You don’t need to be reminded how many new businesses fail in the first three years, let alone the first five. The pre-revenue “business death zone” is littered with great ideas that didn’t work out for one reason or another.
There’s no magic bullet to ensure entrepreneurial success, of course. Especially not for first-timers. But there are some things you can do to set yourself up for success.
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Do What You Love, Not What You Think Will Make the Most Money
It sounds cheesy, but following your passion pays. Even if you’re your own boss.
“Don’t rush into a career for the wrong reasons,” says Christopher Roy Garland of Botswana, whose business advisory practice serves major corporations and governments across southern Africa. “To the extent that I’ve been successful in my life…it’s because I didn’t set out to have a particular title or role or endgame in life.”
Translation: Start a business that does something you care about, not something that seems lucrative for its own sake. That could be a recipe for failure.
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Plan Ahead, But Understand That Plans Change
The best entrepreneurs are well-organized planners. They’re capable of building and executing strategies on three-, five-, even 10-year timelines. They see the big picture but also know how to break down huge projects into smaller, more manageable tasks.
“Someone’s sitting in the shade today because someone planted a tree a long time ago,” says famed value investor Warren Buffet.
Of course, even the mightiest trees succumb to storms, fire, and disease. Great entrepreneurs recognize the inherent uncertainty of long-range planning and build a range of scenarios into theirs. When circumstances change, they’re quick to pivot.
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Avoid the “Friends and Family” Trap
Avoid the temptation to borrow money from friends and relatives unless it’s truly no-strings-attached — that is, the investor hands you a pile of money and says, “I don’t care what you do with it or if I ever see it again.”
Unless you have very generous connections, that’s…not realistic. A better alternative: Self-fund until you can’t anymore, then seek out debt financing on the most favorable terms possible.
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Be Honest About Your Strengths
Looking inward often raises more questions than it answers, though.
“You might actually be the least qualified person to provide information about your own strengths,” says Matt Mignona, a self-improvement coach.
Instead, Mignona recommends seeking honest feedback from people you know well and trust even more. They’ll help you paint a more accurate picture of your strengths and weaknesses, helping you figure out what’s best for you to do on your own and what you should delegate to others.
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Be Slow to Hire and Quick to Fire
You’ve probably heard this one before, but it’s easy to let slip when you’re in growth mode.
Don’t. Correcting a bad hire is emotionally difficult and legally dicey. It’s far better not to make the mistake in the first place. Since (as we’ve seen) predicting the future is easier said than done, the best move may be to hire full-timers only when absolutely necessary and use contract labor elsewhere.
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Hire “Passion First”
When you do hire, make sure you’re hiring people as passionate about your company’s mission as you are. While you can’t expect your team to work like they own the place, you can be sure they’ll work harder if they’re proud of what you’re building.
Find Your Groove As an Entrepreneur
Consider this list a high-level road map — maybe a star guide — to entrepreneurial success.
Is it a guarantee you’ll make millions? No. Does it increase your chances that you’ll still be doing what you’re doing now in five years (if you want to) and make a good living in the process? Yes.
So why wait? Find your groove as an entrepreneur and say “see ya” to fear of failure.