No, get a customer. I never started a successful business that didn’t start with a customer.
“But what about Google?” someone might ask.
Stop asking that.
First get a customer. Then build a product. Then create content. Lots of it.
No, many successful businesses were started by people who did not quickly quit their jobs.
Starting a business is not about taking risks. It’s 100% about risk mitigation.
Steve Wozniak stayed at Hewlett-Packard because he didn’t want to give up his safe job.
I stayed at HBO full time for 18 months before quitting to join my first business first time.
Give up on an idea when you can’t generate revenues, customers, or interest for two months.
No interest, no business.
Divide things up into these categories: manages the company; raises the money; had the idea; brings in the revenues; built the product (or performs the services). Divide up in equal portions.
Over-deliver for the first 100 days. Then you will never lose them. (see my podcast with Joey Coleman. This is also a truism for many areas of life). Practice over-promising and over-delivering (and no, don't say "underpromise")
- Asking for an NDA.
- Trying to raise VC money before a product or customers.
- Having fights with partners in the first year. Fire them or split before anything gets out of control.
- Worrying about dilution.
- Trying to get Mark Cuban to invest because “this would be great for the Dallas Mavericks.”
- Asking people you barely know to introduce you to Mark Cuban.
- Asking people for five minutes of their time. You are establishing yourself as a liar.
- Having a PowerPoint that doesn’t show me arbitrage. Investors need to know WHY they are getting this "amazing" opportunity.
- Rejecting a cash offer for your company when you have almost no revenues. Hello Friendster and Foursquare
- Going from BS product to services to product to SaaS product. (Corollary: The reverse is amateur hour.) (e.g. Oracle).
- Cutting costs every day.
- Selling every day, every minute.
- Studying the entire industry (applies to career).
- When you have a billion in revenues, staying focused.
- When you have zero revenues, staying unfocused and coming up with new ideas every day.
- Saying “no” to people who are obvious losers.
- Saying “yes” to meeting winners, without a purpose.
No more than 2x your lowest employee if you are not profitable. If you are not funded, your salary should be zero.
IMPORTANT: The CEO’s salary is the last expense paid in every business. This is LEADERSHIP.
When you love her and the feeling is mutual. And if he works for you, he should make first move.
Absolutely not. The best businesses are started in horrible economies. GE, Microsoft, GM, Disney, Apple, were all started in recessions or the Depression.
You don’t have any more friends.
Yes. Tell him everything that happened. You’re his partner. Not the guy that hides things and then lies about them. TRUTH IS REWARDED ALWAYS
Nothing. Relationships > Money. But... charge next customer more.
Come up with 10 ideas a day about new services your business can offer. Try to get a customer for each new service. Ask current customers for advice.
OR...sell your business.
Yes, of course. They gave you money. But then don’t do anything they ask you to do.
Revenues. Get customers. Then monetize. Margins can always go down but revenues can't always go up.
Once, I did not do this and I had a founder quit almost instantly and I had to buy him out.
No. Nobody is going to steal your idea. This applies to many areas of life. Nobody can do your idea as well as you if you have passion for it.
No. If you don’t already have a technical co-founder, you can always outsource technology and not give up equity.
I once wanted to give 3%, they wanted 50%. I gave it. Made them more involved.
Always do the ethical thing: HIRE THE FRIEND and get the client’s business.
Stay in touch once a month. Never be angry.
I deliberately like to sell WHEN they reject me. Staying in touch allows me to build relationship without providing service or product.
Do it, or find someone who can do it, even if it’s a competitor. If you sell life insurance and they want auto insurance. BE THE SOURCE. Help them find best auto insurance.
- NO. All competitors are frenemies. You never know when they will buy you. And it is classless to trash them.
WHAT ABOUT A BAD EMPLOYEE?
- No, be a leader. Train them or find them a better opportunity.
NEVER GOSSIP. EVER!!
- Do as many ideas as possible. The right idea will pick you.
- Advertise all of your ideas. See which ones generate most interest.
- Remember above: when zero revs, remain unfocused.
Most market research is BS. Most people don't know what they want. Hence..advertising.
Find one customer who DEFINITELY – without a doubt – will buy a service from you. Any service, even one you don't offer direct.
- When they gossip.
- When they don’t over-deliver constantly.
- When they ask for a raise because they think they are making below industry standard.
- When they talk badly about a client.
- When they have an attitude.
- Treat them VERY nicely. Send them a big Christmas basket. Go on vacations with them. And find new customers before you kill yourself.
Big ("this will change everything") + Safe ("you won't risk anything") + Easy ("all you have to do is X") + Unique ("We're the only place you can get this"). PLUS...be their friend. Everyone wants a friend. Sell a product, business, idea
a) Roughly, (to an investor) what's my potential income times ten.
b) If selling your company, what profits will the buyer have (with their much bigger customer base) and divide by 4. Hence, some cos with $0 profits, sell.
Itemize each item as finely as possible and charge for each service. Then charge monthly maintenance.
- know everything about industry
- know everything about who you are meeting, including tweets they sent ten years ago. Interests they might have. Etc.
- I watched an entire TV series a few weeks ago (5 seasons) when I knew a cust was into it
Absolutely, but remember that when you give for free, the receiver of free IS THE PRODUCT. Figure out how to monetize that. E.g. Google monetizes YOU.
When they approach you.
57) When should I say “yes” to a client?
Every other conversation you ever have with them after that initial “no.”
Make them work for your attention.
Stop asking that.
No. Make money. Build or do things people want. Then start a business if you legally need to.
Send everyone you know a gift basket.
61) If my customer just got divorced, what should I say to him?
“I can introduce you to lots of women/men.”
They hate you.
“Yesterday” was like a split second ago for them and a lifetime for you.
There’s THE LAW OF ENTREPRENEURIAL RELAVITY. Figure out what that means and live by it.
No. The founder is the head of sales until at least 10 million in sales.
65) My client called at 3 a.m. Should I tell him to respect boundaries?
No. You no longer have any boundaries.
Should you listen to them? No. Diversify in every way you can.
67) I personally need money. Should I borrow from the business?
Only if the business can survive for another six months no matter what.
Divorce them or close your business.
69) I’m starting my business, but I have relationship problems. What should I do?
Get rid of your relationship.
A business is HARD. No bad relationships! No exceptions!
Make a monopoly by answering these:
Uniqiue: how are you better than everyone else
Big: how your product/service is better
Safe: how your customers are safer using your product
Easy: how it's easier for customers to use you
Document every meeting line-by-line, and send your document to the client right after the meeting. I wish I had done this more. I have experienced a lot of yelling. Still do.
No, they are useless. Every day send out 10-20 emails to media places offering to provide stories, content, whatever makes you special to their audiences.
Don’t be afraid to instantly shut down your business and start over if you can’t sell it. Time is a horrible thing to waste.
I don’t know. Did God tell you that in a dream?
It means you’re fired.
76) XYZ just sold for $100 million. Should I be valued at that? I’m better!
No, you should shut up.
Real reason: I want to make a SHITLOAD OF MONEY!
Say the good reason: "I feel it would be easier to grow in the context of a bigger company. That 1 + 1 = 45."
Sell it as fast as possible (applies in 99 percent of situations). Sell for cash. Companies buy for cash when their stock is valuable. They buy for stock when their stock is too high.
No you can’t.
100a) Corollary: Don’t smoke crack.
I sold my businesses early, lost everything, started new businesses, sold them, and got lucky every now and then.
80a) Corollary: These rules don’t always apply. But if you want break the rules, learn the rules.
You create your luck by being healthy and not regretting the past or being anxious about the future.
You create luck by building skills, building network, being persistent, building on past success.
I've experienced a lot but I clearly don't know everything or anything. Feel free to teach me what I don't know and disagree with any of these rules.