Identifying True Grit In A Startup Founder

“If you are going through hell, keep going.” – Winston S. Churchill

Jessica looked more than exhausted when she walked into the coffee shop, looking around slowly before spotting me and walking over. Late the night before I answered the phone to hear a tired voice say, “Can we catch up. It’s all just going shit. I’ve had some wins along with the crap, but I can’t take joy in anything right now. Half of my people have quit or plan to quit. How long does this keep going for?’

Have you ever noticed how sometimes people seem to shrink, or seem smaller than they are. I see this all the time. This isn’t about depression, this is about what happens to someone when they get up every single day and fight their way through it only to wake up the next day and do it again. With the stresses of being the person who leads a startup into the unknown and squarely shoulders the burden of all the uncertainties about the business model, funding and the future the founder can become ‘compressed’ – like they are under pressure from all sides and just shrink. Even worse is when they are also dealing with personal grief, whether it is a relationship breakup, a loved one dying from cancer or major illness.

Jessica was compressed – and clearly suffering from the adrenal exhaustion that comes from 10 cups of coffee a day for weeks at a time.

“We had some great wins lately. We have signed up a new alliance which will double the size of our customer base in 12 months.  This is brilliant news.” Sighing, she continued. “Our existing customers are playing silly buggers and paying late. Some are discounting their payments until we add more functionality, even though there is no product in the world that can offer a fraction of what ours does. Don’t they understand contract law? All my lawyer friends won’t do any more pro bono for me, so I can’t even sabre rattle properly. I have trouble meeting payroll because of this. My credit cards are maxed out, my husband has loaned me every penny he has, even worse, I took money from my grandmother. Can you believe that? I hate myself. She has so little, and she’s been through so much in her life, but when she heard how bad things were for me she wrote a check. I hate myself for accepting that check. I am no longer the person I thought I’d be.”

This is not an untypical episode in the life of a startup founder, and of all the people I know Jessica will get through this. She has that famous ‘reality distortion field’ that people said of Steve Jobs, although it was sputtering and sparking this morning. Normally she would have charmed half of the people in the coffee shop with her charisma and stories, and had at least one person ask about an internship. Not today.

I am fascinated by how some people like Jessica can persevere when others simply collapse. Some people can persevere for a month, some for a decade. It’s all a head game, and you can’t tell what is going on inside somebody’s head from outside.

I have met triathletes and marathon runners whom I thought had perseverance but couldn’t take the uncertainties of the startup life. We are all told the importance of having routines, but sometimes the sports obsessed can be obsessed with routine to the exclusion of the need for flexibility that comes with running a startup.

I know mountaineers who have scaled peaks solo, and others who have ridden half way across the world by bicycle through places people rarely go. People who perform magnificent feats of endurance against all the odds tend not to be good at dealing with people. They can shy away from the emotional pain and disappointment that comes with relationships. It is quite interesting to note that many of these admirable characters are clinically depressed and use extreme adventures to self-medicate.

A clear warning sign of mental fragility is the over use of inspirational quotes. A good quote can help us reframe a problem and change the narrative, which is a good thing. There are a few quotes in this article, for example. When someone fills their LinkedIn and Facebook pages with inspirational quotes about leadership and optimism my first reaction is “Oh crap, they aren’t doing well.” At which point I usually call and ask how they are. Inspirational quotes should be like a hit of sugar that recharges us, not a crutch we use to keep going.

Excessive alcohol consumption is likewise a temporary crutch. It may dull the pain and help you sleep at night, but it also makes it harder to get out of bed and face the day and do things which need to be done.

Talking about changing the world – an expected line from TED speakers and young people in general – will win praise from all quarters and may get you laid but will very rarely win funding from investors. Taking on all the burdens of changing how people and society think and act is a good way to absolutely destroy yourself and descend into cynicism and alcoholism.

Having brilliant ideas and expecting others to deliver is also a warning sign of detachment from the realities of a startup. Many others in the startup space have also made the comment that being the ideas man, while good, is not sufficient. Startups are Darwinian in many ways. You may have a group of founders starting off with equal shares and great enthusiasm, but six months in, when half the team have been working 15 hour days delivering the product, the one who tries to tell them what to do but can’t contribute is going to be sidelined. Incoming investors often demand that such people are given the shaft. Startups don’t need middle management.

If I had to define what I thought were indicators of true grit in a founder I’d put it down to genuine optimism, and the desire to beat your enemies.

To me genuine optimism is the belief that things will work out and trying regardless of the doubts and fears in your head. Whether there are genetic factors at play here I am not sure. To be a genuine optimist you need to have been beaten down many times and still have the ability to get up. Or as the 19^th century satirist Ambrose Bierce put it “It is held with greatest tenacity by those most accustomed to the mischance of falling into adversity…”

In modern society positivity has become a quasi-religion. You see many people who smile and enthusiastically accept every challenge when talking to those above them in the food chain, but behind closed doors all that optimism proves to be just a mask. People want to be seen as being positive and a doer, especially in the month or two leading up to a performance review. People in their twenties usually haven’t faced too much hardship so this is an easy mask for them to wear. In our thirties and forties we take responsibility for children, our parents and we often see our grandiose dreams crushed.  If someone is still optimistic at 35 then that’s a good sign that they are a keeper.

Speaking about having enemies means having rivals. It may simply be a case of one-upmanship over friends or old university colleagues, a fellow entrepreneur whom you feel is stealing too much of the limelight, or a competing business. Enemies define us because every time we think that things are working well, they come up with a new and better way to do things which we then need to emulate and surpass.

“To be successful you need friends and to be very successful you need enemies.” – Sidney Sheldon

Nothing can motivate us more than the need to beat a rival.

I am sure that next time I catch up with Jessica she will be back to her normal self; she has true grit. I also know that many other startup founders are going through the same and some of you will make it and others of you won’t. No matter the case, forgive yourself for being human. When you are tested it makes you stronger and even if you don’t end up being the next Facebook or Uber millionaire, you are going to be better the next time you start a business or take a job.

To end with yet another quote from quite possibly the most quoteworthy individual in history.

“It is not enough that we do our best; sometime we must do what is required.” – Winston S. Churchill

Driver, Passenger or Navigator?

I’ve invented a new personality test this morning (freshly baked) to help you categorise people so you can get the best out of them.

Drivers – willing to make decisions, willing to take responsibility for their actions, willing to ask for help, willing to delegate, realises they carry the whole team in their car, willing to lead, and able to teach others to become drivers or navigators.

Navigators – specialists who can provide advice on the complexities faced by the driver, able to distil complex issues down to the essentials needed for decisions, driven by helping others (drivers and passengers), good at delegating when running teams, good subject matter experts, concerned with the mechanics of the business.

Passengers – the majority of us and the core of any business, do their job well, trust the decisions of others but willing to ask questions during the decision making process, rely on the system set up for their work, concerned with doing their job right and being recognised for it.

Things can go wrong, for example, when a driver fails to delegate to the navigator and passenger, or where they are decisive but don’t have sufficient experience and won’t listen to their navigators.

Likewise, navigators may not have a breadth or depth of experience to provide all the advice they are required to. In many companies too many inexperienced navigators and you end up with a risk averse company.

Passengers who have forceful opinions but lack the understanding of the bigger picture that the navigator and driver face can be disruptive. Also, ambition combined with a lack of confidence or lack of willingness to take on roles with a higher level of responsibility may lead to a BACK SEAT DRIVER – the most irritating personality type of all.

Hopefully this will help you understand yourself and those around you so you can work to get the best out of them, encourage personal growth, and get those who are in the wrong seats to move.

Cash flow management for a startup – learning to be frugal

Money doesn’t grow on trees, and for many startups the expenses that go with establishing a business come as a shock. The delays in revenues come as an even bigger shock.

Here are some of the key things to remember.

It will cost three times as much and take three times as long as you think.

This old saying is a reminder that you will either need to save more than you think before you start, and that you need to start looking for income or investment in your company as soon as you can. Also, forgive yourself for not meeting your ambitious schedule that wasn’t tempered against suppliers or the market.

Flog product as soon as you can

You may have grand plans for your ultimate product, but I guarantee that you will go bankrupt before it is ever developed. Products are always a work in progress. Always remember that your product needs to satisfy your customer first, and you second.

None of this is suggesting or recommending selling inferior products, only that you sell products that meet your customer’s needs.

On TV we are often treated to tales of people who stick relentlessly to their vision of product and quality and have reaped the benefits in the long run. Fine, yes a few do succeed, but you have a better chance of winning the lotto than doing this.

The people who do succeed like this tend to be artisans for whom there is a small but rich clientel willing to pay for the product.  You also need to have a decent amount of experience, the ability to deliver on your visions of perfection and an ability to ignore the fact that you are out on your own.

The market will tell you what is working or not, and you will very rapidly start adapting your business model and product to match.

In other words, you need to make money to pay for improvements to your product, and you can’t do that unless you are selling product.

Spend as little money as possible

To start a business nowadays you need a website, email address, a business card and a company. This should only cost a couple of grand.  I would have said computer, but as of the last year or so you can probably run your business on internet based software (SAAS) without even owning a computer if you really wanted to.

Wait till later to reward yourself.

Spend money on the product or experience

A typical trap for a startup is overcapitalisation. You pay too much for everything up front to build what you think is the way to run a business.

Stick to this rule – ‘If it doesn’t genuinely make a difference to the customer experience or genuinely help staff retention, safety and productivity, then don’t spend it.’

Here are some tips on saving money: 

1. Office and business premises are expensive, so work from home for as long as you can. Use telecommuting tools and online collaboration tools.
2. Pay a bit more for an unlimited phone plan.
3. If you are embarrassed by your car, catch a cab to important meetings or park your car round the corner and walk a bit further.
4. Spend time doing research yourself rather than paying advisors where you can. As the owner you have a vested interest in making things work, and your time is effectively free as long as you aren’t neglecting sales. So ask around for pointers, but do the heavy lifting yourself to save money.
5. Pay for a virtual office address. Sadly, many buyers feel weird about dealing with people working from home and this is why there are companies who will answer the phone for you, collect your mail and offer meeting rooms for clients.
6. Meet people in good cafes rather than in your home office or tatty cheap meeting room.
7. Meeting rooms, showrooms, retail space and the reception areas should always be professional looking, very clean and welcoming. If you don’t take anyone behind this façade it can be held together with sticky tape and string as long as it works.
8. Use public transport where you can and always but always travel economy class. If you really want to be fresh for that important meeting then it is often cheaper to fly economy class the day before and stay at a hotel for the night. 

Counter examples include: 

• Paying the money to be located near the majority of your potential customer base could be the best investment you make.
• Make sure your website looks great and functions well.
• Don’t skimp on IT for knowledge workers -  I make sure my team get a decent lightweight laptop with a good internet connection and current software.
• Allow people to personalise their work space a bit. That element of choice can make a big difference to morale.

Always bill on time

Yes, this is obvious, but when you are in the time consuming business of a startup invoicing can take second place to more urgent work – after all they have a contractual obligation to pay don’t they.

This is true to a certain degree and can work while you have a decent amount of credit available. The issue here is that the timing of revenues and expenses don’t match.

For example in my own business I pay my staff every two weeks and invoice monthly. In practice this means that I receive cash up to 6 weeks after I pay my staff. If I delay invoices by a week, then in many large companies this means that I am now allocated to the following months invoices, and I will then be 10 weeks out of sync. If you have large expenses this timing mismatch will kill your business faster than anything else.

The second reason for billing on time is more psychological. If you bill late you are effectively saying to your customers that you don’t care so much about money and that they can pay you late too.

The old rule is that if you act like you’ll get paid then you will. I have learned the hard way how true this is.

Learn to think short term to reduce locking yourself into longer term risks

Lease equipment at the start. Sure the monthly bill may be high, but you get to sign up a short term contract, or even take equipment on an as needs basis.

For physical products use rapid prototyping or other higher unit cost, short product run methods for your initial product. The reason being is that it the capital costs are a lot lower. You don’t want to spend $30,000 on tooling dies when you can print your product on a 3D printer or use a slower more labour intensive method.  Many of the truly cheap unit cost manufacturing technologies require you to make many thousands of your product. This can be the kiss of death to startups as it is pretty much guaranteed that your first design or two are not going to be as popular with the market as you think.

There are also manufacturers who specialise in short product runs and prototype manufacturing for complex goods. They spend a lot of money on equipment and sell their high quality services to a wide range of clients.

Use local IT people for any complicated web based business where you can. The reason for this is that you can have that face to face interaction and spend time with them to learn what the problems are and sort them out. Yes, this is a lot more expensive that hiring people out of India, Ukraine, the Czech Republic or so on, however, it makes the process smoother and brings local cultural sensibilities to design and wording.

Keep on being frugal

I could keep going on this topic, but you get the essence of it now. Learn to be cheap where it doesn’t matter and you will do better.

Business plans are bollocks

This is you - for starting a business. Ignorance is bliss I say.

Depending on what kind of business school hype you are smoking, you will think that all businesses are the same.

Scope out the needs, design a solution, raise funds, develop solution, sell solution and then get rich.

Yep – and I have unicorns in my garden, and I talk to the pixies and leprachauns every night in my dreams and everyone in the whole wide world is my friend.

Are you picking up on any sarcasm yet?

It doesn’t matter whether you work in software, product design or major projects the reality is that business plans and project plans are incremental and repetitive.

The real process is along the lines of the following

• Identify a market need.
• Scope out the need.
• Design a solution.
• Raise less funds than you wanted – if any at all in which case exit loop and do anything legal that makes money.
• Make a solution
• Try to sell the solution – discovering that your idea of what the market wanted was too simplistic and didn’t take their real needs into account.
• Drink yourself into oblivion for a couple of weeks.
• Come back to the office determined to do something about it.
• Work as a team to make your product better match client’s needs.
• Run out of money.
• Pay staff using your credit card while begging for funds from everyone you think might have money (this is the point that you will consider selling your soul).
• Run over your credit card limit and start borrowing from family and friends, basically doing everything you can short of embezzlement.
• Finally get funds through investors or pre-sales. At this time you will have four separate and entirely made up versions of your business plan which you hand out to investors depending on their attitudes. You may also be indulging in selling vapourware (OMG).
• Get revised product to market – discover hidden glitches, and fix at a great cost which is written off as capital.
• Finally get traction and make more sales.
• Have dinner at home with your partner and children for the first time in 2 years.
• Enter growth stage and have a whole new set of pains as you take on employees and are forced to make up systems as you go.

 From all this, the point is that you don’t know everything when you start out, the market is a brutal mistress and you will have to reinvent and start again on many aspects of what you are doing. And this is all normal.

Enjoy.

Leave something on the table

One of the worst complaints that can be made about a company is “they’re greedy.”

Yes, you are allowed to make a profit – most people understand and accept that.

Yes, you are allowed to charge for scarcity or urgency – again this is understood.

However, if you consistently charge more than is normal in the market then customers will notice – and they do gossip.

Also, being unreasonably opportunistic in pricing – i.e. seeing that they have no choice but to use you this time, will lead to long term relationship damage.

People will go out of their way to avoid using a company they think is greedy. They may even pay the same fee, but for better service or a better relationship.

Most transactions in business are a part of a bigger relationship. If you have a one off transaction then you have no motivation to give a better price other than to make a firm sale. If you are looking for repeat business or are interested in your reputation then you need to make the other person feel that a deal is not totally one-sided.

Leave something on the table to have better long term relationships.

You need to be more outrageous

There's nothing wrong with a bit of showmanship

Marketing and promoting your company is absolutely vital. If nobody knows you exist then how are they going to buy your product?

Whatever you are doing now is probably not enough to get attention.

• I bet your business card is the usual name rank and serial number. Do you use it to provide contact details or is it designed as the mini-marketing tool that it really is?
• Do you put your opinions about what is not working in your  industry on the record?
• Do you tell a client when their scope (invitation to offer, etc.) misses the mark?
• Do you provide a client with what they need as well as what they say they want?
• Do you fight for recognition when the procurement section of a potential client decides not to use your company?
• Do you offer your opinions to the press?
• Does your website and branding reflect what the company needs as opposed to what you prefer? The odds are that you are more conservative than your brand should be.
• Do you talk to anyone you meet about your business? Sure it might be socially embarrassing on occasion but if you aren’t prepared to risk embarrassment then how will you ever promote yourself.
• And most importantly – do you attract attention to the business?

Stop trying to do it all yourself

Why are you doing the work yourself?
But darling, I save on fuel.
Yes, but it takes us ten times as long to get there.

The formative stages of your new business venture are hard. You need to be doing a little bit of everything – marketing, legals, accounting, design, IT, HR and more.  You very rapidly learn to be a generalist.

If you can get across the fundamentals then you can help the company grow rapidly with a minimum of indecision. This works for a while, but sooner or later the company gets too big for one individual to be the decision maker – there are just not enough hours in the day.

I have seen many examples of fast growing companies topping out at about 20 employees and having trouble growing beyond that. I have no studies to back this up for you, but the maximum size of a company under a central decision maker seems to be in the 20-30 employee mark.

The issue here is the founder. Once they worked out how to do everything they then try to keep doing it. Sooner or later you need to start trusting your people and managers to do their job.

You can use part-timers to help out. Hire an accountant one day a week. Hire an experienced HR person on a 2-3 days a month basis. Put on salespeople on a commission basis. Have IT support on a retainer.

Give yourself a break and help your company live up to its potential and stop trying to do it all yourself.

If you think you’ve been screwed you probably have

Being stuck in the middle hurts  

When you go into business you leave the protected and cosseted world of being an individual. Now you are fully exposed to commercial law at its finest.

• You will never have all the information you need to make a decision.
• Contracts are legally binding – Yes this is obvious, but many people entering business think that they can change their minds at a later date and the other person will be reasonable. You are required to perform. I see this mistake all the time. Make friends with your lawyer.
• You don’t have time to do all the homework you need to.
• The other party is under no obligation to pass on any information, other than that which they are legally obliged to for the formation of a contract.
• They may pressure you into making a deal now (the ticking clock approach, and the ‘this is a one-time opportunity’ approach).
• If you don’t include all your costs and the conditions precedent for you in the contract you may not get them.
• You are required to seek your own tax and accounting advice. Your agreed price may end up costing you more than you thought.
• Some people get tricky with the conditions and pricing of their services/products. This can come back to bite you at a later date.

All this is a fun learning curve – but never forget that it is a learning curve.

The other person will always know something that you don’t. A good businessperson leaves something on the table to keep the other party in a long-term relationship. However, some people can’t help themselves and they have to screw every last penny out of a contract.

The worst are those who profess to wanting a win-win outcome but by their actions don’t care at all. These are usually the big corporate purchasers who tell the media that they want a sustainable supplier base, and then tell their consumers that they get them the best price they can. You are stuck in the middle getting screwed by someone with good PR – and it hurts.

Trust your instincts, and find ways to duck and weave, delay decisions, build in options and variations, build in ratchet points or other mechanisms to revisit price, or other ways to make sure that being screwed doesn’t destroy your business.

Thank you friends for their kind advice – but ignore them

Supporters and those with constructive criticism are welcome

One thing you discover when you start a business is all the advice that your friends and acquaintance have for you.

On the one hand, it is really great to have all the interest in what you are doing.

However, what you will find is that what a lot of people tell you is really quite negative.

You will hear comments like, “it’ll never work”, “you aren’t an entrepreneur”, “what would you know about running a business”, etc.

When you get this from one or two people you can deal with it, but when you are getting this from many people it can absolutely crush any morale you have.

As to why people talk like this – I think the answer is simple – they are projecting their fears. They are imagining themselves actually taking the risks you are, and most of what they are saying are the reasons why they haven’t done anything yet.

Some of your friends will be constructive and supportive – keep talking to them.

But, don’t feel compelled to talk regularly with the negative people around you.

Be polite when you listen, nod a lot, don’t argue, and ignore most of what you hear.

Think like a wholesaler

Supply to as many as you can

Want to get stupidly rich? Then think wholesale not retail.

I don’t mean that you actually have to set up a wholesaler, just take the mentality.

Have a product and sell it to as many people as you can with a small margin.

By having a small margin – you product is more competitive and more attractive to more customers.

As your customer base grows, your brand grows and you will naturally attract more customers.

By having a product that reaches as broad a client base as possible then you maximise your chances of a sale, and you also minimise the effects of losing a single client.

And yes, this advice does go against the advice that is commonly given about finding an niche and becoming the best at it. While there are some good examples of that, most of the time going for high volume markets is a better choice.

The sticky bit for this model is that you need to have a good amount of working capital upfront to allow you to charge the lower margins from the beginning. Also, your suppliers will give discounts with volumes too, so your costs could go down over time on this basis.

There’s good money in thinking like a wholesaler.

Stop trying harder

Are you trying almost anything to get an extra sale?

Effort is rewarded isn’t it?  To a degree yes, but when things aren’t going great working harder may not make any difference. You could be putting extra hours in for nothing.

The key concept to keep in mind is that you can’t control everything. Let’s go through a few.

Location – you can choose where to locate, but vacancies and price determine whether or not you can take it.

Brand name – you can choose the brand and the image. However, what builds a brand is a large and growing customer base, not what you pay a graphic designer or an advertising agency.

Web presence – you can design a website with almost infinite variations, however, you need to understand what it is that drives your customers to the site and converts them to a sale. It is not your website – it is their website.

Costs – you can cut costs, hire and sack staff, change the quality of your product inputs, or even the quantity of your product. However, you need to keep your customers happy. If you take cost cutting too far then quality of service and quality of product will drop to a level that your customers will abandon you – overnight.

Revenue – generally the market sets the price.  You may be able to play on the margins, but generally speaking you are locked into a range. If you try selling an average product for a premium price then your lack of customers will let you know. If you believe that you can use packaging and gimmicks to sell bad product at a premium price – after all there are some companies that do exactly this very successfully – but for most companies it utterly fails.

General economic conditions – you have absolutely no control over the broader economy – so stop losing sleep over it. There may be rough periods, mostly you can just ride them out. You need to keep some working capital or savings to help you out over those periods. However, there is always need for a good product, so make sure you are getting the fundamentals right. Have a good product and good service with great customer experience and you can survive. 

Competitors – you can’t stop competitors setting up and taking some of your business. However, what you can do is recognise that customers will likely buy from all of you to varying degrees, with the best known and largest brands getting the lion’s share. Embrace the competition as it means there is a great market – go grab some of it.

It’s important to keep your sanity by limiting your activities to those things that actually make a difference. If you find yourself working harder than ever just to stay profitable then step back and take a look at your business – the problem may not be what you think it is.

Just be there when a decision is made

Make sure you're in the mix

This is both one of the most obvious and profound statements you can hear about marketing.

When somebody is making a decision to buy your product, they need to know about your product and know that it is available as a choice.

Let’s start with something simple to illustrate. When you walk to the drinks fridge at the shops you know you want a drink. You look at the available options and choose which one to buy. The chances are that you will buy one of the major brands because they are rich enough to spend enough on advertising to keep it front of mind for you. However, if they see a lesser known alternative then some people will try that just to see what it is like.

To take an example from the other end of the spectrum, if a company is looking to buy a product then their procurement process will allow them to identify available suppliers. They will usually go with the usual suspects, but as they are mandated to be fair, they will also consider newer suppliers. How are you making sure that they are aware that you exist and that you offer the product they want?

Really, this is the essence of all marketing. Your product needs to be present either physically, or in their minds when they are making a decision. If you want to get ahead learn to think like your buyers.

It’s a leap of faith

Take the chance - it might all work out

There is no getting past the fact that setting up any business is a leap of faith.

The only person who can make the final decision is you. Either you believe it will work or it won’t.

If you believe it will work you will at least try.

If you have seen others succeed at something similar, then you know that it can be done, you just have to do it yourself.

If you are launching a new product or service then your leap of faith is bigger. The current ‘lean startup’ paradigm is to test the leap of faith type assumptions in your business model to find out what works and what doesn’t.

I know many of you out there have been playing with the idea of setting up a business for years now.

Here’s what I say to you.

There is no guarantee of success – but conversely there is no guarantee of failure. All you can do is set yourself up so that you are able to incrementally change your business to meet what the market actually wants, and then grow.

If you have picked too small a market, or your timing is bad, then you’ll have to decide whether to stick with it or to sell out.

If you have faith, then back yourself to give it a go. It will be stressful, it will be difficult, it will also be exciting and you will gain a lot of satisfaction. A couple of years from now you will look back and wonder why you didn’t do it earlier.

Pay for one hour of an expert’s time – not 15 hours of someone who means well

Yes Maam, he does indeed look like a pilot, I'm just not sure if he can fly yet.

Expertise is important. An expert is somebody who has accumulated sufficient experience on a subject matter to sell themselves as being able to provide you a shortcut through your own learning curve.

I have learned that it is better to pay for an hour of a Senior Law Partner’s time and ask a bunch of hypotheticals about commercial and legal matters, than to pay for a junior lawyer to go on a voyage of discovery for a few weeks.

An experienced tax partner at an accounting firm will let you know your main choices and advise on the due diligence and fact checking required for your actions.

An experienced engineer will be able to tell you the known issues with your technology or scale up ambitions.

A good commercialisation expert will be able to point out the known paths that you could take.

The key thing about actual experts is that they will usually couch their language with terms such as ‘could’, ‘might’, and ‘possibly’. This is for two reasons. First, nothing is certain. Secondly, they are taught to do so by their legal departments as many firms have been caught out by vexatious lawsuits from clients who thought that they were getting a 100% accurate prediction of the future.

To help sort out your own business go and make contact with some genuine experts and use your interactions with them to set the vision and strategy of your company. Then use your employees or less experienced contractors deal with the day to day work.

Time to grow a set

Who do you most want as a client and are too afraid to talk to in case you don’t win the job? Time to go talk to them.

Looking to take on employees but don’t really know how? Go talk to your accountant and a lawyer.

Having troubles delegating? It’s time to handover responsibility and not interfere.

Running out of money? Go set up a working capital facility or go raise equity.

Don’t know what to do as a next step to grow the business? Go talk to someone who has a lot of experience in that business.

Having trouble with your main client? Up their rates or fire them. You need multiple clients and you can’t run your business being continually afraid of your main client.

Worried about recession? Build a larger client base

Looking to quit your job to go fulltime on your startup? Make sure that you have savings to get you through a few months and then credit card facilities to go past that – then take a calculated risk.

Read your star sign – why astrology can break rigid habits

I originally trained in science and have since been working in pretty much analytical professions ever since. I can even tell you exactly why astrology is a load of bunkum, however, I have learned to appreciate one aspect of it. That is – it encourages change and experimentation.

Seems contradictory right.

Many people with a strong technical background get stuck in their ways. Yes, I am talking about you.

You have a limited group of friends, you are rigid about the times you go to and leave work, you generally eat the same foods, you watch the same shows each week, and so on. You are probably stuck in a rut.

Time to introduce some chance into things.

It doesn’t have to be astrology that does this. There was a book called “The Dice Man” years ago that encouraged people to choose what to do by rolling dice.

The Jim Carrey movie “Yes Man” was another example where rather than choosing to follow the normal routine he said yes to everything.

Start mixing your life up a bit.

• Try buying a new brand of toothpaste, deodorant, bread or breakfast cereal next time you are at the supermarket.
• Let your hairdresser or a complete stranger pick your next hairstyle.
• Go into a clothes shop you have never been to.
• Force yourself to go out to a restaurant or café on a weeknight.
• Go meet complete strangers at an event.
• Go the long way to get to work.
• Go somewhere new in your lunch break.

The benefits are huge. You will get used to being out of your comfort zone and you may just meet all sorts of people who can help you on your way.

Get out there and mix it up a bit.

Success is the best revenge

“You’ll never succeed.”

“That’s the stupidest idea I ever heard.”

“You just don’t have the right personality to do business.”

“The market is already sewn up, how on earth do you think you can make it?”

“Ha ha ha… you want to what? That’s the funniest thing I’ve ever heard.”

“What if you don’t succeed. Think about your partner and children. You’re putting it all at risk.”

And so on. If you haven’t heard variations of the above, just wait, you will.

The modern education system is set up to train us all as good workers for the modern industrialised society. 

When you go into business you are stepping out of the comfort zone that we all exist in and others will react.

Ex-co-worker’s reactions can range from seeing you as an inspiration for them to do something to outright hostility.

Family members can try to talk you out of it.

Friends can be quite vicious in terms of comments they make.

Potential clients can be quite cruel during the formative stages.

Guess what – none of that matters in the end.

You will probably develop a long list of people you’d love to tell “See, I was right, you were wrong.”

There may be others you fantasize about getting revenge on – which is fine so long as you only think it and never act on it.

The supreme form of revenge on the naysayers is success. They see the outcome and have absolutely no idea how you did it. Their view of the world is obviously wrong, or maybe you are just an aberration to their world view. It doesn’t matter.

The mere fact that you exist and are succeeding is enough to irritate them so get out there and make it work.

How to replicate a successful team

Your business is going great. You have managed to pull together a team that delivers your services to your main clients and now you want to grow.

You are thinking of setting up a new office in another city, or putting together a second team in your existing office.

Here’s where it gets hard.

A successful team is usually led by a few great individuals who have worked out how to get on with each other, work as part of a larger team, and how to deliver to customers.

It is naïve to think that you can just hire a totally new group of people to replicate the same phenomenon.

This is the point where you need to start capturing some of the team’s operations in systems and processes. This shouldn’t be overdone. Work with them to recognise some of the key areas of their work processes which should be replicated.

You can also split the team and add new people to both the new teams. However, this is potentially disruptive to the existing team, and your cash flows if they start failing to deliver because of the disruptions.

You can also start rotating people through the successful team before moving them to the new team. This might involve taking the No. 2 or 3 from the original team into the new team as well. Also set up a mentoring/collaborative arrangement with the existing team.

You can hire in successful individuals or teams from other companies. This needs to be accompanied by ensuring that they really do know their field of expertise as well as the say they do. Also, you need to ensure that there is cultural and values compatibility otherwise toxic relationships may form with the existing team.

If you are setting up in a new city or town, you definitely need to get some of the new team to come to the existing operations and vice versa.  If you don’t do this then you can end up with a strange ‘us and them’ type culture that can become quite adversarial. You really need to send legal, marketing and finance types to spend time with the new office to keep all of you aligned.

Replicating a successful team is possible, just accept that it can take some time and quite a bit of effort.

Don’t try to build a market as well as your product

This feels counter to the conventional wisdom. I mean, just look at Google, Facebook, Amazon, and eBay after all. They all did it didn’t they.

Well, in a word, no.

Google improved on internet searches and took out the competition. Facebook is largely a new phenomenon, but is still largely bankrolled rather than paying its own way (the buy high sell low strategy I talk about). Amazon consolidated the mail order book catalogue business.  eBay took the essentials of community auctions and ‘For Sale’ sections of newspapers and put them on line.

Microsoft didn’t invent computers or operating systems – they made it more user friendly, so I’ll give them, IBM, Radio Shack/Tandy and Apple co-credit for actually helping create a market. Mind you, consumers and businesses were ready to adopt 40 years of computer based automation for their own benefit, so the market was ready in many ways.

So, if we put aside the above examples the other 99.999999% of us are scratching round trying to sell our products and services.

An attitude of “build it and they will come” is a particularly good way to lose money.

If you want to build a business in a conventional way then you should pick crowded business sectors.

Put that another way, competition is usually thickest where most of the money is.

Find a way to do the same thing as everyone else, but better, and you will grow rapidly. The market is already primed to buy your product and is cashed up, so you just have to take out part of the market share from your competitors to make a profit.

Employees are not your servants

Maybe I’m just destined for mediocrity, but I really can’t stand spending time around people who have an overdeveloped sense of self importance.

You know the ones I am talking about. They are destined to greatness, and walk into any given room with an air of authority and control, however, they often lack any meaningful experience in the business they are in.

This is a reborn aristocracy, not capitalism.

The revolution in industrial relations over the last century was the recognition that there needs to be a system or set of rules that both the employee and employer can turn to in order to assert their rights.

Employers expect a certain set of behaviours and productivity in return for payment.

Employees expect boundaries on their personal lives and dignity to be respected for their hard work.

It is not just the small or family owned businesses that do this. Many construction, consulting and professional services companies also treat their staff as expendable servants. How many great people burn out and are sidelined from a career they would otherwise do well in for their whole lives due to the insane pressures these companies put on their people.

I have seen some truly great small companies that take people who from these industries when they are burned out and treat them with dignity and respect, and go on to great things.

It’s amazing what happens when you treat people as if they are human rather than your servants. Welcome to the 21^st century.