I founded four start-ups, and taught Entrepreneurship at Stanford Business School for half a decade all the while, so I have reached some solid-based opinions regarding what aspiring business people should know before they start building a company. This is what I have learned…
1. We must be passionate about our products and services
Money-hunting as the sole aim of a business will not benefit you much. Deterministically, you will face challenges at some point and I am not talking about common start-up phase mistakes here, or about some wrong decisions on the way. I am talking about challenges that no one, no matter how prepared and organised they are, could predict.
Faced with such hard challenges, many of the business people who are in it only for wealth-making, will move on to the next, easier pray, ‘gold’ opportunity. If you are in it for more than wealth-making though, inspired and motivated by your mission and goals, you are going to find a way through the challenges, no matter what it takes. This will benefit you, your investors, your employees and your clients. This way, you are not working for a start-up. You are working on a cause. Company cultures that have a cause in the core base and mission are more fun and fulfilling for everyone. I wouldn’t say the same for cultures based on wealth-making though.
2. Know what you know. Know what you don’t know
And don’t be too sure about the things you think you know! Look for partners and employees that have a different set of skills from yours. I have founded all my companies with a partner and in every single case, my partner and our employees had different set of skills than mine. Feel extremely dissatisfied if you feel the smartest person in the room.
Attract the best talent you can get and offer them the chance to add extra value. Do that by eliminating the fear of failure. On the contrary, allow them to blossom by supporting experimentation, all the while insisting that they should aim at making new mistakes instead of repeating some.
3. Define the key factors that are essential to your business’ success
After you do that, define which of the factors you do not yet have. Develop a plan of resourcing what you do not have, be it capital, talent etc. Then, be realistic about how much funding capital you are going to need. It is usually much higher than you initially calculate that it will be, so always try to raise much more funding capital than you think you will need.
4. Choose your investors wisely
Make sure that you like them first. Make sure that you trust them. Then make sure that they get your company mission and that they can align their goals with your vision.
Furthermore, make sure that your investing horizon and their expectations are realistic as far as your company is concerned. Do not give them full control. If you do, quit and leave. You will be much happier than you will be trying to lead what used to be your business.
5. Don’t wait until you need more funds to raise more funds
If you do so, then you will not be able to stay in control of your company. Investors demand the control they think that circumstances demand—or control they believe they can bargain successfully. This is right. This way, by offering a share of your company earlier to raise more money, is wiser, strategically, than doing so at a later stage just because it is too late to do anything else and you desperately need the money.
6. Lead by your example
Work harder than anyone else in the company. Be sincere always. Care about the company culture you create and clarify the values that shape this culture. Make sure that these values are not just printed quotes on wall posters around your offices. There is an inverse relationship between materialisation these values and their plain placement on the walls: The latter is easy to do, the first is not. Your employees will soon know the difference. Remember that reliability is key in leadership.
7. Follow your vision
Success in Business is almost never achieved by following the conventional wisdom. Learn all you can learn as fast as you can, from the best mentors you can find. Make tough decisions and always support your ideas courageously.
Writer: Joel Hayat