When I started my first business venture over 15 years ago, I knew nothing about entrepreneurship and owning a business. During that time I’ve learned a lot — much more than any MBA textbook would talk about. Some of these experiences you can get only from the school of hard knocks.
There’s nothing like real-world business experience over some textbook case.
Believe me when I say this, all of the years I’ve been in business have not all been smooth sailing. If anything, far from it.
I believe Kanye West says it best with the lyrics, “What doesn’t kill me makes me stronger.” I can’t believe I’m quoting Kanye West, but I digress.
These are the biggest mistakes I’ve made throughout the years.
Not Picking Right Business Partners
Not choosing the right person to work with in business is perhaps the biggest mistake I’ve made. I’ve been through three different business partners for the same business.
One of my business partners once said, “A business partner is like being married but without the sex!” Fortunately I found and married my partner in life, but with my business, not so much. You should carefully check out a business partner with the same critical eye as when finding a mate.
Currently, I’m without a business partner for my businesses. I figure I’m better to be solo than have a bad partner that either doesn’t add value to the business or doesn’t have their heart in it. Owning a business can be very stressful and adds stress to any business relationship.
My first business partner, Rob, wanted to name our hosting company Weebotech. Sorry Rob (if you are reading this), but it’s still an awful name. Rob was very strong technically — probably one of the best I’ve ever met for server administration.
The problem is I’m also strong in that area. We somewhat complemented each other but not to the degree needed to run the business successfully. Both business partners should not have the same skill sets.
My second set of business partners were already accomplished business owners. They had over 50 employees with their existing business. I figured they knew a lot about business, and I was right, just not about the business I was in.
They happened to know their business very well but unfortunately didn’t effectively apply their knowledge to the industry I was in. In addition to not really understanding my business, they were trying to cash in on the dot-com craze. They were more focused on their existing business than growing a new business.
So I left those business partners and went into collaboration with my last business partner. He was a really intelligent guy but lacked the business experience, because he was young and just out of college.
For automating daily processes, he preferred to develop in-house technology to using a prebuilt hosting control panel. The business relationship ended but unfortunately hurt our friendship.
As each business partnership ended, it was like a divorce and in some cases, an expensive transaction. Bottom line — pick your business partners very carefully!
Not Delegating Work
One of the first mistakes as a business owner is thinking you have to do it all. Entrepreneurs typically have the do-it-yourself attitude — which is great — but you can’t be great at everything.
This isn’t to say you shouldn’t understand accounting, business law and how to code HTML. Some of these skills can be great to know, so you can estimate time spent, but aren’t always the best use of your time.
You must understand the value of time, because we are unequal in everything but time. Someone else might have better sales, technical or planning ability. You cannot possibly be the best in every skill needed to run your business, which means you need to delegate work to others.
Plus, this approach to business isn’t very practical. In my opinion any business that cannot run unless you are present isn’t a business! You don’t have a business, you have a job. That’s not a business plan.
A successful business should be able to generate income while you aren’t awake or present. In today’s age of the Internet and labor available to you from any part of the world, you should be able to find a virtual assistant to help you with some of your tasks, even if you’re just starting out.
For example, when I first started my hosting business, you had no option but to buy and rent space in a data center. This was an expensive monthly fee. Today, you can find shared hosting providers that offer “unlimited” space to host your website for less than a cup of coffee at Starbucks.
In terms of the virtual office, it’s easier than ever to start and run a business to compete against the big guys. Know what you are good at, and outsource the rest.
Delegating the Wrong Tasks
On the flip side, not everything should be delegated. While I mistakenly did not delegate enough tasks, I’ve also delegated tasks I should have done myself.
This may sound contradictory, but let me explain. There are some tasks you should do yourself, instead of having to explain how to do it according to your standards.
Meaning if it’s a one-off task or a task that you infrequently do and takes only a few minutes, then you should more than likely do it yourself.
Another reason you should do something yourself is because you’re the owner of the business. Such as establishing a relationship with an important vendor or client, or resolving an issue with an unhappy client. There are some cases in which you are aptly suited to do the task because of your skills or because others will respect you and your company because you gave it your personal touch.
Not Focusing on Execution
With my first business, Weebotech, my partner and I primarily focused on the technology. That was a huge mistake! This situation is clearly described in the classic business book “The E-Myth.”
Most small business owners start a business thinking, “Hey, I know the technology; I can do this better than everyone else.” This is the biggest trap you can fall into! The best businesses focus on execution of an idea, not just falling in love with the technology.
I myself fell into this trap and took years to fully realize it. I used to have the notion that the best business ideas had to be complex and have many technical moving parts.
As I’ve discussed in another article, sometimes the best businesses ideas are the simplest. What doesn’t matter is whether a business idea has been done before. The question that has to be asked is, “Was it effectively executed?”
Readers: What mistakes in business have you made?