Here are some of the mistakes I’ve made with past attempts at starting a business that I want to avoid with this new business going forward. I know I do not have to get EVERYTHING right the first time around, but it’s helpful to remember what I’ve learned up to this point:
1) Be cheap, but not too cheap. Invest your money wisely but plan your finances according, at least 6 months out. I’ve invested monetary capital in a disciplined and very frugal way with my past companies. I might not have always gotten it right in terms of what I invested in (e.g. Scrimple t-shirts which costs around $500 but results in dubious marketing results). However, when I was cheap and cash was low, I was EXTREMELY cheap, choosing sometimes to not invest in business activity that could have returned a multiple ROI.
2) Finding the right people and putting them in the right positions relative to their talent(s) is critical to “driving the bus” (tips hat to Jim Collins) forward. With my last start-up I had my co-founder who had graduated with a Computer Science degree from Cornell and he was relatively perfect as our CTO. He was passionate about creating websites and using web technology to solve problems; he worked hard and invested all of his time into the business.
3) Know what you want and what you’re building towards. Then build towards it and don’t stop until you get there. Too often we can be led astray from the original vision that got our entrepreneurial juices flowing, but listening to others or by second-guessing our own judgment. With my first start-up, after a year I became insecure in running it and in the brand I was building in part because of the some of the negative, snide remarks I was over hearing. So instead of focusing hard and trying to solve some of the fundamental problems with the business (which, only in retrospect seem easy to solve but we difficult at the time) I re-branded and launched a new product (which definitely had it’s upsides by comparison, since it was profitable right away).
4) Be profitable immediately. Before you build or invest in your business you either need to make sales upfront or get outside investors (who can also be customers!) to foot the bill.
5) Build tangible mechanisms to keep yourself and your team going, especially after you reach significant milestones. Comfort is never the objective if you’re trying to build a great company. For example, with my last start-up, I never made the time to get around to coding a feature for our web-based sales back office which would have automatically sent each team member an email (once a week for instance), asking them: What’s new? Have you talked with new potential clients? How many? Any sales? The intention of building into your business a tangible mechanism like this is to stimulate DISCOMFORT and cause productive ACTION on the part of your team members.
Any other ideas or lessons learned from your past start-up experiences? Feel free to comment below.