Featuring Bryan Janeczko of Gro Academy
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In this episode of the Coach Mike series, Mike Suprovici (FI Head of Portfolio Success) is joined by special guest serial entrepreneur Bryan Janeczko and Founder Insights editor Dustin Betz to talk about recession-proofing your business. Bryan Janeczko is the Founder of Gro Academy, VC advisor at Loeb.nyc, and former Director of FI New York (2011-2016).
Janeczko's first startup NuKitchen (a D2C subscription meal delivery service) was acquired during the Great Recession of 2007-08. With experts predicting a possible new market correction in 2020, and coronavirus already showing signs of slowing global markets, how can founders prepare their businesses for a potential downturn? Mike and guests discuss the preventative steps that founders can take to avoid the costliest negative outcomes of economic recessionary periods.
Coach Mike and guest Bryan Janeczko answer questions like:
- What lessons are drawn from the successful founder experiences of the last recession: How did Bryan do it? What happened at NuKitchen between the start of the Great Recession and its acquisition?
- What are best practices in planning your business for a potential downturn in 2020 and beyond?
- What types of products or services tend to fail or succeed more or less during recessions? Predictions of categories that will fail or succeed through this next downturn?
- Why impact companies and ethical ventures have greater chances to success during hard financial times.
- and more!
Try Gro Academy's new free tool, Gro X, to validate your startup idea with customized feedback and receive a personalized 1-page Business Brief.
The following includes a transcript from this Founder Insights podcast episode – these transcripts are produced by a third-party natural language processing algorithm, and are not checked word-for-word by humans for complete accuracy—so, there may be some errors or typos!
Mike Suprovici 0:02
Hello, everybody. Welcome to this edition of the founders to podcast. My name is Mike Suprovici. I lead the alumni success group here at the founder Institute. And this is Dustin.
Dustin Betz 0:13
I'm Dustin Betz. I'm the head of community and content at the founder Institute.
Mike Suprovici 0:18
And today we have a very, very special guest. And I'm going to let Bryan introduced himself to the world here. But we're really, really thankful because this is a great topic. And we're going to dive into some really important things and also very timely topics. So Bryan, would you mind introducing yourself?
Bryan Janeczko 0:35
Sure. My name is Bryan Janeczko and I am a serial entrepreneur. I launched my first business about 15 years ago, as a pioneer in what is now the fresh meal delivery business. That's a multi billion dollar business, but back then we were the first and ultimately after doing enough things right, we were able to scale the business, raise a little bit of venture capital and then ultimately sold the business. It started in 2008. But we actually sold in 2000 to Nutrisystem the weight loss company. So definitely a very timely topic for today's discussion on what might be going into a winter season for us right now, from that experience, a number of things. Many areas I've been several years, notably how to build a company that creates value that gives back to the community, the value of helping entrepreneurs get going. And those have really been core to me as not just as a seasoned exited entrepreneur, but also in terms of what we can do to help create the next generation of scalable businesses that have impacted meeting or as I think founder institute says, building businesses that are both meaningful and enduring. I love that particular statement. And I am a former director of a founder Institute here in New York, Gabe Zuckerman and I launched and ran that for a few years. Gosh, that was a few years ago at this point, but you know, it was so excited to be able to be part of the founder Institute and understand what they were doing to help early stage businesses. Really Get going. And what I love about the model is, it's it's very unique in many regards, certainly compared to other accelerators. And I think you're uniquely positioned to really help these dreamers, these emerging entrepreneurs really get going and kind of tie up to where I am today, I'm working with Michael lobe, who would co founded Priceline and built a number of other multi billion dollar opportunities. And he's backing some of the ventures that I'm working on today, including crow Academy. So I'm very fortunate to be in an area surrounded all day, every day by successful entrepreneurs, Business Builders, and working with people like you who are really trying to help incubate the next generation of scalable startups.
Mike Suprovici 2:42
How's that? No, it's great. It's great. Thank you so much for providing all this knowledge for our community. This is really really helpful. You know, back back to new kitchen a little bit. The sounds like it was a pretty tough time for you to be building this business then not only is it just business itself, but also just doing this in Oh 708 Those are some pretty rough times.
Bryan Janeczko 3:02
Yeah. And it's interesting because so much has happened since the last recession and I've been very fortunate to be well, I do believe that we are entering probably a recessionary at least a market downturn for sure how deep it is. I can't predict that. And then Frankly, I don't know how much of an impact coronavirus ultimately will have right on our society from a health and human standpoint, but from a business standpoint, we're already seeing a slowdown, and it was just accelerated or aggravated by the coronavirus.
Dustin Betz 3:33
Yeah. Well, I mean, I think every economic downturn is obviously a little bit different. They tend to be triggered by different things. I think two months ago, you don't wouldn't be talking about the coronavirus being the trigger for you know what might or it's very likely to be the next economic downturn but maybe tell us a little bit about your experiences through the recession period in particular at new kitchen right like what kind of changed in the business versus stayed the same. Yeah, and how much of that was do you think was a result of recession versus, you know, things that were just happening naturally as the business changed and grow during that period?
Mike Suprovici 4:09
Well, I think you always need to be mindful of economic conditions. But at the core, I think for all of us as entrepreneurs, we're trying to solve a problem. And if you're very focused on a problem, and you think you've got a great solution, and you've actually got customers who are engaging with your product or service, and are opening up the wallet, which is demonstrated proof of that relationship, I think you're onto something. And in the case of new kitchen, being a fresh prepared meal delivery service, but people were time starved and cooking and preparing meals is a challenge. And one might think during recession, well, that's going to change. And certainly it may depending on the type of service that you're offering. So for us, as the recession hit in 2007, and eight, there were really three things that I thought as I was preparing for today to really think through the three elements that I believe are critical for any business, especially if you're positioning yourself As a premium product, number one is are you providing an outcome? Or what are you actually selling to your customer, you're not actually selling them a product. It's an outcome. That's number one. Number two, it's really understanding who your consumer is and really understanding the behavioral psychographic data elements about that consumer. And that will help you think about how you target that person, retain and acquire new customers, even during a downturn. And then number three, how do you create value, it's really creating more value, giving the customer more more value than they're paying for. So we look at those three elements. I think we did those things pretty well. And let's start with number one. When I think about providing an outcome, I wasn't selling you food because you're you know, you had a long day at work, you're coming back you just didn't want to cook that night. That wasn't at all what it really was over the course of a month. If you a healthy, delicious organic meals that were fresh, prepared, delivered to your door, not only you're gonna have more energy, you're going to feel better but you can lose weight, being the The best shape your lives, it's often during these down times when we're selling this outcome that over a 30 or 60 day period, you can be the best you can be. Because we all have to step up our game, especially when we think we're at risk, our lives are at risk, we want to be the strongest players we can. And we did that buying new kitchen as an investment in your health and your wellness, people came to sort of rediscover themselves to transform themselves, and they stayed for the convenience. So while people may, you know, eating our meals, seven days a week for four to eight weeks, after that period, they were continuing to enjoy meals, you know, at a more ad hoc basis, but we were able to extend the revenue lifecycle of that particular customer. So that's number one. Number two, really understanding who that consumer is because there are certain consumer segments if you don't have a strong connection with you don't have a strong bond with they're going to leave. And so we understood that our primary consumer was a person in their mid 30s. That was time star professional. They were working parents made solution. He's still better, which then led to point number three creating more value without having to cut prices. Sometimes there's inevitably a little bit of discounting that goes on. However, we can't discount our way to the bottom, you've got to pay salaries, you've got to pay overhead, you've got to pay for the product itself. So what other ways can we create value that would lock in the customer. So obviously, by knowing who your customer is, and understanding what's important to them, discounting may not be the most relevant thing to them, offering them some other solution, additional meals. In the case of new kitchen, we added a lot of complimentary services we worked with different healthcare facilities, gyms, fitness facilities and other places where you can go to to create a better life whether it was you know, Equinox as an example, you get a complimentary membership for a month. Equinox is happy, we were happy, the customer was happy. Those are things as we try to find partnerships for complimentary blend brands.
That's really interesting. I kind of want to riff on that a little bit because there's a lot of tidbits in there. So yeah, Definitely provide a solution to a problem. That is a real problem seems like a very big theme here. Yeah. How did you go about, you know, managing through this this time with, like your employees and everybody that's involved in the business? Right, obviously, like you mentioned this part about like the bottom line and making sure that you're profitable in the unit or unit economics look really good and things. You know, how did you manage through all that during that time? And what are some of the best practices that you can share with all of us?
Bryan Janeczko 8:29
I think we did some discounting, but it was really reconfiguring how we sold it. There may have been some maybe would have done more sales beforehand. I'm not sure we don't have another data point. But we didn't fundamentally shift. Anything we were doing other than the fact that we weren't spending a lot of money on offices, lavish offices doing expensive activities that I find a lot of startups that get funded, they tend to overspend or they try to ramp up very quickly. We were very deliberate with how we grew and scaled business. And we work with a lot of outsource partners. So I think that's probably onto something really important there is, is having a lean team, and then making sure you work with outsourced relationship. So there's the marketing side product development side, you know, in terms of our co manufacturer who helped us produce the products, we put in orders every day, we had certain minimums and as long as we threshold, we were able to manage that pretty well. And any capital investments that were required were those costs were born by the partner that we had. So that's how we really managed that I do think employees tend to be a little bit more committed to you at that point. Because you're doing well you tend to see not as much job hopping. So for us it actually was a great opportunity to attract some better quality folks, but we didn't do a whole lot of hiring during that period. We did a lot of working with outsource partners and we continued we leaned into that obviously provided more flexibility and work to our advantage I thought.
Mike Suprovici 9:57
Did you did you create any sort of like plan or some sort of plan Planning beforehand, obviously, it's really hard to plan against like a black swan event or whatever, but like at least have some kind of like measures in place you can share with us.
Bryan Janeczko 10:09
Well, I don't think there's anything over. But the idea of creating value, sort of that last point always be in a place to create value, that that's been a fundamental philosophy, something I've always subscribed to. So I want to make sure that I'm adding value to those I serve. And that's at the core of everything that we do. And I believe that is what will differentiate products, because you're always trying to go above and beyond and make sure the customer has an incredible experience. I can't say we hit it out of the park every time but at the same time, I can say that it served us well and it served me well today. So I think what shifted between then and now, I believe our models that are really focused on mission, social impact. So if you've got a product or service that's really aligned truly and authentically aligned to the product, service you're selling, I believe that you stand a much better chance during a recession as well. And what I mean by that and the differences in the past, we always supported causes for hunger. When we first launched new kitchen, we were working with one co the women's housing Economic Development Council in New York to help at risk moms, young moms who didn't really have a place to live. And this particular building, gave them shelter, and they rented out a kitchen space. That's where we started the business. And we got to know firsthand some of the people who are struggling with not just hunger but with how to eat healthy. And so it was such an incredible eye opening experience. And so we were able to partner at an early level. Now we didn't focused on that we didn't make that part of the brand DNA, we didn't promote that. But what I'm finding today is if that is part of your brand DNA, make that front and center. It doesn't have to be serving, you know, the homeless or feeding the hungry. I think whatever is important to you, whatever that core value to your businesses, make that front and center so that the consumer identifies with you can also identify with that because As you may know, Millennials want to make sure that their dollar has impacted, they want to make sure that they're buying products and services that align with their core values.
Mike Suprovici 12:08
You know, we agree 100%. And as a matter of fact, you know, as a side note here, we also agree with that. So we want to have 80% of our businesses over the next 10 years, have some sort of an impact focus, and that's a big core to our DNA as well. You know, I want to double click on that a little bit, though, you know,
Bryan Janeczko 12:25
why do you think that,
Mike Suprovici 12:27
let's say in a recession, you know, these companies tend to have a possibility to be more robust. Do you think it's, it's more from a marketing perspective, and people just aren't going to want to continue to vote with their dollars because of that, or is there something else? Is it easier for them to recruit employees? Because maybe there's the mission aligns, or how do you think about that?
Bryan Janeczko 12:47
Well, that's a great question. And I think it could be a little bit of all of that. But you know, during this session, people are going to cut back so it's typically subscriptions, things that are viewed as nice to haves and and, you know, meal delivery clearly could follow. into that category. So I can see a lot of people not getting that meal kits delivered once a week where you spend an hour preparing a meal with your loved one, if that's what you do. Again, if you're positioning it as that I think those items tend to be cut. It's a matter of how you position it. And I think you can think about, you know, how you market it and the value that you provide, and really the outcome. So I'm going to come back to what we did. I mean, we provide fully prepared meals. And like I said, if you ate with us for a month, you're going to feel better, you're going to look better. It's a pretty strong value proposition. And even during a downturn, people want to make sure they're at their best. And if you can guarantee that and provide 100% satisfaction guarantee you're in a much stronger place. I think from the consumer perspective, that's how I would address that. From an employee perspective. I think you can attract and retain talent, and even today's consumer who are employees who could be considered, businesses might say that they're a little more fickle. Since job hopping is so common. I think people should always be looking for opportunities that can help them Be the best. But at the same time recession really makes you think about Should I dig in here a little bit more? What what value can I continue to add here? So I actually think it's better for companies during recessions with the employees they have in terms of attracting and retaining talent. You know, oftentimes marketing might become a little cheaper, since budgets, sometimes they're freed up. And you know, some other companies are pulling back on marketing companies that are struggling. And so you're not going to push the demand up for pricing, whether it's on Facebook or other social channels or offline channels. Well,
Mike Suprovici 14:31
that makes a lot of sense. It just triggered some other questions. Sorry, I know Dustin's got a bunch of questions for you too. But for the entrepreneurs that have never been through this type of an event before or, you know, maybe have never even lived through it as an employee or whatever. Yeah, what generally happens in a recession
Bryan Janeczko 14:49
here fear if you think it's scared, it's natural and and I definitely had an element of that when I sold the business. You know that that weighed in a little bit and I was actually not looking to sell it. I was looking to find a strategic partner. But I am full candor, I will admit that there is a fear factor. And I think that's the biggest thing that happens during recession. Frankly, it's an opportunity for all of us and recognize that there is opportunity whenever this downturn. In fact, most companies were formed during rough times. And so if that is anything to take note, and because if you can do well during these times, or at least get going, as the economy improves, hopefully you will improve.
Mike Suprovici 15:32
So from your perspective, and oh, seven away, what are some of the things that happened? Like what are some of the things that were you went through that so so obviously, I think capital probably was a little lower. Tell us a few examples of some of the things that your drove?
Bryan Janeczko 15:45
Well, I think capital definitely dries up people, the purse strings tighten. So that is a real manifestation. It's challenging. So if you break this and you're looking to get funding, or a lot of people pull back on the funding Venture Capital tried up in 2000. During that, that crash, and then clearly again in 2008, nine, you know, started in 2007. It was tough. And even if you're trying to get a mortgage for a house, I mean, there was no, it was very difficult to get money. So, again, I'll go back to fear fear is what drives that. But if you understand that, how can you work within that? Again, I'm not saying it's easy, but if you understand the psychology, and if you even haven't been through that before, listen to people who have been through that and who were able to manage and navigate some of those moments more successfully. And I think you can try to at least counterbalance some of that. So in terms of raising capital, you know, for me, it was finding a strategic partnership as opposed to asking for money. But what Nutrisystem needed was a way to differentiate itself. So try to think big and broad with whatever business product or service that you're offering. Think about what other big company but other organization, it is a whole host of things that may go through your head. Forget about all that and think about What would be the ideal sort of distribution partner that could help you?
Dustin Betz 17:05
I really like kind of what you said, or I find it very interesting that, you know, a large amount of businesses are actually founded during economic downturns that, you know, I think like, you never know what the next cause of the economic downturn is going to be. But then when you look back in retrospect, sort of like it's the causes kind of eventually, they always seem obvious in retrospect, or opportunities that emerged kind of seem obvious, maybe. So now we're going to have you play kind of media armchair, speculate a little bit. What kinds of products or services you think tends to be more successful or maybe tends to fail more often during a downturn, and then maybe want to extrapolate that out and bring out your ball? You know, what do you think possibly given kind of the macroeconomic conditions that we have right now in 2020? Yeah, opportunities that you see, possibly to be disrupted. Next. In the next downturn?
Bryan Janeczko 18:01
Well, I think education needs to be disrupted in a big way. So number one, the cost of education, higher education is out of hand. But terms of products that people will start to cut, I may have touched on this a few moments ago. But subscriptions, if you look at, you've been on TV Do you need I think, even now, I questioned Do I really need all of these because, you know, going back to Netflix and Amazon, Hulu for for everything else. So those are things people will look at. They'll look at some of the other models that aren't essentials in their life. Certainly, if your premium price, you're going to be in a position but things that people know and love things that are important for that outcome. You've got some kind of, you know, a beauty regimen, something that you spin cream, you may try to look for a less expensive version. But if you have something that works and you like that's providing an outcome, it's making you feel better, it's making you look better, maybe it's anti aging, whatever the case, those are things that people will continue to buy, maybe they're not going to see an uptick in that So as a company, you've got to figure out what other products is just can't sell to that consumer who's already loyal to you. So while customer new customer acquisition may be difficult during recession, extending the lifetime value of customers through, you know, additional products and services is a great way to experiment and to grow. And you brought up something earlier about the type of recession, cheap capital, low cost capital, there was a lot of venture money in the world and it went into a lot of tech startups. As soon as you hear the proverbial taxi drivers IPO on the startup, that's time to be scared. That's what you should be selling. And that's exactly what happened. And we had a crash that was really precipitate that was precipitated by that built in, you know, easy credit and easy capital. And a lot of that was flowing into products that were not necessarily proven. It was based on eyeballs, there was no sense of stability. It was all eyeballs. And actually the crash of 2007 and eight was really a credit crunch. It was a housing crisis. That was a different kind of bubble, that crash. I think the one that we're going to experience now is probably related. More 2000. So if I had to compare the two, it'd be something more like that. Cash is incredibly cheap today, you've got a lot of funds, a lot of venture groups, a lot of family offices with a lot of excess cash that are just falling money. And you're starting to see that fall apart with we work with Uber, a lot of these companies. So it's already happening, I believe we're already in at the start of a recession. And so when you look at what's already happening, you know, it's just going to get a lot worse and funding will dry up for those kind of businesses. I think business models in 2020, you need to think through what is your path to profitability? What are you doing to try to drive? market share?
Mike Suprovici 20:37
Yeah, we agree as well. I think that having profitable unit economics is just absolutely important these days. It's difficult to scale. And then for founders alumni being that most of you are not in Silicon Valley, the access to the level of capital that you wouldn't need to try to build kind of an eyeballs business is just tough anyway, like even if you're in the Best of times, but your company is headquartered in Africa or something like you're just not not going to have that capital anyway. So either way, you have to figure out a way to basically be profitable from the first time and the more direct you are to that capital, the better, right? So if your business models like, Hey, I have this thing, pay me for it. That's very directive. Yeah, your business models like, Oh, I have to get these people over here. And I'm going to sell them to this other third party thing that is a double loop or whatever you want to call it. Like, for example, like the people that sell like analytics, you know, type of businesses, that's much more difficult to make some trying to provide a product that is so valuable, and people want to pay for it. Solve the real hair on fire, kind of a problem that people want to need to spend money on.
Bryan Janeczko 21:48
You're absolutely right. And we're talking a lot about consumer products, which we know the middle class drives a lot of consumption, the bulk of the economy, but we forget about the enterprise. All the solutions, certain sectors, right health, and it's just really hard. But when you look at some of the business to business, if you're in a mode of figuring out how we can create more value or what we're actually doing and convince the person writing the check on the side that you've got something, and you're able to execute it in a streamlined way, with that path toward profitability, and solid business model economics, you're obviously in a much stronger, stronger place. And I firmly believe that I've been trying to promote that within the walls here at low gram, and we've got about 40 early stage businesses here and thinking profitably, and how are you going to get there? What are you doing today? that's going to get you a little bit closer and I hitting some of those metrics,
Mike Suprovici 22:40
ya know, b2b, I mean, speaking back, bringing it back to fear, right, the b2b buyer, part of their fear is am I going to get fired right if I make this decision? Yeah. And so really need to provide a lot of value to the buyer and to everybody involved. So you, you got to think about that when you're building your product, and your your market and all that. And it's super critical. Now, before you know you find yourself down the line after you spend all this money that you, whatever, building this, that's not really quite where it needs to be. So just food for thought.
Dustin Betz 23:15
And I think one thing that's also interesting to to bring it back to kind of the social impact startups. You know, I think we believe that some of the next trillion dollar businesses are going to be these kind of impact companies that are solving really, really big problems. And that also the thing underlying that comes back to Yeah, value and outcomes, right. And similarly, I think that, you know, the big opportunities that are going to present themselves are going to be to solve some of these huge problems.
Bryan Janeczko 23:40
I agree. I'll bring up a company that I was just with before speaking to you here bombas. I was with the co founder of bomba socks, and they literally had built up to $300 million dollar model. In five years. You talk about the traditional hockey stick curve, I write these plans. I've given these plans They have and they're profitable. They're a great business and a great mission and how a company like that positions itself for potential downturn is, you know, you've got economies of scale, you're producing your production. So both on the, you know, the cost of goods side, you've got that supply chain manage well, and you can continue to improve efficiencies there. You've got a loyal base of followers, and then you can for them, you think about expanding into other product areas as well beyond stocks potentially. So that way, you don't have to worry about acquiring so many new customers as you can extend the value to existing customers. And look, it's all cyclical. It's unlikely we're going to be in a prolonged recession, you know, downturns always result in upturns. You know, unfortunately, the midnight early 19th century when we had the Great Depression throughout the 1930s. There were a lot of bad macroeconomic policies, credit was sort of loosened it was tightened and we now know better so hopefully, we won't have such a prolonged period, even with the 2008 reset. And I could have been a lot worse. But we did all the right things I believe as a country to help get us out of that. And look, it's it's been happening straight. You know, soon as we got into it, we did a number of things to help us get out of it and took some time, but we've been doing it.
Mike Suprovici 25:13
Can you talk a little bit about some of the strategies? I know you also working with a big portfolio of companies that love and just your experiences on some of the strategies to maybe even build some sort of like redundancy into your business. For example, if you have vendors, do you want to have like a set of other vendors just in case whatever reason they can make it up times or redundancy on potential employees or anything like that to basically try to give you a little bit more peace of mind. I guess. things do go south.
Bryan Janeczko 25:40
Yeah, no, I think that's a great point. I think the redundancy of having backup vendors, it's always critical during a good or a bad time, but during a bad time, I think because of the market things are aggravated and a lot worse and it's easy for your vendor to go out of business provide subpar service, and a host of issues that are going to impact your quality and how you you present yourself to your end consumer, you know, they're due to do so and they made them more Carter at least, potentially, that's the expectation. And then you still have freelance help. So I think you can test and learn with a lot of different resources much more easily. I know we've tried to bring on people know in the last year as a consultant or advisor, in a limited capacity, it's been tough. People want to have full time they there's a whole different experience expectation that I think becomes a little easier. So that's the one thing that does, in my mind become a little bit easier. There's less wage pressure, there's more people willing to dig in and commit to you, especially if you believe in your vision and align with your core value.
Mike Suprovici 26:40
It makes perfect sense. I mean, we just sent out an email yesterday with regards to, you know, to the whole entire ephi community, mentors, alumni, things like that about just kind of how to think about this potential like Corona virus outbreak if there is going to be one. And one of the things we said is like, Look, in 2020, you should just have redundancy with regards to supply chain, particularly if you're a hardware company, you working primarily with China for to build your product, you know, you probably want to think through like maybe somewhere other places in the world where you can have be able to have similar outcomes just in case something were to happen. And Either way, it's a good strategy respective with buyers irrespective of whatever.
Bryan Janeczko 27:16
Yeah, it is. But also, speaking from an early stage business perspective, it's very expensive to do that. That's the biggest challenge is while but you still need to have them lined up just in case run. So I think your your situation is a little different for an early stage business. So my suggestion is to really make sure that the person or entity you're going to be partnering with is prepared. And look, there's going to be exogenous risks. I don't think we could have predicted the coronavirus right here. And now, what we could be predicting is a downturn because it's been 12 years of some sort. So we can think through that. I know we've had some challenges with China in the last two years under the current administration, some of that was brewing well before That the previous administration, I think naturally want to just dig, you know, dig deep and look hard and try to find alternative sources. But as an early stage businesses, you're still a little limited. So it's good to identify them. But you may not be able to sign a contract or partner with multiple ones. Kudos to you if you can, but not always going to be the case. But with that being said, I do believe that certainly founder Institute and even with grow, I do think that there's such an incredible opportunity to even think, and then you have the added benefit of people leaving jobs or being fired. You know, there's a lot of shrinkage that goes on for companies that are poorly managed at our cash flow constrained. You know, good folks are let go. So if you are thinking about starting a business, maybe this is the catalyst that you need, are you band together with other people who maybe share your vision, and you start something together and you think about how you can test them or that and achieve way which, again, I think is a great segue into both grow and a high level, validating your idea and then going to actually get the practical steps that you need. need to plan fund and launch the business in a meaningful way and a supportive community and then a huge fan of founder and student for years, I think the model is the only one of its kind for such an early stage entrepreneur. But this is the way you test it. And you see is entrepreneurship right for me? Is this model going to do well, and you get the community to launch it. And so I'm a huge fan and I think anybody should really who's got something in their head should really start to just just see if there's a they're there. And if they think there is go to founder Institute, and then you know, test it, and there's not you don't have to launch but you're obviously encouraged to do so.
Mike Suprovici 29:34
You know, sometimes these conditions are really good forcing functions, whether it's to start your own or join something. Yeah. So it's it could be a good thing if you look at it on the positive side.
Dustin Betz 29:44
Yeah, well, I wanted to Yeah, I guess just kind of give another second to put it all in a wrap is to put this scenario sort of in place: the downturn is here, my startup we're doing our best to deal with it. Just to recap, you know, what are the kind of potential techniques that founders can put in place to improve their chances of survival and things you talked about. Again, we're like, looking at outcomes, looking at your customer, and then looking at your values. That's it. Anything else you kind of want to say about just in terms of founder planning? In conclusion?
Bryan Janeczko 30:16
Well, you're right, you got the three pieces you've got create an outcome, make sure that you're not selling a product, it's an outcome and understand your customers. And in terms of managing, you know, during a downturn, because capital could be tight, what can you do in terms of tiny well, and you just want to credit beforehand, what can you do to foster those relationships with investors before you actually hit the downturn? So make it a little bit easier, potentially, when you're actually in one and then have a focus on actually creating a cash flow positive business? What are your business model economics? What are you doing to move to a path of profitability? day one we recognize most startups are not profitable and they take a few years but that's okay if you're hitting key metrics to get there and I think Think attracting the fundamental premises always attract talented team to cute. The need that we put obviously during a downturn, I think that becomes even more pronounced. We talked about the idea of making sure that your supply chain, you've got a potential backup solution. So if something shouldn't go down, even in the case of a startup, where you have the one provider, the one co manufacturer, that they go out of business, you have another one lined up so that maybe if you're not producing for one month, maybe two months at most, puts a dent in your business, but doesn't necessarily have to put you out of business.
Dustin Betz 31:32
Awesome. Well, this has been a great conversation with I think, a lot of practical tips and really timely for people to start thinking about this now, before a recession is really, really clearly upon us. So thank you so much, Bryan, for your time.
Mike Suprovici 31:49
Thank you so much for your time. Really appreciate it.
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