in mind.

 

(Get the basics of your business right from the start.)

 

2, Buy guttering that lasts. Quality will save you money and time in the long term.

 

(Only work with the best: people, tools, companies etc. Expensive really is cheaper.)

 

3, Don’t wait for the rain to come to make repairs

 

(Maintenance of your business/brand should become a daily habit.)

 

4, My strategy is to keep the water away from the buildings to stop them declining.

 

(Always be clear on your strategy and follow it through.)

 

5, The moss and the leaves will make good compost. And in turn, it will make good potatoes.

 

(How can your business close its loop?)

 

6, You get to know the buildings, the walls, the leaks, the problems just by climbing up a ladder to clean the gutters.

 

(It’s never bad to get your hands dirty. To get on the shop floor, to visit the factory, the showroom. You need to know your business from top to bottom.)

 

7, I didn’t set out to write this list. I set out to clean the gutters. But while I was doing it, my mind wandered.

 

(Ideas for your business will come to you mostly when you are away from it. Time off is good for you, your family and your business.)

 

 (I live on what used to be an old working farm. I am not a farmer or a handyman. But I am learning how to do a little bit of both.I am learning by doing.) 

David Hieatt

 

Lindab guttering is worth the extra money. Guaranteed for 25 years.

 


 

 

 

 

 

It’s a ball. Throw it.

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Hey you.

I’m a dog.

Your dog.

And this is a ball.

My ball.

Throw it. And I will go chase it.

Throw it again.

And, yup, I will go chase it again.

I am not complex.

I don’t do meetings.

I don’t have a laptop.

I won’t ever send or receive an email.

I have never heard of Google.

Like I said, I am not complex.

Eat. Sleep. Play. (Note, I reserve the right to change the order)

That’s it, simple huh.

So each time you throw the ball, it’s as much fun to me as the first time.

There are no diminishing returns here.

So stop what you are doing.

And just throw the bloody ball.

I’ll do the rest.

(i will be doing lots of my blogging at the do village - www.dolectures.com)


 

You are stronger when you are flexible.

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A tree will see many storms.

 

The trick is to have strong roots.

 

The other trick is to bend, to not resist the storm.

 

Don’t fight the storm.

 

Feel its force.

 

But go with it.

 

Flex. Sway. Bend.

 

 

 

 


 

weather forecast

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The higher the Rooks nest in the trees,

the hotter the summer is going to be. 

Or so they say.

Fingers crossed.

They are nesting higher than last year.

Well, here's hoping.


 

Fallow Friday

R0015183
 

Don’t go to a meeting.

Don’t give out.

Don’t email.

Don’t twitter.

Don’t blog.

Don’t use your mobile.

Go see a film.

Buy a great book and read it cover to cover.

Go to a comedy hour.

See a show.

Go to the museum.

Buy ten magazines and actually read them.

Watch a great talk.

Buy some new music and listen to it.

Go for a run.

Play football. Play tennis. Play marbles.

Input.

On a farm you have to learn you can’t just take from a field.

You have to give it input for it to output.

And even then a field will have to fallow every now and again.

Otherwise, the law of diminishing returns will set in.

You reap what you sow

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Today, we bought the seed potatoes for the garden.

Now we find a good sunny place to chit them.

Then we plant them.

Then we wait.

Then we dig them up.

Then we cook them.

Then we add a little butter to them.

I like that moment.


 

To Do List for spring

Must go see gerald, who spoke at this year's Do Lectures, and get some pigsIMG_0598
 
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