65 Lessons I learned about Entrepreneurship
02 August 2011
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For starters, I started a personalized merchandise company with couple of my friends while in my final year of graduation. When we jumped into this business , we knew nothing about Entrepreneurship. Not just that, we even did not know anything about merchandising, the core of our business. All we had was the zeal for making money and the knowledge that the top market players in this business are not yet indomitable. We thought that is all that is needed, as we had high esteem about our skills. But as every first time entrepreneur experiences, the ground realities are different. Once you are into it, you will learn a lot of lessons.
Though I parted with my first company within an year and a half, my interest in entrepreneurship has never left me. During the course of the year that followed, I learnt many more lessons. Here goes the compilation of lessons I learnt and probably you are not told when jumping into Entrepreneurship.
2) There are no holidays in Entrepreneurship.
3) Starting the business with zero/minimal investment is a very bad idea. Start with at least 6 months' operating costs as investment.
4) Legal processes of incorporation take much more time than expected and eat up a lot of your time. So, even if costly, hire a pretty good CA who takes care of it all.
5) Idea without proper execution is worth nothing. Spend more time discussing the idea in order to perfect it and more importantly, execute it.
6) No one is going to steal your idea. Even if they steal, they won't execute it as good as you can. So, don't at all worry about the confidentiality of your idea.
7) Pivoting is not at all bad. Actually, it's a very good thing. Every top company now, has pivoted at least once in the past.
8) Don't do a lot of things. Focus on one thing, make it near perfect and then go for the next thing. Do things sequentially, than simultaneously.
9) Implement something in your product/service that attracts press. Most of the times, silly and unusual stuff garners a lot of attention.
10) Decide on your differentiating factor viz., price, quality or uniqueness and work towards achieving it. By the way, competing based on price is not always bad.
11) Ideas that generate maximum business are the ones that reach the masses. You may be hip, high quality etc., but if there are very less number of affordable customers, most of the times, it doesn't help. Try to target the market which is going to generate the maximum business.
12) Google is not going to kill you. They have many other better things to do. Even if they come, first thing they think of is an acquisition.
13) You can't take on a market leader head on( unless you have boatloads of money ). So always start in a niche, make a dent there and then expand into mainstream.
14) Lot of Entrepreneurs are too possessive and don't want to dilute their share in the company. But, remember liquidation is not bad. Liquidation comes with lot of benefits that help your business grow massively.
15) Get an awesome mentor/guide for your business. A right mentor can make your business grow at a 10 times faster rate.
16) Decide on an exit strategy. Acquisition and IPO are the most common exit strategies.
17) Fix a salary for yourself and compulsorily take it. Most often, bootstrapped startup founders forgo their salary for sometime. This is bad. Taking salary keeps you motivated and also saves you from pressures from personal life.
18) Setup a very good work culture. You need to lead by example. Your first few employees follow you and your company's work culture will be totally dependent on those first few employees.
19) Incentivize your employees with Stock Options. Stock Options keep your employees as motivated as you are and also makes them committed to you for a period of time.
20) Hiring in startups is a very big pain. Startups are the ones where the best of talent is needed but they are the ones where least of talent goes to.
21) Be ready for attrition. Every employee is bound to leave. It is just a matter of time. When an employee is leaving, be nice to them. Be in touch with them. Most of the times, they are the ones who are going to refer your next great employee.
22) People may say "What's there in a name?". But name matters a lot for a startup. Your name should be easily rememberable, pronounced and importantly, appealing to your target customers.
23) Networking doesn't help in bringing in customers if your product is bad. But networking can help in introducing and spreading your company. But be sure that the networking is with the target audience.
24) People are willing to pay for a good product/service. You may think they it is difficult to make people pay, but if the product/service is good, you can be sure that they are going to pay for it.
25) Use a lot of guerrilla+network marketing techniques. Affiliate, Ambassador, and MLM models work very good if implement properly. They also cause network effect and spread it virally.
26) Document all the processes and how to do them . Make it your bible. It helps a lot when you are scaling up and have not enough time to train each and every one.
27) Use PR extensively. Be agressive. Funding news, Number of customers, controversies etc sell a lot.
28) It is not compulsory that you cater to all the market in your business. But be sure to cater to everyone that is going to profit your business in long term.
29) Set targets and move towards them. When setting up targets, be realistic. Targets keep you focused.
30) Don't spend a lot of time in discussions.
31) Argue on issues but always reach a consensus and more importantly argue only on important issues.
32) Mistakes do happen. Don't get tensed. Actually, be tensed if there are no mistakes (which is not going to happen). Try to ensure that the mistake doesn't happen again. Or, at least that when the mistake happens again, there is a damage control in place.
33) Things don't go as planned. Not more often, always.
31) Location of business matters a lot. So, setup your business at a location that is best for it, even if that means you have to move out of your house.
34) Know about taxes and pay them promptly. You don't want problems in future for those small mistakes.
35) Be fast in your execution even if the idea is not perfect. Speed is the first deciding factor. Perfection is worthless if u r not fast enough.
36) Make a team with people of diverse skill set. Most of the times, people start companies with friends, who generally have same skill set. That doesn't help and you will be forced to hire some unknown person for that skill set.
37) Start with problem and not with technology. Don't be obsessed with technology. Cool products are sold only when then they are helpful. Use technology only when needed.
38) Set some basic rules of operation for your business. Never do anything that doesn't confirm with those.
39) Scale your business very fast without worrying much about costs. Without scaling your business is not going to go anywhere.
40) Communication skills count a lot. They help you in closing the deals, pitching to investors, selling your product and what not.
41) Write accounts. notes. Document everything. They help you in analyzing your business in future and learning from them.
42) Don't over hire. Firing people is easy but it damages the company's reputation and increases insecurity among employees.
43) Never neglect any stakeholder. Make everyone feel that they are the most important ones to you.
44) Take feedback. Lots of it. But you need not implement everything. Just tell the loyal customer why you are not going to implement their suggestion. And when you implement something they suggested, tell them. Even better if you announce it to all other of your customers. This makes your customer feel important to you.
45) Don't get obsessed with optimizing your product/service. You need to know when to stop and focus on a new issue.
46) There is always going to be a phase where you will feel like quitting. You need to take a wise decision there. Remember The Startup Hockey Stick.
47) Don't be emotional with your business. Be objective in your thinking about it. Difference between a good manager and a founder is that the manager sees it objectively, whereas founder takes it to heart.
48) Inculcate healthy habits - drink a lot of water, eat food on time, exercise. You need to be healthy, for your business to be healthy.
49) Don't mix business and friendship. You may fight in business, but don't let those affect your friendship and vice versa.
50) Don't Bullshit to yourself. Be ready to accept your mistakes and blunders.
51) Do a lot of bullshitting. It brings you a lot of PR.
52) Don't get emotionally attached to any idea/opinion. Most often you are wrong.
53) Follow your intuition but be ready to change your decision when proved wrong.
54) Have a life other than work.
55) Attend a lot of startup conferences, *when you have time*. Food there is very good :)
56) Entrepreneurship and Freelancing are not the same.
57) Be realistic. Not every company can be a Google/Facebook. But it surely can be acquired by them.
58) Get yourself a Business Card. Wear your company's Tshirts wherever you can.
59) Have a very good story. Stories make your customers get into emotional attachment with you. Remember how Steve Jobs always starts his keynote with a story.
60) Learn from everyone and anyone around you. Don't stop learning.
61) Be funny, laugh often. Laugh at yourself, make others laugh!!
62) When you are going for a negotiation be clear about what you want and what you can forgo for getting them. Negotiation skills are very important for any business.
63) Gift/Incentivize your valuable customers.
64) Don't show negativity in front of your employees. Always emit positive energy, at least in front of them.
65) Don't get tensed at anything. Tension doesn't solve anything. Cool mind solves everything.
