How to Tell Whether It's a Bridge or a Pier

Sometimes you hope for a bridge but get a pier instead.

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Americans, being natural optimists, like bridges. Some bridges are big and impressive, others are mostly functional. They all inspire. Bridges get us to the other side, a better place than where we are now. Bridge financing helps companies get better organized for a subsequent round of equity. Building a bridge is a noble task. A “bridge to nowhere” is the ultimate put-down.

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But sometimes there is no other side. There is no market for the subsequent financing. The bridge just made your mistakes more apparent. The ideas that you hoped would bridge you until the major release just confused the market. You were hoping for a bridge but got a pier instead--and a short one at that.

Bridge builders are famous. Pier builders are not.

How to tell the difference: Sometimes you can’t. Which is why venture capitalists are very good at this sort of thing. They want to give out their money in dribs and drabs, or “bridge financing,” until a clear pathway to profitability is evident. Even then, bridges can become piers. Markets, products, situations all change and we must adapt. (It is interesting to note, however, that if Wall Street was a company and the government was its venture partner, chances are good it would not have received such a big pile of money, without knowing more.)

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But, no matter how good you are, when you are starting out, you don’t really know if you are on a bridge to success. Recently, I was observing a panel that helped some university students with their money-making venture. The class had to come up with an entrepreneurial idea, work on it all semester, and even got a bit of operating money to help with its execution.

The best idea? Remember, this is Minnesota where hockey is the sport of choice. For hockey parents, the big issue is the hockey bag. It smells of sweat and other unmentionable odors. This is a big problem--and not just for moms.

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So, this class designed a clever new kind of hockey bag, a big gym bag really. They got an exclusive U.S. deal with a manufacturer of carbon inserts that would, in effect, eat up the odors. By all accounts, every parent loved it. They attended the state hockey tournament, sold the idea to athletic departments ("with your team’s logo!") and, in general, did a good job with it.

So how many did they sell? After all this work, after meeting after meeting. After “everyone” being all positive about it. I think the number was 45 or so. Of course, more orders were coming in during the last few weeks of the class. Bridge or pier?

The point is, it is OK either way. No one knows what lies on the other side, or if there even is another side. But I am thinking if I were going to be a bridge builder, I would want to build a few piers too. Just for practice.

G. L. Hoffman is a serial entrepreneur and venture investor/operator/incubator/mentor. Two of his companies have traveled the entire success path from the garage to IPO. Currently, he is chairman of JobDig, which operates LinkUp, one of the fastest-growing job search engines. His blog can be found at WhatWouldDadSay.com.

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