No North Star? You can fix that.

In the GroundWork Workshops, the first, fundamental question I ask participants is, “what is the next strategic milestone you and your team need to hit in order to move the company forward in a meaningful way?” The first answers founders give are usually to tell me their our 60-day plan to increase sales. Or that they want to get to 100,000 customers. Or that they think they need to raise a round of funding in January. Or that in 12 months they want to be at $2M ARR. Or that next year they’re going release a new version of their product, open a new market and build out a professional sales team.

These are all real-life examples from founders I’ve spoken with over the past two years since we launched the GroundWork accelerator. All of these are wrong answers. None of them are strategic. None of them are within in a meaningful time frame nor tied to a specific date and time. None of them express what gets unlocked if/when they are achieved, a fundamental feature of strategic milestone.

If you are a venture-scale startup, the a correct answer can (and should) be stated in the form: “By {specific date and time 4 – 6 months out} we will achieve {single, highly-quantified objective} by doing {list of the most important tactics necessary for success} by doing so we will unlock {description of what next important milestone becomes available to you.}

For example:

“By April 25th at 5pm PST (six months from today) we will increase our MRR from $8k to $40k by focusing all of our efforts on quantitative marketing channels to acquire 1.5 new $1,000/month customers per week. By doing so we will reach a sustainable cashflow-positive runway, enabling us to raise a favorable round of funding to fuel our growth to $2M ARR.”

Determining whether this milestone is actually cogent requires a thoughtful and disciplined process of considering your available resources, determining the most important next achievements that you could reach with those resources, identifying what must be true (quantified assumptions) in order to reach that milestone and building a cogent plan that takes into account your most precious and scare resource — time. But none of this is hard. Every single founder is capable.

But there is no Startup Police. You’re not required to have a cogent milestone. It’s certainly possible to be successful without having one… and a next one… and the next. But one wonders… why would you not want to have one?

The right milestone gives you and your team a North Star, that one thing(s) that keeps everyone moving in the same direction along the shortest path. Your North Star helps you know when you’re spending your time, money and talent on the right things… whether you’re getting distracted… whether you’re making meaningful progress. In short, a North Star increases your chances for success.

If fundraising is in your future, there is perhaps no stronger signal you can send to investors than making consistent and meaningful progress toward a milestone that you can articulate as the right next place the company needs to be. The diligence process is essentially reverse engineering the story you tell them to see if it’s cogent and then correlating that with the execution they see.

Startups are chock full of uncertainty and ambiguity… and opportunities. The job of a founder is to sort through the opportunities to discover the right path forward and then execute the hell out of it. Nothing in the entire universe can help a founder do this better then identifying their North Star and building a cogent plan to reach it.