In three weeks, my friend and business partner, Mike and I will be moving to Chile for seven months to build our startup SimpleCrew. To aide us in our business and adventure, we received a $40,000 grant from the Chilean government.
This is a huge, exciting opportunity for us, and one that I’m sure you many of you could run with given the details. So when Maneesh asked me to share my thoughts on the application process, it was all the motivation I needed to put something together.
In this post, I’ll share some thoughts on how we applied and were accepted into Start-up Chile, a startup initiative out of Santiago which offers grants to budding entrepreneurs.
It’s worth noting that when it actually comes down to it, there isn’t really that much between application and acceptance to Start-up Chile. Unlike the application process for other startup incubators, this one was relatively hands-off (more on that below).
But as MJ from Millionaire Fastlane would point out, you can’t just focus on the “event” (applying/getting into Start-up Chile), you have to look at the “process” (the months of work we put in that made our application attractive and ultimately worthwhile).
While my experiences offer only one data-point, I’m happy to offer my thoughts on what we did well, as well as the details of our application and the (limited) feedback we received.
Start-up Chile is a program run by the Chilean government that brings early-stage entrepreneurs to the country to build their startups. Their ultimate goal is to make Chile the innovation and entrepreneurship hub of Latin America by bringing 1,000 startups to Chile by 2014.
During the six months of the program, the participants must remain in Chile. Each startup gets a $40,00 equity-free grant, a 1-year work visa, and access to local financial and social networks to launch their businesses from Chile while interacting with the local entrepreneurship ecosystem.
For the last three years, Start-up Chile has run two programs per year, accepting around 100 companies into each program. From what I’ve heard, around 1,400 companies apply each term.
Applicants have a 1 in 14 chance of being one of the 100 accepted companies. For an opportunity as amazing as this is, those are some incredible odds.
Here are the details of our full application on our company blog.
A while back, I read a blog post from Micah Baldwin with the edgy title, “Just Fucking Sell.” If you’re curious, it’s a great quick read. But the message is simple and can really boiled down to this one idea:
“For a company to be successful, there are literally only two functions the company has to perfect. Building and Selling. Thats it.”
Since reading that, the idea has really shaped how I think about what’s important in startups. It can be easy to get lost in the sea of shit that you’re supposed to do as an entrepreneur, but you should always remember: at the end of the day, it’s the building and selling that’s going to make you.
Anything other than building or selling — including legal, accounting, financing, etc. — is peripheral. Your strategic advantage is never going to come from how you raised a round, how you structured your company, what state you’re incorporated in, or any of that other stuff. Yes, those things matter, but only to the extent that they help or hurt your ability to build and sell. Everything else is secondary.
So if all that matters in startups is building and selling, then that’s all that matters to potential investors or the selection committee in a program like Start-up Chile.
They want to see that you can build and sell. So how do you communicate that in an application? It’s not necessarily easy, but it’s simple enough:
– Have something to show (building)
– Show social proof (selling)
Have something to show (building)
If you’re a hopeful startup, whether or not you’re applying to a program, you’ve got to show that you can create something.
Of the 1,400 teams that apply to Start-up Chile, I’d bet that a majority were just hopeful dreamers with an idea in their head and dollar signs in their eyes. The bad news is that your ideas alone are worthless. Everyone has ideas. Everyone has five in the morning when they shower, and a dozen more while turning over in their beds before sleep.
So an application with just an idea will not get you in. You have to create something. 1 in 14 odds aren’t daunting, but creating something will automatically put you in front of the majority of “ideas” and “dreamers” in the pack.
So what to show that you’ve created? There’s a range. On the high end, you could have product out on the market available for use. On the low end, you could have just a landing page collecting emails. In between there, you have a range of things to show from product sketches to mock-ups, wireframes, and minimum-viable products.
Get something out there. Prove that you can create, giving yourself something to sell and give people something to buy into.
You don’t have to have a product for sale, thought that would obviously help. Just keep in mind that for every little bit more you create, you’ll separate yourself from the dreaming pack of hopeful “wantrepreneurs,” and stack the odds of acceptance in your favor.
Bottom line, you have to show them something. At the very least, put up an attractive launch page selling your vision and collecting emails (emails = social proof, more on that next). Then mock-up some product screenshots and make a *brief* (1-2 minute) video walking viewers through the mock-ups.
That should give you something to sell, and help you with the next step: collecting social proof.
Show Social Proof (Selling)
If you build it, will they come? Sales is the answer to that question. You have to show that you have what it takes to sell your idea and product to future customers, employees, partners, and investors. In a word, you’ve got to show that you can hustle. There’s no better way to describe it.
So how do you prove to a selection committee that you’ve got hustle? By showing social proof. Here’s some forms that you might be able to leverage:
- Customer Development Tests: Interview groups of your target customers on the problem or pains that your product is aiming to solve. Show that you really understand the customer pain, that people are willing to pay for your product, and that you can get your ideas in front of potential buyers.
- Quotes and testimonials from target demographic: Water the customer development tests down to bite-size quotes that help sell your product.
- Active social channels with followers/subscribers: Especially if you have a consumer product, show that you can leverage the free marketing tools out there to build excitement for your product. (For us as a business product, this is less of a priority. But for you consumer companies, this is obvious enough.)
- Email list: If you’re collecting emails on a launch page and can show that people are signing up, that’ll help communicate interest and show that there’s a market for your product. This will be an important tool for you as you grow.
- Letters of Intent: If you’re a business product, this is a strong showing of social proof. You need to get number of customers to sign a non-binding agreement saying that if you built this, they would buy it. Obviously this isn’t binding and isn’t meant to hold in court, but if your product is solving a compelling enough problem, this will be a good indicator of buying preference.
- Paying Customers: The ultimate level of social proof is having people paying or highly-engaged on your product. This is clearly a high level of social proof and, I imagine, would automatically put you in the top 100 companies applying to a program like Start-up Chile.
- Press: If your startup already has press, that’s a great way to show that you’ve already had success pitching your business and getting it attention from press. That can be a strong tool later when it comes to selling your product.
- Investment: If you can show that you’ve sold your vision to investors and raised any amount of capital (especially outside of immediate friends and family), that’s a good signal that you’ve got some of the chutzpah that will be critical in making you successful. That said, plenty of companies get investment and go on to fail, and again it’s slightly peripheral to the true essence of “building and selling,” so don’t get too caught up in it.
Ultimately the social proof component needs to show that you’re going to have what it takes to get your product off the ground as it’s being built. This is an often overlooked and underrated part of startups, so think wisely about which Traction Verticals might be the most relevant given your product and business model, and find ways to indicate social proof in that direction.
Sit and Wait
Unlike the application process in other accelerator programs like Y Combinator, TechStars, and others, this one was completely hands-off…meaning you apply and wait. There were no follow-ups, no massaging of alumni or mentors, no interviews or phone calls.
In our eyes, this was an attractive trait. We’d applied to TechStars Boulder and Seattle before, and both times got relatively far, within the top 25 out of 1,000ish teams going for 10 spots. Both times, we flew to the respective locations for interviews and to meet with the program directors. And both times the process pretty much ate up my entire bandwidth and focus. It’s hard to focus on building and selling when massaging mentor and alumni relationships is a top priority.
To give you some insight into how the judges graded us, here’s the feedback we received from our Start-up Chile application. It wasn’t much, but for any of you that are considering applying, it might give you some insight into what they’re looking for:
- Very interesting idea! Heard about something similar before but I believe no one has hacked that market.
- How will you acquire your customers? Given that they are business customers, you may have to do some face-to-face selling, but for $20 bucks a month, it looks like that will be too expensive. Finding a scalable marketing/sales solution is key to scaling your business, so definitely focus a big part of your efforts on that.
- I didn’t feel your video introduction really gave me an impression of who would use the service. It wasn’t clear who ‘teams’ were. In your market desciption, you cleared up that missing piece of info. But I wonder if you’re really focusing on the right market. Real estate investors?? Are they tracking a team of people who invest for them? I think this is the missing piece for me. I understand people use photos, but I’m not sure you’re providing enough. It is entirely possible I just don’t understand the market enough.
- I don’t know about the idea. But I believe in your team.
My co-founder Mike and I leave for Chile in two weeks, and we couldn’t be more excited. As big as our ambitions are with SimpleCrew, the opportunity to spend seven months working on our project in the Start-up Chile program has already minted this startup as a win in our eyes. And from here, we’ve got a great foundation upon which to push our company to the next level.
When you peel back the layers and look at what matters, putting together a project for a successful application to a program like Start-up Chile isn’t easy, but it’s simple enough. What it comes down to is communicating your ability to build and sell the product or your vision.
So get out there and do it. 1/14 odds… it’s certainly possible. At the end of the day, you’ve got nothing to lose. And as they say, there’s nothing more dangerous than someone with nothing to lose.