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The 100 Rules for Entrepreneurship:
A) It's not fun. (there’s a strong chance you will hate yourself throughout the process of being an entrepreneur.)
B) Try not to hire people. .... You’ll have to hire people to expand your business. But it’s a good discipline to really question if you need each and every hire.
C) Get a customer. ..... This seems obvious. But it’s not. Get a customer before you start your business, if you can. Customers before fundraising. Even customer before building a product.
D) If you are offering a service, call it a product.....
Oracle did it. They claimed they had a database. if you “bought” their database a team of consultants would help you “install” the database. This allows you to fine-tune into a product that has a lot higher value.
E) It’s OK to fail. .... Start over. Hopefully before you run out of money. Hopefully before you take in investor money. A "failure" should really be viewed as an "experiment".
F) Be profitable. .....Try to be profitable immediately. This seems obvious but it isn’t. Try not to raise money. That money is expensive. I've never made a billion dollar business. But my most successful businesses started off profitable in month one.
G) When you do need to raise money: if it’s not easy then your idea is probably incapable of raising money. ... If it is easy, then take as much as possible. If its TOO easy, then sell your company (there are anecdotal exceptions but many more failures that could'v'e sold)
H) The same goes for selling your company. ....If it’s not easy, then you need to build more. Then sell. To sell your company, start getting in front of your acquirers a year in advance. Send them monthly updates describing your progress.
I) Competition is good. (not commodity competition). It helps you judge progress. It shows that other people value the space you are in. Your competitors are also your potential acquirers. And if the competition is better than you, quit or merge immediately.
J) Don’t use a PR firm. .... You are the PR for your company. You are your company’s brand. You personally. Do things deserving of PR. Do-marketing > content marketing.
K) Communicate with everyone. ... Employees. Customers. Investors. Partners.
Employees want to know what to do and you are thinking of their overall career.
Customers need to know they made the right choice.
Investors want to know they can count on you when time’s are tough.
L) Do EVERYTHING for your customers....Be their friend. Speak at their charities. Introduce them to your competitors if you think a competitor can help them. Always think, “What’s going to make my customer happy?” If you are the SOURCE, then everybody comes back to the source.
M) Your customer is not a company.... There’s a human there. That human bet on you. Make that person look good. Help their career. Keep them happy. Be honest with them always.
N) Show up..... Go to breakfast/lunch/dinner with customers. Treat. Be pro-active about update meetings
O) History.... Know the history of your customers in every way. Company history, personal history, marketing history, investing history, etc. Know the history of investors, acquirers, industry.
P) Micro-manage software development.... Nobody knows your product better than you (or your partner(s) do. If you aren’t a technical person, learn how to be very specific in your product specification so that your programmers can’t say: “well you didn’t say that!”
Q) Hire local.... This is for software but can apply to other things. You need to be able to see and talk to your programmers. Else, leaks will happen.
R) Sleep.....Don’t buy into the 20 hours a day entrepreneur myth. You need to sleep 8 hours a day to have a focused mind.
If you are working 20 hours a day, then that means you have flaws in how you are managing your time or how you have managed the project.
S) Exercise (and nutrition)..... Same as above. If you are unhealthy, your product will be unhealthy. This applies to any creative project.
T) Emotionally Fit..... DON’T have dating problems and business problems at the same time. The business will suffer and customers, employees, and investors will smell this all over you.
U) Pray. You need to. Be grateful where you are. pray for success. Pray for the success of your customers. Pray for the success of your competitors. The better they do, it means the market is getting bigger. And if one of them breaks out, they can buy you.
V) Mentor employees... Even suggest better jobs. I always imagined that at the end of each day my young employees would be calling their parents and their mom and dad would ask them: “Hi honey! How was your day today?” And I wanted them to be able to say: “It was the best!”
W) Treat your employees like they are your children.... They need boundaries. They need to be told “no!” sometimes. And sometimes you need to hit them in the face. But don't knock them out (else they won't learn the lesson). (jk) But within boundaries, let them play.
X) Don’t be greedy pricing your product. Give 90% of value for free (if possible). If your product is good and you price it cheap, people will buy. Then you can price upgrades, future products, and future services more expensive. Which goes along with the next rule.
Y) Distribution is everything. ... Branding is everything. Get your name out there, whatever it takes. The best distribution word of mouth.
Write a blog about your industry & be honest about the flaws.
Authenticity is the best branding.
Z) Don’t kill yourself... It’s not worth it. Your employees need you.
Your children need you. It seems odd to include this but we’re keeping it real.
Most books for entrepreneurs say “think big”, “go after your dreams”. But often dreams turn into nightmares.
AA) Give employees structure. ...Let each employee know how his or her path to success can be achieved. All of them will either leave you or replace you eventually. That’s OK. Give them the guidelines how that might happen. Tell them how they can get rich by working for you.
BB) Fire employees immediately.... If an employee gets “the disease” he needs to be fired. If they ask for more money all the time. If they bad mouth you to other employees. If you even think they are talking behind your back, fire them.
The disease has no cure & is contagious.
CC) Make friends with your landlord..... If you ever have to sell your company, believe it or not, you are going to need his signature (because there’s going to be a new lease owner)
DD) Only move offices if you are so packed in that employees are sharing desks and there’s no room for people to walk.
EE) Have killer parties.... But use your personal money. Not company money. Invite employees, customers, and investors. Life is meant to be lived. And there's no such thing as work/life "balance". Make them the same.
FF) If an employee comes to you crying, close the door, sit with him until it stops. Listen. . If someone is crying (and someone will) then there’s been a communication breakdown in the company. Listen and fix. Don’t get angry at the culprits. Just fix the problem.
GG) At Christmas, donate money to every customer’s favorite charity. Every aspect of the vision for the company is about your team improving the world.
HH) Have lunch with your competitors. Listen and try not to talk. Frenemies today are often your best partners tomorrow. Successful careers are long careers.
II) Ask advice a lot. Ask your customers advice on how you can be introduced into other parts of their company. Then they will help you. Because of the next rule…
JJ) Hire your customers. Or not. But always leave open the possibility. Let it always dangle in the air between you and them. They can get rich with you. Maybe. Possibly. If they play along. So play.
KK) Over promise and over deliver. On any delivery, do one extra surprise that was not expected. Always extra that the customer didn’t pay for.
I’m surprised people don’t do this 100% of the time. This is an easy way to compete and surprise and delight. Then.customers for life.
LL) Understand the demographic changes that are changing the world. Where are marketing dollars flowing (it changes every day). What services do aging boomers need? Is the world running out of clean water? Are newspapers going to survive? Etc. Etc. Read every day to learn.
MM) Don’t go to a lot of parties or “meetups” with other entrepreneurs. Work instead while they are partying.
NN) Don’t listen to the doom and gloomers that are hogging the TV screen trying to tell you the world is over. They just want you to be scared so they can scoop up all the money. Sometimes the economy rests, but it doesn't die.
OO) You have no more free time. ...In your free time (even rest time) you are thinking of new ideas for customers, new ideas for services to offer, new products. Keep a notebook around always. ALWAYS.
PP) You have no more free time, part 2. In your free time, write down ideas for potential customers. Then send them emails: “I have 10 ideas for you. Would really like to show them to you. You will be blown away. Here’s five of them right now.” This again makes you the SOURCE.
QQ) Depressions, recessions, don’t matter. There’s $15 trillion in the economy. You’re allowed a piece of it: FedEx, Microsoft, HewlettPackard, other huge companies were started in recessions or depressions. Leave economics to the academics while they leave good business to you.
RR) Talk. Tell everyone you ever knew what your company does. Your friends will help you find clients. Your vision and excitement will spill over. And this allows you to practice your message.
SS) Always take someone with you to a meeting. .. "Following up" is a different skill from "Sales". So, if you have another employee. Let them follow up. Plus, they will like to spend time with the boss. You’re going to be a mentor. And customers need to be weaned from you.
TT) If you are consumer focused: your advertisers are your customers. But always be thinking of new services for your consumers. Each new service has to make their life better.: they become healthier, richer, feel more connection, or have more sex.
UU) If your customers are advertisers: find sponsorship opportunities for them that drive customers to them. These are the most lucrative ad deals. Ad inventory is not ideal business model (except for Google and FB). Sponsorships let companies talk to their customers.
VV) No friction. The harder it is for a consumer to sign up, the less consumers you will have. No confirmation emails, sign up forms (or as few as possible), etc. The easier the better.
WW) No fiction, part 2. If you are making a website, have as much content as you can on the front page (above fold). You don’t want people to have to click to a second or third page if you can avoid it. Stuff that first page with content. ADV - Always Deliver Value
XX) Don't take a "no" from someone who can't say "yes". ... Say yes to any opportunity that gets you in a room with a big decision maker. Doesn’t matter if it costs you money.
YY) Sell your company two years before you sell it... Get in the offices of the potential buyers of your company and start updating them on your progress every month. Ask their advice on a regular basis in the guise of just an “industry catch-up”.
ZZ) If you sell your company for stock, sell the stock as soon as you can. If you are selling your company for stock it means companies are valuing their stock for less than cash. So you should also.
AAA) Execution is a dime a dozen. If you have an idea worth pursuing, then just make it. You can build any website or app or service for cheap. Get at least one person to sign up and use your service. Fail quickly. Good ideas are HARD. It’s execution that is a dime a dozen.
BBB) Don’t use a PR firm, part II. Set up a blog. Videos. Let the customer know you are approachable, and have a real vision. Become the voice for your industry, the advocate for your products. Blog your way to PR success. Be honest and bloody. Syndicate everywhere.
CCC) Don’t save the world. If your product sounds too good to be true, then you are a liar.
DDD) Your company is always for sale.
EEE) Frame the first check. More memories, more vivid moments, more celebrations, longer life. Plus...reminders of the vision.
EEE) No free time, part 3. Pick a random customer. Find five ideas for them that have nothing to do with your business. Call them and say, “I’ve been thinking about you. Have you tried this?” Be the SOURCE.
FFF) No resale deals. Nobody cares about reselling your service. Those are usually bad deals. Your old customers are your best new customers.
GGG) Your lawyer or accountant is not going to introduce you to any of their other clients. Those meetings are always a waste of time but they use that in their sales pitch to you.
HHH) Get a professional masseuse in every Friday afternoon. Nobody leaves a job where there is a masseuse.
III) Sell your first company. Sell your first company as quick as you can. You now have money in the bank.. Make a billion on your next company.
Note Mark Cuban’s story: Before he sold Broadcast, he sold his first software company for ten million.
JJJ Pay your employees before you pay yourself. Every chance you get ask, "what would a leader do?"
KKK) Give equity to get the first customer. If you have no product yet and no money, then give equity. Note: don’t blindly give equity. If you develop a product that someone asked for, then sell it to them. But, if first customer can keep u going forever, offer equity to nail it
LLL) Amateurs worry about anyone stealing their ideas. Nobody will have the passion to compete with you if you are doing this right.
MMM) Question: You say no free time but you also say keep emotionally fit, physically fit, etc. How do I do this if I’m constantly thinking of ideas for old and potential customers?
Answer: It’s not easy or everyone would be rich.
NNN) Question: how do I cold-call clients?
Answer: email them. Email 40 of them. It’s OK if only 1 answers. Email 40 a day but make sure you have something of value to offer.
OOO) Question: how can I find cheap programmers or designers?
Answer: if you don’t know any and you want to be cheap: use freelancer.com. But hire local. You need to communicate with them even if it costs more money.
PPP) Question: should I hire the programmers?
Answer: first…freelance. Then hire.
QQQ) Question: what if I build my product but I’m not getting customers?
Answer: develop a service first, get customers, fine-tune service, repeat, THEN make a more automated product. Test quickly before spending your life.
RRR) Question: I just lost my biggest customer and now I have to fire people. I’ve never done this before. How do I do it?
Answer: one on meetings. Be Kind. State the facts. Help them. You want to be a good guy. This is one reason why it’s good to start with freelancers.
SSS) Question: I have a great idea. How do I attract VCs?
Answer: build the service/product. Get a customer. Get money from customer. Get more customers. Build more services in the product. Get VC. Chances are by this point, the VCs are calling you. Now you can say "No".
TTT) Question: I want to leave my job but I’m scared.
Answer: Keep your day job, and try to get ONE customer on side service. Then two. Then three. Then decide comfort level for leaving job.
Final rule, part 1: Things change. Every day. Like, I said "100 rules" but this is about 73. Things change midway through. Be ready for it every day. Every day figure out what you can change just slightly to shake things up and improve your product and company.
Final rule, part 2: Your business is not your life. When you start a business you also trigger a cognitive bias that makes you think your business is GREAT.
Every day make sure you are not smoking crack. If you smoke crack you can die. GOOD LUCK!
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