Why Your Idea And Execution Aren’t As Important As You – with Tomer Yogev

by Tim Jahn on February 25, 2011

Over the past 10 years, Tomer Yogev has worked with several startups, owned his own small business consultancy, and spent time in venture capital.  Recently, he launched TandemSpring, another small business consultancy.

In this interview, Tomer explains how the individual can be more important than their idea or execution, and techniques for moving past the ideation phase.

Transcript

Tim Jahn: What’s TandemSpring?

Tomer Yogev: So TandemSpring is a consulting company that — both my partner and I, what we realized is small organizations, be it a start up, a small business, non-profit organization really all suffer from the same thing which is they probably got started with a guy or a group of people, maybe a little bit of money, maybe a really good idea.

Hopefully some domain knowledge and that’s really about it. There’s merely always these rather large gaps in their knowledge, maybe they’ve never done marketing before, maybe they’ve never done finance before, maybe they’ve never done fundraising before.

All these kinds of things and there’s these things that are really essential to getting their organization to be successful. But they’re probably not in the position to hire on a CMO, a CFO, those types of roles. So what we look to do is kind of come on, partner with the companies, sort of act as, more as part or short term labor rather than as consultants in sort of the typical sense.

Our pricing and our modeling of how we interact with our clients and based off of that, we don’t generally go off of hourly fees and project basis and things like that. We’re really looking much more to kind of come on for a certain period of time, to you to a point where you can then hopefully take it from there or maybe bring someone else on full time if it requires, those kinds of things. So it’s really about filling the gaps for smaller organizations.

Tim Jahn: Okay, that makes sense. And I imagine that’s a big need to fill. I mean there’s you know hundreds of thousands of small businesses and start ups being created all the time that, like you said they don’t necessarily — it’s hard to know everything that you need to know.

Tomer Yogev: Right, exactly. And we don’t position ourselves as people who know everything ourselves. You know we know what we know. And we know other people who know things we don’t know, so we’re work –

Tim Jahn: That’s a great way of putting it.

Tomer Yogev: Yeah, so we’re more than happy to, you know refer out and those sorts of things, but we really like to position ourselves as the first place to come to. You know you need help finance, come to us. If we can help you with that kind of finance we will, if we can’t, we’ll get you someone who can help you.

It’s again really about trying to help these start ups and small organizations to fill these generally glaring business gaps that in most cases they just don’t where else to go. I mean I’m sure we all know start ups who have spent a great deal of time getting financial advise from the guy who does their taxes. Which maybe that’s passable, maybe it’s not. You know tax guys are tax guys.

They’re not necessarily finance guys and so on and so forth. So, as entrepreneurs you’re usually left to kind of take whatever you can find and we hope to try and take that upper level so you’re actually talking to an expert in the problem you’re trying to solve.

Tim Jahn: What did you do before TademSpring?

Tomer Yogev: So I did a couple of things. I’ve been with a handful of start ups, most recently with a software startup that go acquired back in ’09. After that I spent some time in Venture Capital. So I — and I also had a consulting business prior to this. So, also focused on smaller business and helping them out.

So, my background essentially is I’m an entrepreneur myself so I definitely know the struggles of being the one person company or the two person. I’ve been with small organizations, being as early as early as the fourth as late as like the thirty-something. I’ve seen those organizations grow to as many as 300 people and you know tens of millions of dollars of revenue a year. So I’ve definitely kind of seen all the different stages of small businesses. And then I’ve also had some exposure on kind of the investor’s side as well so I feel like I bring a lot of different perspectives to try and address the issues of small business.

Tim Jahn: Yeah definitely. You kind of have all of the perspectives covered there. You mentioned in your pre-interview notes that while you were working at Venture Capital you say a lot of firms and a lot of people with amazing ideas, but lousy execution. Can you give an example of something you’ve seen along those lines?

Tomer Yogev: Yeah, I mean there’s two that really come to mind and the reason that I really love these two is because the idea behind them is so much the same. One of the things I really was targeted on when I was working at Venture Capital was exploring the inner section between health and wellness and mobile internet, kind of new technology type stuff.

And I came across, we’ll start with this first one which was a company that was going to send you messaging, specifically on your mobile phone to try and help you get through your addiction. So the guy who started this is a PhD psychologist specifically oriented around addictions, you know wrote papers and is well known in that space. And he has a methodology that specifically has been proven and so on and so forth that if you receive constant reminders about your goal that say to break your addiction to the cigarettes or drugs or alcohol or what have you, that there’s clinical proof that his methodology works.

So here’s this really wonderful idea as far as obviously helping the world. But then he also had some nice ideas as how he was going to make some money. He could get grant money, he could put some things on top of to kind of orient it specifically to you as a thirty-something, white, male who’s trying to quite smoking. Maybe that messaging would be a little different than someone else. So he had all these really nice business idea.

And what we took a look at is, okay that the business idea checks out and the main thing we kind of look at in business ideas is this you know just kind of a logic there? You look at some of the really big successes of the last few years on a Groupon, Facebook, Google even. The fundamental idea is not particularly astounding. You know, we’re going to give people coupons. But like that’s been done you know and — you know we’ll have people find out about each other, like a directory.

You know that’s been done. Those are really these monumental ideas, but obviously they turn into these whopping successes. So we focus idea was, at least as good as giving people coupons. So we liked that.

And then we look at two other things. Kind of what’s the plan here? And then are you the person to do it? So this guy, like I said PhD psychologist, definitely has the psychological chops here. Hadn’t started a business before, but you know everybody needs to start somewhere. Everyone has their first, so maybe he’s not ideal, ideal candidate, but definitely looked pretty strong in that regard. Then we started looking at his execution.

Okay, you know, how are you going to really get this out there? And you know I always feel bad when I tell this story because it feels like I’m belittling him so much, but his business plan essentially was I’ll pay a developer to build an iPhone app and I’ll put it on the iStore and we’ll see where it goes. And that’s not a business plan. You know it — you know there’s no market acquisition. There’s no pricing strategy. There’s no –

Tim Jahn: I could see that being a common business plan though, for that type of thing, I could see a first time entrepreneur saying I’ll just build it, put it on the store and wait.

Tomer Yogev: Absolutely, I mean the only thing — and there will come a strategy. I’m not going to say it’s a good strategy.

Tomer Yogev: But it certainly is a way to go and look, I mean you look at Angry Birds. You know I’m not exactly sure what their business strategy was beyond that and they’re going to get a TV show now I hear. So, you know it’s not to say it can’t possibly ever work. It’s just not a particularly strong strategy, especially in something like this where even if you were successful, what’s really to stop a better known psychologist from spending a few thousand dollars to have his iPhone app and now and Android app as well put out there and you’re toast.

You know you really don’t have any kind of barriers. You really don’t have any real strategy. And I think that goes to the fact that again, this guys, he’s a psychologist. He’s not going to be a business man by trade. This was kind of his first foray.

So like I say, that’s not necessarily a guarantee failure, that you’ve never started a business, so you can’t start a business. Clearly there’s more than enough examples to demonstrate first time business people can be very successful. But sometimes there’s a reason why you haven’t started a business and you don’t have the business chops which in this case was kind of true. And it really became apparent in the strategy, so I mean we were going to give him the benefit of the doubt but then when we really started looking at his execution strategy, it became very clear. So I know this happens every day of the week.

People are sitting on their couch watching TV or in the shower or wherever they have that light bulb moment and they come up with this awesome business idea. Usually people get stuck there. Is this idea good enough, you know can I really make money at it, blah, blah, blah. And they really get stuck there and don’t even really get into the execution.

I — to give this guy the benefit of the doubt, I wouldn’t be surprised if we had caught up with him not long after he finally decided to get up off the couch. So here’s this idea, he finally go the motivation to go do it, hadn’t really gotten to the business planning stage yet, hopefully. But I can tell you this was over a year ago and there’s really no notable progress from that day to this.

Tim Jahn: What — you mentioned that a lot of people are going to sit on the couch, have the idea and then say okay is this a good idea? Am I going to make money off this idea? Can this idea work? Sho — and I under that execution is, most of the time just so much more important than simply having the idea, but isn’t there a certain amount of vetting that you should do with your idea before executing by — before — I mean to actually make sure it is a good idea or is it just more import to hit the ground running and that’s kind of the vetting processes?

Tomer Yogev: I think, I think you’re right. I think there is some degree of vetting that needs to happen. I don’t think you just have your light bulb moment and go. But where I really feel the vetting needs to happen is on the execution side less the idea. You know the example I like using all the time is the pet rock. If someone really sat down and tried to vet the idea of taking rocks and selling them for a lot of money, probably wouldn’t have got real far.

But the execution of it was fantastic. It was witty, it was fun. The guy who did it was a good person to do it. He had good contacts that was toys and knew that type of space. So, the execution and the person were really well made for that.

The ideas, probably one of the worst ideas in the history of business. So you know it’s, and — yet he’s walking around with a lot more money than you and I have probably ever made in our lives. So it’s, the idea-ry does involve some vetting. One of the other things I hear about that is, if I vet the idea don’t I risk it getting stolen? You do, that’s true, but what I would contend is if we look at this other aspect of who you are, that should alleviate that concern.

If your idea is a good one, but you don’t bring any unique skills to making that — such — you’re going to have a hard time making that idea successful anyways. So if someone steals it, in many cases they’re probably better situated to make it successful than you are. Up, I think I lost all you on you.

Tim Jahn: I’m sorry. It cut out just before that, your last part, if you could just repeat that.

Tomer Yogev: Ah, the part about it getting stolen?

Tim Jahn: Yeah. It cut out a little bit. I missed the key part.

Tomer Yogev: Yeah, so essentially what I’m saying is people do get concerned about having their ideas stolen during the vetting stage. But what I tell those people is that if their not bringing any unique value in of themselves, if they don’t have skills that are going to help make that idea successful, such that when they pull a vetted, anybody who hears this idea can just go and do it too, or do it even better than they could, then they’re probably barking up a bad tree to beginning with.

You really want to make sure that your idea not only holds water in of itself and that your execution plan holds water in of itself, but that you somehow match up to this idea in someway that you’re bringing the value. Because if you’re not, there’s going to be someone else out there who does bring value whose probably going to beat you to the finish line.

Tim Jahn: So, I mean, and I think this is the part that most people don’t look at it as, there’s really three elements. There’s the idea, the execution, and then you.

Tomer Yogev: Yep.

Tim Jahn: So I mean you know you look at a company like Facebook and Mark Zuckerberg, you know I hear this all the time, you know I think it’s just the, I’m sure we both do, I think entrepreneurs always here this, you know you hear your mom and dad “oh why didn’t you invent Facebook? Or why didn’t you invent Groupon?”

And you know you think about Facebook is successful because, not necessarily the idea, not necessarily the execution, but the — Mark is a large part of that. I mean I hear all these stories, whether they’re true or not, you know there’s movies made about whether they’re true or not, but who this, you know who this guy is. So what you’re saying is, you know the success of Facebook is just as much idea and execution as it is the fact that Mark Zuckerberg is the one that implemented it rather than you or I?

Tomer Yogev: Absolutely. I mean, specifically Facebook I think is such a wonderful example because there are these monster corporations out there like SAP, PeopleSoft, Oracle that essentially build the same underlining framework as what Facebook is, right? Like let’s take a lot of data, put it in containers and have it all relate to each other in a way that people can search and find it easily.

And what they do for Fortune 500 companies is really not too different from what Facebook is doing for 13 year olds all over the world. So why didn’t, I mean Facebook is worth like more than most of those companies now. Why didn’t they do it? The answer is they kind of already were doing it, they just didn’t have the execution, they didn’t have the right person, they didn’t have the cache of starting it at Harvard and then rolling it out to other universities and all the network effects that you have there and so on and so forth.

There just wasn’t a lot of other things that aligned. But here are these massive corporations and the technology space that were doing the same fundamental, underlying technology and even they were doing it, let alone you or I, you know sitting in our dorm rooms or whatever at the time.

So it’s — you’re absolutely right. I mean there’s those three components. There’s a lot of other components. And I think Facebook really helps aluminate it, Groupon’s another good example. I mean their — you know how many coupon website’s there are, but they had so many other things line up. They — you know and of course they were at a point before that and so on and so forth.

But you know there’s more to it than just the idea and when you talk to the average person who has that light bulb moment, they go “I want to start a business that does X. Is that a good idea?” And it’s, you know what? It’s good enough. Does it make sense? Does it have some sort of underlying logic to it? If it does, give it the check mark and let’s move on. Now let’s look at you, let’s look at your execution plan and then beyond that let’s look at, you know the economic environment, where you’re going to start this business?

Do you know people with the appropriate talents? All the other things that kind of go with starting a business. But so many people, and we’ve all been there where you’re watching a commercial with your buddy and commercial pops up and they go “I thought of that idea three years, you know dang, I should have done it.”

Tim Jahn: There’s one guy in every room that says that every time.

Tomer Yogev: Can’t make it through a football game without hearing something along those lines. And you know it’s, look what separates you from the entrepreneur behind that commercial? And the answer usually is not a whole heck of a lot.

Maybe some effort, maybe a little bit of domain know how, but you know the primary difference is that person had the same idea as you, got up off the couch, came up with an execution plan, looked at themselves, figured out their own unique talents and value they’re bringing to this business, and he moved on it. And that’s really the only difference.

Tim Jahn: That’s a great point. Actually that leaves me my last question in which is for those people sitting on the couch that have that light bulb moment or they thing they have that light bulb moment, what is your one simple, single piece of advice for them on that next step towards successfully executing, or at least on the path to successful execution?

Tomer Yogev: Show up. I mean that’s really the name of the game. Every entrepreneur I’ve ever spoken to at the really early stages of their business when they’ve launched and they’re, you know maybe pre-revenue, and so on and so forth, they all tell the same story which is will this business successful? You know we’ll see. I’m doing what I can. I’ve done you know what I think are smart moves.

And either it will swim or it will not and I have some sort of back up plan if the answer is it does not, but I’m certainly hoping for it does. And it’s — that ability to accept risk that I think separates the people who actually get off the couch and those who don’t. But those who really are stuck there and I know countless people who have had a business idea just percolating in the back of their mind for weeks, months, years.

It’s just about showing up. Get yourself in a position, whatever that may mean, be it financially or whatever to just really give it a shot. And once you get to that point, you will figure out the strategy, you will figure out your own unique talents that stuff will come. You really have to get past this ideation phase where it just sounds like a cool idea that you could maybe do one day.

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