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In my last article, I focused on what it takes to become a successful entrepreneur and what “success” means today. Here, I’d like to drill when to start a business and offer some practical tips for entrepreneurs as they develop their new ventures.
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Two Windows theories
Deciding when to start a business can be one of the most difficult decisions for entrepreneurs. For many, it is a choice between a typical corporate effort 9-5 with a risk of burnout compared to prematurely becoming an entrepreneur before gaining enough real-world experience.
Keep this in mind: most startups fail in the first year, there is an even higher failure rate in the second year, and only about 2% of surviving startups reach the third year.
Given the risk inherent in starting a business, there are two ideal times to start a new venture: right after school in the early 20s, when you have a lot of energy and no other commitments, or in the late 50s or 60s , when your children have left home and you probably have a higher net worth. Both of these windows are easier times to take the risk of starting a business. But if you want to have a successful and profitable business until your 40s, you really have to invest “sweaty capital” when you are 22 years old.
Related: Why some startups succeed (and why most fail)
Don’t give up on fairness
Successful entrepreneurs often say, “The first million is always the hardest.” That is true, but today’s technology can certainly help. In today’s hyper-connected digital age, an entrepreneur can launch a unique product or service online and quickly become profitable, especially if he uses the right marketing and social media channels to build a loyal customer base and follow the brand.
If I could give any advice to entrepreneurs, it is the following: Don’t start a new business unless you know you have the aspiration and means to reach the third year. And don’t give up capital in your own company just to keep the lights on. $ 10,000 bills add up quickly, but if you start giving away equity to pay those bills, you may experience regrets when your company makes $ 10,000 every minute.
Build momentum
If you are an entrepreneur, by definition, you will probably have some failures. That is the norm. But wipe it off quickly and don’t let that define you. Learn from failure, and then apply the lessons to your next endeavor. Try to build a positive momentum. Just like in sports or even gambling, the changes of the moment happen in business, when it seems that the stars are just aligning for you. Staying focused and maintaining a high level of self-confidence is a big part of building and maintaining a positive momentum, and that self-confidence and positive energy will inspire your team as well.
Related: How to create business momentum
Delegate as you grow
The whole point of an entrepreneur is to work for yourself and create jobs, careers and livelihoods for others. When you open a new business, you should train someone and ask them to do it. If you do it yourself, you are wasting your time and skills that should be focused on generating new revenue streams for your growing business. Delegating roles and responsibilities to others will give you the time it takes to generate new jobs and new revenue streams. You can’t do everything. Scaling the business will be very challenging if the founder is micro-managing or trying to do every job himself. Learn to effectively train others and the art of delegation and you will succeed. As a company founder, you will need time to work on strategic priorities such as profitability, marketing, cost management, recruitment, staff retention and communications. Remember - you manage projects, but you lead people. Successful entrepreneurs know the difference.
Have a succession plan
Finding people who are smarter than you is part of a successful entrepreneur, and at the same time you have a long-term succession plan. Some people may be scared of people who are smarter than themselves and think, “Well, they could take my job.” On the contrary, I want to surround myself with smarter people who can do my job if something happens to me. There are five people in my company who could succeed me if they need me, and I am proud of that, because I know that the company is long-lived beyond me. A successful and lasting job will be a legacy that I will eventually leave behind.
Related: 4 lessons on succession planning for entrepreneurs
Always be involved and ignore noise
Nothing can fully prepare you for the ups and downs of entrepreneurship. Not even an MBA! There is such a high level of failure in startups that it prevents many smart and talented people from even trying. But of course, if you succeed, you are in an exclusive group. But with that privilege comes serious responsibility. Every successful entrepreneur will always be available to his team, because your company is always involved, which means yes you it must always be included.
And as you grow, more livelihoods will depend on you and the strategic decisions you make. Other priorities fall to the side, and a 12- to 16-hour day may become the norm. When you are so focused, guided and dedicated to your work, external forces (such as critics and advocates) simply become noise that you should ignore. Always be involved, ignore noise and you will have a strategic advantage over the competition.