The Road to Revenue

Louise Daw, Strategy and Innovation Adviser at Hexagon Mining, shares tips from her journey about raising revenue without diluting your company.

Photo by Marvin Meyer on Unsplash

The path to taking your business idea to generating revenue doesn’t have to be a long journey. In fact it should be as short as possible. Before starting my own business I sought advice from people who had been there and done that and the key takeaway was don’t dilute. Just don’t do it.

It left me thinking how can you possibly build a product and take it to market without raising capital because ultimately that’s what you need to generate revenue….or is it?

  1. You are the capital: You have started a business, that means you have an idea, you are self-motivated and you are looking at how to solve the problems your industry faces as opposed to just working around them. That knowledge is worth something, so in the early days use it to generate revenue. My co-founder and I generated revenue from day one by using our industry knowledge to consult to businesses who would ultimately become our first clients. This revenue allowed us to fund product development. The model also opened doors to potential clients all over the world as we built our reputation as thought leaders in the industry.
  2. Be Creative: Being focused on the end vision may mean you miss the opportunities to realize revenue along the way. No development project should be longer than 12 months before some aspects can be commercialized. If it requires longer, then rethink how you are taking the product to market. Be strict with this rule. The element of our product that would differentiate our business required a lot of capital, time and resources to complete. By breaking the development of the project into modules we could meet client needs in stages. Each module was commercialized immediately and generated reoccurring revenue for the business. It took seven years to build our vision but we generated revenue within 6 months of starting.
  3. Collaborate: Expanding on the point above you may not be able to build all you need in the timeframe required so find partners who can. Building relationships with other businesses who have mutually beneficial interests can completely change how rapidly you can get product to market. Our solution needed analytics but it’s a red ocean and we didn’t want to spend time building an analytics engine. We found an Analytics business who had a great product but was looking for new customers, we resold their solution to our clients delivering them value whilst buying our business valuable time to complete the additional features our product needed.
  4. Educate Yourself: Ignorance is hazardous. You may have the ‘Idea’ and know how to run a business but not understand the technical aspects of building the product, or perhaps you understand the technical but are not interested in the financials or marketing. Making the effort to understand the basic mechanics of all aspects required to run your business is essential. Managing costs and ensuring time is not wasted unnecessarily is a must from day one and the only way you can do that is by taking the time to educate yourself.

Using the above tips we managed to bootstrap our business for the first 5 years without dilution or debt. This changed the narrative entirely when we went for seed funding as we already had products, clients and a strong history of revenue. We controlled the narrative and found the best investors for our business without ever coming close to giving up a majority of ownership.

Louise Daw is the founder of the MiPlan mining software company which was acquired by Hexagon in 2017. Louise remains at Hexagon as an Innovation and Strategy Advisor, is a board member for INX Software Pty Ltd and mentors several startups.

Her extensive experience in the software industry and MiPlan journey resulted in being named Ernst Young’s Entrepreneur of the Year (Western Region) in 2017. Louise has worked with some of the worlds largest software firms responsible for product design and delivery, go to market strategies for new product lines and solution implementation.

Louise holds a Bachelor of Commerce (IT and ECommerce) from Curtin University. She is ITIL certified, a member of the Australian Institute of Company Directors and a proud Springboard Alumni.

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