by Lauren Drell
The entrepreneurship journey isn’t an easy one — developing a product, scaling a business and growing an audience are intimidating tasks that necessitate endless hustle, ambition and passion. And even if you have all of those qualities in spades, there’s still a good chance your venture will fail.
But 1 in 12 startups succeed, and these businesses are healthy, growing and maybe even profitable. But that’s not to say there weren’t bumps in the road. We’ve asked some founders for things they wish they knew when they started their companies, in the hopes that it’ll help you and your startup avoid a fatal flaw.
Founders in Their Own Words
“I wish that I knew how hard it is to find good, affordable tech — I would’ve majored in CS!”
“What I really wish I had known before I got started, is how important it is to get your legal sorted out at the very beginning. A lot of times people put this off because dealing with lawyers is expensive and tedious. But some lawyers will work with young startups with deferred payment until the company raises financing. It’s just so important to have an operating agreement and a real clear equity structure among founders and early employees. A lot of times these are not fun conversations to have when everyone is just so excited to build an amazing product. But these conversations are necessary and it is so much better to get them out of the way so everyone is on the same page about their role and ownership.”
“I’ve been self-employed for almost 20 years. I started my first company when I was 16 years old, and I really wish I had read the book E Myth sooner. My business partner Nazim Ahmed gave it to me a few years ago. It really emphasizes the importance of working ‘on your business’ instead of being ‘in your business.’ We began applying this mindset and have been growing at 75% year-over-year since. Wish I read it sooner!”
“Running a business is very challenging and also exciting. The most valuable thing I’ve learned launching Lover.ly is adaptability. Be prepared to fail and learn from your mistakes. The faster you fail and quicker you can identify your mistakes — what works and what doesn’t — the sooner you will reach success. Always listen to your users and take feedback from industry insiders. Always be prepared to test, change and evolve.”
“I know I sound evangelical about encouraging entrepreneurism, but I wish I had known, before starting BlogHer, how valuable and fulfilling starting a company was. Throughout my life my professional ambitions were tied to progressing in a corporate career, working for someone else. Proving my worth and climbing the ladder. Starting my own business after 40, I discovered that you will work far harder than you thought you could when it’s your baby, but that you will also learn more, grow more, and climb even higher. I could have saved myself years of frustration had I but known!”
“Pick the right co-founders. People joke that co-founding is like marriage, but is it ever true. Not only are you looking for someone with complementary skillsets who shares your work ethic, but pay close attention to potential co-founders’ values and ethics as well. In my first company, I ignored a few red flags and ended up in a really bad situation that, frankly, I should have seen coming. We lost the company as a result. Trust your gut.
Hope for the best; prepare for the worst. Set up your business properly from the beginning. Work with a lawyer to get airtight documentation and an operating plan for the business. If you have partners, go through a variety of long-shot situations (someone wants to quit; someone gets injured; someone wants to force another person out) and put down, on paper, how you would deal with the situation. Pay a lawyer. In my last company, we didn’t want to spend $1,500 on our docs so we drew them up and signed them ourselves on notebook paper. It was a terrible idea.
Only have one CEO. No, seriously. Fully “equal partnerships” rarely work, as disagreements often arise in startups. I rarely recommend them unless co-founders are joined at the hip and willing to take bullets for each other. For better or for worse, startups need a “buck stops here,” and it’s better for all parties to be agreed in advance.
Someone once explained fundraising to me as investors rating your startup on a scale of 1-10 across four dimensions: product, team, traction and revenue. Being a “10″ in just one category is usually better than being an “8″ across the board, so find out where you’re strongest and play to those strengths.”
“Your big competitors will often be slow and not very creative, but they will ultimately fight hard to remain in their incumbent position. Capitalize on areas where you can win as a startup: by first going after parts of the market that are under-served, innovating at a speed that larger companies can’t or distributing your service and acquiring customers in ways that larger players aren’t used to.
Hire the best possible people you can, and never compromise in this area even for the roles that you ‘just need to fill quickly.’ The problem set will always become harder, and you want to bring on people that can do the future job, not just the work that exists today.”
“When we first came up with the idea for theSkimm, we were too nervous to tell anyone. We now look back at that thought and laugh because the best thing you can do is tell everyone your idea. Our product only became stronger by getting feedback from the people who would actually use our service. theSkimm has transformed itself from ideation to launch, and that is only thanks to the tremendous feedback we received from our friends, family, professional mentors and users.
“We also underestimated how much time everything takes. Whether it’s finding an attorney, accepting money, coding, putting together a team and even agreeing what our official ‘startup’ kitchen should be stocked with. Estimate how long something will take and multiply by three.”
“I didn’t actually realize when I first started out how all-encompassing running a business would really be. Of course I had heard from lots of people that running a startup and building something from scratch will take over your life, and I said “Yeah yeah, I got it.” But only when I started to get into it, did I realize how true that really is. Running a business that you are excited about is a 24-hour-a-day job. From the moment I wake up to the moment I go to sleep, I am thinking about Taste Savant; thinking about what I need to do the next morning. It’s definitely hard to balance your non-startup life with your startup life, but I think I’ve found some ways to do it. I just wish I took the advice I got seriously before I started so that I could find balance a bit earlier in the process!”
“I wish I knew that success does not happen overnight, it can take years (not months) to build a great company. You need to make sure that you can survive that long without any pay, and that you are patient so you remain focused when things don’t appear to be moving so fast.
“Celebrate success, especially the small things. Working in a startup is exhausting, and you get burned out quickly if you only focus on accomplishing the impossible. It’s essential that you celebrate the smaller achievements along the way, like hiring new people, getting your first customer and launching your product. Celebration energizes your team, and reinforces that everyone is doing the right thing to achieve the bigger picture.”
Series presented by join.me
The Bootstrapping Business Series is presented by join.me, the free and easy way to have an online meeting. Named one of Time magazine’s best websites of 2011, join.me lets you share your screen so you can instantly share your ideas. Try join.me today.