Q & A With Entrepreneur Dana Severson
Dana Severson has a message for business owners today: Be bold, be different or be gone.
Broke. Scared. Embarrassed. This was Dana Severson and really no one else in the world knew it. The crowdfunding company he founded, Wahooly, was failing. His baby, his dream, his vision – it was dying. And then there was that $1 million in funding that had gone poof. Why would anyone, anywhere ever listen to what he had to say again?
And yet, something funny happened on the way to this man’s utter business ruination. No, it didn’t involve a visit by angels, a winning Powerball ticket or a cosmically created rewind button. The guy simply decided, even if Wahooly was over, that he wasn’t going to be.
He started other projects – like crazy stuff involving beef jerky – all while merging Wahooly with another startup. He didn’t ride off into the sunset, but he salvaged what he could. Amazingly enough, people still cared what he said – they even paid for his business advice.
Today, Severson is an entrepreneur, an investor, a columnist. The guy has made a brand out of taking a shot, taking a punch and getting off the mat. If you want a consultant, look elsewhere. If you want a big idea man, Severson’s become an “it” guy. Here, in a Q&A with Counselor, he gives his take on his favorite topics: emerging technologies, innovative marketing and the latest business buzzword – disruption.
Counselor: You’ve written lately about the idea of disruption in business. Is it a fad or a trend?
Severson: It’s definitely a buzzword, but that doesn’t take away what it stands for. To me, disruption is going against the status quo, doing things that are unconventional. When everyone goes right, you go left. This could be a new business or your branding. Disruption is a very real thing and proven to be very impactful.
Counselor: Yeah, but let’s not pretend going left is easy. Can’t you be successful going right?
Severson: You have two choices: Be bold and risky or spend a lot of money. Too many people think they can succeed spending little money and not being bold. You might as well burn the cash.
Counselor: Can big companies play defense here or do they have to disrupt, too?
Severson: Big companies need to start embracing unconventional approaches, otherwise they’ll be left behind. Most large companies are too conservative, which gives startups a huge opportunity to capture market share with disruptive strategies. There is no better example than what Uber has done to the transportation industry.
Counselor: Is Alibaba a disruptor? Are Jack Ma and company going to take over the world?
Counselor: Will 3-D printers disrupt the traditional manufacturing cycle?
Severson: I had once suggested to Best Buy that they allow customers to compare prices and make an online purchase from a competitor while they’re shopping in the store. They’re losing sales to online shoppers anyway, so they may as well play the same game Amazon is playing and make a cut. Alibaba is a similar beast to Amazon. I think that Alibaba could actually be a benefit to other sellers, much the same way Amazon is for its competitors.
Severson: From what I know, 3-D printing has some incredible applications across many industries. I couldn’t say whether or not it will take over traditional manufacturing. It feels like there is a long way to go before that could happen.
Counselor: Pick one area to invest in then: virtual reality, drones, robotics factories or wearable tech?
Severson: I’m going with virtual reality. It’s the future of gaming. Oculus is an absolute game changer. In the very near future, if you’re not buying your child a virtual headset, you’ll be the worst parent in the world.
Counselor: Is mobile technology still a good place to invest?
Severson: The Internet of things is the current and near future. We’ll continue to run our lives – our homes, health, personal data – through our devices. I see a big trend in mobile health care, where our devices will serve as both a diagnostic tool and health-care provider.
Counselor:Amazon delivers products in two hours now. How can companies – like those that sell promo products – respond to increased expectations?
Severson: Deal with it. You need to be fast in today’s economy, otherwise you’ll lose the business. You need to cut time from the manufacturing and delivery cycle somewhere to succeed.
Counselor: If you were running a promotional products firm, what would you do to stand out?
Severson: Be bold in your branding, marketing and customer service. Take risks and do it repeatedly. In a commoditized market, the only way to win is to be different. Look at ways you can improve on a process. Look at the way a company like Vistaprint was able to simplify and systemize printing. They’ve made it easy for the customer to say yes.
Counselor: You’ve dealt with failure. How do entrepreneurs get past it?
Severson: It takes time, first and foremost. One of the greatest characteristics of an entrepreneur is resiliency. Entrepreneurs never retire and don’t give up on their dreams until the day they die. If you’re not failing on some level as an entrepreneur, you’re probably not taking enough risk.
Counselor: How can you know if a risk, though, is really worth it?
Severson: Doing. It’s the only way. Start by building the lowest cost, lowest tech version of a product. This is the minimum viable product, or MVP. Get feedback and continue to iterate until you get your answer.
Counselor: What’s the most creative thing you’ve seen in advertising in the last year?
Severson: Poo-pourri makes me extremely jealous. They built marketing into the DNA of their brand. Their name, tagline, videos – everything is brilliant. I’ve also been impressed with the creativity that comes from Dollar Shave Club. Both of those companies have embraced social reach and have, for the most part, avoided traditional channels.
Counselor: What’s the next big thing in advertising and what’s the secret to getting ahead of it?
Severson: Extremely targeted advertising and native are not going anywhere, only getting stronger. Social engagement is the future. Platforms like Loot!, which engages the social masses in brand reach, is a glimpse into what the future looks like.
Counselor: How can entrepreneurs be edgy on social media, but not lose business, be yelled at or get sued?
Severson: Simple. Don’t worry about losing business, getting yelled at or sued. Hard to be an edgy conservative.
Counselor: What do you tell people who say they’re not very good at coming up with creative ideas?
Severson: Creative muscles are a real thing. One of my favorite bloggers, James Altucher, works his creative muscle each day by coming up with 10 new ideas. It can be ideas for anything. You need to figure out where you’re the most creative and practice that each day.
Counselor: What can smaller companies that don’t have big marketing budgets do to promote themselves?
Severson: One of my marketing heroes is Robert Stephens, founder of Geek Squad. He has famously said that if he had had money when he started Geek Squad, it would have never amounted to what it is today. Guerilla marketing is the answer. Stealing an idea from Stephens, if you own a garbage company, paint your trucks pink.
Counselor: You’re also a money man. How can someone sell a cool product idea to investors?
Severson: The secret is to get them to sell themselves to you. The only way to do that is to get their attention. Nothing gets their attention more than traction and momentum. If you’re on a rocket ship, they want to be on board – everyone does. Investors care about what you’ve done, not what you say you’re going to do.
Counselor: What really happened with Wahooly?
Severson: Wahooly was a tough loss. Looking back, there are so many things I would have done differently. I nearly lost one of my dearest friends in the process, a decision I wish I could take back. Also, we pivoted way too soon. I lost passion for the vision once we changed directions. To be honest, I still believe wholeheartedly in the original vision. There is a new company now, AngelBacker, that is building something similar. I really want to see them succeed.
Counselor: So what’s the Wahooly lesson for entrepreneurs?
Severson: Where there is failure, there becomes opportunity. The experience of Wahooly led me to start StartupsAnonymous.com, which I truly enjoy. That wouldn’t have come otherwise. I’ve learned from my past mistakes, but I have many more mistakes to come. Something will work, but I’ve also embraced the fact that many things I do will fail. It’s part of growing. I have no plans to retire, this is not a job for me. I don’t plan to quit until I’m in the ground.