12 There’s PR and then there’s wasting your time & money

There is a time and place for PR, but all too often start-ups dive in way too early. Even worse, many founders have no clue what PR truly is about and they define the wrong things as PR. I believe “hype” is what is generated and ends up having nothing to do with PR. Unfortunately, hype leads to false expectations. False expectations lead to under-performance and we all know what happens in the start-up world thereafter.

Before I even get into PR, let’s talk about what PR is not. It’s not attending conferences. It’s not a blog. It’s not advertising. It’s not attending start-up parties. And finally, it’s not your mom raving to her friends and colleagues about how great their son or daughter are doing “with that Internet business”. PR can touch upon a couple of these things (sorry, your mom won’t really ever count in this regard) but it’s not one or the other alone and I see this mistake made often. PR needs to be defined, executed upon and measured. If you can’t measure it, don’t bother. Actually, if you can’t measure it in some way, it’s not PR. More users, more clicks, more revenues… that’s what you want to be measuring after executing on your PR strategy. If you’re doing it right, the numbers will be going up.

Throwing parties or going to conferences because all the other cool kids will be there is wasted money. It’s also wasted opportunity because you could be doing so much more for your business with that time and money. Only go to conferences where you can do business. “Doing business” means you will meet potential partners, customers or learn something mission critical to your business. If one of these three options aren’t executable, leave it out. Same thing goes for parties. If you can throw a party to get your partners to do more with you or your customers to buy more from you, go for it. Small parties to keep your employees happy are also fine. But parties to “get our name out there” just aren’t effective. Don’t even get me started on “house-warming” parties for new office space.

So let’s get back to my point about PR. Start-ups always have limited resources: too little time, too few employees, limited finances and so forth. PR in the traditional sense of the business is necessary once you’ve (1.) built your product, (2.) launched it, (3.) managed to get people to pay for it and (4.) proven your business case. If you haven’t taken care of (1.) through (4.) you will waste money and at worst, torpedo your success. People will be expecting too much too early. You will be over-promising and under-delivering. This leads to a death-spiral almost impossible to get out of. You can always catch up on PR and fortunately, if your product rocks, PR kind of takes care of itself. So, to summarize, don’t focus on PR too early. Only after you’ve created something to rave about, do so. Don’t get caught in the trap though of focusing on PR too early. It’s fun to do and easy as you can throw money at the problem. But it’s only a strategy and a solution after you’ve focused on more important things like your product and business case.

About Paul Jozefak ()

I am nowadays based at Neuhaus Partners in Hamburg, Germany. I used to run the European venturing activities for SAP AG, where I worked out of Walldorf, the company's headquarters. After six years in that role, I decided it was time to move back into a more entrepreneurial position and get signficantly more involved in the actual venture business. This means doing the actual fundraising associated with a venture fund and really having a hands-on role when it comes to the companies you end up investing in.

In addition to my daily activities as a VC, I blog regularly about the venture industry at BabblingVC. My public profiles with previous stops in my career can be found on LinkedIn and Xing.

Tagged: , , , , ,