With crypto values languishing and investment cash thin on the ground, the winter of discontent for the Web3 sector looks set to drag on for a while longer.
But for veteran start-up founder and tech industry figure Jerome Faury, focusing on a handful of fundamentals can help you survive and even thrive through tough times. He should know.
Faury remembers “coding on a green screen” in the late 1980s, riding out the dotcom bust in Japan, and experienced the rollercoaster ride of helping lead a publicly listed company. He is also a co-founder of two companies that help anchor the Web3 scene in New Zealand - Centrapay, NZ’s most advanced digital payment acceptance network, and Immersve, the crypto card issuing as-a-service platform.
Faury and his colleagues at Centrality pulled off one of the then biggest ICOs (initial coin offerings) in 2018 when Auckland-based Centrality raised $100 million in funding.
“Six months later, the price of Ethereum, which is what we raised in, went from US$1400… to about $140 a coin, so that $100 million rapidly turned into $10 million. We went from [drinking] Cristal to Lindauer.”
In the recent Web3NZ Learning Series webinar How to survive a bear market, Faury dispenses some refreshingly frank and insightful advice about how to keep a start-up on track in a challenging and fast-changing economic environment.
You can play back the webinar and read the transcript in full. Here are five tips drawn from Jerome Faury’s experience in the world of IT, Web3 and founding start-ups:
- Take care of yourself and your team
During difficult times, it's easy to get burnt-out and feel the pressure to work harder to make up for lost ground. That can lead to poor decision making and bad leadership decisions.
“I know there's an expectation on founders that we work almost 24/7, we don't take breaks,” says Faury.
“But my mental health and also the mental health of my team is probably the most critical thing.”
He recommends taking regular breaks and making time to exercise, meditate or even squeeze in an afternoon nap. He also schedules in a one week holiday each quarter and has a “digital detox” while he is doing so.
He also suggests talking to other founders who are in the same boat to share ideas and support one another.
“There are a lot of naysayers, so your ability to believe in what you're doing and to also instill that belief in your investors, your customers or your people is really critical.”
- Leverage your networks
Immersve was fortunate to be chosen to participate in one of the largest Web3 accelerators in the world, Outlier Ventures, and raised $17 million at a $120 million valuation from offshore investors via Outlier’s venture capital connections.
But just as important as the injection of capital was the access to Outlier’s portfolio of 200 companies.
Faury: “We've found that being part and alumni and part of that ecosystem super valuable.” He also uses the expertise and networking available via Callaghan Innovation, FintechNZ and BlockchainNZ.
Being part of Mastercard’s network as a result of integrating its platform with the credit card giant’s services, has also opened many doors.
Each entrepreneur and start-up will have their own network of connections that become invaluable, particularly when the going gets tough.
- Have a North Star
Faury is a big proponent of strategic planning and tracking progress towards strategic goals.
“Our Northstar, what we're looking to achieve, is to process US$110 million of annual spend via our platform within the first 12 months of going live,” he says.
Goals are laid out in four key areas - finance and legal, product tech, sales and marketing, and people, with business objectives “that hold each of us to account”. Immersve ensure goals are SMART (specific, measurable, attainable, realistic, time-bound) and Faury favours transparency - even the interns know the state of the company’s finances.
“What this does is it creates the foundation to execute against that strategy,” he says.
Immersve is a big user of Notion, the productivity and collaboration app.
“We use it as a source of truth for pretty much everything in the business.”
- Persistence = sales
“I used to do the 100 calls a day to get one sale,” says Faury.
When he was trying to sell people websites in the late 1990s, a typical response was that they didn’t need a website because they were listed in the Yellow Pages.
The key is not to give up, because 80% of sales occur after the fifth interaction.
“Don't expect to close on call one, two, or even three, have a templated approach. You need to have that perseverance,” he says. Ultimately, sales is a contact sport.
Faury says selling your product or service requires the same approach as a doctor, listening to a patient’s health complaints.
“When I visit the doctor, I typically talk for probably 80% of the time. In sales, you want to understand your prospective customer’s strategy, their pain points. What does success look like for them? It's no longer about your product.”
- Nurture your investors
Start-ups in search of funding need to demonstrate they represent the “water in the desert” for potential customers, making them attractive to invest in. Faury says it is critical to understand your numbers, your target market and to be able to communicate this well to prospective investors.
You also need to be able to demonstrate a high AQ - adaptability quotient.
“The US military has this term called called VUCA - volatile, uncertain, complex and ambiguous,” Faury points out.
“So your adaptability quotient, your AQ, is now the new superpower.”
Speed and scale are essential to success and the latter can be achieved by partnering with larger organisations, just as Immersve did by working with Mastercard. Funders want you to succeed and reward their investment with you, so are a great source of leads for prospective partners that can help your company scale at speed.
Faury keeps close to his investors sharing progress and keeping them in the loop with quarterly Zoom meetings offering an extensive update on progress.
“I really engage investors, and I find that probably our largest source of revenue leads and opportunities come from those investors,” says Faury.
“They also have other portfolio companies that could be good customers or good partners.”
Watch the full webinar for more insights and tips from Immersve founder Jerome Faury.