Starting a new business is no small undertaking
There are many factors to be considered when you start a business, and it is important to do your research and prepare yourself as much as possible, with some 80 percent of new businesses failing within the first couple of years.
Over the past 15 years, I have had the opportunity to be the founder or co-founder of three companies in three different industries. Along this journey, my teams and I have done a lot of things right – and a lot of things wrong.
Building a business is a daunting task – from originally creating the idea, then planning and validating that idea to fund raising, staffing and achieving profitability. There are many pitfalls in the journey that could easily completely destroy your business.
Luckily, I have always been an avid reader. From my very first read, Og Mandino’s classic, The Greatest Salesman In the World, I developed a hunger for learning. I satisfied that hunger by devouring over 1,500 books on business, leadership, start-ups, business finance, culture creation and many more business-related topics.
I am convinced that it was the information I absorbed in these books and the validation from mentors that has helped me to avoid a bunch of potholes on the road to success in business.
Today, I get to speak to entrepreneurs and students heading down the business path on a regular basis. Inevitably, I encourage them all to read books related to their business and management. It’s a free education.
Related: 5 Tips to Read 100 Books a Year
There are thousands of books out there to help educate new entrepreneurs about what they’re getting into, so I wanted to review five books that I think will help any entrepreneur succeed with their start up:
The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup, by Noam Wasserman
I have personally given over 200 copies of this book away to new business graduates and friends that I have come across.
The book is based on Wasserman’s research at Princeton. He did a masterful job of studying founders from many industries and detailing their experiences, good, bad and ugly.
The book is captivating because it uses real identifiable examples, like Twitter and other recognisable companies. It is a must read for anyone who wants to start their own company.
This book focuses on helping entrepreneurs take proactive steps to keep them from making mistakes that, though common, can have a hugely negative impact on their business.
It familiarises new entrepreneurs with business structure and helps them to better understand all that goes into making a things run smoothly. This is a great book for teaching you how to appropriately manage your business and all that comes with it.
Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses, by Eric Reis
I’ve learned many lessons from Reis’ book. One of the biggest struggles you will face in building your own business is managing cash flow. You know the old saying, “Cash is king.”
I don’t think that anyone can go far enough to explain the importance of cash flow management to a new business owner. Lean Startup is a book designed to serve as your guide through the many changes that a startup brings.
It will teach you how to effectively manage your budget, allowing you the freedom to innovate and make your way in the business world. If you want your business to thrive, you’ve got to have precise, effective budget-management.
This one is a classic for a reason. Peter Principle is an amazing book for helping founders to understand when they reach the “point of incompetence” and how to recruit great people to help you.
Why do things go wrong? I think it’s safe to say that every business owner has asked this question at some point. In this book, the question is answered by addressing the issue of incompetence in the work force today.
You will learn the importance of staffing and how it can make or break your business.
Disney Way: Harnessing the Management Secrets of Disney in Your Company, by Bill Capodagli and Lynn Jackson
Over the years, I have realised\ the importance of building a fun, warm culture into your business. The world’s reigning master of business culture creation is Walt Disney.
In Disney Way, the authors do a better job then any other book on Disney to articulate how he thought and what actions led to the creation of the most culturally rich company In the world.
This book details how Walt Disney’s mantra of “dream, believe, dare, do” has helped to transform businesses all across the globe. In it, you’ll learn how you can create the most productive, effective and positive environment for your employees and your customers.
By adopting the Disney way, you can play a part in transforming our culture, and can impact your industry for the better.
Behind the Cloud: The Untold Story of How Salesforce.com Went from Idea to Billion-Dollar Company-and Revolutionized an Industry, by Marc Benioff and Carlye Adler
Behind the Cloud just jumped onto my five-best-books-to-read list. Chris Brady, an Inc Magazine Top 50 leadership expert, suggested I read the book, and I am so thankful.
It is the story of salesforce.com and how Benioff and team built a world-caliber company before the term “In the Cloud” existed. Since it’s beginning, salesforce.com has been a leader in innovation.
This book details the company’s unhindered journey to success, exemplifying how you can use the unique qualities of your business to generate massive revenue.
This book is a great resource for making your business stand out in any circumstance.
Whether you’re a seasoned entrepreneur, or a first-time business owner, you should never stop looking for ways to make your business better. Examine your strengths and weaknesses and find the areas you wish to grow in.
Perhaps you want to learn how to budget better, or maybe you want to strengthen your business structure. Whichever aspect of your business you wish to improve in, there is a book out there to help you do it.
This article was originally posted here on Entrepreneur.com.
Put On Your Wellies: It’s Time To Wade Into Risk
Entrepreneurs aren’t all leaping into the unknown like lemmings off a cliff, but they do need to consider it…
You’ve had a great idea. You’ve looked into its development. You’ve recognised that it has potential beyond just what Auntie Mabel and Mike From The Grocer think. And you’ve clearly nailed a pain point that can make money. Now it is time to take the risk of running with it.
Every big idea comes with risk. You can’t step out into the world of entrepreneurial thinking and business development without it. Your idea may fail. It will also be time consuming, demanding, hungry for money, and hard work. It is unrealistic to expect that your project will leap out into the world and be an unmitigated success.
It is also unrealistic to assume that it isn’t worth taking this risk.
There are steps that you can follow to ensure that your risk is managed so you aren’t blindly leaping off that cliff…
Step 01: Do your research
No, canvassing your neighbours, friends and family is not doing research. You need to know that your idea will appeal to a broad market and that it will have significant legs. This may sound like daft advice, but you would be surprised how many people think an idea will take off just because Susan in Accounting said so.
Step 02: Understand the costs
Projects are hungry for money and investment. Realistically work out your budgets and how much it will cost to take your project off the ground and then stick to it.
A calculated risk is a far better bet than one that shoots from the hip and hopes for the best. You can also use this as an opportunity to draw a clear line under where you will stop investing and end the project. If it keeps eating money and isn’t getting anywhere with results you need to be able to walk away.
Step 03: Know when to walk away
As mentioned before, this can be defined by a line you’ve drawn in the proverbial sand (and budget) but no matter where you draw this line, you have to stick to it. Often, when time, money and energy have been poured into a project it can be incredibly hard to walk away.
You think ‘but I have put so much into this, just one more’ and then it gets to a point where the ‘just one more’ has taken you so far down the line that walking away feels impossible. Leave. Learn the lessons. Apply them to your next project.
Mind The Gap
The entrepreneur’s guide to finding the gaps and building the right solutions.
Innovation may very well be the key to business success but finding the gap into which your innovative thinking can fit is often a lot harder than people realise. Some may be struck by inspiration in the shower, others by that moment of blinding insight in a meeting, however, for most people finding that big idea isn’t that simple. They want to be an entrepreneur and start their own high-growth business, but they need some ideas on how to find that big idea.
Here are five…
It sounds trite but networking is actually an excellent way of picking up on patterns and trends in conversation and business problems. The trick is to note them down and pay attention. Soon, you will find patterns emerging and ideas forming.
2. Look for pain
Just as networking can reveal trends in the market, so can spending time reading. The latter will also help you find common business pain points. These are the touchpoints that frustrate people, annoy business owners, affect productivity, or impact employee engagement.
Be the Panado that fixes these pains.
This is probably the most annoying of the ideas, but it is unfortunately (or fortunately) very true. Luck does play a role in helping you capture that big idea. However, luck isn’t just standing around and random people offering you opportunities. Luck is found at networking events, it is found in research and it is found in conversations with other entrepreneurs.
4. Luck needs courage
You may have found the big idea through your network, a pain point or pure blind luck, but if you don’t have the courage to take it and run with it, you will lose it to someone else.
Being bold in business is highly underrated because most people assume that everyone is bold and prepared to take big leaps into the unknown. However, not all brilliant entrepreneurs were ready to throw their family funds to the wind and leap into an idea – they were courageous enough to figure out a way of harnessing their ideas realistically.
5. Pay attention
This is probably one of the most vital ways of finding a gap in the market. Often, people are so busy that they don’t really pay attention to that niggling issue that always bothers them on a commute, or in a mall, or at a meeting. This niggling issue could very well be the next big business opportunity. Pay attention to it and find out if that issue can be solved with your innovative thinking.
5 Things To Know About Your “Toddler” Business
As you navigate this new toddler phase of your business, here are five things to bear in mind.
Ah, toddlers. Those irresistible bundles of joy bring a huge amount of energy, curiosity and fun to any family – but there’s also frustration and worry that comes with their unpredictability, as they grow and start to become more independent. If you own a business and it’s successfully past its “infancy” of the first year or so, it’s likely it will also go through a toddler stage of its lifecycle.
Pete Hammond, founder of luxury safari company SafariScapes, agrees with this. “Our business is now three and a half years old, and we’ve found that we’re not yet big enough to justify employing a large team of people to handle the day-to-day admin tasks, yet we still need to grow the business as well,” he says. “As a result, our main challenge is finding the time to step back and see the bigger picture. Kind of like when you are raising a busy toddler and you spend most of your time running after them!”
As you navigate this new toddler phase of your business, here are five things to bear in mind:
1. This too shall pass
Everything in life is temporary – and that goes for both the good and the bad. It’s as helpful to remember this when you’re facing the might of a toddler temper tantrum, as it is when you’re facing throws of uncertainty in your business. If your new(ish) venture is going through a rough patch in its first few years, it can be easy to think about giving up – but don’t. As long as you have an overall big idea that you believe can add value to your customers, keep pushing through the rough parts until you come out the other side.
2. Appreciate what this phase brings
The toddler years mean that the initial newborn joy is officially behind you. But these small humans also bring their own kinds of joy, as you watch them learn new skills, say funny things, and give affection back to you. While your two-year-old business may not hold the same exhilaration for you as it did during those first few months, there are now different things to appreciate about it: Maybe you’re expanding your product range, or employing new people who can take the workload off you.
3. Establish boundaries
Toddlers thrive on boundary and routine – and your toddler business will too. As it grows into a new phase, try and establish limits in terms of the type of clients you want to work with and the type of work you’ll do. It’s also a good idea to make a decision about the hours you’ll work and when you’ll switch off, which will help you establish a good work-life balance.
4. Take a break
Every parent with a toddler needs a break every now and then, even if that means a walk around the block (on your own!), a dinner out with friends, or even a few days away. The same is true for a demanding small business: every so often, remember to take time out to rest properly, where you switch off your laptop and completely unplug. You’ll return much more inspired and resilient to deal with the everyday uncertainty that it brings.
5. Give it space to make mistakes
While the unpredictability of a young business can be stressful and tiring, it’s also a time for trying new things without the risk of huge consequences if they don’t quite work. After all, it’s much simpler to change your USP if you’re a small business employing a few people, rather than a big company where 50 people are relying on you for their salary, or where you’ve received a huge amount of investment capital. While you may fail in some of the things you try with your business (in fact, this is almost guaranteed), see it as a toddler that’s resilient enough to pick itself up, dust its knees and keep moving forward.
During this phase of business growth it’s also essential to have the right type of medical aid cover. There are medical schemes such as Fedhealth which has a number of medical aid options and value-added benefits to ensure that your health and wellness is taken care of too. After all, the healthier you and your staff are, the more productive your business will be – during the toddler (business) stage and beyond.
While this phase can be frustrating, it’s a sign that your business is growing and adapting, rather than remaining in its infancy, and that can only be a good thing! So embrace the difficulties, learn from them, and watch as your business strides forward confidently into the next exciting phase.