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Saturday, May 28, 2011

Scientist & Technical People Can Be Entrepreneurs TOO

Becoming an Entrepreneur is more of following a dream than a learning exercise.  You either develop a passion for developing a business or you do not.  Scientists and technical personnel often create some new technology and decide they want to see it become a product.  Sometimes, they want to take the lead role in development of the business and even desire to run it.   This is not the case for all technical oriented people, but the select few that have been bitten by the “Business Bug.”
The biggest problem the face is lack of experience.  Science and technical training in school does not require taking business courses and typically these individuals do not get experience at work.  This is unfortunate.  The lack of training is often perceived as a disadvantage when investors look at the individual and the company.  Investors want to have confidence the company will be run properly.  They insist on having someone run the business that has the proper business skills as to ensure good management of funds and business.
Investors and Boards often give consideration to the stage of the business and the background of the person running the business.  Even if someone has been running a startup for a long time, it is not too surprising to see changes in management once a product is launched.  This is understandable, but the outgoing CEO really never got the chance to demonstrate an ability to take on a new level of responsibility.
It is true that not all scientists and technical personnel are destined to be good business people.  But, that aspect can be learned.  Many scientists have been elevated through the ranks to be CEO of major corporations.  This is following their career in the company on the product development side of the business.  These technical people learned the business aspects and developed a skill set to run the company.  They also had key mentors and advisors along the way to help coach, train, and/or provide advice.

As an entrepreneur, the first question you need to ask is: “Would I rather run the company or develop the products?”  You will be a founder of the company in either mode, but you need to make a decision as to who will be management and of what.  It will come down to which will you enjoy the most and work the hardest at to make the company successful. Just to be clear, no one will think the less of you if you decide someone else should be the CEO.  Also, this is no reflection on skills.  Some of the best and smartest scientists and technical personnel remain in development while others decide to switch to business. But if you want to be the CEO, GO FOR IT!
The transition from Scientist to Business requires a strong desire to switch. The scientist must want to manage the business and believes he/she can do great job. This will be tested over the months to follow and your Board of Directors will let you know if it is not working out. But if you do not try on a company you start, you may never get another chance.  Remember that management can be learned just as anything else.  There are things that can be done to facilitate the learning and fill in gaps that will improve your chances.   Here are a few for your consideration:
1)     Develop the Business Plan and Investor Presentation:  Compile the plan and presentation yourself getting whatever advice you need.  You will be forced to learn your business, it’s background, and define where it will go.  Use advisors, staff, and consultants, legal and financial assistance and ask questions along the way.  It may take longer to get to a quality document, but you will be planning the company future and learning the business at the same time. 

2)     Hire the Team:  You will immediately be involved in recruitment and negotiating and leaning the issues.  You will explore alternatives to compensation and ways to keep burn reduced to a minimum and maintain the budget.  When making offers, you learn a wide range of personnel and compensation issues as you discuss them with your counsel.  When the people join, they will see you as the boss and leader of the company.  You will further develop your management once they are onboard.

3)     Set the Timelines and Milestones:  Establish the company objectives and communicate clearly to the team; this is crucial.  The company will not achieve objectives if you do not clearly define and communicate them. You cannot expect them to guess what you want or when it needs to be completed. Part of the management process is monitoring and guiding to ensure the team meets to objectives.

4)     Assign Work Load:  You cannot do everything!  Select the sub-leaders in the company and delegate responsibility for certain objectives.  Monitor their progress and try not to micromanage; they hate that.  You must make sure they are on board with your timelines and objectives.  You may not have identified all the issues required to meet the timelines.  Also, the cost analysis may need adjustment once the team gets more serious about the tasks and learn what it will take to accomplish them.  Do not be surprised if your first guesses on timing and cost are WRONG.

5)     Advisors and Mentors:  No one is an expert at everything.  Thinking you are one is BAD.  Try to identify where you have needs for learning and find mentors to assist.  You will develop skills you need along the way and help your company not to suffer by your weakness. 

6)     Continually Reassess and Question: Vigilance is critical.  Not just for the company meeting objectives but your personal performance.  You should always explore better ways to improve how you manage and lead your company.  This is another reason to have great mentors around.  They can tell you when you are missing things and help you improve.
Taffy Williams is the author of:  Think Agile:  How Smart Entrepreneurs Adapt in Order to Succeed to via Amazon 

Wednesday, May 25, 2011

Why Startups Should Focus on Marketing Strategy (by Pooja Khanna)

While discussing marketing strategy with a friend of mine who is also the founder of a startup said “All our marketing strategy efforts to date have been secondary to building out a product people want to use.  Once we nail the product however, we hope to spend much more time (and money) on bringing that product to as large a market as we can”.

As a marketing strategy expert I found this position completely wrong –

1. How do you know what “a product people want to use” is, without talking to the people?

2. How do you know how many people will sign-up for this product without assessing the market? The founder was so in love with the product but does not know who the customer is. Twitter is poor example here, yes it was build without thinking of which market it would address, but only 1 in a million startups will succeed like Twitter without an understanding of the market.

3. The idea of “bringing that product to as large a market as we can” is also wrong on many levels.  Startups should build on small success, capture the market in one niche and then build on that success.

Startups have limited funds for marketing and getting to a profitable position or even keeping the cash flow positive is challenging, under these circumstance it is understandable that marketing cost should be kept low. Startups should work with marketing experts who understand the startup mentality and are capable of devising effective marketing strategies with very tight budgets.

When did you get marketing strategist involved with your startup?

About the Author:

Pooja Khanna (CEO Blueknee Marketing) specializes in developing marketing strategy, competitive analysis and pricing strategies. He is also the owner of the LinkedIn group
Marketing  for Startups .
You can follow his regular blog contact him via email – pooja@blueknee.com  .
I want to thank the Pooja for this Blog article. I am pleased he asked me to join his group on LinkedIn and that he agreed to write a guest article for this Blog!

You can follow Taffy Williams on Twitter by @twilli2861 and you can email him with questions at twilli2861@aol.com. His company website is  http://www.ColonialTDC.com and he writes for the local Examiner Paper.  He is a member of the group Startup Group on Linkedin. The blog is now listed on Alltop®. 

Presentation 101 – Please do not do this!

I often have the opportunity to listen to first time entrepreneurs and early stage companies present their company.  This occurs in multiple venues and I have been doing this for several years.  One particularly fun event includes co-hosting (with Plazabridge Group) a forum referred to “Deal Desk.” Deal Desk is the opportunity for early stage companies to present for 15 minutes and then a group of experienced professionals provide feedback and/or addresses a key issue the new company may want to discuss.  

Plazabridge has a group of talented entrepreneurs with startup experience in sales, marketing and IT; I usually cover healthcare.  The mix of entrepreneurial reviewers is useful in providing advice and feedback to early stage entrepreneurs and their startup.  I must warn in advance that I am the “Simon Cowell” in the Deal Desk group! I also provide steps as to how to address short comings, but am never sure the entrepreneur hears all of them.  In other venues, you will be safe; I am much less aggressive.

The result of seeing presenters in different types of meetings is that some trends emerge which are the PLEASE DO NOT DO THIS TYPE for your first presentations.  I read a lot of articles on startups and some deal with making killer presentations. This is not one of those articles.  I am going to encourage you to do your homework and address the following before you ever make your first presentation.

Tell what the product is :  In multiple presentations over the years, I have listened to scientists and business professionals present.  It always amazed me that in a number of these the presenter fails to define the product.  The listeners are trying to help, and hate having to stop you in mid-presentation or at the end to ask: “what are you making, what is your product, or what is the service you are offering?”  Your presentation suffers and listeners stop listening when they do not understand what you are doing.  Please address this up front and help set the framework for the listener to follow you better.

Who is going to buy the product :  This is really an issue of describing your target market.  It is important to know if you are selling to a group of 100 or require a mass market direct to consumer selling campaign.  You really need to address this issue and should have addressed it in your business plan. So don’t leave it out of the presentation and please tell us what your plans to sell the product are.

Intellectual Property :  How to you intend to develop a moat around your business?  Protecting the company from competition is an important consideration.  When asked about Intellectual Property, please know what you have as protection.  Repeating that you have a patent and not understanding what that means is not really helpful!  You do not even need patents, but you can describe that company Know-How is the protection and elaborate as to the fact that it is difficult to make the product without the Know-How.

Management Team:  One of the surest ways to make me believe you do not have any technology or products, is to spend most of the time talking about how great your team is.  This is an early lesion I was taught.  In one turnaround, I had to eliminate the technology but developed a great team to take the company forward when we found something new.  My presentation spent 70% of the time discussing the management, because there was not technology.  So, if you do not have anything, tell me.  I can try to help from there.

How is the product being developed:  I can only guess your plans if you do not tell me.  Timings, milestones, and areas of importance show you are seriously thinking about launching a product someday.  They also show you are end result oriented and help build confidence that you are well focused on a product launch someday. Telling that you plan to have a product that will address a critical need is extremely important.  Showing you have no clue how to create the final  product is not a good idea.  I am happy to give advice, but I do not want to write your development plan for you; at least, not for free.

Know your business:  I am always amazed that some entrepreneurs have not taken time to learn about the business sector they plan to launch into.  They show no evidence of understanding of the development path, how to manage a business, or lead a team!  How can you ever believe you will succeed if you do not understand the landscape you plan to compete in?  At least, tell me you have key advisors that will coach you in the area and you need help with.  It does not matter if you are a scientist learning business or a business person learning science.  You should be able to address the company and its direction. 

HOW DO YOU KNOW THEY WILL BUY:  It is interesting to describe your products as unique and possibly useful.  Often, a scientist or entrepreneur gets so attached to the technology and product they forget to ask potential buyers if they would use it.  This is a rather common trap for even experienced entrepreneurs.  In doing your market assessment, try to figure out whether your end users even care if the product ever is launched, how much they are willing to pay for it, and if they will use it.  This is part of your homework as well.

Taffy Williams is the author of:  Think Agile:  How Smart Entrepreneurs Adapt in Order to Succeed to via Amazon 

Monday, May 23, 2011

Don’t Confuse Your Team

Entrepreneurs starting companies come from a wide range of backgrounds and training.  Your motivations to create and innovate are real and probably as strong as your enthusiasm to have the business succeed.  The business is your BABY and you are the PARENT.  This means you are learning.  Your business did not come with a rule book that provides step-by-step instructions. You have advisors, mentors and other resources, but each business is unique and comes with unique challenges and learning requirements.

In taking a new position in an established company, it often takes several months just to understand the culture and people.  You will establish a game plan for running the group, understanding the business, and identifying milestones and objectives.  A startup is the same, but your leaning needs to be quicker and adaptations are made sometimes daily.  Your instructions to the team you created are likely to change regularly as you attempt to adapt. 

You have a team.  When you asked them to join, you provide for job titles, functions, objectives and milestones.  At some point, you may want to take back some of those responsibilities back and do them yourself.  This is your prerogative.  But, you need to communicate the directional change to the employees being affected.  They will never perform to your standard if you do not tell them what the standard is or that it changed.  Also, you will have them continuing to attempt to perform the original tasks while you are attempting to do the tasks you just decided to take from them. 

Your team cannot read your mind.  They are not privy to all of the latest advice or suggestions you received.  Even though you changed your mind, your team will continue to operate according to the last set of instructions you provided.  As the CEO, you always have the right to change direction.  But, make sure your team knows you changed directions and then lay out a clear set of new objectives.  Also, it does not hurt to provide more information as to why and how you project the change will improve the situation.

You originally selected the location of your company for convenience, because you live there, or some other reason.  The team you assembled may be few but they are likely highly dedicated to your cause.  There will come a time when you review the location of the company in a more strategic manner.  For example, companies often find it easier to recruit in regions where larger companies of similar technology are established.  Look at Biotechnology in Massachusetts, California, and North Carolina and see where startups were created and exist near centers of experienced personnel.  Relocations to regions where talent is available for hire results in lower recruitment costs and increased ease of relocation of the employees.  If the business does not succeed, the employees have other opportunities to find work without moving.  The decision to relocate is natural in the early days of the startup.  Decide on the facts and get it over with.  Don’t forget to take care of the current team in the process and don’t turn the decision into big ordeal.

Like the example of a move, the decision process is a common issue for the CEO in every startup.  There will be many decisions and each will have pluses and minuses for your consideration.  Part of the job of being a CEO is making the decisions.  Flip-flopping and changing continuously does not generate good morale and leads to lack of ability for your team to move in the direction you want.  Make a decision and provide clear directions as to what changes need to take place.  Don’t keep changing your mind every time someone provides a new idea.

There is a high probability that as the first time entrepreneur you find yourself working in a field in which you have minimal experience.  It sometimes takes a long time to become familiar with all of the aspects of the field and the surrounding business.  The team you assembled hopefully has the experience you are lacking.  Second guessing the directions is natural, but when you second guess, at least do so from a position of having attempted to understand the space and the issues.  This means you have to work extra hard to learn as much as possible before you start second guessing.  You should try to work as part of the team and foster respect as their knowledgeable leader when addressing the business. Your team will lose confidence in you as their leader and they will have difficulty meeting objectives if you continue to direct but fail to understand your business.  Make sure you read everything you can about the business and issues.  Then consult with your advisors and experts. Try to understand the business and address changes from a position of in-the-know. 


1.     Make sure your team knows you changed directions and then lay out a clear set of new objectives.  Also, it does not hurt to provide more information as to why and how you project the change will improve the situation.

2.     Make a decision and provide clear directions as to what changes need to take place.  Don’t keep changing your mind every time someone provides a new idea.

3.     Make sure you read everything you can about the business and issues.  Then consult with your advisors and experts. Try to understand the business and address changes from a position of in-the-know.

  Taffy Williams is the author of:  Think Agile:  How Smart Entrepreneurs Adapt in Order to Succeed to via Amazon 

Thursday, May 19, 2011

Parallel Paper Economy (by S.A. Boyko and W.C.. Rappleye Jr.)


How could it all have happened – so vast, so disastrous – this subprime debacle? 

We argue that advanced rulewriting in the form of one-size-fits-all (OSFA) deterministic regulatory metrics were mischaracterized as a proxy for stability. Policymakers were blind to attendant opportunities for ever smarter game-playing in the regulatory machinery. Much like marching soldiers breaking cadence when crossing a suspension bridge, complex systems needed to counteract fragility by breaking suppression of volatility. The failure to do so led to a catastrophic valuation uncoupling of the real goods and services sector of the economy from the financial sector of the economy that initially foiled, and eventually froze the pricing mechanism causing systemic failure.

What suggests the way to prevent the otherwise inevitable next economic crash is the understanding of the broad arch of randomness—the difference between predictable, risky, and uncertain underlying economic environments. For every product made in the real goods and service sector of the economy, there is a corresponding product created in the financial (“paper”) sector of the economy. Acknowledging randomness, the Parallel Paper Economy[i] provides a pathway for better governing of the reflexive price interrelationship between the real products and financial sectors of the economy.

The financial sector’s capital market difficulties persist and require analysis as to whether problems are the result of either:
  1. Ineffectiveness that requires doing things differently because of a dysfunctional market that failed to trade as in the subprime and 1987 crashes; and/or,
  2. Inefficiency that requires doing the same things better because of discontinuous pricing as in the S&L and Dot-comet crashes at the turn of the century.

Einstein said that “insanity was expecting different results from repeatedly doing the same thing.” Yet, policymakers have chosen to do more of the same with OSFA governance trying to overcome conceptual shortcomings by raising the legacy capital market standards from legality to morality by equating failure with fraud. [ii]

Throughout the policy spectrum many have advocated command-driven, governance based on a too-big-to-fail (TBTF) capital structure that enables regulatory scale to trump market forces. The TBTF financial sector strategy is a de facto subsidy because of the implicit government guarantee. But TBTF argues against itself as subsidies create excessive volume (market share) that feed industry giants and excessive complexity (over-engineered products) that beget uncertainty. Thus, the question remains as to how to govern uncertainty more effectively with OSFA deterministic metrics?

Financial sector ineffectiveness caused by OSFA deterministic regulation

Randomness is the range of variability of a complex adaptive system. In determining the degree of randomness, the component parameters of predictability and risk can be bounded whereas the component of uncertainty cannot be bounded with any degree of precision. But uncertainty must be considered. Ignoring uncertainty is done at one’s own peril (See: Beyond Rumsfeld).

The randomness matrix below illustrates how to differentiate risk from uncertainty for the financial sector of the economy. The matrix describes the functional domains of randomness in terms of predictable, risky, and uncertain underlying economic environments. The conceptual construct of financial cash flow and operational pricing is in the upper left corner of the matrix. Its matrix location is designated (A1) for column A, row 1. Binary benchmarks are made up of financial brightlines, (B1) and (C1); and, operational brightlines, (A2) and (A3), that define the boundaries of the determinate and indeterminate randomness.

Why use cash flow and mark valuations as brightline differentiators for indeterminate and determinate domains? They have established accounting precedents.

Investments supported by positive cash flow have greater control over their underlying economic environment. They can: buyback their stock or position their company as a takeover target, merge with or acquire a competitor to reach critical mass, use trade discounts to buy equipment to become a low-cost provider, explore distressed-sale opportunities, issue or increase their dividend, and reduce amount of debt and/or increase debt rating thereby lowering their cost of capital.[iii]

FASB 157 establishes guidelines for fair value accounting to assure objective, arms-length pricing. The statement holds that market participants should include their valuation assumptions. Randomness inherent in a particular valuation technique used to measure fair value should include inputs and assumptions as to the valuation technique.

Randomness Matrix

Financial cash flow
Pricing  (A1)
Positive cash flow
Negative cash flow

Mark-to-market valuation
·  Predictable domain
·  Knowable knowns
·  US Treasuries
·  Risky domain
·  Unknowable knowns
·  Initial public offerings

Mark-to-model valuation
·    Risky domain
·    Knowable unknowns
·    Merger & acquisitions
·    Uncertain domain
·    Unknowable unknowns

The binary benchmarks of the conceptual construct interact with each other to form brightline boundaries where risk ends and uncertainty begins. Binary benchmark having positive cash flow (B1) cross-referenced with binary benchmark for mark-to-market valuations (A2) enable the price of Treasury securities (B2) to be formulaically determined in a predictable domain (deepest and most liquid) of knowable, knowns. Prices are discovered in the risky domains of initial public offerings (IPOs) and mergers and acquisitions that have either mark-to-market valuations or positive cash flow but not both. Lastly, uncertain issues such as no-money down, NINJA MBSs[iv] have neither mark-to-market valuations nor positive cash flow from which to price investments.

Systemic dysfunctional pricing suggest the need for better organized information. We argue that one-size-fits-all governance needs to be segmented into predictable, risky, and uncertain domains. Unless and until uncertainty is recognized, the randomness of underlying economic condition is a recursive loop that produces in larger and more frequent economic boom-bust cycles.

Financial sector inefficiency caused by regulatory gaps, laps, and naps

Efficiency speaks to the capability to do things right by minimizing the functions of cost, effort, and time. This requires fixing capital market governance:

·       Gaps: as in capital market governance omissions,
·       Laps: as in governance that is redundant, conflicting, and/or differing, and
·       Naps: as in regulatory policymakers not paying attention to market activity.

Gaps in capital market governance require fundamental change. If you want to change the capital markets system, you need to be willing to make real changes. Managing risk and managing uncertainty are conceptually different and require different approaches. With risk, one can insure (i.e. buying put options for portfolio insurance) and one can hedge (Ford and Exxon stocks in a portfolio). With uncertainty, one can insure against natural disasters, but cannot hedge (Ford and commodities). Uncertainty is not bounded.

Why? Determinate and indeterminate prices react to information differently. Without informational correlation, the less robust variance measure of randomness is used instead of the standard deviation. From an investment perspective, Nassim Taleb, hedge fund manager and author of “The Black Swan,” scorns any correlative association because past history can never prepare you for catastrophic failure. Taleb posits that relying on correlation is charlatanism. Similarly, we argue that investor protection is a state-sponsored, rent-seeking scheme where OSFA governance relies upon correlation.

Laps or overlaps create redundancies in jurisdictional responsibility. For example, credit-card products offered by Chase were overseen by one regulator with one set of governance standards, while a virtually identical product offered by a competitor would be overseen by a completely different regulator with different standards.[v] Furthermore, there is a fundamental need to differentiate regulation from rule-writing. Rules are codified best-practice procedures that define operational efficiency. Where were the best practices in SOX or Dodd-Frank? Rule-writing is the proscriptive description of an undesirable situation. It is ad hoc policymaking that Band-Aids over the current problem. It expects buy-in from society by describing the undesirable situation and prefacing it by saying “don’t do this.”

Naps as in policymakers not paying attention to market activity where financial intermediaries made the fundamental error in giving property rights to renters. This happened by extending credit to new home buyers through no-money down, NINJA mortgages. Or by existing home owners using their home equity line of credit as an ATM machine to borrow excessively without realizing that the integrity of their mortgage was being compromised. Mortgagors had no skin in the game.  This regulatory “nap” was further compromised when regulators allowed financial intermediaries to raise their leverage ratio from 8:1 to 30-40:1. Such naps altered behavior, leaving regulators unprepared for the crash that was about to occur.

Uncertain MBSs (unknown cash flow and unknown market demand) were later securitized with an AAA-rating. How could uncertain securities receive an AAA-rating? Attempting to cross-manage non-correlative assets minimized the value of both resources (AAA-rated, uncertain MBSs, real estate, Fannie Mae etc.) as the reliability of price information is corrupted. This meant that you could neither cross-sell CDs and bonds as Citigroup tried to do in its financial supermarket, hedge tranches of MBS as financial engineers tried to do, nor regulate risk and uncertainty with one-size-fits-all governance metrics as policymakers have tried to do.


Like Agatha Christie’s mystery “Murder on the Orient Express,” there were no innocents in the subprime bubble. Investors, issuers, and intermediaries speculated and then scrambled to stay ahead of the impending tsunami of bad debt. Policymakers and rating agencies were blind to attendant opportunities for ever smarter game-playing in the regulatory machinery This was not so much the perfect economic storm as the search for the ultimate free ride. The act of giving property rights to renters via no-money down, NINJA mortgages was exacerbated by investment banks given regulatory impunity to become highly leveraged casinos. Societal subsidies such as the tax deductibility of mortgage interest that had been a form of forced savings became a form of forced speculation for teaser-rate mortgages that became wasting assets. Conflating risk and uncertainty enabled the financial contagion to be systemically spread by mischaracterized AAA-rated securities that had unknown cash flow and unknown mark-to-model valuations. What remains in the crash aftermath is deciding the timing and sequence of where to start—will ineffectiveness or inefficiency be the independent variable for restructuring or reform?


Stephen A.  Boyko is the author of "We're All Screwed! How Toxic Regulation Will Crush the Free Market System" http://readingthemarkets.blogspot.com/2009/10/boyko-were-all-screwed.html . He has over forty years of financial services industry experience that include formulating regulatory policy for the National Association of Securities Dealers (now FINRA) and providing a practitioner's perspective for the privatization of the former Soviet Union in corporate governance and regulatory development of the Ukrainian Capital Market. Contact: n2keco@bellsouth.net

Willard C. Rappleye Jr. has spent a lifetime as a financial journalist. He was the National Economic Correspondent for Time, Editor of American Banker, Founding Editor of Financier, the Journal of Private-Sector Policy, and Vice Chairman of FinancialWorld.


[i] The “Parallel Paper Economy” is the companion article to The Engine of Economic Growth.

[ii]   Note many policymakers are calling for another Pecora Commission. The Pecora Investigation was an inquiry begun on March 4, 1932 by the United States Senate Committee on Banking and Currency to investigate the causes of the Wall Street Crash of 1929. Ferdinand Pecora was the Chief Counsel to the U.S. Senate's Committee on Banking and Currency.

[iii]We’re All Screwed,” (Boyko,2009) p.141.

[iv] NINJA is an acronym for “No Income, No Job or Assets and MBSs is an acronym for Mortgage-Backed Securities.

[v] Dimon, Jamie, “A Unified Bank Regulator Is a Good Start,”
Wall Street Journal, OPINION, JUNE 27, 2009, p. A13.
I want to thank the authors for their excellent article for the Blog. They continue to publish articles and books of importance to the financial and regulatory sector. Steve published the book "We're all Screwed!" and has been on active speaking engagements. I am pleased to call him a friend and he has agreed to be an active contributor to the blog!

You can follow Taffy Williams on Twitter by @twilli2861 and you can email him with questions at twilli2861@aol.com. His company website is  http://www.ColonialTDC.com and he writes for the local Examiner Paper.  He is a member of the group Startup Group on Linkedin. The blog is now listed on Alltop®. 

Tuesday, May 17, 2011

Advisors and Luck Improve Business - Photo Example

Preplanning is essential in all startup businesses.  Most often this takes place before and during development of your business plan.  In my personal blog, I defined steps to create a business plan and start the business.  I also elaborate on selecting advisors and directors and how critical they are to the success of your business.  New business owners and even the more experienced entrepreneurs often are working so hard they miss things that could have improved the chances for success; i.e., they are just too close to situations.
The better advisors are likely highly experienced executives or former executives that you’re your business and are willing to take an active interest in the CEO and the company.  They should have a personality that complements the CEO and willingness to guide and mentor.  The CEO must plan strategy to enhance chances for success but if they lack experience they could use guidance to ensure: 1) key opportunities are not missed; 2) they see opportunities often missed due to lack of experience, and 3) they recognize and capitalize on lucky breaks.  I have found that each of these circumstances have come in companies while I was running them. Recently, I encountered real life examples through my hobby of photography.  The following is intended to help the reader visualize how luck, planning, and guidance can improve performance.
I took up photography as a hobby a few years ago and now have graduated to sharing my photos in a website.  In preparing to discuss the relation of luck, planning, and advisors relating to success in business, three photos and the events leading to obtaining the photos came to mind that demonstrate the relationships.  Keep in mind that I plan my trips and make every effort to identify an appropriate guide for the region I plan to visit; much as you would plan any business venture. 
ADVICE FROM AN EXPERIENCED ADVISOR:  While in the Everglades, my guide was an experienced wildlife photographer.  While touring, we came close to the bird in the photo and the guide suggested taking a portrait.  I stood next to my guide and we both took a photo or two.  As we shared views of our images on the digital cameras, my guide said he did not like my photos.  I saw no difference in the photos and questioned why mine were different from his.  He then asked me to move about 12 inches to the exact spot where he was standing and take the photo again.  On review of the before and after move shots, I was amazed to see a large difference which he pointed out.  There was a gap in the bush behind the bird that made the background have a white area running from top to bottom in the before move shot.  After moving, the photo (above) had a filled in and clean background making the photo much better.  My Experienced Advisor knew what to look for and showed me how to improve my performance.  My original photo was OK, but my performance was greatly improved by moving on the advice of a professional.
THE ADVISOR SHOWS A MISSED OPPORTUNITY: Traveling to an Indian reservation in Arizona, I retained the assistance of a Navajo Indian guide familiar with Antelope Canyon.  On the first day, we were extensively on foot in slot canyons, some of which were nearly totally enclosed.  The guide often suggested interesting formations to shoot.  At one point, he stopped and said do you see the “Heart of the Canyon.”  At the moment, it did not mean much to me and I only saw a hole allowing me to see partial sky.  The guide insisted that I take a photo of the opening which I thought would be of little value and  difficult to get a quality photograph.  I set my tripod very low and got on my knees to take the photo. I adjusted my lens gradually taking photos of the opening.  After several photos, all of a sudden, I saw the image of a heart show up on the back of my camera. I then saw the guide was speaking of a real image of a heart.  I would never have seen the image had I not been told to look.  I also would have missed it had I not taken time to explore the opportunity from several different vantage points.  The point of this story is that in business a great advisor can show you an opportunity, but sometimes you also need to examine it extensively to get the best approach and value from the opportunity.
LUCK IN BUSINESS IMPROVEMENT:  I cannot tell you how many times lucky breaks have resulted in a new opportunity or gotten me out of a difficult situation.  Some made the difference between success and complete failure.  Luck had a lot to do with the photo of the Golden Gate Bridge.  I had planned to walk to the bridge with full intention to take a photo.  I had not guide but planned the route.  It was a long walk and I took many photos.  The photo shown here is one of my favorites due to the two girls wearing the exact same dress running on a sand bar and playing.  To me, that actually made the photo complete.  Most every time I have been in that area; it has been overcast, cold, and people were wearing jackets.  I have never seen anyone on the sand bar playing.  It just happened that on this day and this time, the girls were there.  The only way I would likely ever get this photo again would be if I staged it.  On this day, I planned a trip, I took the right materials, I knew what I wanted to take a photo of, and when I saw the girls, I tried to make the best of the opportunity which lasted only a few minutes.
The points of these stories are to highlight that in startup companies: 1) every entrepreneur must plan, 2) they need experienced advisors, and 3) they need to be vigilant in order to capitalize on lucky breaks.  Any mix of these can lead to improved performance or success rather than failure.
Taffy Williams is the author of:  Think Agile:  How Smart Entrepreneurs Adapt in Order to Succeed to via Amazon