The risk of potential failure is ever-present in the life of a startup, especially one that is located in Silicon Valley. As a senior leader, your goal is to maximize the possibility of success by assessing risks and taking advantage of the opportunities that they can present.
Break new ground
Several years ago, my Virsto co-founders and I set out to secure funding for our startup and spent many days visiting venture capital firms along Sand Hill Road, home to many Silicon Valley venture capitalists. Time and again, those VCs would assume that as a startup in the virtualization space, we naturally would develop our first product to support VMware, which was essentially a monopolist in that market at the time.
They were wrong.
On the contrary, we made a conscious decision to build our first solution supporting Microsoft’s yet-to-be-announced competing technology platform. The reason was simple: It was the green field. Many of the companies that were developing products for the market-leading platform had been around for years, giving them ample time to establish themselves and crowd the market. We made a bet that Microsoft would rapidly take market share. We knew that by choosing the alternative path, Virsto would have the opportunity for faster growth with many new users who would need a product to support their brand-new platform.
It was a carefully calculated, strategic risk that we took, and along the way, it taught us several valuable lessons about the keys to going after the green field.
Plan growth wisely
The first order of business was to establish our beachhead. To set ourselves up for success, part of our plan was to grow the company strategically. The first two years were spent developing the technology, determining the product specifics and mapping how the company should grow. We did not outsource quickly or hire with abandon. Instead, we opted to manage our cash reserves carefully before turning on the growth, once we had proven what we had was truly viable.
Too often, startups get overeager and try to “focus” on too much. It is a classic mistake: Right out of the gate, you get excited and want to chase every opportunity in your field of vision. Instead, Virsto took the tack of securing only the capital we needed to start the company and to support our research and development. Determined not to waste a penny or squander a moment of our headstart in the market, we became experts in a specific area that promised great potential growth.
Build a passionate team
A CEO interacts daily with a staggering amount of people in numerous ways — customers, employees, channel partners, board members, strategic partners, investors, lawyers, bankers, prospects and so on. To keep the business running smoothly, it is vital to be team-oriented and assemble a talented group of individuals, interacting with each person in different ways so that each gives you his or her very best.
It is necessary to bring passion to your role, and this is particularly relevant when you are all focused on one goal. At Virsto, our team is defined by its determined optimism. This is a team of people who are very excited about what we are doing and who enjoy working with each other and with our customers and partners. The gang has a strong desire to make a difference, to build something significant. <<
Mark Davis is the CEO and co-founder of Virsto Software. He has been at the center of the networked storage and virtualization revolutions since their inception. He launched the first Fibre Channel disk array in 1994 and was instrumental in growing Sun Microsystems from a nonplayer to the largest Unix storage vendor within five years. Before co-founding Virsto, he was CEO of storage resource management vendor Creekpath Systems, engineering its acquisition by Opsware (now HP), and also repositioned ConvergeNet as the inventor of SAN-based storage virtualization, resulting in a $340M acquisition by Dell.