Starting a Food Company

by Adam on April 28, 2013

I was attending a conference recently and an idea struck me about the best way to actually have success when starting a food company (or perhaps any company in general). While it isn’t the most optimistic assessment of the landscape for entrepreneurship, it is something that I keep coming back to.

One of the key differentiators of success for a new startup is a founder with experience. Someone who has been through the wash before and knows the pitfalls of business building that can often trip-up younger business people. You might rightly ask, well how does one get such experience if they are building their first business? And therein lies the key to all of this.

To be successful in business-building, I think any entrepreneur should start out at another company. “Learn on someone else’s dime” as the saying goes. Whether that’s a big company in the food space, or another startup, taking time to work for someone else for a while has a few key advantages. Chief among them are:

  1. It allows an entrepreneur to build a network of connections, including co-founders, that they can take with them to their new venture.
  2. In the same vein, a startup founder can use the time at another company to build their network of contacts, which can be used to enhance strategic partnerships and funding potential down the road.
  3. Working within a startup, an entrepreneur can easily seem some of the benefits and pitfalls that are sometimes obvious to those that aren’t deeply connected to the company.
  4. By working for another company, a potential founder has the opportunity to build credibility and enhance their resume, which is invaluable when they go to raise money down the road.

I cannot tell you how many entrepreneurs I’ve met with who have limited background and experience in the space, and yet still want to start a company. You cannot throw technology at food and expect a positive outcome, especially if you’ve never worked in food before. The companies we’ve invested in previously have, more often than not, been around the people, not just the ideas. Strong founders, who either have previous exits of their own or who have worked with companies and built up strong credibility have a much greater chance of success in both building a company and also getting investment.

The lesson to be learned here is that there’s a lot to be said for going to work with someone else for a while. It gives potential entrepreneurs the opportunity to explore the space they are innovating in, learn more about what is out there and figure out how best to structure their own endeavors. It also gives you a chance to stop and figure out where you want to actually do what you think you do, and that is perhaps the most valuable lesson of all.

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