If you’re young and aspiring to be a successful businessman, people would be giving you all sorts of advice on what to do and what not to. Trust me, you don’t have to do everything that is being told by any Tom, Dick, and Harry.
Sure, the advice is given with good intent but it can also backfire. However, if you really want to follow some advice, below are some tips given by stalwarts and veterans in the field of business that might help you become successful in your twenties.
Many articles about launching a business typically recommend you to follow your passion. They encourage you to take risks, face your fears, and create a business plan. More advanced advice even includes points like, “Know your target audience” or “Research the market.” But you know what? If you try to build-up your company following only such advice, you will most likely join the 20% of startups that fail during their 1st year on the market.
We are sure you’ve already “researched the market” and “set up your goals” yourself. We know that developing a company is not easy. Motivation and passion aren’t enough to keep it afloat. Knowledge and experience are.
In this article, we gathered pieces of wisdom coming from the experience of CEOs and CTOs whose companies survived the turbulent first years. Here is what we think you should know.
1. Focus your effort on sales first
How do you know people need your product or service? It’s simple. If they buy it – they want it. If you focus on fundraising and attracting investors, you can easily miss this point out. Fundraising is slower, and there are many conditions you will need to fulfill. You might want to leave it for later.
Instead, if your product does not require complicated research and development, you can focus on selling it to your customers right away. If your business idea and model are valid, your product will sell out well, and your customers will give you the money for further development.
2. Postpone working with big companies
If your product was initially designed for bigger enterprises, then skip this point. Otherwise, you might want to wait unless your monthly revenue reaches $1M at least. As a fresh startup, you will spend too many resources, time, and effort to achieve success with big companies. Legal issues, delays in communication, insurances, and regular, “Please rework, it does not fully comply with our policies.”
“Your most expensive advice is the free advice you receive from your financially struggling friends and relatives.” – Robert Kiyosaki
3. Drop bad customers, no regrets
Not every client is worth clinging to, even if they are paying well. Leave the “customer is always right” mentality behind. They need your product, you need their money. This relationship should be beneficial to both sides. If the client does not respect what you do, delays payments, or obstructs your work in other ways, you might want to reconsider your business relationship.
4. Network with the experienced folks
Developing professional and social contacts is crucial. Reaching out vertically and horizontally will help you spread awareness about your company, and possibly find benefactors, mentors, and valuable assets.
When you have just ventured into a new business, you need links to grow your network, reach new clients, and build your business. Networking is an important business practice where people meet, exchange ideas, share their experience, success, and mistakes with other entrepreneurs and businessmen.
And don’t forget about mentor ship. You may be the CEO now, but you can always learn from others. Keep taking advantage of opportunities to learn, whether it’s through listening to podcasts from industry veterans or technology whiz kids, or even just connecting with your team and support systems to keep yourself grounded. Other perspectives are always valuable.
5. Do content marketing
If you cannot tell someone about your business in person, do it on the internet! Content marketing is affordable and efficient. It does not bring fast results and requires consistent efforts. But, if you do it right, the pay-off can be impressive.
6. Take care of accounts
Finances are an extremely important part of a business. Review your accounts to keep track of your business expenses so that whenever they add up, you can fine-tune the expenditure. Never mix your personal expenses with business ones.
Make it a habit to pay all your business bills on time. Missing one will lead to missing others in the future. Setting up reminders help you to never miss any business bills falling through the cracks. With a better understanding of your cash flow and accounts, you can make smart money-related decisions.
7. Chalk out an anti-crisis plan
When it comes to the crunch, you don’t want to run around like a headless chicken. Instead, you want a plan of action when a crisis suddenly hits your business. The situation around COVID-19 is a perfect illustration of these words. 6 months ago, no one could predict global quarantine. No one planned their actions in the case of coronavirus pandemic. And many startups shut down because they had no fail-safe.
You cannot prepare for everything. But, having at least a couple of emergency scenarios up your sleeve can prove invaluable when your company faces a crisis.
8. Figure out how taxes work (or hire professional help)
Taxes are going to be a huge and integral part of your business. The sooner you figure out what, when, and how you must pay the government, the better. If you can’t, do hire an accountant.
9. Hire slow, fire fast
Meticulously handpick every employee. In the beginning, you will not have the luxury to rotate your staff often. People whom you hire now are likely to stay with you for a long time. You want them to be fast-learning problem-solvers able to work under pressure, tight deadlines, and uncertainty of the first years. Develop some kind of a vetting procedure, a checklist of criteria that your perfect candidate must match.
On the other hand, do not hesitate to fire workers who slow you down. We are all people, and everyone has circumstances to take into account. But, when you know it’s time to part ways with someone – do it.
10. Small companies can afford to screw things up
Sometimes. The first years of a startup are the time when your mistakes are invisible to the majority of people. Just because you are starting out, and no one really knows about you. Feel free to experiment, to make mistakes, and to pave your own path (whatever generic piece of advice this may look like). When you grow up, you won’t have the luxury.
“Be stubborn on vision, but flexible on details.” – Jeff Bezos
11. Make mistakes and learn from them
Advice for young business owners is often so generic because everyone operates under different circumstances and in different markets. There is no universal recipe for success. But, there are aspects of running a business that many young startup owners miss out on, or don’t pay enough attention to. Or hesitate to try in practice.
Know this, when you are starting out as an entrepreneur, you will inevitably make mistakes. They will cost you thousands of dollars and deprive you of sleep. Pieces of advice listed above will help you to avoid some of these mistakes, and hopefully to spot other hidden risks.