More than two generations ago, the venture capital community – VCs, business angels, incubators and others – convinced the entrepreneurial world that writing business plans and raising venture capital constituted the twin centerpieces of entrepreneurial endeavor. They did so for good reasons: the sometimes astonishing returns they’ve delivered to their investors and the astonishingly large companies that their ecosystem has created. But the vast majority of fast-growing companies never take any venture capital. So where does the money come from to start and grow their companies? Or yours?
For most companies, fast-growing or otherwise, the early funding comes from a much more agreeable and hospitable source, their customers. That’s exactly what Michael Dell, Bill Gates and Banana Republic’s Mel and Patricia Ziegler did to get their companies up and running and turn them into iconic brands.
In The Customer-Funded Business, John Mullins identifies five novel approaches that scrappy and innovative 21st century entrepreneurs have ingeniously adapted from their predecessors like Dell, Gates, and the Zieglers:
• Matchmaker models (for example, the US companies Airbnb and DogVacay)
• Pay-in-advance models (the USA’s Threadless, India’s Via and Loot)
• Subscription models (India’s TutorVista, the USA’s H.Bloom)
• Scarcity models (Spain’s Zara, France’s Vente Privée, the USA’s Gilt Groupe)
• Service-to-product models (Denmark’s GoViral, Puerto Rico’s Rock Solid).
Drawing on more than two years of in-depth research into the customer-funded phenomenon, and through the captivating stories of these and other companies from around the world, John Mullins brings to life the five models and identifies the questions that angel or other investors will - and should! - ask, and he addresses the key implementation issues that characterize each of the models: when to apply them, how best to apply them, and the pitfalls to watch out for.
Whether you’re an aspiring entrepreneur lacking the start-up capital you need, an early-stage entrepreneur trying to get your cash-starved venture into take-off mode, a corporate leader seeking to grow an established company, or an angel investor, mentor, or business accelerator or incubator professional who supports high-potential entrepreneurial ventures, this book offers the most sure-footed path to starting, financing, or growing your business or those you support.
When he’s not out in the world learning from
or working with entrepreneurs and those who invest in them,
John Mullins divides his time between London, the most
captivating and liveable big city in the world, and the much
smaller and more intimate city of Golden, Colorado, nestled
at the edge of the foothills of the Rocky Mountains. A
former entrepreneur and now an award-winning professor at
London Business School, John is the author of two
best-selling books, as well as dozens of case studies of
real-world entrepreneurial companies and more than 40 other
Now in its fourth edition, John’s first book, The New Business Road Test: What Entrepreneurs and Executives Should Do Before Launching a Lean Start-up, has become the definitive work on assessing entrepreneurial opportunities. His second book, with noted venture capital investor Randy Komisar, the critically acclaimed Getting to Plan B: Breaking Through to a Better Business Model, provides a field-tested process and framework for helping entrepreneurs get from their initial ‘Plan A’, which often doesn’t work, to a more economically viable ‘Plan B’. John is a sought-after speaker to audiences around the world on entrepreneurship, on growing one’s business, and on starting and financing high-potential entrepreneurial ventures.