Cash Flow Diary podcast guest Peter Harris wasn’t always part of University Venture Fund, a multi-million-dollar group that does what it can to thwart poverty from the ground up by helping individuals see their dreams through to fruition. In fact, Peter wanted to follow in his father’s footsteps as an engineer. However, his father decided he didn’t like working the 9-to-5 life and became an entrepreneur. That took Peter to a whole new path in life. (And he still followed in his father’s footsteps!) The great news is that Peter rocks as an entrepreneur who helps others to the same. Peter’s journey put him in the direct line of the impoverished. When that happened he vowed to find a way to use business to help them change their lives. Peter eventually learned how micro-franchising works so his group could offer that to individuals. This form of franchising can help the most financially challenged reach their dreams of business ownership. To make this happen for all those he wants to help, Peter had to learn a lot. He had to hit the re-start button on some of his personal business ventures, too. He refocused on the venture funding group and now helps students attain the capital they need to get where they want to go in life. Learn how Peter Harris solves problems for lots and lots of people every day. You’ll enjoy hearing about what it took to get him to the place he is now. As with a lot of entrepreneurial tales, the path wasn’t laid out for him and it took a lot of dips and turns. Learn more. LISTEN NOW
On this episode of Cash Flow Diary, J interviews Peter Harris, who is the manager of University Venture Fund. Peter is also passionate about using business as a tool to achieve sustainable poverty alleviation. If you like the idea of ‘doing well’ and ‘doing good,’ then this is a great podcast for you.
03:31 Peter’s origin story
07:18 University Venture Fund
10:41 Micro franchising
17:31 Forcing networking
21:27 Finding the deal
27:38 Apply for a free one-on-one break though session / J’s episode insight
29:35 Epic failures
32:36 Lean startup methodology
36:31 Testing the market
39:25 SAAS business
43:00 Too young or too old to invest
46:29 Due diligence process
50:06 Contacting Peter
Main Questions Asked:
- What is your origin story?
- How important is the environment in which you grew up?
- What is Micro franchising?
- How do you become a person who ‘forces networking?’
- Talk about investing in companies as the asset class.
- What do entrepreneurs who are seeking capital need to bring to the table, and what shouldn’t they do?
- What is one of your most epic failures so far?
- How do managers of funds feel about sites like Kickstarter?
- What would you say to someone with a ‘there is no money’ frame of mind?
- Is there a type of business you prefer?
- How do you address people who think they are too young or too old to invest?
- What is the due diligence process for deciding what business to invest in?
Key Lessons Learned:
- The only people who are successful had failure first.
- A franchise has a strong recognizable brand, marketing and advertising, systems, training, and product supply.
- The value provided by a franchise is knowing what is provided and getting the exact same experience.
- Micro franchising assists in de-risking the challenge of being an entrepreneur in developing areas.
- If you are strategic in approaching people, you can get in touch with just about anyone.
- Think about, “How do I get in touch with the person I want to talk to?”
- Ask yourself, “What value can I add to them and all the people along the way I need to work with to get to them?”
- The earlier you are in your business timeline, the more active you will have to be in pursuing deals.
- Investors are looking for people who are bold enough to get started on their own.
- There are legit investors and there are fly-by-night investors. A lot of entrepreneurs get bad advice and terms on investments from fly-by-nighters.
- Be careful on which mentor you choose, as they can be the difference between success or failure.
Lean Startup Methodology
- Don’t worry about having a perfect product. Just start selling, and see if people care.
- There are ways to do this that don’t require money or even have the product built.
- From a traction perspective, Kickstarter is phenomenal and allows entrepreneurs to pre-sell their opportunities.
Testing the Market
- There is always money for ideas that have a chance of returning more capital.
- The challenge isn’t finding the money, but rather figuring out how you craft the right story.
- Test the market and collect data before going to an investor.
- Prove there is a need for your product in the market.
- Peter suggests designing your product, creating a website to sell the product, buying $50 worth of Facebook ads to promote it, and see if anyone tries to buy.
- If you can’t find a buyer and they are not willing to deal with you, then your product doesn’t matter.
- SAAS (software as a service) instead of a CD with software or download, sell a subscription to the software, e.g. Adobe.
- SAAS have great recurring cash flow and are predictable (lifetime value of the customer).
- You don’t have to be venture backed to start a SAAS business.
Investing in Startups & Due Diligence Process
- If you can be identified as someone who is really helpful, the opportunities will flow to you.
- Only invest in things you feel you can understand.
- Look for clues that the company has figured out product market fit. This can be demonstrated via data, sales, pre-order, and customer interviews.
- Ask yourself, “Does this product fit a need in the market?”
- Figure out if the team has what it takes to pull it off and achieve the full potential of the company.
- Venture capital investors say they would rather invest in a B idea operated by an A team rather than an A idea operated by a B team.
- Question whether the people have the skills, passion, and attributes to make them successful in running the business.
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Links to Resources Mentioned
Peter Harris (LinkedIn)
Lean Startup (book)
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